The Cost Effectiveness of Concentrating Solar Power

Concentrating solar power is on a roll. Innovation is happening rapidly. Investment is flowing in. Linchpin commercial deployments are coming on line. More are planned.

The International Energy Agency believes Australia has the greatest potential of any region in the world to use solar electricity to reduce CO2 emissions, higher even than India or the Middle East. Further, Australia is a sophisticated economy brimming with just the kinds of skills in engineering, manufacturing and remote power generation that can be used to capitalise on this emerging market.

By 2015, concentrating solar power will be cheaper than carbon capture and storage coal-fired power. This is very important. Power plants take a long to time to plan and build. A new power plant proposed today would be lucky to get on line by 2011. Given that few new coal-fired power plants are expected in Australia until about 2015-2020, the earliest time in which still untested carbon capture and storage might be available, so called 'clean coal' will be priced out of the market by cheaper solar.

This is demonstrated in the graph at right below. At present, concentrating solar power costs somewhere beween A12-16c per kilowatthour. But this is falling by seven percent per year, making its downward price course quite rapid. Solar photovoltaics is also falling in price quite rapidly, but from a higher base. Given the slow-to-fall prices of carbon capture and storage as estimated by experts, solar will 'cross over' so-called 'clean coal' before 'clean coal' is even ready.

Concentrating solar power will be cheaper than carbon capture and storage by 2015, rendering 'clean coal' a White Elephant

Sources: ABARE, IEA, IPCC

Concentrating solar power is the conservative, low cost option for Australia's future power supplies. The coal industry acknowledges CSP is proven (unlike carbon capture and storage -- see quote at left) and the costs of concentrating solar power are low. The sooner Australia invests in concentrating solar power, the sooner it can reap the benefits of low and stable energy costs and lower greenhouse gas emissions.

It all adds up to a very positive value equation, particularly given that concentrating solar power is proven and carbon capture and nuclear (ie the next generation of nuclear plants) are not. Better yet, investment is now pouring into renewable energy overseas, and overseas research has shown that solar power power investments have a much larger beneficial impact on the regional economies where they are located than fossil fuel plants (right). This means that renewable energy projects such as wind and other renewables like concentrating solar power have a positive multiplier effect on their host regions.

Renewable energy technologies such as wind have a greater positive economic impact on host communities than fossil fuels

Source: "Comparing Statewide Economic Impacts Of New Generation from Wind, Coal, and Natural Gas in Arizona, Colorado, and Michigan," US NREL, 2006

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As the chart below shows, concentrating solar power is on track to roughly halve its power generation costs to about 4.5-5.14 US cents (A6.2-6.75c) by 2014 in the United States (chart, lower left), making it cheaper than carbon capture and storage. This cost reduction will come about through three factors: scaled up projects, advances in research and development and increased competition and economies of scale. European researchers have reached much the same conclusions (lower left) from the research they have been actively conducting in Spain and North Africa.

Current costs are low and falling

Source: US NREL

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Parabolic Troughs are on strong downward price trend	Parabolic troughs and solar towers are both falling rapidly in price
Source: US National Renewable Energy Laboratory	Source: Sargent & Lundy
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The Australian coal industry's research organizations echo these findings, expecting that concentrating solar power will cost roughly 5 to 5.4 US cents per kilowatt hour in 2015, which is the year the coal industry believes is the earliest carbon capture and storage might be available.

Concentrating solar power will fall to US5-5.4c/kwh in 2015	Carbon capture and storage may only be ready in 2015, by which time concentrating solar power will be proven and cheaper
Source: Cooperative Center for Coal in Sustainable Development	Source: Coal 21

Therefore, applying the costs above (or about A6c/kwh) to the prices ranges below, indicates concentrating solar power will be a cheaper and cleaner alternative than fossil fuels and nuclear, particularly when fossil fuel and nuclear's incompletely-costed residual health and public safety risks are taken into account, such an upstream emissions generated by coal and uranium mining and downstream carbon and nuclear waste storage.

Concentrating solar power already stacks up well compared to carbon capture and storage	Coal-fired power's incompletely-costed health and CO2 risks render it economically uncompetitive
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This advantage holds up even when transport costs of concentrating solar power from remote areas of Australia with high levels of direct normal radiation are included. In Europe, the German Aerospace Center has compiled estimates of costs of concentrating solar power plants based in North Africa and the power line transport costs of that power to northern Europe in the year 2020, with a scale up in the following years.

By 2040, the EU could be generating the equivalent of Australia's entire energy demand through CSP and carrying that amount to northern Europe	Concentrating solar power plants in North Africa (ie Europe's 'Outback') could be carried northward cost-effectively over high-voltage, direct current power lines
Source: Trans-Mediterranean Interconnection for Concentrating Solar Power	Source: Trans-Mediterranean Interconnection for Concentrating Solar Power

 

 

Virtually all globally-credible researchers reach similar conclusions on these points.

Greenpeace similarly estimators a cross over of concentrating solar power and fossil fuels in just a few years

Source: Greenpeace

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Solar power edges towards boom time -- Solar grid parity i 5 years for sunny places, 2020 for Britain

SOLAR ENERGY EXPECTED TO BE COST COMPETITIVE IN LESS THAN 10 YEARS

Global electricity production

CNN All About CSP -- viceo