Spain accounted for the vast majority of capacity additions, while several developing countries launched their first Concentrating Solar Power plants and industry activity expanded its attention from Spain and the United States to new regions.
Parabolic trough plants continued to dominate the market, but new central receiver and Fresnel plants were commissioned during 2011 and others were under construction.
Although CSP faced challenges associated with rapidly falling photovoltaic prices and the Arab Spring, which slowed development in the Middle East and North Africa region, significant capacity was under construction by year’s end.
As in the global market, parabolic trough technology dominates the market in Spain. This is due mainly to Royal Decree conditions set up in 2009, which made the development of CSP possible, but also gave a strong position to the technology that was then most mature.
And yet, to date Spain has been the only market with utility-scale solar tower powers in operation. The 19.9 MW Gemasolar solar thermal plant, which started operation in 2011, was the latest of three power towers to come on line; it was also the first CSP plant able to operate for 24 hours under certain conditions, thanks to 15 hours of storage capability.
An additional 1.1 GW of CSP capacity was under construction in Spain by year’s end, with most of it scheduled to go on line in 2012.
The United States continued as the second largest concentrated solar thermal power market in terms of total capacity, ending 2011 with 507 MW in operation. Although no new CSP capacity was completed during the year, more than 1.3 GW was under construction by year’s end, all supported by federal loan guarantees, and all expected to begin operation between 2012 and 2014.
The estimated capacity of CSP projects with power purchase agreements (PPAs) was revised downwards significantly in 2011, primarily because several projects were signed originally with inexperienced companies at unreasonable profitability ratios. Several planned projects were not developed or were converted to solar PV.
Elsewhere around the world at least 100 MW of capacity was in operation at year’s end. Egypt brought 20 MW on line at the end of 2010, as did Morocco (20 MW); they were followed by Algeria (25 MW), Thailand (9.8 MW), and India (2.5 MW), which all launched their first CSP plants in 2011.
All facilities in the Middle East and North Africa (MENA) region are integrated solar combined cycle (ISCC) plants—solar fields integrated into large fossil plants.
India added the first segment of a solar power tower in Rajasthan that may eventually be a 10 MW plant, due for completion by early 2013.
Other countries with CSP capacity that did not add new facilities in 2011 are Italy, Iran, and Australia, where a solar/coal-fired plant generates power and steam.
CSP growth is expected to accelerate internationally, with projects under construction or development in several countries, including Australia (250 MW), China (50 MW), India (470 MW), and Turkey; at least 100 MW of CSP capacity is under construction in the MENA region, with more in the pipeline.
South Africa completed an international tender in 2011 and awarded contracts to build 150 MW of capacity, and the national utility Eskom plans another 100 MW.
Several other countries, including Chile, Israel, Italy, Mexico, and Saudi Arabia, have indicated intentions to install CSP plants or have begun work on legislation needed to support CSP development.
An interesting trend is the integration of solar thermal not only in hybrid systems with coal- or gas-fired plants, but also with other renewable energy technologies.
For example, a recently completed solar project near Barcelona in Spain includes biomass along with CSP. While CSP has faced challenges associated with rapidly falling PV prices and the Arab Spring (slowing development in the region), the ability of CSP to provide thermal storage and thus dispatchability, as well as the possibility to easily hybridise with other energy sources, are expected to remain attractive attributes to utilities.
Although industry activity continued to focus on Spain and the United States, the industry expanded its attention to Australia, China, India, the MENA region, and South Africa.
Sales in 2011 were estimated at USD 545 million, and the installed base of CSP was estimated to be worth USD 9.5 billion by year-end. The Spanish industry continued to lead the world in plant development, design, and operation.
In general, the industry remains vertically integrated, with individual companies involved in many parts of the value chain, from technology R&D to project operation and ownership. Extensive supply chains are emerging in Spain and the United States, with an increasing number of companies involved in the CSP business.
Abengoa’s (Spain) Solana project, for example, includes 70 companies across 26 U.S. states. There is also a trend towards lasting partnerships between technology developers and EPC (engineering, procurement, construction) contractors.
Firms have also begun to expand their development efforts to include a variety of technologies in order to increase product value. For example, BrightSource Energy (USA) announced in late 2011 that it would add molten salt storage to three power tower projects in the United States.
AREVA (France) is using molten salt storage technologies, and is integrating CSP into existing gas and coal plants to increase their efficiency; and GE unveiled a new ISCC power plant that joins its combinedcycle gas turbines with eSolar’s (USA) technology.
Start-ups with new technologies are trying to find their place in this very competitive industry.
In addition, the standard size of CSP projects is increasing in some locations. Due to regulatory restrictions, typical plants in Spain have been about 50 MW, but new projects in the United States are tending towards the 150 to 250 MW range. Increasing size helps to reduce costs through economies of scale, but appropriate plant size also depends on technology.
Some projects are also integrating cooling solutions that significantly reduce water demand, an advancement that is important in the arid, sunny regions where CSP offers the greatest potential.
During 2011, in response to challenges posed by the complicated economic environment, CSP firms found it necessary to strengthen their positions by developing even more competitive technologies and, at the same time, obtaining the financing needed to close their new projects.
For example, in Spain, a number of companies established joint ventures, especially with Japanese companies. While some firms used this opportunity to strengthen their market positions, others, like Solar Millennium (Germany) and Stirling Energy Systems (USA), could not deal with liquidity issues and went bankrupt.
www.map.ren21.net/GSR/GSR2012.pdf
