We’ve been tracking solar thermal for some time as it is intended to be part of our Sou Hills project in due course. One of the more interesting players to enter the fray is Ausra, an Australian company transplanted to the US and the recipient of substantial funding from Khosla Ventures. Recently, David Mills and Robert Morgan, principals in Ausra, published a paper in which the claim is made that solar thermal could account for the entire US energy supply. Here’s a link to their paper.

It’s not lost on most people that the Sun does not shine 24×7 and, in fact, that it doesn’t shine every day even in a desert environment. Thus the stunningly low capacity factors delivered by solar solutions, both thermal and PV. However, with the advent of storage (water, pumped water, capacitors, and molten salts) this is beginning to change somewhat. The thesis advanced by Mills and Morgan is that an oversized solar array matched with a huge storage system sufficient for 16 hours of operation would be able to produce at baseload levels.

The “catch” to this whole approach is that to make the system work at baseload, a developer has the added cost of sizing the solar array 3x larger than normal and installing a huge storage system. Nevada Solar One is a 64MWe project that cost somewhere north of $250M in capital to complete. That’s around $3.9M/MWe at normal sizing. If we consider that the storage system is “free” and up the size 3x, that’s $750M+ capital cost to get 64MWe baseload generation, or $11.7M/MWe. To put this in perspective, a natural gas fired plant is on the order of $1M/MWe, clean coal is $3M/MWe, geothermal is $3M/MWe.

That’s not to say that the economics won’t change, as solar thermal becomes higher volume in production, the price should drop. If the price drops by 2/3, then there is an interesting discussion to be had, because sunshine is an underutilized resource. Also, we found the discussion about oil in the paper to be specious, less than 2% of the US energy load is generated with petroleum based products. If the authors wish to be taken seriously, they would address the technology vs. coal, nuclear, and natural gas generation as they are the top 3 producers of electricity in the US.

Nevertheless, it is an interesting assertion and it’s clear we can and should do more with solar thermal harvest than is happening today. Let’s hope Ausra and their cohorts can change the economic model to make this option viable.

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It’s not only about sustainability, but it’s also about $. After all, eco- is a prefix in ecology as well as economy. Recently due to a comment on the blog a new site came to our attention, Cleantech Finance Insider. Since we happen to be acquainted with the author and the initial content has been such high quality, we thought we’d give it a plug.

So, you want to spin up a renewable energy project and change the world? Yes? Well, read the three part series on Renewable Energy Startups keys to Success on Cleantech Finance Insider. It’s a great place to start and the perspective painted by Bill in these entries certainly rings true to us. If you’re looking for a distinct voice on the finance part of the house, add Cleantech Finance Insider to your RSS reader.

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Yesterday Canada’s Financial Post authored an interesting article about the nascent geothermal industry and how the stocks of several of the publicly traded North American companies are appreciating. It’s true investors are late to the party in this segment; geothermal has none of the sexiness of a solar or wind play (we maintain this is so because it’s difficult for an amateur to look at the earth and say “bet there’s some steam here, let’s build a plant.” Unlike solar or wind where most people can notice the natural resource “hey, it’s real sunny here” or “hey, it’s real windy here”…)

We like to think of geothermal as being the deep thinker’s renewable (pun intended.) The resource is most often hidden, it requires an understanding of basic thermodynamics, and it has the best yield in megawatt hours of all the renewables. (OK, we’ll listen to arguments about gravity hydro which is also quite good.) Here’s a quote from the article:

Sierra Geothermal, Nevada Geothermal Power Inc. (NGP/TSX-V), and Western GeoPower Corp. (WGP/TSX-V) are listed on the TSX Venture Exchange. Polaris Geothermal (GEO/TSX) and U.S. Geothermal Inc. (GTH/TSX) are listed on the main Toronto Stock Exchange.

The largest geothermal company in the world is Or-mat Technologies Inc., (ORA/ NYSE) with a market cap of almost US$2-billion. The seventh North American geothermal company is Raser Technologies Inc. (RZ/PCX), which trades on the ArcaEx.

This enumeration of companies is interesting, but there are some pretty major gaps in this analysis starting with the omission of the largest geothermal operator on the planet, Chevron with nearly 2,000 MWe of production power, mostly in Indonesia and the Philippines (and it sports a market cap of $184B.) Also, there is the omission of large private developer/operators like Caithness/ARCLight who have as large, if not a larger geothermal portfolio as Ormat (~370MWe) – Coso alone for Caithness/ARCLight is a set of 260MWe facilities.

That nitpicking aside, the tone of the article is encouraging and this kind of press can only help in getting the message out that geothermal is a large part of the solution in our march toward energy security and independence.

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Neal Hot Springs in Eastern Oregon, a potential resource uncovered by Chevron in 1979, is now in play. US Geothermal recently announced plans for a full-scale test drilling program that includes plans for a 1,000m (~3,500f) hole to determine the extent of the resource in the area. Geothermometer temperatures are predicted around the 150C (~310F) range.

US Geothermal has taken the Raft River project from prior exploration to commercial operation previously.

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For awhile there, Raser was releasing a new press release every couple of days for the most minor of events. But now, it’s clear that Raser has entered the geothermal development business in a very serious way and has had some significant steps in transforming into a geothermal power producer. Recently, Raser CEO Brent Cook granted an interview to The Street in which he reiterated the company’s grand plans and vision including announcing 100MW of projects per year (not necessarily finishing) for the first few years, and 150MW per year thereafter in 10MW increments.

This comes on the heels of the news that the company has completed its first well in Utah where a 127C (260F) resource was apparently hit in the Escalante desert region. Their drilling program is proceeding even as the resource is being evaluated for commercial applicability. Coupled with their promise of 155MW worth of funding, this breakthrough puts Raser closer to operation than ever before and moves them into the column of serious developer.

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