The document provides a comprehensive overview of bulk solar power generation, discussing both Concentrated Solar Power (CSP) and Concentrated Photovoltaics (CPV) technologies. It covers project development aspects, generation costs, and market perspectives, highlighting the advantages and challenges of each technology in harnessing solar energy, particularly in regions like North Africa and Southern Europe. Additionally, it emphasizes the potential growth of CSP and CPV, along with the necessary support schemes for successful implementation.

1. June 08 Bulk Solar Power Generation : CSP and CPV technologies Fernando Nuño European Copper Institute [email_address]

2. Index Solar energy : why should it make sense? Definitions CSP review Technology Project Development Issues Generation costs – Market perspectives – Support schemes CPV review Technology Generation costs – Market perspectives Ratios and comparisons

3. Solar resource available : much more than we need The Earth receives from solar radiation in 10 days as much energy as the known fossil reserves

4. Solar roadmap – Increasing role in the coming years

5. Where does concentration technology make sense? Annual Direct Normal Irradiation Source : NASA

6. Where does concentration technology make sense? Source : Schott Solar

7. The potential of Mediterranean basin North Africa has an enormous potential. Interconnections with Europe could be then developed Sources : Eurelectric 2007 German Federal Ministry for the Environment, Nature Conservation and Nuclear Safety

8. Why solar energy fits well in hot climates Spanish average load profile vs average irradiation Source : Red Eléctrica de España

9. Index Solar energy : why should it make sense? Definitions CSP review Technology Project Development Issues Generation costs – Market perspectives – Support schemes CPV review Technology Generation costs – Market perspectives Ratios and comparisons

10. Solar technologies and market share

11. Utility scale technologies CSP CPV CONCENTRATION SOLAR POWER : thermal process Heating a fluid Generating mechanical power through a thermodynamic cycle (rankine, brayton, stirling…) Converting mechanical power into electrical power (alternator) CONCENTRATION PHOTOVOLTAICS : photovoltaic process Concentrate solar radiation on the PV cell Direct generation of electrical power

12. Index Solar energy : why should it make sense? Definitions CSP review Technology Project Development Issues Generation costs – Market perspectives – Support schemes CPV review Technology Generation costs – Market perspectives Ratios and comparisons

13. CSP Technology overview Parabolic Troughs Parabolic Dishes with Stirling Engine Central Tower Fresnel Concentrators

14. CSP Technology review Parabolic Troughs Structure Parabolic Mirror Receiver

15. CSP Technology review Parabolic Troughs Solar Field Power Block

16. CSP Technology review HFT (Heat Transfer Fluid) Technology in commercial operation Parabolic Troughs Melted Salts Hot Storage Solar Field Melted Salts Cold Storage Steam Generator Steam Turbine Superheated Steam (100 bar, 380ºC) Reheated Steam (17 bar, 371ºC) Condenser Pre-heater Re-heater Oil Expansion Tank Deaerator Oil 395ºC Oil 295ºC

17. CSP – Technology review Steam is generated directly in the collecting solar field, so no need for heat exchange, reducing costs and increasing efficiency Parabolic Troughs DSG (Direct Steam Generation) Coming soon…

18. CSP : Project Development – Site issues Meteorological compliance DNI > 1800 kWh/m2/year Measurement campaign required Access to electricity and gas grid Access to water Flat land available No special interest zone (urban, industrial, environmental protection) Absolutely flat for parabolic troughs Local authorities Should accept and support the project In sunny places there is strong competition for water use! Impact of cost of building a dedicated electrical line to reach the main grid Gas : required to maintain temperatures during the night (other fuels can be considered for isolated zones)

19. CSP : Project Development – Site issues Typical configurations Solar Field Power Block

20. CSP : Project Development – Administrative issues Request for Administrative Authorisation Environmental impact analysis Public Information Obtaining Administrative Authorisation Consultation to affected entities Responses to this publication Reply to responses Request for Project Approval Construction permits Maturing period : 18 months

21. CSP : Project Development – Engineering, Procurement & Construction Preliminary Basic Engineering Basic Equipment Purchase Construction contracts In-Depth Engineering Supply of equipment - Construction Commissioning and test period Execution period : 24 months Maturing + Execution period : 36 - 44 months

22. CSP : Project Development – Grid Access Guarantee: 20 €/kW Request to recognition of dispatchability RE – PO 08/2007 (see next slide) Request for Access to the grid TSO provides the conditions for grid access Spanish System Project Developer presents its project Project Developer asks for connection point TSO provides connection point

23. CSP : Project Development – Grid Access Dispatchability RE – PO 08/2007 Spanish System Installation controlled from the dedicated TSO dispatching center Program reliability: 90% at 24 h horizon 95% at 6h horizon Required conditions Storage ability: 4h Energy restitution efficiency : 60% Voltage dip ride-through ability (voltage dip up to 1 second) Benefits Less requirements and more guarantees to obtain access to the grid Participation in ancillary services markets Project Developper can make the choice to go for storage or not, so making its installation dispatchable or not. If not dispatchable, grid access seems more difficult to obtain and would be subject to curtailments when in operation

24. CSP : Project Development – Technological issues Mirrors Some companies developing solar projects are developing its own technology, or buying mirror manufacturers Absorber Tube Support Structure Thermal storage Manufacturers oligopoly Extremely critical and technical product (lasting vacuum, layers stability, high transmissivity of glass, high absorptivity and low emissivity of absorber, junctions metal/glass, dilatation management…) Several structures available in the market Continuous evolution to comply with alignment requirements at the lowest cost Liquid salts is the technology used for the moment, but many other are in development

25. CSP - Project Development – Storage optimisation

26. CSP - Project Development – Contractual structure and Project Finance CONTRACTS Engineering Procurement & Construction (EPC) Turn Key Contract Separated Packages negotiated by Project Developer Operation & Maintenance Grid Connection Fuel Procurement

27. CSP - Project Development – Contractual structure and Project Finance Turn Key Contract One Main Contractor assumes the whole project and outsource the various packages to other companies Price is negotiated ex-ante and is firm Deadline is negotiated ex-ante and is firm (penalty otherwise) Responsibility : only one visible head One Main Contractor assumes the whole project and outsource the various packages to other companies Responsibility : only one visible head The Main Contractor assumes the work of supervision and coordination 20% more expensive than the option “separated packages negotiated by project developer” To be financed by banks, it is the only contract structure acceptable Financing Entity will obtain from Main Contractor the required guarantees

28. CSP - Project Development – Contractual structure and Project Finance Contractual Structure Project Developer Financial Entity Legal Advisor Technical Advisor Insurance Advisor Environmental Advisor Turn Key Main Contractor Solar Field Thermal Storage Power Block Civil Work Electrical Systems PROJECT Fuel O&M Insurance Electricity Sales

29. CSP - Project Development – Contractual structure and Project Finance Main risks associated to CSP seen by Financial Entities Melted Salts Storage Expected generation : Availability and Quality of solar radiation data Thermal storage Hybridizing with NG or biomass Availability of main components (mirrors, absorber tubes) Experience of Main Contractor Regulatory risk: once reached the targets set by the Ministry, no more support is available

30. CSP - Some ratios 50 MW - Without storage Investment : 3000 €/kW 50 MW - With storage Annual production : 2050 hours for South Spain Water consumption : 6m3/MWh Gas consumption : 60 GWh /year Collecting surface : 287000 m2, 52 linear km Investment : 4500 €/kW up to 6000 €/kW Annual production : 3000 to 4000 hours – South Spain Collecting surface : increased according to the storage capability Water consumption : 6m3/MWh - 1600 m3/day Gas consumption : > 60 GWh / year

31. CSP - Support Schemes Spain CSP : Target : 500 MW in 2010 Tariff : 278 €/MWh or market price + 262 €/MWh lasting : 25 years After 25 years : 222 €/MWh or market price + 210 €/MWh CPV : integrated to general PV Target of 371 MW reached in 2007 (waiting for provisions for the period up to 2010) Tariff : up to 2007 431 €/MWh – expected 300 €/MWh from September 2008. Lasting : 25 years + reduced tariff after that period Expectations to discriminate CPV from general PV Feed-in tariffs have provided the required confidence to carry out huge investments up to 6000 €/kW

32. CSP - Support Schemes North Africa Call to bid from national electricity agencies ISCC : Integrated Solar Combined Cycle Excellent way to recover solar energy and optimize its thermodynamic efficiency thanks to higher temperatures reached by burning natural gas ISCC by Abengoa Solar : Morocco 470 MW, Algeria 150 MW

33. CSP - Support Schemes USA State requirements RPS (Renewable Portfolio Standards) + remuneration based on PPA negotiation (Power Purchase Agreements) + pluri-annual Federal ITC application (Investment Tax Credit) April 2008 : Pacific Gas & Electric Company (PG&E) subscribes a firm contract to buy electricity generated by solar plants in Mojave Desert : 500 MW + 400 MW optional February 2008 : Arizona Public Service (APS) signs a contract with Abengoa Solar to buy electricity from a 280 MW solar power plant … SEGS series from 80’s : more than 300 MW with more than 2 0 years experience on parabolic trough technology

34. CSP – Current growth Only in Spain, there will be confirmed firmly more than 1000 MW during 2008

35. CSP – Market expectations According to German Aerospace Center (DLR), CSP has a growth potential of 40 GW by 2030

36. CSP – Market expectations Much more optimistic, ESTELA, the European Solar Thermal Electricity Association, sees room for 60 GW by 2030 only in Europe…

37. CSP – Cost expectations According to ESTELA, the European Solar Thermal Electricity Association, only a moderate reduction in the levelized cost of energy can be expected due to high increase of raw materials such as steel and concrete

38. Index Solar energy : why should it make sense? Definitions CSP review Technology Project Development Issues Generation costs – Market perspectives – Support schemes CPV review Technology Generation costs – Market perspectives Ratios and comparisons

39. CPV - General features In spite of its childhood (much less mature than CSP), already several MW installed around the world The big cost reduction is still to come thanks to mass production Doesn’t need cooling water (except some special applications) Modular and scalable technology

40. CPV – The strategy Substitution of the expensive semiconductor material with a cheap optical system and low-cost mechanics Use of best efficiency cells

41. CPV - Advantages No water needs Time to Operation Less sensitive to hot climates Modular / Scalable

42. CPV - Disadvantages Sensitivity to clouds No easy storage ability These two issues together should be solved, as TSO cannot accept sharp fluctuations in the generated power

43. CPV – Components: Cells - Triple junction cells The principle is that each material operates at different wavelengths, the three covering a large spectrum

44. CPV – Components: Cells - Technology evolution In 2009 an average production efficiency higher than 40% will be the rule for multijunction cells

45. CPV – Components: Concentrator - Technologies Lens Mirror Low Concentration Cassegrain

46. CPV – Components: Concentrator - Technologies Central tower CPV Developed by Solar Systems in Australia

47. CPV – Components: Tracking system Light need to be focused at the cell, not close to the cell The higher concentration ratio, the lower angle tolerance In practice, 0.1% accuracy is currently reached Solid structures are required New structural concepts are being developed Need for increased accuracy

48. CPV – Potential for cost reduction Flat PV : module reaches 45% of cost share 40% of remaining costs are proportional to area Reductions in module cost and required area would lead to drastic decrease of Levelized Cost of Energy Source : Concentrix

49. CPV – Area reduction For the same surface, almost 50% more installed power To reach the same power, 30% less need for materials

50. CPV – Cost reduction expectations Investment costs to be cut by 3 in 10 years Source : Concentrix

51. CPV – Cost reduction targets

52. CPV – Market growth – some examples EMCORE

53. CPV – Market growth – some examples GUASCOR FOTON

54. CPV – Market growth – some examples SOL 3G

55. Index Solar energy : why should it make sense? Definitions CSP review Technology Project Development Issues Generation costs – Market perspectives – Support schemes CPV review Technology Generation costs – Market perspectives Ratios and comparisons

56. Comparative CSP - CPV 2 2 2 – 2,5 (more if storage) 2,5 – 3 (more if storage) Land use (Ha / MW) No water No water Similar to parabolic trough 6 m3/MWh Water consumption No Possible (any fuel) Possible (any fuel) Possible (any fuel) Hybrid design No ? Thermal : Possible Thermal : Possible Integrated Storage Yes, with huge amounts of MW available in coming years Only prototypes Soon Yes Commercially available Current : 25 % Soon : > 30 % 31% 23% 21% System Efficiency (electricity / solar) PV effect, no thermal 700ºC 600ºC 395ºC Operating Temperature 10 kW – 20 kW per tracker. Scalable 5 – 40 kW per dish. Scalable 20 – 100 MW 20 – 300 MW Power Range CPV Stirling parabolic dish Central tower Parabolic troughs

57. Comparative CSP - CPV 120 – 150 €/MWh in South Europe. Lower in sunnier locations In line with parabolic troughs In line with parabolic troughs 200 €/MWh in South Europe. Lower in sunnier locations Expected LCOE by 2020 300 €/MW in Souht Europe. Lower in sunnier locations ? ? 260 €/MWh in South Europe – 180 €/MWh in MENA Current LCOE (Levelized Cost of Energy) 6 – 7 €/W 14 €/W 4 – 6,5 €/W 4 – 6 €/W (according to storage size) Current investment cost CPV Stirling parabolic dish Central tower Parabolic troughs

58. References CSP summit – Madrid February 2008 – Intereconomía Conferencias CPV summit, Madrid 1-2 April 2008 (http://www.cpvtoday.com/index.shtml) http://www.schott.com/csp/english/download/schott_memorandum_e.pdf http://www.wbgu.de/wbgu_publications_annual.html http://www.eupvplatform.org/ http://www.csptoday.com/

59. Thank you!