Gigawatt CSP Power Plant

The world’s ever growing energy demand with its impact on our natural resources urges mankind to develop alternative and economically viable sources of energy. Concentrating Solar Power (CSP) is a proven sustainable technology that has the potential to supply a large share of the world’s population with electricity. However, due to insufficient investments by both public and private sector, the costs of this promising technology remain too high to compete with conventional energy generation methods, depriving many countries of a vast energetic potential and leaving them unnecessary reliant on external factors.

By up-scaling effects, technological developments and the continuing increase of energy prices, CSP can become fully competitive with conventional technologies. However, the initial loss that is inherent to the commercialization of a disruptive technology needs to be overcome. Electricity produced using CSP costs currently approximately 10 $ cents per kWh. The American Sargent & Lundy LLC Consulting Group evaluated the potential cost reduction due to scaling effects and technological improvements at 4 to 6 $ cents per kWh for 2020 (figure 3.a).

Bright Aid Solutions proposes to build five independent CSP-power plants with a cumulative capacity of 1 GW while financing them as one single project. Serial planning allows covering the initial loss for the realization of the first unprofitable plants, with the decreasing production costs for the latter. By situating the plants in sun-drenched areas with relatively high electricity prices, the time needed to make the enterprise profitable is considerably reduced. The plants will be located in different areas or even countries in order to match supply and demand. Since the CSP-technology relies heavily on initial investment, it is essential to keep the cost of capital low. To obtain the necessary capital of 3.5 billion $, a joint venture will be created with a number of large companies and establishments that have an interest in developing sustainable energy on the long term. Given their interest, capital costs can be lower than for conventional risk capital. The internal rate of return on the investment is evaluated at 14%. Carbon dioxide trading schemes and tax cuts for innovative and sustainable developments can lead to even higher returns.

Bright Aid Solutions’ initial focus will be on the energy markets in stable emerging countries with a relatively high electricity price, like Botswana and Namibia. Both governments are currently trying to attract investors to further develop their energy sector in order to supply a larger share of its population with electricity while reducing their dependency on other countries. Electricity produced in the CSP-plants will be sold on the local market to the country’s respective government or to its utilities at a market price. The high electricity price of approximately 7 $ cent per kWh in this region can be explained by the lack of competition and the shortage of electric capacity.

The project as proposed by Bright Aid Solutions allows market entry barriers to be overcome and the entire enterprise to be profitable, yielding a fully competitive technology with a vast potential in many regions of the world.

Roadmap

An ambitious plan to build a Gigawatt Concentrating Power-plant as put forward by Bright Aid Solutions needs a firm roadmap to manage the project and to measure its progress. The proposed roadmap has been divided in four phases: 1) Global Analysis, 2) Finance & Consultation, 3) Design & Construction and 4) Exploitation. Each phase is discussed in more detail below.

I Global Analysis (2006 - 2008)

The first phase is a global analysis of two years to provide more insight in the available technologies, potential construction locations, risks, costs and financing possibilities. Significant effort is used to collect existing information and to reach an optimal combination of available technologies. This phase is financed by subsidies but a large share of the work is carried out on a voluntary basis. Funding for the second phase of approximately 10 million US$ must be obtained during this period by approaching different donors.

II Finance & Consultation (2008 - 2011)

The second phase is dedicated to provide a solid financial infrastructure for the rest of the project as well as commencing official talks with the concerned governments of the pre-selected CSP-sites. A rigid financing scheme is erected and future investors are given the opportunity to get acquainted with the project. Besides all financial aspects, an emphasis is put on promotion of the project among potential investors. The ecological advantages of Concentrating Solar Power are also accentuated during this promotion campaign. During this phase that takes three years, a joint venture with a number of large energy related companies is set up to provide the project with the necessary funding of approximately 3.5 billion US$.

III Design & Construction (2011 - 2022)

Once the funding has been obtained, a research consultancy firm prepares a detailed design for the CSP-plants during a two year period. The information and know-how obtained during the global analysis is exploited and updated regularly to ensure a state-of-the-art design. The remaining legal, technological and/or social issues are also dealt with during this period. After an international tender procedure, the construction of the first CSP-plant is started. The construction of the second plant commences one year after the completion of the first plant to allow for technological improvements to be implemented in the design. The remaining plants are designed and built in a similar way allowing each unit to be more efficient and cheaper than its predecessor.

IV Exploitation (2014 - 2062)

The last part of the project is the exploitation. The first electrical output is expected eight years after the beginning of the project. In the following eight years, the other four plants become operational. The total expected lifespan of the plant is estimated at forty years. It is possible to rehabilitate parts of the CSP-plant after a number of years to make energy conversion even more efficient and to extend the lifespan of the plant.