Jan 21, 2011 - John Farrell -
When discussing centralized v. decentralized solar
power, there’s an inevitable comparison between
solar thermal electric power and solar photovoltaic
(PV). But the fact is that solar thermal power – or
concentrating solar power (CSP) – can also
be done in a distributed fashion.
In fact, of the 21 operational CSP plants in the
world, 18 are smaller than 80 megawatts (MW). And
among operational plants with publicly available
capital costs, there’s no clear pattern of
lower costs per Watt installed for larger projects.
The common element in thermal concentrating solar
power (CSP) is that rather than directly converting
sunlight to electricity (solar PV), they concentrate
sunlight with mirrors to heat a fluid, and that
heat is converted to useful energy. There are a
variety of designs for CSP plants, including parabolic
troughs, towers, Stirling dish engines, and Fresnel
lenses. Because three of the four designs (excluding
the Stirling dish) generate electricity from steam
turbines, the assumption is that bigger is better,
capturing more economies of scale.
But the evidence suggests that most economies
of scale are captured at a relatively small size.
The adjacent chart explores the cost of CSP plants
by size, differentiating plants with storage or
natural gas backups from those that are solely
solar powered. Rather than seeing declining costs
for scale, we see costs level or increasing.
The poor returns for scale may have to do with
the limited economies of scale in heat engines
(the tools for converting heat to electricity).
The following chart illustrates the cost functions
of several heat engines (including traditional
steam turbines, screw motors, Organic Rankine Cycle
engines, and piston motors).
As the chart shows, the cost of heat engines per
kilowatt (kW) of capacity drops rapidly as size
increases up to 1 megawatt (MW). But beyond that,
the economies of scale are much smaller. For example,
there's only a 100 euro drop in the cost per kW
for a steam turbine when increased in size from
2 to 3 MW. If the turbine represented the entire
project cost, the savings from the larger turbine
might equate to a 1 cent per kWh drop in the price
of electricity from the project over its entire
lifetime. In reality, the turbine is less than
20% of project costs and the savings would be much
In other words, economies of scale are small for
CSP projects, even at relatively small sizes.
Perhaps more interesting than the economies of
scale of the heat engines is the difference between
traditional steam turbines and Organic Rankine
Cycle (ORC) turbines. ORC turbines can operate
efficiently at lower temperatures, allowing for
a smaller field of solar collectors and for CSP
plants to populate areas with lower direct solar
irradiance. The potential to serve a wider geographic
area was noted in a recent interview with the CEO
of Sopogy, a producer of “microCSP” (1-20
MW power plants) using ORC turbines:
The Sopogy system doesn’t need high DNI
(Direct Normal Irradiance)…according to Kimura.
[Traditional CSP] needs 7 plus DNI but Sopogy can
work at 5 DNI. That means Sopogy can and is installing
systems in the Pacific Northwest, Idaho, the Middle
East, Spain and Australia.
In other words, smaller-scale CSP projects may
be able to capture most economies of scale and
distribute the use of concentrating solar power
to areas previously thought uneconomic for concentrating
solar. The smaller scale may also prove advantageous
because CSP can provide high efficiency heat for
industrial use as well as electricity, reaching
significantly higher capacity factors (as with
traditional combined-heat-and-power facilities).
Overall, the lesson with CSP seems similar to
that of solar PV and wind. Most economies of scale
are captured at smaller sizes, allowing projects
to integrate more easily into existing grid infrastructure.