AUSTRALIA’S BIG SUN

Australia’s appetite for solar: Can CSP compete Down Under?
Rikki Stancich, 20 May 2011 (CSP Today)

"Despite having generated some of some of the brightest innovations in concentrated solar power, Australia lags behind…its commitment to supporting the development and implementation of concentrated solar power technologies…But recent events suggest that Australia may be shrugging off its coal-induced stupor…

"…In January this year, the Large-scale Renewable Energy Target (LRET)…[began covering] large-scale renewable energy projects including commercial solar, geothermal, and wind…[It] is expected to deliver the majority (around 41,000 GWh) of the 2020 target of 20% of electricity generated by renewable energy sources…[D]espite the country’s vast land and solar resource, a mere 1GW is likely to be supplied by solar thermal energy…The government has also pledged funding [to roughly AU$40M ]to stimulate R&D and accelerate deployment of renewables…"

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[Mark Twidell, Executive Director, Australian Solar Institute:] "…The primary issue for CSP is that the cost is significantly higher than wind energy, which is the renewable energy price setter…People often cite the advantage that CSP provides inbuilt energy storage and can generate 24/7 into the night, however, from a market perspective off peak nighttime electricity – often called baseload - is the lowest priced electricity, traditionally supplied by low cost coal generation…Today the market generally does not reward renewable energy that can offer firm capacity…"

[Mark Twidell, Executive Director, Australian Solar Institute:] "…Parabolic trough technology has been demonstrated and, as such, is considered to be bankable but is typically higher cost than wind and, arguably, other solar technologies…Power Tower and to some extent Fresnel and Dish technologies, which offer cost advantages, have not yet been demonstrated at the megawatt scale over an extended period, so it is difficult to get private sector debt and equity financing for these projects. There is a need, globally, for the finance sector to build confidence through proven operational experience with these technologies…[The Spanish government] is prepared to pay a high cost for electricity…[and] is allowing financial risk to be reduced for project financiers and allowing new technology to be proven and become 'bankable.'"

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[Mark Twidell, Executive Director, Australian Solar Institute:] "The big challenge for CSP is to bring the cost down. The best way to [bring the cost down] is on large engineering projects, and by building a learning curve of ‘do-learn-do’…With hybrid CSP it is possible to lower the capital cost and construction and planning time as you don’t need to cover the grid connection and turbine cost. In this way you can develop experience in deploying what is different: the actual conversion of solar to heat, rather than heat to electricity, (which is something that has been done for a century using traditional coal and gas generation in other industries)…Looking at the long-run requirement, the move to a standalone CSP will come. This will be helped by having available low-cost proven solar-related components…"

[Mark Twidell, Executive Director, Australian Solar Institute:] "I would not say that fossil fuel subsidies are hampering the roll out of renewables. Technology has to be available at a cost that the financial community will finance. CSP needs to be cost competitive with wind…That said there is no doubt that a carbon price (if introduced) would send a clear signal to investors in CSP. Renewable energies are more competitive when external costs are factored in to fossil fuel prices. A long term market mechanism to price carbon would reward investors who were successful in developing viable CSP technology…"