In Chile’s last auction for power, SolarReserve bid a world record breaking low price at just 6.3 cents per kWh ($63/MWh) for dispatchable 24-hour solar.
SolarReserve’s CSP technology with integrated thermal storage provides 24-hour solar power, and is ideally suited for Chile’s grid with round-the-clock power needs due to its huge mining industry. To bid 24-hour solar at 6.3 cents is a world record for CSP (Concentrated Solar Power), a form of solar utilizing heat from the sun that can be stored thermally. Chile has open auctions for both fossil energy and renewables, and no subsidies.
CleanTechnica spoke today with SolarReserve CEO Kevin Smith about the firm’s next Chilean bids:
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
Interestingly, our thermal solar bids were lower than all but one new-build natural gas project bid into the last tender. Chile has no indigenous fuels, so natural gas needs to be imported in the form of LNG, which is much more expensive than natural gas costs in the US, and is susceptible to spikes in supply pricing in the world markets.
SK: How do you ensure that you can deliver solar power around the clock? Does that require operating at something less than full capacity? [Background explainer: How CSP works: CSP with integrated thermal storage makes solar dispatchable at any hour 24 hours a day.]
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.
We could design it for three times the power for 8 hours a day or twice the output for 12 hours a day, but since Chile’s load is really a 24-hour load we design the storage to handle that.
It really comes down to the design of the steam cycle and turbine capacity, the storage tank capacity, and the size of the heliostat field, which dictates how much additional power you can store when its sunny.
SK: You seem to do all the permitting before you bid, not just in South Africa which requires it, but even in the US and Chile that do not – why? [SolarReserve just received the environmental permitting for its 450 MW Tamarugal CSP; the second of three thermal solar projects it is developing in Chile. Copiapó was permitted in 2015. A new CSP project, Likana is in development.]
KS: I think we’re a bit out front in the way we operate. We like to move forward on permits and make sure we have a fully developed project that’s ready to go. That provides confidence to the offtaker, that the project will be built on the time frame expected in the bid.
For SolarReserve, obtaining the permits certainly minimizes the development risks of the project. So the fact…