Concentrating Solar Power will cost 50% less in 15 years

A joint study by A.T. Kearney and the European Solar Thermal Electricity Association, ESTELA, shows the growing mid-term potential of STE to progressively substitute conventional energy sources and complement the renewable energy sources portfolio with a cost-competitive dispatchable solution – In a best-case scenario industry roadmap involves creation of 100,000 to 130,000 jobs by 2025.

Concentrating Solar Power is now entering the commercial ramp-up phase and will soon be viable as a renewable energy source with a relevant positioning in the utilities portfolio. Within the next 10 years STE will be able to run with a profitable business model – challenging conventional and other renewable energy sources without any subsidies. In a best case scenario and with the proper support, concentrated solar energy could reach a global installed capacity of up to 100 gigawatts (GW) by 2025.

This would involve the creation of a maximum of 130,000 jobs of which 45,000 would be permanent full-time jobs in operation and maintenance. This is one of the main findings of a joint study of global management consulting firm A.T. Kearney and the European Solar Thermal Electricity Association, ESTELA. The objective of the study was to derive a comprehensive industry roadmap assessing the cost and technology development potential for concentrated solar energy.

Moreover, the study reveals that electricity generation costs of this technology could be reduced by up to 30 percent by 2015 and more than 50 percent by 2025. Concentrating Solar Power is thus an attractive tool that can make a considerable contribution to the achievement of energy and environmental targets such as the European Union 20-20-20 goal.

After a pioneering and demonstration period starting as far back as the 80s, concentrated solar energy is now entering a commercial ramp-up phase with 3,000 megawatts (MW) of generation capacity and new large-scale projects of over 50 MW being deployed around the world – currently mainly in Spain and the USA. Solar thermal electricity (STE) technologies convert a renewable energy source, radiation from the sun, to produce electricity.

This is achieved through the concentration of solar radiation using mirrors and receivers to heat up fluids which are used to generate electricity in power blocks. “The STE industry’s innovation efforts from the past decades are now yielding fruit. What we see today is a proven and ever more attractive industry that is right on track to soon seriously challenge conventional and other renewable energy sources. According to the study, in a best-case scenario and with the proper support STE could reach a global installed capacity of up to 100 gigawatts (GW) by 2025”, says José Alfonso Nebrera, President of ESTELA.

Assuming fulfillment of the industry roadmap as outlined in the study, STE penetration is expected to reach 12 GW of installed capacity by 2015, 30 GW by 2020 and between 60 and 100 GW by 2025. Already by 2015, when most of the STE ramp-up phase improvements currently underway are expected to be implemented in new plants, energy production can be expected to be boosted by more than 10 percent and plant CAPEX reduced by 20 percent. Furthermore, economies of scale resulting from increases in plant size will additionally contribute to reducing plant CAPEX per produced energy unit.