New Hampshire, U.S.A. — The solar industry is moving to the south, and for concentrating photovoltaics (CPV), this is a good thing.
While northern climes like Germany and Japan have traditionally soaked up the majority of the traditional flat plate PV installations, the intense solar areas to their south have made little headway in project development. But there’s a shift underway as the solar industry begins to branch out from its political strongholds to the north and into the areas where the sun shines the strongest.
Solar remains a virtually untapped source in India, Africa and the Middle East. Just as lucrative is the potential in Latin America, where energy needs are surging and the renewable resources are becoming too obvious to pass up.
CPV is a young industry with relatively few projects in the ground. What it lacks in a track record, though, it makes up for in other ways. Certain locations from Mexico to Chile have exactly what CPV is after — high Direct Normal Irradiance, or DNI. The technology was designed for these regions, and now the industry is working to build a market that can support its product.
While silicon-based PV panels, and to some extent thin films, become less efficient in high levels of direct sunlight and scorching temperatures, CPV continues to thrive. On trackers, it follows the sun and filters its direct sunlight through optical devices, which concentrate sunlight on tiny, highly efficient cells. So far, the biggest markets have been in places like Spain and the Southwestern United States. But developers will surely follow the resource, and the hunt for projects could eventually create a beaten path along the Western edge of Latin America.
“It’s a nice timing of the market,” said Russ Kanjorski of Semprius, a North Carolina-based CPV manufacturer whose cells just set a record for PV module efficiency at 33.9 percent. “When Germany had most of the market, CPV had nowhere to go because the technology didn’t have a place there. Now, the markets are going right where the sweet spots of the technology already are.”
For a small company like Semprius, which is just now coming onto the commercial scene, it becomes a question of how to break into the nascent market.
In the Ground
Some companies have already started to stake a claim in that market, and while the projects in the ground thus far are small, the potential is in the gigawatts. Getting there, though, won’t come easy, and it will come with many lessons learned.
Skyline Solar is putting the finishing touches on a 500-kW development in Durango, Mexico. The project marks the first phase of an announced 10-MW deal. So far, that’s the biggest installation across Latin America.
SolFocus also has some experience in the region, with small projects in Mexico and Chile, and another much larger project on the way in Mexico.
In Juarez, Mexico, the company installed a demonstration project that powers much of a central agency’s offices in the heart of the border city, and in Puebla, the company worked on an off-grid project that powers Volkswagen’s test facility. In the fall, the company announced the first two projects for Chile, one at an EnorChile facility in Santiago and another at a mining facility in Calama.
The company plans to soon overtake Skyline Solar’s claim to the largest installed CPV project in Latin America with its 1-MW installation in Apaseo el Grande, Guanajuato. The company made startling headlines last week when it announced it would build a 50-MW project in Tecate, near the U.S. border. That project could eventually expand to 450 MW. While the smaller projects have worked to allow local governments, local contractors and international businesses to test the waters, a project at this scale shows that the technology is building up the trust it needs to move forward in a big way.
Challenges of Doing Business
Skyline Solar’s Tim Keating likens the Latin American solar market to project development in the U.S. during the industry’s infancy.
“When I talk to people from the early solar development days here in California, there was a time that when there was a 25-kW project, everybody in the market knew about it and competed for it. Every project was hand-stitched together. There were secret cookbooks on how to get things permitted. And you had to do a lot of work to get things through. That’s how it is in [the Latin America market] now.”
In the U.S., policy is now seen as the driving force behind new developments. That’s not quite the case yet in the Latin America market, but that day is coming. There have been developments in Mexico, which is dominated by state-owned CFE. Recently, new policy has allowed for independent entities generating energy from renewable sources to connect to the national grid. In Chile, there’s pending legislation that is calling for a serious investment in renewable energy to power the nation’s prosperous mining operations.
This has opened up new industrial opportunities, but with the growth has come new challenges. In the U.S., utilities learned about incorporating solar power in relatively small doses through net-metered rooftop installations. Mexico’s utility, for instance, doesn’t have that luxury. With no rooftop market to speak of, the utility is now considering how to connect relatively high levels of solar with little experience. This means developers must forge a strong working relationship with the utility right off the bat.
In Chile, meanwhile, CPV projects are expected to thrive in the northern desert regions where mining operations provide the lifeblood of the economy. The mines have huge appetites for energy around the clock, and solar is projected to figure prominently. But many of the regions also face issues of grid instability, or in some places, no grid at all. More than anything, because solar is so new to the area, many of the issues have yet to be identified.
“The first thing is you have to understand the energy markets,” said Keating, who added that the lack of clear policy doesn’t necessarily mean that government support couldn’t come quickly. “The upside of the centralization in the governments, is they can — like the Europeans when they get their ducks in a row — actually move centrally with a clear focus. They can learn from the successes and failures of the feed-in tariffs in Europe and the tax benefits of the U.S., and they can formulate a policy that will grow the market.”
The Road Ahead
The first projects are always the hardest, and with those installations come new leaders and newfound experience.
When Skyline Solar began work on the Durango project, the team charged with doing the construction didn’t even know what a CPV installation was supposed to look like. To give the crew the experience and background it needed, Skyline flew key members of the construction team to Mountain View, Calif., for training classes. There, they watched videos, went over processes and demystified the concept of CPV.
There was a litany of small obstacles to cross to get the project off the ground, including the need to acquire business visas for construction workers to enter the U.S. It wasn’t an impossible feat, but it did little to speed up an already lengthy process.
For a company like Semprius, it’s hoping to tap into the expertise of Siemens, the global energy giant with which is has formed a strategic partnership.
“They’re just about everywhere,” said Kanjorski about Siemens. “We provide the technology — it’s their systems powered by Semprius. Hopeful they will drive this globally.”
And perhaps right into the Latin American market.