UTILITY IN NEW SOLAR POWER PLANT DEAL

It is easy to understand why solar power deals like the just signed between eSolar and Southern California Edison are getting BIG BIG funding. Here’s how eSolar describesd its power plant: “…a low-impact, pre-fabricated form factor with advanced optics and computer software engineering [to meet] the demands of utilities of any size for clean, renewable and cost-competitive solar energy. By focusing on the key business obstacles that have characterized large solar installations – price, scalability, speed of deployment and grid impact – eSolar has developed a proprietary solution to make a dramatic reduction in the cost of solar thermal technology…”

That business-to-business smart talk has earned eSolar $130+ million in venture capital funding in the last year. In simple terms, it promises large scale solar energy generation at competitive prices without the need to get homeowners to figure how to finance costly rooftop installations.

As described yesterday in SOLUTION: SOLAR ENERGY AND UTILITIES , change is afoot in the solar energy sector, change that will come from consolidation and corporatization. In the pursuit of making solar energy cost competitive with cheap dirty energy like coal and cheap dangerous energy like nuclear, utilities are making solar power plants their aim.

In addition, utilities are setting up deals with photovoltaic (PV) panel companies for ownership of generation from large-scale and distributed PV installations. Future home solar installations are likely to be either owned by or financed by utilities. Generation will contracted for by utilities. Rooftop PV panels will be no more the concern of the homeowner than the electric meter.

Solar energy's financial burdens and financial benefits are shifting.

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eSolar and Southern California Edison to Produce 245 MW of Solar Power; Series of Pre-fab Solar Plants to Provide Clean Electricity to Communities in Southern California
June 3, 2008 (Antenna Group via eSolar)

WHO
eSolar, Southern California Edison (SCE)

WHAT
eSolar announced the signing of a Power Purchase Agreement (PPA) with SCE covering 245 megawatts of solar energy-generated electricity.

A solar power tower. (click to enlarge)

WHEN
The agreement calls for eSolar’s plants to begin providing electricity to SCE in 2011.

WHERE
- The contracted eSolar power plants will be built in and supply the Antelope Valley region of Southern California.
- SCE serves 13 million people in a 50,000-square-mile service area of Central, Coastal and Southern California.
- eSolar is based in Pasadena, CA.

WHY
- Rather than the familiar photovoltaic (PV) panels, eSolar’s power plants utilize “concentrating solar” technology. A field of flat mirrors reflects and focuses the sun’s light and heat on the top of a central tower where a substance is heated to intense temperatures. That molten substance flows to a boiler where the heat generates steam to drive a turbine that generates electricity the same way any other heat-generating energy (coal, natural gas, nuclear) drives a steam turbine to generate power.
- The optics of the mirror system and the software that maximizes the sun’s productiveness are proprietary eSolar intellectual property.
- eSolar has been the beneficiary of significant venture capital funding this year. See MORE BIG BUCKS TO SOLAR POWER PLANTS and GOOGLE’S $10 MIL TO eSOLAR POWER PLANTS.

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QUOTES
- Stuart Hemphill, vice president of Renewable and Alternative Power, SCE: "SCE is committed to providing renewable energy generation at competitive costs – to this end, we review all of the possible sources to meet the growing demand for clean power…eSolar's proposed solar projects promise to be modular, scalable, and easily and rapidly deployed. SCE is excited about the prospects of eSolar's unique solar technology and the potential benefits it can bring for our customers."
- Asif Ansari, CEO, eSolar: "eSolar's proprietary approach to solar thermal generation can be designed to meet the needs of utilities large and small – a smarter-sized footprint and variable configurations ensure power can be delivered where it is needed most…We are proud to be supporting SCE in its commitment to delivering clean, reliable electricity to its customers."