Solar Reserve, the people behind the Crescent Dunes concentrated solar power (CSP) plant in Nevada, have bid just US$63/MWh in the reverse auction with the Chilean government for their Copiapó plant in Chile. Here's part of an interview between CleanTechnica's Susan Kraemer and Kevin Smith, CEO of Solar Reserve:
SK: You bid Crescent Dunes in Nevada at 13.5 cents, then Redstone in South Africa at 12 cents. Your bid in Chile was 6.3 cents. How are you able to come down so low for solar that includes thermal storage so it can be dispatched any time — 24-hour solar for just 6.3 cents/kWh?
KS: SolarReserve has made substantial advances in our technology that has increased efficiencies and brought down capital costs since our first project in Nevada.
But there are a number of other factors that influence power prices and the Chilean market appears to be ideally suited for solar thermal with storage. In addition to the best solar resource in the world, the country’s stable financial status along with US dollar denominated power contracts results in excellent financing and investment terms
SK: How do you ensure that you can deliver solar power around the clock? Does that require operating at something less than full capacity?
KS: Our bulk storage capabilities utilizing molten salt give us tremendous flexibility, without having to consider the degradation issues associated with batteries or the replacement cost issues.
We’re designing the projects in Chile for full capacity 24 hours a day. To do that we put in about 14 hours of storage. That will give us the full capacity of the project essentially 24 hours a day.
SK: Might you bid a Hybrid PV/CSP like Copiapó in Chile’s Next Round?
KS: We permitted Copiapó for PV as well as CSP, but actually in the current situation, we’re not sure of the value of adding PV into the mix, because daytime power prices are low. We can take the PV out as we’re not required to include it. We could always come in later and add the PV in the future if it makes economic sense, but we think it has limited value in the Chilean sector right now: there has been an oversupply during the day because of all the PV.
So in the last round we bid Copiapó purely as CSP with SolarReserve’s tower and molten salt storage technology. We had already made that decision that the PV wasn’t adding any value to the bid, so we did not include the PV, and we bid that at $63/MWh.
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That's cheap. What this means is that CSP can deliver power 24/7 at a lower price than coal or gas, without any CO2 emissions.
Obviously it's cheapest in desert regions close-ish to the equator, like northern Chile, and in the mid-latitudes it will be 20 to 40% more expensive, because there's less sunshine. At high latitudes, wind plus storage remains the most attractive option--but it is also true that countries like Denmark could still get their power from CSP plants in Spain via HVDC lines.
Solar Reserve is planning two more CSP plants in Chile, each with three towers, has offered to build six in South Australia, and is planning on building a ten-tower complex in China.