Concentrated Solar Power: Industry Outlook - Gp Capt PK Khanna, Senior Project Engineer, Center for Solar Energy Technologies (CSET), Indian ...

Concentrated Solar Power: Industry
Outlook

      Gp Capt PK Khanna,
      Senior Project Engineer,
      Center for Solar Energy Technologies (CSET),
      Indian Institute of Technology Jodhpur (IIT J)(Raj)`

Introduction
•   Concentrating Solar Thermal Power (CSP) Technology has reached
    a high level of commercial maturity.

•   Four basic approaches, trough concentrators, tower / heliostat
    systems, linear Fresnel concentrators and dish concentrators (in
    declining order of deployment and commercial maturity).

•   Level of deployment has been growing at around 40% per year.

•   Overall the use of solar generation technologies, including
    photovoltaic systems, is growing fast and becoming a significant
    part of the future energy mix.

•   CSP approaches, although only a small part of the present total,
    have claimed an important place in the future mix, because they
    offer large scale and proven energy storage as an inherent part of

Why Concentrated Solar Power (CSP) ?
PV technology                    CSP technology

Solar irradiation is harnessed   Solar irradiation is harnessed
by exposing to sun.              by concentrating on single
                                 point or over the tube.
Thermal energy can be            Can store thermal energy
stored in form of chemical       directly.
energy.
PV cells are flat to absorb      CSP has mirrors to reflect
irradiation.                     irradiation.
Low efficiency.                  Higher Efficiency .

Involves conversion of DC to     Can be made direct AC
AC.                              generation.
Does not provide peak loads.     CSP provides peak,
                                 intermediate or base load
                                 capacities.

CSP Plants: Global

CSP Plants (NSM Ph 1) India

CSP Market
•   Important to understand the market readiness of different CSP
    technologies, the investment opportunities which these technologies
    are likely to create and the overall market development scenario.

•   Sub-technologies (sub-system)/components -- are an important
    market segment and also addresses the cost benefit and investment
    opportunities in solar power projects.

•   Development of a variety of CSP technologies like concentrated
    solar PV (CPV) ,concentrated solar thermal (CST).

•   Parabolic trough collectors, power towers or central receivers,
    compound linear fresnel reflectors, parabolic dishes (dish-sterling
    engine system) -- reached commercialization or near it.

CSP Market – Parabolic trough
• Parabolic trough technology is currently the most proven CSP
  technology-developed and standardized.

• Currently in operation, are between 14 and 80 MWe in size, and
  existing plants produce well over 500 MW of electrical capacity.

• Central receiver technology is also well proven. Central receiver
  systems use a field of distributed mirrors i.e. heliostats which
  individually track the sun and focus the sunlight on the top of a tower.

• Such systems can achieve up to 35% peak and 25% annual solar
  electric efficiency when coupled to a combined cycle power plant.
  Over 300 MW capacity CST power projects have been announced by
  various companies in the coming decade.

CSP Market – compact linear Fresnel

• Compact linear fresnel reflector system is similar to the
  parabolic trough collector system - consists of an array of
  nearly-flat reflectors which concentrate solar radiation onto an
  elevated inverted linear receiver.

• Water flows through the receiver and is converted into steam.

• System is line-concentrating, similar to a parabolic trough, with
  the advantages of low cost for structural support and reflectors,
  fixed fluid joints, a receiver separated from the reflector system

• long focal lengths that allow the use of flat mirrors, technology
  is seen as a potentially low-cost alternative to trough technology
  for the production of solar process heat.

CSP Technology: Cost
•   The main factors influencing the CSP market in India is the
    government's commitment, its budgetary support, and more
    importantly, availability of funds (grant, debt, equity and low cost
    finance) from international agencies.

•   Technology development and technology providers' outlook about
    Indian market including political and economic stability and
    bureaucratic hurdles, water, grid, and gas network development in
    areas of high potential, indigenization of technologies and lowering
    of costs of equipment and services are other crucial factors.

•   Solar PTC-based solar thermal power plant was estimated to cost
    Rs 2,02,150/kW and power tower-based solar thermal power plant
    Rs 2,35,877/kW.

CSP: Global Market
•   Concentrated solar thermal power (CSP) is an emerging market.
•   Spain and the United States together represent 90% of the market.
•   CSP technology showed especially strong growth in Spain and the
    United States since 2006. Installed capacities near 1 gigawatt (GW)
    and projects under development or construction exceed 15 GW
    worldwide.
•   Investment costs range from USD 4.2 to 8.4 per watt, depending on
    the solar resource and the size of the storage.
•   Energy costs are expected to decrease as more suppliers enter the
    market and as a result of R&D efforts and learning. In good sites,
    they could break the threshold of US cents 10 in fewer than ten
    years.
•   The BLUE scenario of the IEA publication, Energy Technology
    Perspectives 2008, foresees that CSP will provide 5% of world
    electricity by 2050.

CSP Global Market: Outlook and
               Barrier
•   The building of CSP plant creates 8 to 10 jobs per megawatt of
    equivalent electrical solar capacity in the construction and
    manufacturing of components.
•   Areas suitable to CSP technologies are found between 15° to 40°
    parallels– and occasionally at higher latitude.
•   The deployment of CSP plants is driven by feed-in tariffs in Spain,
    and Renewable Energy Portfolio Standards and a grant programme
    in the United States.
•   Low costs of fossil fuels remain an important barrier on grid – even
    more so in countries where fossil fuels prices are kept below world
    prices by direct or indirect government subsidies.
•   CSP Suitable areas are often semi-arid and water scarcity might be
    an issue, unless costlier dry cooling is used.

CSP: Global Water poverty

CSP Indian Market: Outlook
•   Indian market for CSP technologies under three scenarios - solar
    mission scenario, optimistic scenario, conservative scenario.
•   NSM scenario is the result of the government's policy following the
    JNNSM.
•   Optimistic scenario is based on the efforts of governments and other
    initiatives to promote the technologies.
•   Conservative scenario assumes -- development of CSP technology
    -- in a sluggish manner.
•   Projected market development --- CSP market can reach about 15.2
    GW by 2022
•   Optimistic scenario where as under conservative scenario only
    about 5.7GW market is likely to be developed by 2022.
•   GOI -- encourage CSP technologies -- depend on implementation of
    policies, impetus from the private sector.

CSP Indian Market: pitfalls
•   Innovation is not just a way of life, it is also a concept that perfectly
    encapsulates what needs to happen to the CSP technology industry.

•   India we need it to work, we need it to be cheap, and we need it to
    be local and innovative.

•   It would be an understatement to suggest -- CSP industry is going
    through a hard time in India.

•   National Solar Mission (NSM) had much promise when it took off.

•   Time has exposed obvious flaws with no easy remedy: insufficient
    accurate DNI data, expensive financing leading to very difficult
    financial closure.

CSP Indian Market: pitfalls
•   Unclear future of government subsidies, difficulty securing land and
    water, need local manufacturing.

•   Tight profit margins, time limitations etc, inability to use gas at all in
    CSP.

•   Developers in India underestimated the difficulty of developing CSP
    projects. From the first batch of 500MW, most are still at various
    stages.

CSP Indian Industry - Status
•   Small Solar Power Generation Programme (RPSSGP) have been
    commissioned.

•   Developers were to commission 500MW of CSP projects in NSM
    Ph1, till date only 2 plant are commissioned.

•   CSP Today forecasts that besides a couple of singled-out projects,
    the rest will face delays.

•   Time extensions “due to the availability of heat transfer fluids”.

•   How long the MNRE anticipates the Phase I plants to finish
    completion ? The responsibility for implementation has also mostly
    been moved to the states, and the technological ratio CSP-PV goes
    down from 50:50 to about 30:70.

CSP Indian Industry - Status
•   Above and beyond, the government has also worked in some
    [separate] hybrid programs to encourage investment in this
    particular technology.

•   In a poll conducted during a recent CSP bidding for Phase II until
    2014 was a ‘wise choice – [the industry] needs to learn the lessons
    from Phase I’.

•    CSP experts expressed “in the present cost competitive market
    affordability are the key drivers and therefore cost cutting in CSP
    technology is a challenge in India. Low DNI, long gestation,
    variability in weather conditions.

•   Outside the NSM the CSP projects under independent state
    portfolios are making strides. Gujarat, the first solar state to has a
    project called Gujarat Solar One in Kutch district of 25MW and 9 hrs
    of thermal storage by Cargo SOLAR CSP expected to live in the
    first quarter of 2014.

CSP Plants -- Status

CSP Industry: Recommendations
•   DNI data in the country is improving day by day with weather
    stations by C-WET from the MNRE shedding light over a previously
    obscure issue.
•   Price and technology adjustments can be made by developers to
    adapt to the real DNI conditions and respond accordingly.

•   CSP has also seen over the past months many Indian
    manufacturers attempt to develop a local supply chain. Companies
    in the dozens are starting to specialize in tube receivers, frames,
    curved mirrors and other key components.

•   NSM provides a strong cost reduction potential for developers,
    means a possible strong manufacturing base for key components to
    be exported, strengthening India´s balance of payments.

CSP Industry: Recommendations
•   Above and beyond local manufacturing, Indian market is bringing
    large scale Fresnel technology into the international spotlight,
    through the Reliance plants that are using AREVA Solar’s
    technology for plants of a 125MW scale.

•   Hybridization is by far, the biggest opportunity for CSP technologies
    in India, huge niche of opportunity exists.

•   MNRE have clocked onto it. Last year they released a program to
    target demonstration CSP hybrid plants ranging in size from 20-50
    MWs.

•   Furthermore, the technology of the plant may specialize in CSP with
    hybrid cooling to reduce water consumption.

CSP Industry: Recommendations
•   What the government needs to be realistic about is the time the
    projects take and to encourage serious developers that take
    calculated risks, rather than favoring those that have simply come in
    unrealistically cheap.
•   Improving the financing options and making it cheaper will also help
    the industry along and secure projects, ensuring that the financial
    models can be sustainable over time.

•   As complicated as the proposition for CSP is for the next few
    months, the industry will get through it and come out shining. There
    are plenty of opportunities still for the taking and many lessons have
    been learnt.

•    It is time for all the stakeholders to get their act together and push
    forward innovation, resourcefulness characterized its millions of
    entrepreneurs creating some of the most dynamic global companies
    in the world. And this means that it is time for some Jugaad.

CSP Industry: Recommendations
• MNRE should ensure that Phase 2 policies continue to encourage
  CSP technologies along with other solar technologies.

• The government should enforce commissioning timelines for Phase
  1 projects to avoid setting a precedent of leniency on delays

• MNRE should ensure that Phase 2 guidelines strike a balance
  between encouraging new players to participate and attracting
  experienced developers.

•   MNRE should assess opportunities for hybrid CSP base load plants
    with sustainably-produced biomass and other fuels.

•   By providing incentives like tariff premiums, MNRE should
    encourage water-efficient technologies in CSP plants.

CSP Industry : R&D priorities
•   Research and development efforts so far, most of them taking place
    within the IEA Solar PACES Implement
•   Agreement, have been supported in particular by Germany, the
    European Commission and the US Department of Energy.
•   Improvements can be expected on all components of CSP plants.
    One possible step improvement with troughs would be direct steam
    generation, increasing the overall efficiency.
•   Phase-change materials and concrete offer novel options for
    storage.
•   Towers have even greater room for improvements. Many innovative
    designs are currently proposed, with one or several towers sharing
    fields of heliostats, a great variety of central receiver designs, heat
    fluids and storage options.
•   Towers with air receivers feeding the gas turbine of a combined
    cycle power plant could offer record solar-to electricity efficiency of
    around 35%.

CSP Industry : R&D priorities
•   The production of solar fuels such as hydrogen and other energy
    carriers can take several roads, notably in conjunction with fossil
    fuels; it still requires significant R&D efforts.

CSP Industry Outlook: Conclusion

•   CSP has significant cost reduction potential – immediately and with
    future innovative developments

•   The debt markets will recover and offer improved lending conditions.

•   CSP has strong growth potential in many countries – mainly those
    with high irradiation in the world‘s sun belt.

•   As technologies and market participants develop, dynamics towards
    lower prices will increase in the industry.

•   As specific costs decrease, new markets will be opened up.