UTILITIES & SOLAR POWER PLANTS

CSP garners favour with utilities; Utility partnerships and investments in CSP gathered pace in 2010, and market analysts expect power producers to look favourably on solar thermal this year as the technology establishes itself as the friendliest solar option for large-scale generation.
Bob Moser, 14 January 2011 (CSP Today)

"Concentrated solar power technology is winning investor confidence with its proven reliability and technical advancements that have led to economies of scale and investor progress over the past 12 months…[It] is likely to have a huge impact on utilities' outlook towards future projects…Within the last year…EBL (Elektra Baselland), a Swiss utility company…NRG Energy…[and] GDF SUEZ [invested in CSP]…

"A mere 0.03% of global electricity was generated by CSP in 2010, but the sector is growing quickly, with thousands of megawatts under construction or in planning throughout the world, including Europe, the US, North Africa and the Middle East. New interest is also blooming in China, Australia, Mexico and India. Power companies worldwide moved on CSP investments and partnerships…[Through] 2016… utility-owned or sponsored CSP capacity additions in the US [are forecast to] approach 6,360MW…"

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"CSP has some legitimate advantages on PV at scale that are winning over wavering utilities. Higher capacity factors allow CSP plants to produce more power per megawatt installation, and output of PV in the desert drops due to factors like extreme heat, losing as much as 15-20% productivity for a crystalline silicon panel…CSP also offers efficiency rates that solve intermittency problems that utilities fear with other renewables…CSP facilities with heat storage back-up…can provide base-load electricity. That's a main motivation [as are RPS deadlines] for utilities to either own CSP facilities or strengthen ties through Power Purchase Agreements with third parties…

"A key indicator on the trend of utility investment in solar thermal is that it hasn't been taking place through the rate-base, but instead through independent power production subsidiaries…These are still, to an extent, opportunistic investments that are relatively risky but high-reward, instead of more conventional utility investments that are less risky but offer lower reward…This trend can continue this year…[But it is not clear] CSP will win favoritism in the short-term over other renewables…"

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"Fixed-price payment deals have a strategic significance for utilities entering pacts with a CSP provider, as it lets them hedge against volatile energy prices. Natural gas prices in 2009 dropped due to the economic crisis, but rebounded in 2010. This is one underlying motivation for utilities to turn increased attention to renewables…

"Established feed-in tariffs and federally guaranteed loans remain vital to solar's growth in 2011 and beyond. Photovoltaic and CSP generation remains just below US$200/MWh, nearly four times the cost of coal-fired energy at US$56/MWh. It is also two to four times more expensive than the cost of onshore wind power…Legislation such as the American Recovery and Reinvestment Act favor CSP technology over wind, by providing three-year Production Tax Credit extensions for CSP, compared to two-year extensions for wind power…"