Concentrated solar power (CSP) has emerged as one of the most promising renewable energy technologies in the past decade. While traditional solar photovoltaic technologies directly convert sunlight to electricity, CSP uses mirrors or lenses to concentrate sunlight onto a receiver that heats a working fluid to high temperatures. This thermal energy can then be used to drive a steam turbine and generate electricity.
Global CSP capacity has been growing steadily since 2010 as costs have declined significantly with larger-scale deployment. As of 2020, over 6 gigawatts of CSP plants have been installed worldwide, primarily in Spain, the United States, the Middle East and North Africa. These facilities have demonstrated CSP's ability to provide reliable baseload power by integrating energy storage in the form of molten salt. With favorable policy support and further technological advances, the International Energy Agency (IEA) projects global CSP capacity to reach over 25 GW by 2030.
Cost Competitiveness Through Economies of Scale
One of the greatest successes of Concentrated Solar Power has been achieving cost competitiveness through economies of scale. Early demonstration plants commissioned in the 1980s and 1990s had high generating costs above 30 cents/kWh due to low-capacity factors and limited deployment experience. However, as projects grew in size from tens to hundreds of megawatts, costs began falling rapidly.
The IEA estimates the levelized cost of electricity from utility-scale parabolic trough or power tower plants coming online today ranges from 6-13 cents/kWh without storage and 13-18 cents/kWh with storage. This puts CSP on par with or lower than new natural gas-fired generation. Developers are now shifting focus to "gigawatt-scale" facilities which promise to drive costs down further to the 5 cents/kWh range. Larger size also enhances reliability and enables greater utilization of shared infrastructure.
Reliable Baseload Power Through Thermal Storage
One of the main challenges of solar and renewable energy has traditionally been intermittency due to variability of resources like sunlight. However, concentrated solar power uniquely overcomes this by facilitating cost-effective thermal energy storage on both the utility and power tower designs. Molten salt is most commonly used - it acts as a heat transfer fluid to transport high-temperature heat (565°C) from the solar field to the power block after sunset.
With 6-15 hours of thermal storage possible in commercially available plants today, the resulting load factors rival or exceed conventional fuels. Storage allows facilities to generate electricity even when the sun isn't shining. As a result, CSP with storage provides reliable, on-demand baseload power to the grid without emitting any carbon. Developers, utilities and system operators are recognizing this dispatchable solar advantage.
Market Growth and New Geographies
Spain was historically the epicenter of CSP market deployment due to an early and sustained commitment to the technology. Its five commercial plants totaling over 2 GW of capacity demonstrated CSP's technical viability at a commercial scale.
However, concentrated solar power landscape is diversifying significantly. The United States continues expanding capacity from initial installations in California and Nevada. New markets are emerging across the Middle East and North Africa where high DNI resources make the technology increasingly cost-competitive. Countries like the UAE, South Africa, Chile, India, Australia, and China are developing multi-hundred-megawatt facilities.
While high upfront capital costs remain a challenge, supportive policies and the prospect of future lowering costs are driving more countries to explore CSP as a climate-friendly, local energy solution. As deployment grows to GW-scale worldwide, the future appears bright for concentrated solar power to increasingly contribute to sustainable, reliable and low-carbon electricity generation globally. With further cost declines expected, developers remain confident in CSP's long-term prospects.
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Alice Mutum is a seasoned senior content editor at Coherent Market Insights, leveraging extensive expertise gained from her previous role as a content writer. With seven years in content development, Alice masterfully employs SEO best practices and cutting-edge digital marketing strategies to craft high-ranking, impactful content. As an editor, she meticulously ensures flawless grammar and punctuation, precise data accuracy, and perfect alignment with audience needs in every research report. Alice's dedication to excellence and her strategic approach to content make her an invaluable asset in the world of market insights.
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