Hydropower, Solar, Utility Scale

Approaching the horizon: Very large-scale photovoltaics

Issue 4 and Volume 10.

For years, proponents of solar energy have drawn maps representing the amount of land needed to supply global electricity demands from PV. While photovoltaics on such a scale is still some way off, it is getting closer, and large-scale energy from the desert has never been more realistic. By Edward Milford.

How quickly things can change. When the first edition of the International Energy Agency’s (IEA) Photovoltaic Power Systems (PVPS) Task 8 book Energy from the Desert outlining a vision of gigawatt-scale photovoltaic installations was published in 2003, many in the industry saw it as a futuristic fantasy. At the time, 1 MW systems were rare and PV was largely used as a kilowatt-sized technology for local applications. The idea of scaling the technology up by at least three orders of magnitude for power generation seemed like a dream that was several decades away.

Just four years later, with publication of a second edition of Energy from the Desert, this time sub-titled Practical proposals for very large scale photovoltaic systems, the scene is completely different. The pace of development is rapid and the gap between current installations and those proposed for very large scale photovoltaics (VLSPV) has narrowed significantly. The first order of magnitude is already a reality, with a 12 MW installation at Erlasee in Germany completed in 2006, 11 MW operating at Serpa in Portugal and 10 MW at Pocking in Germany. There are now over 150 installations larger than 1 MW operating around the world.


A multi-megawatt crystalline silicon PV plant in northern Spain ACCIONA

Even larger installations are under way; a 64 MW plant has been announced in the municipality of Moura in Portugal, undertaken by newly formed company Amper Central Solar SA, and there are 40 MW systems planned for Spain. Plans have been announced too for a 116 MW system for La Sabina in southern Portugal as part of the Parque Solar São Domingos in the Alentejo region being planned for completion by the end of 2009 with a total investment of €426 million. This is to be made up of eight smaller power blocks, with a solar module assembly plant on site. The race for the first 100 MW system is on, and it seems quite likely that two of the three orders of magnitude needed to scale up to the futuristic gigawatt-size systems envisaged by IEA PVPS Task 8 in 2003 may be achieved within seven years. (An important caveat to these developments, of course, is that such large schemes are currently only being installed in areas where there is a feed-in tariff offering a premium price for the electricity generated.)

Advantages of VLSPV

So what is the thinking behind such systems, and what are the main issues to consider? The starting point is a fairly obvious one: the solar resource falling on the world’s land surface is a vast potential source of energy, greatly exceeding the world’s current total energy consumption. While solar energy is by its nature a low-density energy, where there are large areas of unused, relatively flat land available (i.e. deserts, particularly) it may be practical to capture and use this energy. With one third of the land area of the Earth covered by dry desert, using about one-thirtieth of it for photovoltaics could cover the total world energy consumption.


A close-up of a concentrating photovoltaic module NREL

Capturing this energy can be done either with small systems (possibly up to 3 kW for domestic use, or up to 100 kW for systems on industrial or commercial buildings), with mid-scale systems (100 kW up to 1 MW or even 10 MW on unused urban areas), or by installing even larger systems up to 1 GW and beyond – these are the very large scale PV systems looked at by Task 8. Such installations could either be one very large plant or a series of smaller plants operating together.

The theoretical advantages can be summarized as follows:

  • it is easy to find land in or around deserts appropriate for large-scale energy production with PV
  • such land is normally in high insolation areas and many such sites are in parts of the world where energy demand is growing rapidly (such as the Gobi desert in China, or the Thar desert in India, or the Southwest of the United States)
  • the energy potential from a few such areas is technically easily sufficient to meet world needs
  • such installations could proceed in modular fashion, with plant capacity increased gradually
  • installation can be quick
  • the environmental benefits are significant as, once installed, this is a zero-CO2 technology
  • such installations could bring socio-economic benefits to some of the world’s poorest areas
  • large-scale PV would have a significant impact on the future of the PV market by leading to significant cost reductions
  • these systems do not rely on new technology breakthroughs, simply on scaling up a well-understood technology

Of course, there are a number of disadvantages at present as well. Such systems will need to work in conjunction with some form of energy storage to ensure supply during hours of darkness, and as some of the most promising desert areas are some way from population centres, the transmission of power will become an issue. It is also true that no such systems have yet been built, though given their modular nature it seems likely that good project management skills will be the main requirement to ensure installations run smoothly. However, above all, the economics of such systems currently works against them.

Middle East case study – Israel

To explore further the viability of VLSPV systems, the Task 8 carried out a number of theoretical case studies. Two are described briefly here. The first of these is a top-down study of the potential in the Middle East. Israel was chosen as a theoretical site for VLSPV installations, and five initial questions were addressed:

  • how much land area is available, and how much electricity could be produced from this area?
  • what is the electricity demand in the area?
  • what technology should be used, and how much of it?
  • how quickly can the resource be introduced?
  • what financial resources are required, and how could these be provided?

A system based in Israel is likely to be sited in the Negev desert in the south. The potential electrical yield here is 189 kWh/m2 for a static system (and more for tracking or concentrator systems). Given the land area of Israel of over 20,000 km2, this gives a theoretical maximum output of over 1300 TWh/year. In 2002, Israel consumed 42 TWh, so the theoretical maximum is 30 times the recent electricity consumption.

To keep things simple, the IEA study made a number of assumptions: that the installation of VLSPV plants would proceed at a linear rate of one per year; that the manufacturing capacity is matched to this rate; that VLSPV will meet 80% of the country’s projected energy needs after 30 years of continuing VLSPV construction, and that the future electricity consumption increases proportionately to population growth.


Test site showing crystalline and concentrating photovoltaic systems in the desert NREL

Some assumptions also need to be made about the technology to be employed and the system configuration. First, it was assumed that a concentrator PV technology would be used. An issue for conventional PV is that the same, high-cost material is, in effect, used both to collect the energy and to convert it. Concentrated PV (CPV) allows a low-cost material, such as plastic, aluminium or steel to be used to collect the energy, and a relatively smaller amount of high-cost PV material to be used to convert it. There are several CPV systems close to market at present, such as a 25 kW one from Amonix and a system from Daido Steel, and some assumptions about the cost of large-scale manufacture of these, or an equivalent, have been made as part of the study.

While CPV systems can achieve 32% efficiency, an effective operating figure of 25% was assumed to build in a margin of safety. Using the solar irradiation reference data for Sede Boqer in the Negev desert, a typical collector rated at 50 kW could generate 119,700 kWh of electricity in a year. For large systems, a trade-off is required between land area used and shading losses. A land area to collector area ratio of 8:1 can ensure no shading losses, but reducing the ratio to 3:1 decreases the required land area significantly while losing only about 10% of the energy through shading.

Using these assumptions, a 1 GW VLSPV plant in the Negev desert would consist of 20,000 collectors, occupy some 12 km2 of land and produce up to 2.15 TWh of electricity. For the next stage of the top-down calculation, a figure of 2 TWh/GW installed per year was used.

There are two other significant cost factors if this is to be a realistic replacement for existing generation systems. The first will be some form of storage system to help match supply to demand. It was estimated that storage power of about one third of the solar power installed will be needed while there is still some form of grid power back up in addition to the storage capacity. There will also need to be some transmission lines, and the losses and costs inherent in these need to be factored in to the calculation.

So what is it likely to cost to construct a 1 GW VLSPV plant, the storage to go with it and a manufacturing facility that can produce one such plant per year? Some of these costs are relatively well known and the Task 8 study provided a first estimate as follows (US$ throughout):

  • cost of cells. A 1 GW installation will require 64 million CPV cells, estimated to cost $2.5/cell, at a total cost for the plant of $160 million
  • cost of Fresnel lenses. Estimated to cost US$1 per cell, or a total of $64 million
  • Cost of inverters; normally quotes are around $300/kW, but a price of $40/kW has been quoted, giving a total inverter price for the plant of $40 million
  • balance of system costs, including transport to the site and physical erection were estimated to cost around $150 /m2 of collector.
  • large storage systems can be used for any type of generation, not just PV, which complicates the calculation of their cost. It increases their capacity factor, so it may not be appropriate for the entire cost to be allocated to the VLSPV system. Large-scale vanadium redox flow batteries can cost $850/kW for an operational capacity of 6 hours.
  • a manufacturing facility capable of producing 20,000 collectors a year is likely to cost $530 million. In addition, there is an estimated cost of $220 million for the first such plant for engineering designs, etc, though these can then be shared with other such plants built in the future.
  • at the current electricity rates in Israel, which typically average 9 cents/kWh, a 1 GW VLSPV plant would generate $180 million per year. Allowing for 0.5 cents/kWh for operation and maintenance, we can use a net income figure of $170 million per plant per year.

Using these figures, the IEA study then put together an investment algorithm for building up the VLSPV plants to reach the target of 80% of Israel’s electricity generation within 30 years of completion of the first plant. The results are striking. Allowing for credit costs of 3% interest, overheads, construction of solar production line, storage production line, generating plant and storage plant the peak demand for credit would be $9.781 billion in year 13. Selling electricity at 9 cents/kWh between years 6 (when the first plant is completed) and 21 pays off all the accrued costs plus interest, and the price could fall to 5.5 cents/kWh thereafter. The credit line reduces to zero in year 22 as well, with all future VLSPV plants paid for out of profit from electricity sales. After 30 years, decommissioning and replacement is expected to start, but the costs of this are also covered by the revenues generated. Hitting the 80% target figure would require about 560 km2 of land and create some 23,000 jobs. Such a scheme could theoretically be rolled out in other Middle Eastern countries as well.

This top-down study has a number of other interesting results. First, it seems reasonable to assume that large CPV systems can be mass produced for under $1000/kW. Such collectors have already been successfully tested elsewhere and seem ripe for mass production. Secondly, the power production figures may be conservative, depending as they do on cell efficiency, and there are already existing cells with significantly higher efficiencies than have been assumed. Thirdly, it looks likely that inverters in the megawatt range can be manufactured more cheaply than previously thought. Most importantly, though, even when storage is built in to ensure supply stability, the cost of electricity production from such systems appears to be directly competitive with the power generation from fossil fuels. Furthermore, not only is this without loading the fossil fuels with any additional costs to balance out externalities or assuming sharp price rises from fuel shortages, it is also self-sustaining, with replacement plants being constructed out of the revenues from existing ones.

A Chinese case study

While this top-down study is very theoretical, and the sums involved make a commitment to the programme, something only likely to be considered if underwritten by the state, the potential for systems in China actually to be developed in the coming years is considerable. With huge, unmet demands for power, and large desert areas, there is a smaller gap to bridge from theory to installation. The IEA study outlined the details of an 8 MW system for Dunhuang in western China. An evaluation meeting has since been carried out following the completion of a feasibility study.

The site identified at Qiliying is just 5 km from a 6000 kVA substation. Dunhuang has highest demand during the daytime from agricultural machinery and irrigation, so there is a good load match between supply and demand. A feed-in tariff is in place for the local micro-hydro installations (which have a capacity of about 10 MW, supplying 35 GWh per year, about 2.7% of the city’s electricity consumption).

The system design used has eight 1 MW sub-stations, each feeding electricity into the grid though a 1000 kVA transformer. Each 1 MW sub-station will be divided into five 200 kW channels, each connected to an inverter. Each sub-station and channel will be independent of the others, which will allow for easier maintenance, flexibility for investors and allow different systems to be compared. With Dunhuang having an excellent solar resource, the annual output from the installation is calculated to be over 13 GWh per year.

The proposal uses 50,000 modules of 160 Wp each, together with the 40 sets of 200 kVA inverters. Each substation will need just over 23,000 m2 of land, so allowing for other buildings and the array layouts proposed, a total of 300,000 m2 of land will be required for an 8 MW system. The site gets over 3000 sunshine hours each year.


Concentrating PV systems on trackers could be used for very large desert arrays AMONIX

Costing out the system has given a total cost of 322 million yuan, or $38 million. The Gansu grid company has guaranteed a feed-in tariff, and the Chinese central Government might provide 30% of the costs needed, reducing the funds required to around $27 million.

This plant has been adopted as the first pilot project of a Great Desert Solar PV Programme, proposed by the WWF and the group of both local and international experts who have been investigating this study. Indeed, preliminary announcements were made at the end of 2006 that a letter of intent to build the ‘World’s Largest Solar Power Station’ had been signed for the $765 million construction cost of such a plant by Zhonghao New Energy Investment. The 8 MW prototype may then become part of a larger set of power plants that could go on to be the first actually to break through the 100 MW barrier. However, there has not been more recent news about progress on the development since a flurry of press stories at the end of 2006.

Other impacts of VLSPV

Such schemes would clearly have major impacts on the areas in which they are situated. One other key aspect considered in the report is to look at such installations holistically to ensure that they are established in consultation with the local communities, and planned in such a way to bring maximum benefits to the host community to allow them to thrive alongside such large installations.

One immediate impact, of course, will be that there would be a sustainable energy supply immediately to hand. It will be important that energy generated is available for local use as well as being distributed through the grid to more remote locations.

A second feature will be the likely presence of PV manufacturing or module assembly facilities in the immediate vicinity, providing a number of secure jobs directly related to the plant, as well as others dealing with the operation and maintenance of the plant and related tasks. In addition, such plants will require better infrastructure development, such as transport links, which should support other economic activity in the vicinity.

Another feature will be to optimize the land use in and around the plant. There is likely to be a particular need for shelter belts; these can both protect the local soil and help protect the PV from the effects of strong winds and dust storms. The plant could also help towards establishing sustainable farming methods alongside any such installation. Desert areas are by definition water-stressed, and careful, sustainable control and use of limited water resources will be essential. Appropriate crop selection will also be a key factor. However, if successfully managed, such steps should lead to better use of the land, less desertification and possibly also the restoration of abandoned tracts of agricultural land.

All of these and other related features should lead to the establishment of stable and sustainable communities based in parts of the world that are currently experiencing high migration patterns to the cities. With such communities established, other requirements such as the provision of health and educational systems will follow.

Current status

The current status of the IEA PVPS Task 8 work was summarized at a meeting in Athens, Greece, organized by European Photovoltaic Industry Association (EPIA) in April 2007. The case studies were briefly outlined, and the next areas for the Task members to work on (grid networks, storage, hydrogen and concentrator technology) were identified. Peter van der Vleuten, one of the report’s authors, offering a personal perspective, said he expected to see most of the work being carried forward eventually by the utilities, as they had the scale and resources to invest in larger systems. He emphasized the importance both of using concentrators and locating systems where the best solar resource is to be found; these are the best ways to improve the economic returns and, therefore, the fastest route away from the current situation, which relies on subsidies in the form of feed-in tariffs.

Summarizing the report, Professor Kurokawa, Operating Agent Alternate for Task 8, outlined many of the familiar virtues of PV as a clean energy technology. Once installed, it is a genuinely zero-emission source of energy. It has plenty of potential to meet the world’s total primary energy supply many times over. If allied to the developments as outlined here, with module assembly and possibly cell manufacture close to the site, it has a real socio-economic benefit to the local community close to the plant. This should lead to a community-integrated approach to such installations.

So what of the economics? Crucially, the costs involved are pretty well known and understood. At present, as calculated by another of the Task 8 members, Claus Beneking, they appear to be 24-38 eurocents per kWh, of the order of twice that of other grid generation costs in some parts of the world. Prices are falling quite rapidly, and prices for PV are expected to continue falling by about 5% per year as demand grows. Crucially, the risks, particularly the technology risks, are significantly lower than for some of the futuristic technologies that are the subject of frantic lobbying.

Various reports, such as the Stern report published in the autumn of 2006 and the more recent 4th assessment report from the IPCC (see article by Ralph Sims, pp.31-39) have outlined the need for significant rethinking of the energy supply to reduce the CO2 emissions from energy generation. Many governments have interpreted this to mean either carbon capture and sequestration (CCS), or nuclear power. Each of these comes with uncertain technology, long lead times and significant areas of poorly understood risk. Each will also lock in many generations to a particular plant and technology, and, above all, has a very high and very uncertain price tag.

By contrast, PV is a technology that is well understood and essentially ‘off the shelf’. The lead times for development can be very short. The main risks are known. It is modular and scalable. The practical issues now focus on project management and implementation, and local issues such as the use of water resources and job creation. Once the economics work, the private sector is likely to provide the capital and momentum for a rapid uptake of the technology (as has been the case with the rapid development of PV in Germany). Such plants could also be self-sustaining once set up, with the replacements being afforded out of the revenue generated.

With governments responding to unscrupulous lobbyists and rushing to pour billions and billions of pounds and dollars into the potentially bottomless pit that CCS and nuclear power represent, the case for proper support for VLSPV surely becomes overwhelming. It is a great deal closer to providing a sustainable energy supply than these other, speculative technologies. It has progressed two orders of magnitude in under a decade, and the steps for it to progress another order of magnitude are clearly mapped out in Energy from the Desert. What was once, to quote Professor Kurokawa again, ‘a future dream’ is now within sight of being an economic reality.

Edward Milford is Publisher Emeritus of Renewable Energy World and Chairman of publishers James & James/Earthscan
e-mail: [email protected]

Energy from the Desert is edited by Kosuke Kurokawa and is published by Earthscan. Visit www.earthscan.co.uk for more information.