As the solar energy movement progresses the efficiency and cost-benefit ratios can be examined to determine which technologies will serve us best. Concentrating solar power (CSP) is one such vein in the solar technology movement. Unlike photovoltaic generation, which converts light energy to electricity, CSP uses thermal energy to produce electricity (Shioshanasi and Denholm 2009). CSP value was analyzed at various sites in the American Southwest. It was shown that CSP is made more valuable by implementing thermal energy storage (TES) which allows for increased capacity of plants as well as greater profit by shifting production to hours of higher energy prices. Despite these advantages, it was determined that CSP with TES cannot be justified at current capitol costs, but CSP alone will become more economic with further cost reductions. — Teija Mortvedt
Sioshansi, R., Denholm, P., 2010. The Value of Concentrating Solar Power and Thermal Energy Storage. iwse.osu.edu.
Shioshansi and Denholm worked to model the capabilities and costs of CSP using data from four sites in the southwest: Gila Bend (Arizona), Daggett (California), Southern New Mexico, and Western Texas. They evaluated plants both with and without TES. With TES a larger solar field could be built and plant layout and size would be dramatically affected. Field size determines plant capacity so this is an important consideration. If the solar field is too small, the power block will be underused and inefficient, 2nd capacity will be lower. If the solar field is too large thermal energy will be wasted because the plant will not be able to utilize all the energy collected.
The study analyzed operating profits of CSP plants with different sized solar fields and three different levels of TES. TES always increased operating cost and it was seen that cost varied significantly with location and plant size. Location differences can be attributed mainly to energy price differences by location.
CSP makes it possible to hold electricity at any moment in anticipation of energy prices the next day. They assume prices are known only one day in advance although predictions of multiple days may be available in the future. This feature allows given amount of energy generation to be sold at the highest price but the analysis was based on the assumption of perfect foresight into the future, which in practice is not true. Regardless, it was determined that this model was profitable without 100% foresight.
CSP with TES is currently not an economic option anywhere but in Texas where energy prices, and therefore profits, are higher. It is assumed that CSP is eligible for investment tax credit (ITC) of 30% currently or a possible reduced 10% in the future due to CSP cost reductions. The 30% ITC makes CSP without TES an economic option only at the Texas site, and with TES economic in Texas and Daggett. CSP will become a more economic with technological increases and cost reductions in the future.