Drivers and Barriers in the current CSP market

Pictures Source: by NDA protections most of pictures are from public internet domains11

Drivers and Barriers in the Current Concentrated Solar Power Market

Pictures Source: by NDA protections most of pictures are from public internet domains

Contents

1. Altran Group Presentation2. Solar Activity within Altran3. Introduction to CSP Industry,

Technologies and Markets4. The basics of CSP Technology

• Parabolic Trough System• Central Receiver or Power Tower• Linear Fresnel Reflector System• Dish System

5. CSP Performance per technology6. CSP Costs7. CSP Market

• Drivers• Barriers• Value Chain• CSP Worldwide Capacity (MW)

8. Conclusions

Pictures Source: by NDA protections most of pictures are from public internet domains

26 years of innovation 3 continents: Europe, Asia, Americas Partner with the largest multinational companies : 500 large accounts accompanied in 40 countries

Global Partner

Employees June 08: 18 000 June 07: 17 200

Sales Turnover 2007 : 1,591 Md € 2006 : 1,495 Md €

Employees June 08: 18 000 June 07: 17 200

Sales Turnover 2007 : 1,591 Md € 2006 : 1,495 Md €

Long-term collaboration

1. The Altran Group

Strategy and Management

Organization and Informations Systems

Technology and R&D

EUROPEAN LEADER IN INNOVATION CONSULTING

•A global innovation partnercovering the whole innovation cycle

•Presence in all market sectors

• Innovation Projects at the forefront technology around the world

Pictures Source: by NDA protections most of pictures are from public internet domains

Strategy and management consulting*

Sales 2007: 20%

Strategy and management consulting*

Sales 2007: 20%

Technology and innovation consulting

Sales 2007: 47%

Technology and innovation consulting

Sales 2007: 47%

IT and organisation consulting

Sales 2007: 33%

IT and organisation consulting

Sales 2007: 33%

Automotive, Road & Engineering

Sales 2007: 19%

Automotive, Road & Engineering

Sales 2007: 19%

Aerospace & Defence

Sales 2007: 16%

Aerospace & Defence

Sales 2007: 16%

EnergyEnergy, Life-Sciences & other industries

Sales 2007: 22%

EnergyEnergy, Life-Sciences & other industries

Sales 2007: 22%

Telecoms, Media, Electronics & Services

Sales 2007: 24%

Telecoms, Media, Electronics & Services

Sales 2007: 24%

Finances & Government

Sales 2007: 19%

Finances & Government

Sales 2007: 19%

The Altran group

Pictures Source: by NDA protections most of pictures are from public internet domains

CSPCSPPVPV CPVCPV

2. Solar Services

Products Processes ProjectsR & D

Development Engineering•Feasibility•Product Design•System Engineering•Simulation and Analysis•Software Development

Product Optimization•Benchmarking•Design to Cost•Quality Improvement•Testing•Failure Analysis•Reengineering

Innovation•Systematic Analysis•Time to Market Analysis•Innovation Management•Innovation Certification•Technology Surveillance

Technical Office•Basic and Detailed Engineering•Systems Engineering•Execution Engineering•Technical Assistance to Execution•RAMS Analysis on Processes

Owners Engineering & Controlon Execution

•Owner’s Engineering•Execution Control•Quality Assurance•Technical Audits•Commissioning

After Sales, Warranties, O&M•Claims Management•Maintenance Protocols•SW for Operation & Maintenance

Process Engineering•Feasibility studies•Simulation and Analysis•Production Improvement•MES Manufacturing•RAMS Analysis on Processes

Process Management•Supply Chain Management•Supply Quality Assurance•Quality Management•Testing

Process Optimization•Lean Manufacturing• Quality Improvement•RAMS Improvement•Innovation in Processes

Pictures Source: by NDA protections most of pictures are from public internet domains

3. Introduction to CSP Industry, Technologies and Markets

• Which are the most important technologies related with the thermal application of CSP?

• Which are their advantages and disadvantages?

• Which technology is the most developed?

• What are the real investment costs?

• Which are the expectations for the near-future?

This presentation is based on the “Global Concentrated Solar Power Industry Report 2010 - 2011”. This report provides the latest information on the thriving Concentrated Solar Power (CSP) industry, including essential cost and performance data on the four main CSP technologies: Parabolic Trough, Power Tower, Fresnel and Dish Stirling.

Pictures Source: by NDA protections most of pictures are from public internet domains

4. The basics of CSP Technology

• The basics of CSP Technology

• How CSP works: description of the technology

Thermodynamics

• Brief history of CSP and current state

• Brief description of main configurations

• Storage

• Main Requirements: solar (DNI), land requirements (ft2 and m2 per MW), water usage, etc.

Pictures Source: by NDA protections most of pictures are from public internet domains

4.1. Parabolic Trough System

• Parabolic trough technology is currently the most proven CSP technology, and therefore the more developed and standardized system.

Characteristic Parabolic Trough

Plant power 30 – 300 MW

Annual Capacity Factor 23 – 56 %

Peak Efficiency 20 %

Annual net efficiency 11-16%

Maximum Cycle Temperature 300 – 400 ºC

Cycle Rankine Cycle

Optical Concentration Ratio (from Collector)

28:1 (LS3)82:1 (ET150)

Area collector 34-550 m2

Receiver absorptivity 0.94 - 0.99

Thermal storage 0-12 Hours

Pictures Source: by NDA protections most of pictures are from public internet domains

4.2. Central Receiver or Power Tower

• Power Tower systems are reaching their commercial feasibility and seem to be the next step in the development of CSP technology.

• Power Tower systems use a circular or semicircular array of heliostats (individually tracking large mirrors) to focus sunlight onto a central receiver mounted on top of a tower.

• Solar radiation is concentrated on a relatively small surface so it’s possible to achieve a high concentration ratio and therefore efficiently operate at high temperatures

Characteristic Power Tower

Plant power 10 – 200 MW

Annual Capacity Factor 20 – 78 %

Peak Efficiency 19 – 23 %

Annual net efficiency 7 – 20 %

Maximum Cycle Temperature

585 ºC

Cycle Rankine

Area heliostat 40 – 120 m2

Thermal storage 7 – 15 Hours

Pictures Source: by NDA protections most of pictures are from public internet domains

4.3. Linear Fresnel Reflector system

• A linear Fresnel reflector power plant uses a series of long, narrow, shallow-curvature (or even flat) mirrors to focus light onto one or more linear receivers positioned above the mirrors.

• On top of the receiver a small parabolic mirror (secondary reflector) can be attached for further light focusing.

Item Fresnel

Annual Net Efficiency 13%

Peak Efficiency (electric-solar) 18%

Plant availability 94%

Capacity Factor 25-90%

Temperature of Operation 390ºC

Annual Electricity Yield 316 kWh/m²a

Water consumption per MWe760-920 gal/MWhe

(plus other uses 8gal/MWhe)

Land Requirements 1,800 m2/MW

Land Use m2/MWh/year 4-6

Storage (hours) 0-12hours

Storage (medium) Steam

Technological maturity Medium

Power Capacity Range 2-200MW

Pictures Source: by NDA protections most of pictures are from public internet domains

4.4. Dish system

Characteristic Dish Stirling

Unit power 5 – 25 kW

Annual Capacity Factor 24 – 25 %

Peak Efficiency 29,4 %

Annual net efficiency 12 – 32 %

Maximum Cycle Temperature 800 ºC

Cycle Stirling/Brayton

Reflectivity 92 - 94

Area collector 91 m2

Receiver efficiency 90

Thermal storage Not possible

• Dish/Engine systems use an array of parabolic dish-shaped mirrors (stretched membrane, flat glass facets or curved glass facets) to focus solar energy onto a receiver located at the focal point of the dish, which means a three dimensional radiation concentration.

Pictures Source: by NDA protections most of pictures are from public internet domains

5. CSP Performance per technology

• Performance Comparison between different CSP technologies

• Possible performance improvements

Impact of a higher operating temperature

Impact of a simplification of the system brought about by Direct Steam Generation

General Considerations

Performance Parameters

Seasonal and hourly variations of electrical yield

Storage and Hybridization

Pictures Source: by NDA protections most of pictures are from public internet domains

6. Costs of CSP Technology

General considerations:

• Scale of the project

• Performance

• Solar Resources

• Terms of financing

• Impact of Tax Credits and Regulations

Current Costs per Technology

• Parabolic Trough

• Tower

• Fresnel

• Dish

Perspectives for CSP Cost Reductions

Pictures Source: by NDA protections most of pictures are from public internet domains

Current Costs per Technology

Item Parabolic Trough Power tower Fresnel Dish

Initial Investment Cost (without storage) 4.0 – 6.5 $/We 4.0 – 6.5 $/We 3.0 – 7.0 $/We 1.14 – 10.0 $/We

Initial Investment Cost (with storage) 5.0 - 8.0 $/We 5.0 -7.0 &/We 4.0 – 8.5 $/We -

Initial Investment Cost Solar Field58% of the Investment

cost43% of the Investment

cost43% of the Investment

cost60% of the Investment

cost

Initial Investment Cost Power Block14% of the Investment

cost

13% of the Investment cost (the tower supposed the 4% and the receiver

18%)

18% of the Investment cost

35% of the Investment cost

Initial Investment Cost Steam Generation3% of the Investment

cost9% of the Investment

cost7% of the Investment

cost-

Initial Investment Cost Control2% of the Investment

cost2% of the Investment

cost5% of the Investment

cost5% of the Investment

cost

Initial Investment Cost O&M 0,01 – 0,04 $/kWhe 0.02 -0.09 &/kWhe 0.009 – 0.05 $/kWhe 0.01 – 0.05 $/kWhe

Initial Investment Cost Balance of Plant 120 – 500 $/kW 100 – 400 $/kWe - 200 – 280 $/kW

Initial Investment Cost Storage20 – 30 % increases

Investment cost20 – 30% increases

Investment cost20 – 30% increases

Investment cost-

LEC 0.14 – 0.40 $/kWhe 0.04 – 0.07 $/kWhe 0.20 – 0.40 $/kWhe 0.28 – 0.35 $/kWhe

Pictures Source: by NDA protections most of pictures are from public internet domains

7. CSP Market

Introduction to the CSP market

General Overview of the Industry

7.1 Drivers• CSP can enhance Energy security Energy security in electricity generation.

• The fluctuating Price of Fossil Fuels fluctuating Price of Fossil Fuels has an important impact in the economy of countries, the use of CSP plants reduce the energy dependence.

• Job creationJob creation: 500 jobs are created during the construction period of a 50 MW CSP plant, and about 50 will be permanents for O&M.

• Climate changeClimate change: 70,000-149,000 tons of CO2 emissions are avoided with a 50MW CSP plant.

• Government incentivesGovernment incentives and regulationand regulation: It is important that governments provide with mandates and energy policies or incentives. (Example of FiT, Tax Credits, Tax Incentives, etc…)

Pictures Source: by NDA protections most of pictures are from public internet domains

7.2. Barriers

• The high Capital CostCapital Cost of CSP Technologies leads to a high LCOE and makes project financingfinancing more difficult, compared to technologies that are fuel-cost intensive.

• Geographical risksGeographical risks (high DNI, near water source, flat land and a good connection to

the grid is needed for a CSP plant)

• Long Permitting processes, Long Permitting processes, which directly affect the total cost of the project

• Technological uncertaintyTechnological uncertainty with constant improvements and cost reductions

• Lack of transmission capacityLack of transmission capacity will limit the amount of power that can be exported

Pictures Source: by NDA protections most of pictures are from public internet domains

7.3 CSP Value Chain

Pictures Source: by NDA protections most of pictures are from public internet domains

7.4. CSP Capacity and Projects worldwide (in MW)

Worldwide Operating P lants (% P er T ec hnolog y)

88%

7%5% 0%

P arabolic T rough F resnel C ollector T ower S ystem Dish S tirling

• Plants in operation• Plants under construction• Planning plants

Worldwide P lants Under C ons truc tion (% P er C ountry)

88,9%

0,0%

3,3%2,0%

1,6%

1,3%

0,3%

2,6%

0,1%

S pain US A G reece E gypt Morocco Algeria Australia Italy F rance

Pictures Source: by NDA protections most of pictures are from public internet domains

8. Conclusions (I)

• A high level of direct normal irradiation (DNI) is needed for the operation of

CSP plants (2,500 kWh/m2/yr is recommended). This requirement limits

the geographical areas where CSP is feasible to the following areas:

Southern Europe; Middle East and North Africa; Southern Africa; Some

region in India; North-western and central Australia; Northern Mexico;

South-Western and Mid West USA and Andean Plateau.

• Technological improvements are needed to reach higher performance: Increasing operating temperature

Energy Storage

Reducing water consumption

• Parabolic Trough is the most mature technology, followed by Power Tower and Fresnel. The less mature is Dish technology.

Pictures Source: by NDA protections most of pictures are from public internet domains

8. Conclusions (II)

• Installed CSP power capacity worldwide is about 700MWe. USA is the country with more plants in operation with about 443 MW.

• Spain is second with about 230 MW in operation, and 1,367 under construction. When finished, Spain will be at the forefront in installed capacity with more than 1,500 MW.

• The main drivers for the CSP Technology development are: • Government Mandates for Renewables• Energy security, linked to the fluctuating price of fossil fuels. • Job creation opportunity• Climate change• Government incentives and regulation

• CSP technologies have a great potential, but nowadays they face a number of market barriers such as political instability, insufficient legal and administrative structures, economic vulnerability or lack of infrastructures.

However, in developing countries it is expected to minimize them in the near future.

Pictures Source: by NDA protections most of pictures are from public internet domains21

www.mediaconsult.es

www.altran.com\es

www.altran.comwww.csptoday.com

More information about CSP in the

Global Concentrated Solar Power Industry Report 2010 – 2011

www.csptoday.com/globalreport

For further information about Altran, please get in contact with David Pérez:

[email protected]