Business, Energy

100MW Solar Plant planned in China

11.21.06 | Comment?

A follow-up story from yesterday’s entry, there is a report out today that China intends to build the world’s largest solar electricity generation plant, 100MW. To put that in perspective, it’s about 1/2 the size of a traditional coal fired generation plant and about 10x the largest solar installations on the planet. If you’ve ever wondered why we don’t see more solar plants, the clues are in the report.

A year has 8,760 hours in it. In this report the selected site has an outstanding 3,362 hours of sunlight. That would yield a capacity factor of a little over 38% (good compared to the 25% normally achieved by solar.) To translate that into something more tangible, the system is rated at 100MW x the 38% capacity factor means that around 38MW output can be expected from the installation. Each MW provides enough electricity for about 600 households per year (US – I’m sure China is substantially different due to lower electricity demand per capita.)

The announced cost for this installation is $766M, or $7.6M per nameplate MW, or $20.1M per capacity factor constrained MW. Even amortized over decades, it’s difficult to see the economic payback from such an installation. To put solar cost in perspective, one would expect to pay $1M/MW for wind, $750k/MW for natural gas, and $3M/MW for geothermal. My sense is we’re still a technology generation or two away from economically viable solar electric generation at utility scale.

I think solar energy generation is great and I laud China for stepping up with an audacious plan, but I do believe there are more economically viable ways to achieve the same result. I’ll watch this project with interest as it unfolds.

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