The solar industry (PV & CSP more specifically) are at the breaking point, where collaboration is a must in order to gain a sustainable market share within the energy sector. This was the conclusion drawn in a recent webinar organised by CSP Today and delivered by Luis Crespo (ESTELA and Protermosolar), Ruud Dekkers (Solar Millennium) and Pablo Giménez (Fotowatio Renewable Ventures).

To further solar energy as a whole, the webinar discussions considered the fact that PV and CSP are complementary technologies; each one being more appropriate than the other according to the location where energy is required, solar resource, land peculiarities and water availability. From the technical viewpoint, their project feasibility seems to be clearly differentiated and specialised.

During the preparations for CSP Today USA 2011, American executives mentioned that the competitive environment in which PV and CSP are currently immersed might have been created by the nuclear lobby in the USA. While this might be an exaggeration and even a conspiracy theory, some still claimed that “if they divide, they will rule”.

On paper PV and CSP can exist quite happily in their own separate niches – but when applied to real life, such as Solar Trust of America’s (STA) emblematic Blythe project in the US, matters become more blurred.

As the largest announced CSP project in the world, Blythe greatly impacted the international scene. Once completed, it was expected to have a 1GW capacity divided into 4 parts of 250MW. In April, STA secured the largest US Department of Energy loan guarantee of any CSP project, receiving $2.1 bn. The funding would have been allocated to build the first two phases of Blythe with a total installed capacity of 500MW. It wasn’t enough. Just four months afterwards, STA announced that the technology had been changed to PV.

The questions raised by the news started to arrive at CSP Today. Consulting with various experts, nobody knows the real impact of the decision. Opinions vary regarding the nature of this change. In an exclusive interview with CSP Today, Uwe T. Schmidt, CEO at STA, mentioned that the change was motivated by the economic situation, as PV allows the plant to be financed through traditional banking (instead of a loan guarantee) and  to construct Blythe in smaller phases. However, he denies that CSP is impossible to finance as Solar Millennium (STA’s sister company in Europe) is having no such problems in Spain.

Favourable regulatory systems aside, the three main attributes that utilities and their customers want in a power source are competitive energy cost, ancillary services that support the power grid, and delivery upon demand. Current energy markets have placed the greatest focus on energy cost from intermittent renewables.

The cost of CSP has been, fairly or unfairly, deemed as an intermittent energy source, because of an enduring skepticism about solar's ability to deliver uninterrupted power, on demand. Therefore the competiveness of the technology is judged only in terms of cost.

However, the issue is complicated further in markets such as India, where interesting pricing situations can be observed. Although PV is considered easier to scale up, simpler, faster to construct and cheaper, the Indian tariff reflects just the opposite: 15Rs per unit for PV against the 11Rs per unit that CSP achieves. And this is not a unique occurrence, it can be found across different markets.

Going back to the American market, a sense of disenchantment with PV is in the air following the fall of Solyndra last week. Solyndra is the third American PV company to file for bankruptcy only in the past month unable to compete with Chinese panel prices. In the case of Solyndra it hurts more because the company was often cited as ‘the’ American example, having been favoured with almost $600million from the DoE to construct a factory. President Obama himself visited their facility earlier last year.

PV and CSP coexistence is not only possible… It is highly desirable and the best situation. Collaboration is necessary to gain market share and energy independence in a world in which polluting traditional energy production should decrease year by year.

As somebody was telling me in my CSP Today USA conference, “The price of gas is going up in the future as sure as the sun will shine tomorrow”. We were in Las Vegas and the sun indeed came out the next day. I hope we learn this lesson as soon as possible.

by Belén Gallego, Founder & Director, CSP Today

PV and CSP Good Friends 

(This chart is courtesy of Fotowatio Renewable Ventures and was extracted from the webinar 'CSP and PV: Balancing Competition and Opportunity'- click to enlarge)


____________________________________________________________________

At CSP Today Sevilla (29-30 November) you will find out which strategic developments will take CSP ahead of the game and the opportunities available to you. Click here to view the summit’s brochure.

Let me know if you have any questions.

Best regards,