Sunday, January 12, 2014

Cost of solar power (41)


RenewEconomy today has a story about the Cerro Dominador CST plant to be built in the Antofagasta region in northern Chile.  A press release from Abengoa about the plant is available here.


Cerro Dominador will be a remarkable plant – 110 MW peak power output from a heliostat/tower configuration with dry condensers, 17.5 hours thermal storage in molten salt, and, according to BNamericas, a Capacity Factor of 95%.  By comparison, the Gemasolar plant in Spain, the best-known of the heliostat/tower plants equipped with storage, is “only” 20 MW with 15 hours storage.


BNamericas quotes the cost of the plant as USD 1.0 billion and Abengoa says the plant will avoid emissions of 643,000 t CO2 per year. 


Chile is fortunate in having major deposits of sodium nitrate, NaNO3, one of the two main components of the salt storage system.  It’s interesting that access to naturally occurring NaNO3 deposits avoids embodied CO2 emissions in the plant that would otherwise occur if the NaNO3 had to be synthesised using natural gas.


The information on the web did not explicitly state the annual power output of the system, so I’ll estimate this in two ways.


If the Capacity Factor is 95%, then the annual output will be 0.95 × 110 × 365 × 24 = 915,420 MWh.


On the other hand, if 643,000 t CO2 are avoided per year, then I estimate the power produced as 643,000/0.7 = 918,571 MWh/yr.  Here I have assumed the emissions intensity of the Chilean generation system is 0.7 t CO2 per MWh, which is reasonable, I think, since the generation capacity in Chile is (according to Wikipedia) 33% hydro, 13% oil, 30% gas and 20% coal. 


Those estimates are very close.  Let me use the figure based on Capacity Factor: 915,420 MWh/yr.


I’ll analyse the Levelised Cost of Electricity (LCOE) for the Cerro Dominador project using my standard assumptions:

 

  • there is no inflation,
  • taxation implications are neglected,
  • projects are funded entirely by debt,
  • all projects have the same interest rate (8%) and payback period (25 years), which means that the required rate of capital return is 9.4%,
  • all projects have the same annual maintenance and operating costs (2% of the total project cost), and
  • government subsidies are neglected.

 

For further commentary on my LCOE methodology, see posts on Real cost of coal-fired power, LEC – the accountant’s view, Cost of solar power (10) and (especially) Yet more on LEC.  Note that I am now using annual maintenance costs of 2% rather than 3% as in posts during 2011.

 

The results for Cerro Dominador are as follows:

 

Cost per peak Watt              USD 9.09/Wp

LCOE                                     USD 125/MWh

 

The components of the LCOE are:

Capital           {0.094 × USD 1 × 10^9 }/{915,420 MWhr} = USD 103/MWhr

O&M              {0.020 × USD 1 × 10^9 }/{915,420 MWhr} = USD 22/MWhr

 

By way of comparison, LCOE figures (in appropriate currency per MWh) for all projects I’ve investigated are given below.  The number in brackets is the reference to the blog post, all of which appear in my index of posts with the title “Cost of solar power ([number])”:

 

(2)        AUD 183 (Nyngan, Australia, PV)

(3)        EUR 503 (Olmedilla, Spain, PV, 2008)

(3)        EUR 188 (Andasol I, Spain, trough, 2009)

(4)        AUD 236 (Greenough, Australia, PV)

(5)        AUD 397 (Solar Oasis, Australia, dish, 2014?)

(6)        USD 163 (Lazio, Italy, PV)

(7)        AUD 271 (Kogan Creek, Australia, CLFR pre-heat, 2012?)

(8)        USD 228 (New Mexico, CdTe thin film PV, 2011)

(9)        EUR 200 (Ibersol, Spain, trough, 2011)

(10)      USD 231 (Ivanpah, California, tower, 2013?)

(11)      CAD 409 (Stardale, Canada, PV, 2012)

(12)      USD 290 (Blythe, California, trough, 2012?)

(13)      AUD 285 (Solar Dawn, Australia, CLFR, 2013?)

(14)      AUD 263 (Moree Solar Farm, Australia, single-axis PV, 2013?)

(15)      EUR 350 (Lieberose, Germany, thin-film PV, 2009)

(16)      EUR 300 (Gemasolar, Spain, tower, 2011)

(17)      EUR 228 (Meuro, Germany, crystalline PV, 2012)

(18)      USD 204 (Crescent Dunes, USA, tower, 2013)

(19)      AUD 316 (University of Queensland, fixed PV, 2011)

(20)      EUR 241 (Ait Baha, Morocco, 1-axis solar thermal, 2012)

(21)      EUR 227 (Shivajinagar Sakri, India, PV, 2012)

(22)      JPY 36,076 (Kagoshima, Kyushu, Japan, PV, start July 2012)

(23)      AUD 249 (NEXTDC, Port Melbourne, PV, Q2 2012)

(24)      USD 319 (Maryland Solar Farm, thin-film PV, Q4 2012)

(25)      EUR 207 (GERO Solarpark, Germany, PV, May 2012)

(26)      AUD 259 (Kamberra Winery, Australia, PV, June 2012)

(27)      EUR 105 (Calera y Chozas, PV, Q4 2012)

(28)      AUD 205 (Nyngan and Broken Hill, thin film PV, end 2014?)

(29)      AUD 342 (City of Sydney, multiple sites, PV, 2012)

(30)      AUD 281 (Uterne, PV, single-axis tracking, 2011)

(31)      JPY 31,448 (Oita, PV?, Japan, to open March 2014)

(32)      USD 342 (Shams, Abu Dhabi, trough, to open early 2013)

(34)      USD 272 (Daggett, California, designed 2010)

(35)      GBP 148 (Wymeswold, UK, PV, March 2013)

(36)      USD 139 (South Georgia, PV, June 2014)

(37)      USD 169 (Antelope Valley, CdTe Pv, end 2015)

(38)      AUD 137 (Mugga Lane, PV, mid 2014)

(39)      AUD 163 (Coree, fixed PV, Feb 2015)

(40)      AUD 298 (Ferngrove Winery, July 2013)

(41)      USD 125 (Cerro Dominador, mid 2017)

 

Conclusion

 

You can compare results in the graphic shown in my last post, which expresses costs in USD/MWh at the exchange rates of 6 December 2013.   (Currencies deflated at 1.75% per annum, baseline date is end 2014.  Red is for solar thermal, blue for PV.  Filled-in circles denote completed projects, open circles denote announced projects.)

 

According to my methodology, the LCOE for Cerro Dominador is outstanding, about one quarter of that for Gemasolar (number 16 on the list) and one third of that for Shams (number 32 on the list).  We have been hearing for some time that the cost of CST projects with storage would eventually start to fall quickly.  If the data above for Cerro Dominador is accepted, then we now have evidence for the drop in prices.


Footnote:  One other factor to be taken into account is the solar resource near Antofagasta.  A little web searching today indicates to me the resource is the best in the world.  That's probably worth a few tens of dollars per MWh.