Green Wombat

Green Wombat has written a lot lately about the greening of the data center and efforts by companies like Sun Microsystems (JAVA), Google (GOOG), Intel (INTC), and Advanced Micro Devices (AMD) to slash the power consumption of energy-hungry servers. But perhaps the ultimate eco-friendly server farm is a small 100 percent solar-powered data center in the Southern California desert called AISO.net. Green Wombat visited AISO co-founder and CTO Phil Nail recently for a story that appears in the final issue of Business 2.0 magazine and is now available online.

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photo: slinger5
Denver International Airport is installing a 2-megawatt solar array to provide up to half the electricity needed to power the facility’s people-mover transit system. In an increasingly common financial  arrangement for commercial solar installations, green energy financier MMA Renewable Ventures (MMA) will finance and own the project and sell the electricity it produces to the airport under a long-term power purchase agreement.

The twist here is that Colorado utility Xcel Energy (XEL) will buy the renewable energy credits associated with the solar project and use them to help fulfill its obligation to source 20 percent of its electricity from renewable sources by 2020. (In many states solar, wind and other renewable energy projects are assigned RECs to account for the value of the clean power they produce. Such credits then can sold or traded.) Under Colorado law, utilities can use such credits to meet that mandate. All in all a good deal for MMA Renewable Venutures, which as owner of the project will sell the RECs, receive a rebate from Xcel to help offset construction costs, get a hefty federal tax break, and receive guaranteed revenue from the electricity the solar array produces. 

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In another big boost for the economic viability of large-scale solar power plants, California utility PG&E said today it will buy an additional 1,000 megawatts of solar thermal power over the next five years. That’s on top of the gigawatt the utility already has committed to purchase.

"PG&E (PCG) has identified solar thermal technology as a reliable energy source that can provide millions of American electric customers with some of the cleanest and most cost-effective renewable energy,"
said PG&E CEO Peter Darbee in a statement. A 1,000 megawatts  of solar electricity would power about 750,000 homes, according to PG&E.

One likely beneficiary PG&E’s pledge is Silicon Valley solar startup Ausra. The company, backed by green investor Vinod Khosla and venture capital firm Kleiner, Perkins, Caufield & Byers, has been negotiating with PG&E to build solar power plants for the utility. Ausra executive vice president John O’Donnell declined to comment on the status of those negotiations.

So far PG&E has signed a deal for a 553-megawatt plant with Israeli solar company Solel and is continuing to negotiate a 500-megawatt deal with BrightSource Energy, the Oakland, California-based company founded by solar pioneer Arnold Goldman. Today’s commitment, made at the  Clinton Global Initiative summit in New York City, would make PG&E the nation’s largest solar utility, putting it ahead of California utilities Southern California Edison (EIX) and San Diego Gas & Electric (SRE). The announcement comes as Florida utility FPL (FPL) said it will spend $1.5 billion over the next seven years to build solar thermal power plants, including a 300-megawatt power station using Ausra’s technology.

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In a sign that Big Solar is moving beyond the California desert, Florida utility FPL says it will spend $1.5 billion over the next seven years to build solar power plants in the Sunshine State. That includes a 300-megawatt solar power station using technology developed by Ausra, the Silicon Valley startup backed by green energy investor Vinod Khosla and venture capital powerhouse Kleiner, Perkins, Caufield & Byers.

“It has been widely believed that big solar power was economically viable in the U.S. only in the Southwest, and much of the institutionalized resistance to changing direction has come from the Southeast, an area thought to be renewables-poor,” Ausra executive vice president John O’Donnell told Green Wombat. “The FPL announcement lays down a marker that we can do renewables in the Southeast as well. Florida has perhaps the most at stake in climate change, with about 40 percent of its land mass due for submersion this century in the `business as usual case.’”

FPL (FPL) chairman Lewis Hayes echoed that sentiment. “Florida has much at stake with global warming,” he said in a statement. “FPL Group has evaluated Ausra’s new
solar thermal technology, and we view this breakthrough technology as a promising option to  make solar energy an economically sound addition to our power generation going forward.”

The utility will first build a 10-megawatt solar power plant with Ausra’s solar thermal technology, which uses long flat mirrors to focus the sun’s rays on tubes of water suspended over the arrays. The superheated water creates steam that drives an electricity-generating turbine. FPL is veteran solar power operator and currently runs seven solar power plants built in California’s Mojave Desert in the 1980s.

Ausra and FPL did not announce any specific contract today, a sign that a final agreement has not been signed. Such a deal would be a big boost to Ausra, which also has been negotiating with California utility PG&E (PCG). Ausra chairman David Mills told Green Wombat the company will soon file a development application with the California Energy Commission to build a 175-megawatt solar power station. To date, PG&E and California utilities Southern California Edison (EIX) and San Diego Gas & Electric have signed deals to buy nearly 3 gigawatts of solar thermal electricity.

FPL also said it will spend $500 million to construct a smart metering network that will allow consumers to go online and monitor their electricity consumption in real time. The hope is that such a metering widget will encourage people to conserve electricity – and save money – by running energy-hogging appliances when demand is low.

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In a sign that the nascent solar power plant industry is reaching
the point where the name of the game is less about developing new
technologies and more about managing large-scale construction projects, Silicon Valley solar company Ausra is tapping an energy industry veteran to lead the startup. Robert Fishman, 55, is leaving Calpine, a San Jose-based power company, to become
Ausra‘s CEO. As executive vice president of Calpine, Fishman managed natural gas and geothermal power plants that produce 24,500 megawatts of electricity. "This is exactly the type of experience Ausra needs as it scales rapidly into a large, utility-grade provider of cost-effective, reliable, zero carbon electricity for the world,” said venture capitalist Vinod Khosla, an Ausra investor and board member, in a statement. Ausra relocated to Palo Alto from Sydney, Australia, last year and has attracted big-name investors like Khosla and Kleiner, Perkins, Caufield & Byers, which have poured more than $40 million into the company. Founding CEO Peter Le Lièvre will manage the company’s international projects, including a demonstration power plant being constructed in Portugal. Ausra is negotiating with California’s PG&E (PCG) and other U.S. utilities to construct massive megawatt power plants and is expected to file an application with the California Energy Commission next week to build a 175-megawatt power plant.

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Big Solar – those massive megawatt power plants to be built in California’s Mojave Desert – has been seen at best as an add-on to the power grid. Solar, the conventional wisdom goes, might provide "peaking power" when demand spikes during the day but can never replace the so-called baseload power supplied round-the-clock by coal or natural-gas fired power plants. But in a paper to be presented today at the International Solar Energy Society conference in Beijing, scientist David Mills argues that huge solar farms can replace carbon-spewing power plants and produce electricity at competitive prices for the entire nation.

How? By combining solar thermal power plants with energy storage systems to keep the lights on long after the sun has set, according to Mills, chairman and chief scientific officer of Silicon Valley solar company Ausra. Solar thermal plants like the ones being developed by Ausra use rows of mirrors to focus the sun’s rays on tubes of liquid – water in Ausra’s case – to create steam that drives an electricity-generating turbine. The solar farms would store energy in tanks of liquid that would release the heat for nighttime operation or when clouds pass over. Mills and co-author Robert Morgan calculated that a 92-mile by 92-mile
solar farm in the desert southwest could power the entire country. Analyzing electricity demand data from California and Texas, they figured that solar power plants with 16 hours of energy storage capacity could supply 92 percent of those states’ power at about 8 cents a kilowatt hour – roughly the current cost of fossil fuel-generated electricity. Mills and Morgan believe the same would hold true on a national scale. "Zero emissions technology is required to replace most of current generation by mid-century to meet stringent climate goals," they wrote. "What is now required as a climate safety, economic, and security imperative is a rethink of the function and form of electricity grid networks, and the inclusion of high capacity factor solar electricity technology in the design of continental electricity systems."

That would mean replacing the current AC grid with a DC grid to get solar electricity from sunny states to the rest of the country with minimal transmission losses – an undertaking on the scale and cost of the construction of the interstate highway system in the 1950s. And of course the fossil fuel industry isn’t about to march quietly off to the coal-bin of history. But Mills’s "thought experiment" is less a blueprint for a solar nation than an opening shot in a campaign to shift the power paradigm away from the constraints imposed by coal and nuclear technologies. "Baseload is what those older technologies provided, not what we need," Mills told Green Wombat recently. "We need something that follows the natural load."

In other words, the grid is currently constructed to accommodate capital-intensive fossil fuel plants that need to run 24/7 to be most efficient and economical. The natural load, on the other hand, is the demand for electricity created by people’s and the economy’s daily rhythm. That demand naturally peaks when people are up and about and falls at night when they’re asleep. Renewable energy sources, Mills argues, more closely mirror human behavior. Solar electricity production soars when demand does during the day. At night, stored solar energy and other renewable sources like wind, which tends to blow strongest in the evening, can more closely match lower demand as people and machines wind down.

For its part, Ausra is developing solar storage technology that will be commercially available in about 18 months, according to Mills. The company is expected to file a development application for a 175-megawatt solar power plant next week, a spokesperson for the California Energy Commission told Green Wombat. Ausra has been negotiating with PG&E (PCG) and other utilities. (Along with PG&E, California’s two other big utilities, Southern California Edison (EIX) and San Diego Gas & Electric (SRE) so far have signed deals to buy nearly 3 gigawatts of solar power.)

"We’re hoping to make announcements at the end of the month for multiple projects," Mills says.

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California would become the Saudi Arabia of solar energy if a slew of large-scale solar power plants proposed for the sun-drenched Mojave Desert are built. The federal Bureau of Land Management has received right-of-way requests on 300,000 acres for 34 Big Solar power stations that would generate more than 24 gigawatts of green energy. That disclosure was made in a development application that BrightSource Energy has filed with the California Energy Commission to build a 400-megawatt solar power station complex in the Mojave just across from the Nevada. It’s unlikely, though, that anywhere close to that number of solar power plants will be built in the near future. Still, it’s an indication of the land rush that’s on as solar entrepreneurs start to lock up the best sites. So far, Southern California Edison (EIX) and San Diego Gas & Electric (SRE) have contracted for up to 1.75 gigawatts with Stirling Energy Systems of Phoenix. PG&E (PCG), meanwhile, is negotiating with BrightSource to provide 500 megawatts of solar electricity and has signed a contract for 553 megawatts more with Israeli solar power company Solel. All the projects would be built in or near the Mojave.

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Stealth solar power plant startup Ausra has taken off the wraps, confirming that it has scored more than $40 million in funding from leading green tech investor Vinod Khosla’s Khosla Ventures and marquee VC firm Kleiner, Perkins, Caufield & Byers. Green Wombat sat down with Ausra CEO Peter Le Lièvre and executive vice president John O’Donnell recently at the company’s Palo Alto offices to talk about their plans to jump into the increasingly competitive market for Big Solar.

Ausra, which relocated to Silicon Valley from Sydney last year, is beginning construction of a 6.5-megawatt demonstration power plant in Portugal and says its close to revealing agreements for massive-megawatt solar power stations with major U.S. utilities. "You’ll see announcements of those in the coming weeks," says Ausra executive vice president John O’Donnell, an American who helped hook the Australians up with Khosla and Kleiner Perkins’s Ray Lane.  (In an upcoming story that will appear in the October issue of Business 2.0, Khosla, who sits on Austra’s board, told the magazine that Ausra has been negotiating with California utility PG&E (PCG).)

As solar power companies flock to California and the Southwest to win contracts with the big utilities, the name of the game is developing greenhouse gas-free technology that can deliver electricity at prices competitive with natural gas and other fossil fuels. Some companies, like San Francisco’s GreenVolts and Melbourne’s Solar Systems, are taking a high-tech approach, creating cutting edge technology such as concentrator photovoltaics that rely on sophisticated solar cells. Others, like Ausra, are putting twists on a tried-and-true technology like solar troughs to drive down costs.

"It’s this least cost mentality applied throughout," says Le Lièvre as Ausra co-founder and chairman David Mills meets with visitors from China down the hall. "All the materials
are really commodities. We’re not waiting for our industry to scale
before the cost comes down."

Mills, a noted solar scientist, conceived of Ausra’s compact linear fresnel reflector technology, or CLFR,  at the University of Sydney in the 1990s. In traditional parabolic solar trough systems, curved rotating mirrors sit high off the ground and focus the run’s rays on tubes of synthetic oil suspended over the solar arrays. The hot oil creates steam which drives an electricty-generating turbine. Austra’s innovation is that it uses commodity flat mirrors that sit low to the ground. The refectors concentrate sunlight on water-filled pipes that hang over the mirrors. As the water is heated up to 545 degrees fahrenheit (285 celsius) the resulting steam drives a standard turbine. According to Ausra, CLFR dramatically lowers the cost of solar power production as the mirrors arrays use standard glass and require signficantly less steel than parabolic troughs, allowing them to be be pre-assembled in robotic factories at half the cost. The arrays also take up less ground space and because they sit near the ground are more resistance to wind damage and are easier to clean.

"The mindset that says cheap comes first, cost comes first and look to mass production technologies as a way of reducing cost has informed a lot of the fundamental development direction here," says O’Donnell. Though the efficiency of solar trough technology is relatively low compared to photovoltaics, he argues that all that matters is how cheaply a solar power plant can produce green electricity per kilowatt hour. Ausra also is working on technology to store solar energy to extend the operating times of its plants.

Adds Le Lièvre: "Parabolic trough power plants are well established globally and they’re great; they’re just too expensive. What we’ve done is just apply a different concentrator technology to basically doing the same thing. Unlike some of our competitors that are embarking on fairly advanced
technology designs that they have yet to prove will work, saturated
steam is pretty basic stuff."

While a newcomer to Silicon Valley, Ausra is well known in its native Australia, where the company operates as Solar Heat and Power. Co-founded in 2002 by Le Lièvre and Mills,  Solar Heat and Power has built a prototype power plant in New South Wales that will begin generating electricity by year’s end, according to the company. But the Australian government’s tepid support for renewable energy in a coal-dominated country and a somewhat risk-adverse local venture capital community made scaling up a challenge. After a $A75 million government grant went to competitor Solar Systems last year, the company decamped for Silicon Valley. (Another Australian solar power company, EnviroMission, also has turned to the U.S. market.)

In an April interview with Australian television program Four Corners, Khosla predicted Ausra would be building a gigawatt’s worth of solar power plants within the year. Le Lièvre downplayed that expectation but said it was not unreasonable to think the company might have close to a gigawatt of signed contracts in the hopper in the near future. 

Ausra faces competition from Israel solar trough company Solel, which has won a contract from PG&E to produce 553 megawatts of electricity, as well as from BrightSource Energy, founded by American-Israeli solar pioneer Arnold Goldman. BrightSource, which has developed a distributed power tower technology, is negotiating a 500-megawatt contract with PG&E. Stirling Energy Systems, meanwhile, has deals with Southern California Edison (EIX) and San Diego Gas & Electric (SRE) to produce up to 1.75 gigawatts of solar electricity.

Those plants are expected to be built in California’s Mojave Desert, where a looming obstacle is the lack of sufficient transmission lines to move all that green electricity to distant cities. "Because we have a substantialy lower-cost collector technology, we can place plants where you might not expect them as a way of addressing tranmsission problems," says O’Donnell. "We don’t have to be in the optium solar location to be in the money. We can place things where the transmission is available."

Like most of its competitors, Ausra still must prove that its technology and Henry Ford approach to large-scale solar will deliver green elecricity that can displace fossil fuels in the fight against global warming. But it’s clear that we’re reaching a tipping point where the technology, financial resources and demand for renewable energy will transform Big Solar from a decades-old desert mirage into a reality.

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Solar startup BrightSource Energy has filed an application with the California Energy Commission to build a 400-megawatt solar power station complex in the Mojave Desert near the Nevada border.  Two 100-megawatt plants and one 200-megawatt station would be built using the Oakland, California, company’s distributed power tower technology. Fields of sun-tracking mirrors called heliostats focus the sun’s rays on a water-filled boiler that sits atop a tower. The intense heat creates steam which drives a turbine to generate electricity. The site, called Ivanpah, is on federal land about five miles south of Primm, Nevada, on the California side of the border. The company says the construction application is the first to be filed since 1989, when BrightSource founder Arnold Goldman’s Luz International built the last of nine solar power plants that continue to operate in Southern California. BrightSource CEO John Woolard says the company is negotiating with California utilities for the purchase of the power the plants will generate. BrightSource has been negotiating with California utility PG&E (PCG) to supply 500 megawatts of solar electricity but a final agreement had not been reached.  Both Southern California Edison (EIX) and San Diego Gas & Electric (SRE) have contracted for large-scale solar power plants with Stirling Energy Systems and have been expanding their solar portfolios.

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Silicon Valley solar startup SolFocus has raised $52 million in its latest round, including $27.2 to finance the expansion of its new Madrid-based operation. The Mountain View company, which now has raised a total of $84 million, is developing a concentrator photovoltaic technology that uses mirrors arrayed in panels to focus the sun’s rays on solar cells. One advantage of such a system is that it uses a fraction of expensive silicon to produce solar electricity. Though the startup has yet to bring a product to market, it’s joined other companies in heading to Spain, a hotbed of solar activity due to a "feed-in tariff" that pays operators of solar power plants a guaranteed above-market rate for the electricity they produce. SolFocus is one of three companies working on a 3-megawatt concentrator photovoltaic installation in Castilla,  la Mancha, according to the company. Participating in the latest funding round are New Enterprise Associates, Moser Baer India, David Gelbaum, Metasystem Group, NGEN Partners, and Yellowstone Capital.

In other solar news, former SolFocus director of field operations Stephen Smith is going to San Francisco solar startup GreenVolts to be its director of project operations. GreenVolts, which is developing concentrator photovoltaic power plants, also said it hired an Intel veteran, Joseph “Chip” Krauskopf, as chief operating officer. Meanwhile, SunPower (SPWR) announced today that it is moving into the Italian market, selling solar systems for residential, commercial and power plant installations.

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