The industry has seen significant declines in the price of photovoltaic (PV) panels causing some to wonder if concentrating solar power (CSP) can compete in the market for clean, domestic, renewable energy.
It has taken almost ten years of government incentives (mostly in Japan, Germany, and California) to bring the PV industry from a boutique, green energy source to a mass-produced, rooftop commodity. CSP technology has yet to achieve similar cost reduction because serious, market-moving CSP-specific incentives did not begin until 2007 with Spain’s generous Feed-in-Tariff. CSP is more challenging to incentivize than PV; project size is typically larger and therefore more capital intensive.
Widespread uptake of PV in the residential market has made people more comfortable with the concept of solar power, but most do not fully understand the difference between PV and CSP. In practice, the two technologies are very different, and the arguments for CSP become even stronger as more PV and wind turbines are added to the electricity grid.
Why?
Solar produces energy when the sun shines, and turbines, when the wind blows. As solar and wind technologies achieve greater penetration into the electric grid, operators may at times have to curtail these renewable sources to avoid operating base load power plants, such as coal and nuclear, at reduced efficiencies. CSP offers the advantage over PV that the heat produced by the solar collectors can be stored in molten salt, and used when needed to make electricity. New analysis currently underway at the National Renewable Energy Laboratory (NREL) in Golden, Colorado, indicates that CSP with thermal energy storage (TES) can support higher grid penetration of renewables due to the premium economic value associated with storage.
The market for CSP is global and growing, in response to positive policy environments and government incentives. According to Greentech Media Research, there are a total of 18.7 GW of CSP projects in operation or under development on the planet – more than half will be online by 2014. The leading markets are in the USA, Spain, China, Morocco, and India. The SkyTrough is well positioned to enter these markets, as incentives are lean and SkyFuel has kept low cost as the design driver from the start. Furthermore, most countries require a certain percentage of local content in order to grow their own economies while they increase their clean energy supply. Up to 60% of the SkyTrough can be readily sourced in countries with aluminum and steel fabrication industries. SkyFuel is currently negotiating sales contracts in five countries and marketing agreements in two others.
As the market for CSP develops, costs are coming down. The European Solar Thermal Electricity Association (ESTELA) predicts that costs will be reduced by as much as 55% by 2025; the SkyTrough has already achieved a 20% reduction in just the equipment, and the next generation trough, currently in development under a Department of Energy contract, will reduce cost by another 25% due to a larger aperture and higher concentration ratio.
The future is bright for CSP, and SkyFuel is right there in the focal line.
