An Exploration of the Present and Future State of Concentrated Solar Power in the U.S. Southwest Reber, Joseph E. 12/11/2012
Table of Contents Abstract...1 Introduction...1 CSP Technology...2 Parabolic Trough...3 Power Tower...4 Present State of CSP in the Southwest...6 Making CSP Cost Competitive...8 Solar Field...8 Heat Transfer Fluid...9 Thermal Energy Storage...9 Financial Incentives...10 Current Incentives...10 Future Incentives...11 Problems Associated with CSP...12 Ecological Impacts...12 Water Use...12 Conclusion...13 References Cited...14
ABSTRACT The burning of fossil fuels is one of the major factors promoting global warming. In the United States (U.S.), fossil fuels accounted for nearly 70% of total energy production. Investments in renewable power are important to slow climate change. The National Renewable Energy Laboratory s SunShot vision study predicts that, in the next 50 years, solar power will be the U.S s primary renewable energy source. The U.S. Southwest contains some of the best solar resources in the world, with conditions especially favorable for concentrated solar power (CSP). CSP is an energy generation method which uses mirrors and a steam turbine to capture the sun s thermal energy and convert it to electricity. CSP is currently too expensive to be installed at a large scale. However, it can be made cost competitive with advancements in technology and through the use of specific financial incentives. If cost reductions are achieved and CSP potential is fully utilized, annual electric-sector carbon dioxide emissions in the U.S. may be reduced by up to 28%. INTRODUCTION In 2010 fossil fuels accounted for nearly 70% of the entire United States (U.S.) energy production. The burning of fossil fuels is a major contributor to atmospheric carbon dioxide (CO 2 ) levels (United States Energy Information Administration, 2010). Carbon dioxide is the most significant anthropogenic greenhouse gas, and is therefore the most important factor when addressing human caused climate change (Intergovernmental Panel on Climate Change, 2007). The electricity generation methods which have the potential to lower CO 2 emissions are carbon capture and storage for coal, nuclear, and renewable energies. However, many of these options have significant disadvantages. Utilizing carbon capture and storage is expensive and the technology has yet to be proven effective. Nuclear power requires mineral inputs, of which there 1
is a limited supply, and the disposal of nuclear power s radioactive waste is a problem that has yet to be solved (Fthenakis et al., 2009). Renewable energies, such as wind and solar power, have few disadvantages, and their potential to reduce CO 2 emissions makes them favorable methods of electricity generation. In 2050, solar energy is predicted to account for 27%-35% of total U.S. energy demand according to scenarios developed by Fthenakis et al. (2009) and the National Renewable Energy Laboratory (2012). In both scenarios, solar power accounts for much more of total power generation than any other renewable source. Photovoltaic solar power will account for the largest share of solar power production, but concentrated solar power (CSP) will provide critical base power generation. Because of siting limitations, CSP is constrained primarily to the Southwest (National Renewable Energy Laboratory, 2012). This paper focuses on identifying the current state of CSP in the Southwest, and aims to explore the potential for cost reduction through financial incentives and technological advancement. CSP TECHNOLOGY CSP has existed for over two decades, and was first utilized on a large scale with the Solar Energy Generating Systems built in 1984 in the Mojave Desert, California (National Renewable Energy Laboratory, 2012). CSP works in the same fashion as all steam powered energy generation methods, using steam to turn a turbine which is attached to an electric generator. However, instead of using coal or natural gas to create steam, sunlight is used. This basic premise, the conversion of sunlight into thermal energy, is used for all CSP technologies (National Renewable Energy Laboratory, 2012). There are, however, different methods of achieving this conversion. The most common methods are parabolic trough and power tower (or central receiver). 2
Parabolic Trough The most common CSP method is the parabolic trough. Parabolic trough systems utilize an array of mirrors called a solar field (Figure 1). The solar field is composed of parabolic shaped mirrors which track the sun from east to west. The mirrors focus solar radiation on to an absorber tube filled with heat transfer fluid (HTF). The HTF is circulated throughout the solar field and heated to approximately 390 C. When the HTF reaches this temperature, it is directed to a heat exchanger which generates steam. This steam is then fed through a turbine generator to produce electricity (Hopwood, 2009; National Renewable Energy Laboratory, 2012). Figure 1. The components of a parabolic trough concentrated solar power system (National Renewable Energy Laboratory, 2012). In an ideal scenario, when the sun is directly overhead, parabolic trough systems achieve a solar-to-electric efficiency of 24%-26% (National Renewable Energy Laboratory, 2012). However, overall annual conversion efficiency is only 13%-15%. Power generated by parabolic 3
trough systems is relatively expensive, costing 12-18 cents/kwh (Renewable Energy Policy Network for the 21 st Century, 2007). Power Tower Power towers are a new technology that are only recently being built commercially. The Ivanpah solar project is currently under construction in the Mojave Desert, California, and will be the largest power tower facility in the world (BrightSource, 2012). Power towers have the potential to be cheaper and more efficient than parabolic trough systems because of their ability to utilize thermal storage (Hopwood, 2009; National Renewable Energy Laboratory, 2012). Power tower systems use a large array (up to 100,000) of computer controlled mirrors called heliostats which track the sun and direct sunlight onto a central tower (Figure 2). Figure 2. The main components of a power tower concentrated solar power system (BrightSource, 2012). The tower contains a receiver which transmits the reflected sunlight into thermal energy. The thermal energy may be converted directly into steam or stored in the form of molten salt. Direct 4
steam power towers operate much like conventional steam power facilities, using pressurized steam to turn a turbine powered generator and produce electricity. Molten salt systems, on the other hand, take molten salt at around 290 C and feed it to the receiver where the salt is heated to a temperature of 565 C. The heated salt is held in a storage tank until electricity generation is required when it is used to produce steam (National Renewable Energy Laboratory, 2012). This steam is then used to generate electricity in the same way as stated previously. The use of substances which can retain heat for extended periods of time, like molten salts, is called thermal energy storage (TES). TES is useful because it allows CSP facilities to generate electricity when it is needed (Figure 3). This means that energy generation isn t constrained to times when the sun is out, allowing energy production to not be affected by the passing of clouds or daylight hours. Figure 3. The increased energy generation potential for concentrated solar systems with thermal energy storage (National Renewable Energy Laboratory, 2012). 5
Power tower plants combined with TES have the ability to operate all day, every day in the summer. This allows power tower systems to be very useful and versatile as an electricity generation method. However, despite this potential, power towers accounted for only 3% of global CSP capacity in 2010 (National Renewable Energy Laboratory, 2012). PRESENT STATE OF CSP IN SOUTHWEST In December 2010, global CSP capacity was 1,300 MW (National Renewable Energy Laboratory, 2012). Of the 36 commercial-scale CSP plants installed worldwide, only 7 plants were located in the U.S. Southwest. The U.S. Southwest receives solar resources which are optimal for CSP, yet these resources are severely underutilized. Due to the unique nature of CSP, land suitable for large scale development is determined by a specific set of criteria. Most importantly, areas must have direct normal irradiance (DNI) so that mirrors can effectively focus sunlight. Additionally, the DNI in these areas must be greater than 6.75 kwh/m 2 /day. Lands with contiguous areas greater than 10 km 2 and with slopes less than 1% are able to provide the area needed for CSP facilities. Lastly, water, urban areas, national parks, wilderness areas, and wildlife refuges are excluded from potential CSP areas due to the inability of large scale plants to be built there (Mehos and Kearney, 2007). The most suitable region for CSP in the United States is the Southwest (Figure 4). The U.S. Southwest contains approximately 139,500km 2 of land suitable for CSP development (Table 1). The total energy resource in this area amounts to 17.5 million gigawatt-hours (GWh), which is four times larger than total U.S. energy demand (Fthenakis et al., 2009; National Renewable Energy Laboratory, 2012). Despite this abundant resource, less than 0.1% of U.S. electricity is provided by CSP (National Renewable Energy Laboratory, 2012). 6
Figure 4. Areas which are suitable for concentrated solar power plants. Sensitive environmental lands, urban areas, areas with slope > 3%, and areas less that 1 km 2 were excluded from the study (National Renewable Energy Laboratory, 2010). State Available Area (km 2 ) Arizona 50,000 California 17,900 Colorado 5,400 Nevada 14,500 New Mexico 39,300 Texas 3,100 Utah 9,300 Total 139,500 Table 1. The available area (km 2 ) for concentrated solar power in the U.S. Southwest (Mehos and Kearney, 2007). 7
MAKING CSP COST COMPETITIVE The U.S. Southwest receives abundant solar resources and has the potential to be a major center for solar power. However, development is currently hindered by high initial costs and lack of investors. The studies conducted by Fthenakis et al. (2009) and the National Renewable Energy Laboratory (2012) outline the major factors which will determine a successful future for solar power in the Southwest. The primary requirements for the success of solar power include improving the technology and decreasing the cost of three main components: the solar field, the HTF, and TES. Achieving cost reductions for these three components along with implementing financial incentives is predicted to reduce the cost of solar energy systems by 75% in 2020 (National Renewable Energy Laboratory, 2012). Solar Field The greatest capital investment of a CSP plant is the solar field. Therefore, reducing solar field costs will provide the most benefit for investors. Cost reduction potential is greatest in two solar field components, the support structure and the reflector. Support structures must be strong enough to support the reflector s weight as well as withstand maximum wind conditions. Materials and frame design play a large role in support structure cost and efficacy. Utilizing advanced frame designs can reduce frame costs. Also, using integrated structural reflectors allows for easier and faster assembly, which can reduce installation costs (National Renewable Energy Laboratory, 2012). Reflector performance is directly related to energy costs. For every 1% increase in performance there is a 1% decrease in energy cost (National Renewable Energy Laboratory, 2012). Therefore, in order to achieve cost reductions, it is important to increase the optical performance of reflectors. Replacing heavy glass mirrors with lightweight thin film reflectors has 8
the ability to lower costs, increase reflectance, and reduce breakability. Other advanced reflectors are currently being developed which may increase reflectivity by up to 1.5% (National Renewable Energy Laboratory, 2012; Turchi et al., 2010). Heat Transfer Fluid Currently, CSP performance in parabolic trough systems is limited by the maximum operating temperature of the HTF. The current maximum operation temperature of synthetic oil systems is 390 C. According to a study by Turchi et al. (2010), using water/steam and moltensalt can increase the HTF operating temperature to 500 C. Utilizing substances which allow for higher operating temperature is predicted to significantly improve thermal conversion efficiency, and thus greatly decrease costs. Power tower systems are already capable of operating at temperatures around 565 C due to the smaller amount of piping required for the HTF in these systems. The National Renewable Energy Laboratory is currently researching materials capable of operating at temperatures of 1000 C or higher. If HTF research is successful, extremely high efficiency power tower systems will reduce CSP costs even further (National Renewable Energy Laboratory, 2012). Thermal Energy Storage Traditional solar power systems are only able to produce electricity when the sun is shining. This limitation reduces the amount of electricity a solar plant can produce. However, TES technologies can help remediate this issue. Utilizing TES technology allows for energy production to be greatly increased, thus increasing the overall efficiency of a solar power plant. In order to facilitate TES, collector areas must be expanded and storage tanks must be added. These additional needs increase capital investments, but the increased energy production provided by TES will offset the increased investment costs. The National Renewable Energy 9
Laboratory is currently researching a number of TES technologies, such as: solid-media storage, phase-change material systems, thermochemical storage, and nanoparticle additives (National Renewable Energy Laboratory, 2012). Advancements in TES technology will allow CSP systems to generate more electricity for a longer period of time, thus increasing the profitability of CSP (National Renewable Energy Laboratory, 2012). Financial Incentives Although technological improvements will contribute to cost reduction, government incentives are crucial to making solar truly cost competitive with other energy sources. Financial incentives currently exist for solar investors, and there are proposed financing plans which will greatly aid solar investment in the future. Current Incentives Currently, investors can take advantage of tax credits provided by the federal government in the form of investment tax credits (ITC) and accelerated 5-year tax depreciation. The combined value of these two tax credits amounts to about 56% of installed solar cost (National Renewable Energy Laboratory, 2012). However, these tax credits are due to expire in 2017, and the recent global financial crisis has caused uncertainty about the amount of tax equity available for solar projects. State and local incentives, such as up-front rebates, performance based incentives, tax credits, property tax exemptions, and low-interest loans, allow even more benefits to investors. Solar developers should use federal, state, and local incentives in conjunction in order to make solar projects economically successful (National Renewable Energy Laboratory, 2012). 10
Future Incentives Future incentives, proposed by Fthenakis et al. (2009), include government guaranteed loans, a mandatory solar portfolio standard for electric utilities, and a solar price support program for feed-in tariff (FIT). FIT programs guarantee the at cost purchase of energy produced by solar plants. FIT acts as a subsidy for the cost difference between energy produced by solar facilities and the market price of energy. Currently, FIT subsidies amount to $0.11/kWh for CSP (Fthenakis et al., 2009). Feed-in-tariff programs in Europe have proven FIT as an effective way to increase solar development. Fthenakis et al. (2009) and the National Renewable Energy Laboratory (2012) predict that solar power plants will become cost competitive in 2020. Once solar power plants become cost competitive, these government subsidies will no longer be needed. The National Renewable Energy Laboratory (2012) proposes three, non-subsidy, financial structures which can be used in the future to promote solar development. The first is a prepaid service contract, in which an electricity buyer purchases power from an electricity provider upfront, before it is delivered. Prepaid contracts typically work best with government institutions that have adequate financial assets to make an up-front payment. The second is property-assessed clean energy finance programs (PACE), which was introduced by the City of Berkely, California in 2007 (National Renewable Energy Laboratory, 2012). PACE programs allow municipal financing districts to lend funds to property owners with the stipulation that they must use it for renewable energy or energy efficiency improvements. PACE programs specifically target renewable energy and are well suited for solar development. The third financial structure is on-bill financing, which combines a state subsidy with a loan for the electric utility. On-bill financing is designed to reduce the up-front costs for the solar developer. 11
However, there still exists concerns about the potential for defaults, utility regulation for providing loans, and the large initial capital required to fund solar projects. PROBLEMS ASSOCIATED WITH CSP While solar power does provide clean and renewable energy, there are a few aspects which can be harmful. CSP uses large areas of land which can harm local ecology and wetcooling CSP is water intensive. Ecological Impacts It is important to understand the ecological impacts of CSP due to the number of rare and sensitive species found in the U.S. Southwest (Lovich and Ennen, 2011). Solar development may cause soil disturbance, habitat fragmentation, direct wildlife mortality, and changes in surface water quality (Lovich and Ennen, 2011; National Renewable Energy Laboratory, 2012). Habitat fragmentation can be minimized by avoiding sensitive areas and grouping solar development. Lovich and Ennen (2011) propose developing CSP on areas which have undergone previous degradation, such as old mine sites, overgrazed pastures, and abandoned crop fields. Utilizing previously degraded sites will lessen the impact solar power plants have on local ecology. Water Use Water is required for all CSP facilities. It is used to rinse mirrors, reflectors, and, most significantly, for cooling. Wet-cooling CSP systems currently offer the highest efficiency and the lowest cost, yet they consume the most water (Table 2). Dry cooling systems can reduce water usage by 97%, but causes decreased efficiency and a 7% increase in costs (National Renewable Energy Laboratory, 2012). Total water consumption for dry-cooled CSP systems is far less than that of other power generation methods, and would therefore be a suitable electricity generation method for areas with limited water supply like the U.S. Southwest. 12
Generation Technology Water Consumed for Cooling (gal/mwh) Other Water Consumed in Generation (gal/mwh) Water Consumed in Producing Fuel (gal/mwh) Total Water Consumption (gal/mwh) CSP (wet-cooled) 710-960 40-60 0 750-1020 CSP (dry-cooled) 0 30-80 0 30-80 Coal with CO 2 Capture 700-770 150-180 5-74 855-1024 Nuclear 580-850 30 45-150 655-1030 Table 2: Water consumption of wet-cooled concentrated solar power (CSP), dry-cooled CSP, coal power with carbon dioxide (CO 2 ) capture, and nuclear power (National Renewable Energy Laboratory, 2012). CONCLUSION The U.S. Southwest receives some of the best solar resources for CSP in the world, yet current CSP installments are far from utilizing the full potential of the region. However, future investments in CSP are likely if technological advancements decrease the costs of solar power and if specific financial programs and incentives are utilized. Continued growth in solar power production will not only provide the U.S. with domestic, renewable, and sustainable energy, but will also reduce annual electric-sector CO 2 emissions by 28%. Reducing CO 2 emissions is of paramount importance for mankind, as it is the most significant anthropogenic greenhouse gas causing global warming. U.S. commitment to solar energy is not only a wise national plan, but also represents a crucial global decision and sets a precedent for the world. 13
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Turchi, C., Mehos, M., Ho, C., Kolb, G.J., 2010, Current and future costs for parabolic trough and power tower systems in the U.S. market, in Proceedings, SolarPACES 2010, Perpignan: France, National Renewable Energy Laboratory, p. 1-8. United States Energy Information Administration, 2011, Electric power annual 2010: United States Department of Energy Report, 97 p. 15