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Posts Tagged ‘OptiSolar’

Silicon Valley solar star Ausra seeks buyer

Posted in Ausra, Australia, energy, enviro startups, environment, renewable energy, solar energy, solar power plants, SolarReserve, tagged , , , , on November 17, 2009| Leave a Comment »

Photo: Ausra

Ausra has become the latest credit-crunched solar startup to seek a buyer/investor to bankroll its expansion. As I write Tuesday in The New York Times:

Disrupting trillion-dollar energy markets is expensive, as solar companies like OptiSolar and Solel have found. Both sold out to larger, deep-pocketed companies this year.

Now Ausra, a high-profile solar company bankrolled by some of Silicon Valley’s top venture capital firms, has become the latest renewable energy startup to put itself on the block.

Ausra, which makes solar thermal equipment to generate electricity, is in negotiations with three large international companies interested in taking a majority ownership stake in the venture, according to a person familiar with the situation.

The negotiations were first reported by Reuters.

All three potential acquirers are companies that make equipment for conventional power generation. Ausra declined to comment. Founded in Australia to build solar power plants, Ausra relocated to Silicon Valley and secured funding in 2007 from marquee venture capital firms Khosla Ventures, Kleiner Perkins Caufield & Byers and other investors.

Ausra soon filed plans to build one of the first new solar farms in California in 20 years. The company also built a factory in Las Vegas to manufacture long mirror arrays that focus the sun on water-filled tubes to create steam to drive electricity-generating turbines.

But as the credit crunch made building billion-dollar solar power plants an increasingly dicey proposition, Ausra switched gears earlier this year to focus on supplying solar thermal equipment to other developers.

You can read the rest of the story here.

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Solar startup scores $535m federal loan guarantee

Posted in alternative energy, climate change, enviro startups, environment, First Solar, global warming, green collar jobs, green policy, green startups, green tech, OptiSolar, PG&E, renewable energy, solar energy, solar power plants, Solyndra, tagged , , , , , on March 20, 2009| 6 Comments »

solyndra-rooftop-2

photo: Solyndra

It’s been a good news, bad news Friday for the solar industry. Silicon Valley startup Solyndra received a half billion-dollar loan guarantee from the U.S. Department of Energy to build a solar module factory while further up Interstate 880 OptiSolar moved to shut down its manufacturing operations.

OptiSolar too had asked for a federal loan guarantee to complete work on its Sacramento thin-film solar cell plant but a decision on the $300 million application couldn’t come soon enough to save the startup. “We continued to be unable to find a buyer for the technology and manufacuring business, and the board of directors decided that we needed to limit ongoing operational expense,” wrote OptiSolar spokesman Alan Bernheimer in an e-mail.

First reported by the San Francisco Chronicle’s David Baker, OptiSolar will shut down factories in Sacramento and Hayward, Calif., and lay off 200 workers.  Earlier this month, OptiSolar sold its pipeline of solar power plants – including a 550-megawatt solar farm that will supply electricity to PG&E (PCG) – to rival First Solar  in a $400 million stock deal. At the time, OptiSolar said it intended to focus on manufacturing solar modules.

The news was definitely brighter Friday for Solyndra, which emerged from stealth mode last September with $600 million in funding and $1.2 billion in orders for its solar panels composed of cylindrical tubes imprinted with solar cells. Conventional rooftop solar panels must be tilted to absorb direct sunlight as they aren’t efficient at producing electricity from diffuse light. But the round Solyndra module collects sunlight from all angles, including rays reflected from rooftops. That allows the modules, 40 to a panel,  to sit flat and packed tightly together on commercial rooftops, maximizing the amount of space for power production.

The $535 million federal loan guarantee will allow the Fremont, Calif.-based company to build a second factory, which is expected to create 3,000 construction jobs and more than 1,000 other jobs once the plant is in operation. The factory will be able to produce 500 megawatts’ worth of solar panels a year.

“The DOE Loan Guarantee Program funding will enable Solyndra to achieve the economies of scale needed to deliver solar electricity at prices that are competitive with utility rates,” Solyndra CEO Chris Gronet said in a statement. “This expansion is really about creating new jobs while meaningfully impacting global warming.”

Friday’s grant makes good on Secretary of Energy Steven Chu’s pledge to speed up processing of renewable energy loan guarantee applications. The department had come under fire during the previous administration for taking years to dole out grants and loan guarantees for electric car and green energy projects.

Meanwhile, First Solar (FSLR) announced on Friday that it had manufactured 1 gigawatt of thin-film solar cells since beginning commercial production in 2002. It took the Tempe, Ariz., company six years to hit 500 megawatts and only eight months to produce the second 500 megawatts. First Solar’s annual production capacity will reach 1 gigawatt by year’s end, according to the company.

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Consolidation of solar industry accelerates

Posted in alternative energy, First Solar, solar energy, solar power plants, Suntech, tagged , , , , on March 18, 2009| Leave a Comment »

recurent-energy

Another day, another solar deal. San Francisco’s Recurrent Energy on Wednesday will announce that it is acquiring a 350-megawatt portfolio of photovoltaic projects from UPC Solar of Chicago as the industry continues to consolidate.

“Since the financial crisis set in last year we’ve kept an eye out for opportunities to pick up a pipeline of projects,” Recurrent CEO Arno Harris told Green Wombat. “You’re seeing companies like Recurrent that are well-capitalized take advantage of the market consolidation.”

Recurrent, which last year scored $75 million in funding from private equity firm Hudson Clean Energy Partners, installs large-scale solar arrays on commercial rooftops and at government facilities and then sells the electricity generated back to the hosts under long-term power purchase agreements.

The deal puts Recurrent in the power plant business as UPC’s portfolio includes a number of 10-megawatt projects in Ontario designed to take advantage of the province’s generous feed-in tariff for solar farms. “It’s a significant addition to our project pipeline,” Harris said. The projects are in various stages of development but Recurrent expects that 100 megawatts will be completed by 2012. The company stands to benefit from an expected decline in the price of solar panels this year.

Harris declined to reveal the financial terms of the deal but said that Recurrent is putting relatively little money up front. “We wrote a small check to compensate UPC Solar for the work done so far and we’ve committed to continue funding projects,” Harris said. “Then they’ll get a bonus paid at end for completed projects.”

The deal follows thin-film solar company First Solar’s (FSLR)’s $400 million acquisition this month of Silicon Valley startup OptiSolar’s 1,850 megawatt pipeline of photovoltaic power projects, including a 550-megawatt power plant to be built for California utility PG&E (PCG). The same day as the OptiSolar deal, Spanish solar developer Fotowatio bought San Francisco solar financier MMA Renewable Ventures’ project portfolio.

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First Solar buys rival’s assets in $400 million deal

Posted in alternative energy, First Solar, green startups, MMA Renewable Ventures, OptiSolar, renewable energy, solar energy, solar power plants, tagged , , , on March 2, 2009| Leave a Comment »

First Solar Electric, 701 El Dorado Valley Dr., Boulder City, NV
photo: First Solar

In the second big solar deal of the day, First Solar on Monday announced it was acquiring rival thin-film photovoltaic startup OptiSolar’s solar power plant projects in an all-stock transaction worth $400 million.

The acquisition vaults First Solar into the ranks of big solar power plant developers, giving it control of a 550-megawatt photovoltaic solar farm — the world’s largest — OptiSolar is building for utility PG&E (PCG) as well as 1,300 megawatts’ worth of projects in the pipeline. The deal also includes federal land claims OptiSolar filed on 136,000 acres in the Southwest desert that could support power plants generating 19,000 megawatts of solar electricity.

First Solar CEO Mike Ahearn said 6,500 megawatts of those projects are in the front of the line in the “transmission queue” to connect to the power grid, allowing solar farms to be rapidly deployed over the next couple of years.

“This package in total would be very hard to replicate, if at all,” Ahearn said Monday afternoon during a conference call. “That positions us ideally to be the player in the U.S. utility market.”

OptiSolar spokesman Alan Bernheimer told Green Wombat that OptiSolar will now focus on its solar cell manufacturing operations. “We needed to find a way to realize value for our shareholders,” he said. “This is a wonderful fit. We developed what we think is the largest power plant pipeline while First Solar developed the lowest cost thin-film technology.”

Silicon Valley-based OptiSolar quickly became a leader in the nascent solar power plant market but stalled as the financial crisis hit, forcing the company to halt work on a solar cell factory and lay off half its workers last November. Bernheimer said OptiSolar has applied for a $300 million federal loan guarantee to restart and expand its manufacturing operations.

He said OptiSolar CEO Randy Goldstein will join First Solar, along with about 30 other employees, when the deal closes.

First Solar (FSLR), backed by Wal-Mart’s (WMT) Walton family, has become become known as the Google (GOOG) of solar for its stratospheric stock price. The Tempe, Ariz.-based company jumped into the solar power plant market last year with deals to build small-scale solar power plants for Sempre Energy (SRE) and Southern California Edison (EIX).

The OptiSolar deal follows by hours the sale of solar financier MMA Renewable Ventures’ solar portfolio to Spanish solar developer Fotowatio.  “There’s a shakeout in the marketplace and there’s opportunities for consolidation,” MMA Renewable Ventures CEO Matt Cheney presciently told Green Wombat Monday morning

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Green stimulus: Who wins

Posted in Abengoa Solar, alternative energy, BrightSource Energy, endangered species, First Solar, green financing, green policy, green tech, MMA Renewable Ventures, OptiSolar, PG&E, renewable energy, San Diego Gas & Electric, solar energy, solar power plants, Southern California Edison, Stirling Energy Systems, SunPower, the green economy, tagged , , , , , , , on February 17, 2009| 1 Comment »

topaz-solar-farm-app

In the green stimulus sweepstakes, big potential winners are companies like Silicon Valley startup OptiSolar.

The solar-cell maker came out of nowhere last year to score a deal with utility PG&E to build the world’s largest photovolaic power plant, a 550-megawatt monster that would cover some 9 1/2 square miles on California’s central coast. OptiSolar subsequently began construction of a factory in Sacramento to produce the thousands of thin-film solar panels needed for the project. Then the economy tanked and as financing dried up, OptiSolar laid off half its workforce – some 300 employees – and halted construction of the Sacramento facility.

With a Colorado solar company executive joining President Barack Obama as he signed the $787 billion stimulus legislation into law Tuesday at a solar-powered museum in Denver, OptiSolar and other renewable energy companies stalled by the financial crisis may see their fortunes revive. The package allows builders of big renewable energy projects to apply for a government cash grant to cover 30% of construction costs in lieu of claiming a 30% investment tax credit. A dearth of investors who finance solar power plants and wind farms in exchange for the tax credits has put in jeopardy green energy projects planned for the desert Southwest and the Great Plains. The cash grant would shave about $300 million off the projected $1 billion price tag for OptiSolar’s Topaz Solar Farm.

The stimulus package also includes $2.3 billion to fund a 30% manufacturing tax credit for equipment used to make components for green energy projects, a provision OptiSolar can tap to help finance its solar cell factories. And the company may be able to take advantage of the legislation’s government loan guarantees for large renewable energy projects.

“It will lower the cost of the factory we’re building in Sacramento and make it easier to attract financing,” OptiSolar spokesman Alan Bernheimer told Green Wombat, noting the company’s priority is to complete the facility and begin production of solar panels. “The factory is more than shovel ready – our shovels are hanging on the wall where we put them when we had stop work in November.” (OptiSolar currently manufactures solar modules at its Hayward, Calif., plant.)

Fred Morse, senior adviser to Spanish solar energy giant Abengoa, says the stimulus package puts back on track a $1 billion, 280-megawatt solar thermal power plant the company will build outside Phoenix to produce electricity for utility Arizona Public Service. “With the stimulus bill we’re very confident we’ll be able to finance the project,” says Morse. He says Abengoa expects to use the government loan guarantees to obtain debt financing to fund construction of the project and then apply for the 30% cash refund. “I think the entire industry is very optimistic that these two aspects of the stimulus package, the grants and the temporary loan guarantees, should allow a lot of projects to be built.”

Mark McLanahan, senior vice president of corporate development for MMA Renewable Ventures, agrees. “I expect the government grants to attract new investors,” says McLanahan, whose San Francisco firm finances and owns commercial and utility-scale solar projects.

There are some strings attached, though.

To qualify for the cash grants, developers need to start shoveling dirt by Dec. 31, 2010. That means only a handful of big solar thermal power plants planned for California, for instance, are likely to make it through a complicated two-year licensing process in time to break ground by the deadline. One of those could be the first phase of BrightSource Energy’s 400-megawatt Ivanpah power plant on the California-Nevada border. But BrightSource’s biggest projects, part of a 1,300 megawatt deal signed with Southern California Edison (EIX) last week, won’t start coming online until 2013 at the earliest.

Another Big Solar project, Stirling Energy Systems’ 750-megawatt solar dish farm for San Diego Gas & Electric (SRE), will be racing to meet the 2010 deadline. The project is in the middle of a long environmental review by the California Energy Commission and the U.S. Bureau of Land Management which currently is scheduled to stretch into 2010.

SolarReserve CEO Terry Murphy says his Santa Monica-based startup has a couple of solar power plant projects in the works that should be able to take advantage of the stimulus provisions. “The likelihood of us being able to close on a financial deal has increased,” Murphy says.

Solar analyst Nathan Bullard of research firm New Energy Finance expects the stimulus package to prompt a push for large photovoltaic power projects. That’s because in California such solar farms – which essentially take rooftop solar panels and mount them in huge arrays on the ground – do not need approval from the California Energy Commission and can be built relatively quickly.

That’s good news for companies like thin-film solar cell maker First Solar (FSLR), which builds smaller scale photovoltaic power plants, and SunPower (SPWRA), which has a long-term contract with PG&E (PCG) for the electricity generated from a planned 250-megawatt PV solar farm to be built near OptiSolar’s project.

“It’s great for PV because you can definitely can get construction done by the end of 2010,” says Bullard. “It’s also good news for smaller and mid-sized developers who couldn’t access tax-equity financing.”

The catch, however, is that renewable energy companies still must raise money from investors in a credit-crunched market to cover construction costs, as the government doesn’t pay out the cash until 60 days after a solar power plant or wind farm goes online. And as McLanahan points out, the cost of raising capital from private equity investors is typically higher and will add to the cost of renewable energy projects. Those costs will only rise if the government is late in paying out refunds.

MMA Renewable finances large commercial arrays and solar power plants and then sells the electricity under long-term contracts to customers who host the solar systems. The loan guarantee provision of the stimulus legislation will help secure financing from investors skittish that some of MMA Renewable’s customers may default on their agreements, according to McLanahan.

Says Murphy: “The fact that we’re getting iron into the ground and getting things moving helps us.”

The wind industry also stands to gain from the stimulus package through a three-year extension of the production tax credit for generating renewable electricity as well as the government cash grants and manufacturing tax credit. Despite a record year for wind farm construction in 2008, projects have come to a standstill in recent months as the financial crisis froze development and forced the European-dominated industry to lay off workers.

“I think it’s good down payment on what needs to happen,” says Doug Pertz, CEO of Clipper Windpower, one of two U.S. wind turbine makers. “A lot more needs to be done but I think this will start to bring a lot of people back into the marketplace.”

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China’s solar giant makes U.S. move

Posted in energy, environment, First Solar, Google, OptiSolar, PG&E, renewable energy, solar energy, solar power plants, Southern California Edison, SunPower, Suntech, tagged , , , , , , , on October 2, 2008| 12 Comments »

In another sign that the financial crisis is not slowing the solar industry, Suntech, the giant Chinese solar module maker, made a big move into the United States market on Thursday. The company announced a joint venure with green energy financier MMA Renewable Ventures to build solar power plants and said it would acquire California-based solar installer EI Solutions.

Founded in 2001, Suntech (STP) recently overtook its Japanese and German rivals to become the world’s largest solar cell producer. The company has focused on the lucrative European market and only opened a U.S. outpost, in San Francisco, last year.  The joint venture with MMA Renewable Ventures (MMA) – called Gemini Solar – will build photovoltaic power plants bigger than 10 megawatts.

Most solar panels are produced for commercial and residential rooftops, but in recent months utilities have been signing deals for massive megawatt photovoltaic power plants. Silicon Valley’s SunPower (SPWRA) is building a 250-megawatt PV power station for PG&E (PCG) while Bay Area startup OptiSolar inked a contract with the San Francisco-based utility for a 550-megawatt thin-film solar power plant. First Solar (FSLR), a Tempe, Ariz.-based thin-film company, has contracts with Southern California Edision (EIX) and Sempre to build smaller-scale solar power plants.

Suntech’s purchase of EI Solutions gives it entree into the growing market for commercial rooftop solar systems. EI has installed large solar arrays for Google, Disney, Sony and other corporations.

“Suntech views the long-term prospects for the U.S. solar market as excellent and growing,” said Suntech CEO  Zhengrong Shi in a statement.

Other overseas investors seem to share that sentiment, credit crunch or not.  On Wednesday, Canadian, Australian and British investors lead a $60.6 million round of funding for Silicon Valley solar power plant builder Ausra. “So far the equity market for renewable energy has not been affected by the financial crisis,” Ausra CEO Bob Fishman told Green Wombat.

The solar industry got more good news Wednesday night when the U.S. Senate passed a bailout bill that included extensions of crucial renewable energy investment and production tax credits that were set to expire at the end of the year.

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The hottest tech job in America: Wildlife biologist

Posted in alternative energy, Ausra, climate change, endangered species, energy, enviro startups, global warming, OptiSolar, PG&E, renewable energy, solar energy, solar power plants, Stirling Energy Systems, tagged , , , , , , , , on September 18, 2008| 1 Comment »

photo: Todd Woody

Green Wombat’s story in the new issue of Fortune magazine on the solar power plant-fueled boom in demand for wildlife biologists is now online here. The photo above of the blunt-nosed leopard lizard was taken at a state reserve in San Luis Obispo County.

Or you can read the story below.

The hottest tech job in America

Giant solar plants are being built where dozens of protected species live. That’s good news for wildlife biologists.

By Todd Woody, senior editor

(Fortune Magazine) — It looks like a scene from an old episode of The X-Files: As a red-tailed hawk circles overhead and a wild pronghorn sheep grazes in the distance, a dozen people in dark sunglasses move methodically through a vast field of golden barley, eyes fixed to the ground, GPS devices in hand. They’re searching for bodies.

In this case, however, the bodies belong to the endangered blunt-nosed leopard lizard, and the crew moving through the knee-high grain are wildlife biologists hired by Ausra, a Silicon Valley startup that’s building a solar power plant for utility PG&E on this square mile of central California ranchland.

With scores of solar power stations planned for sites in the Southwest, demand for wildlife biologists is hot. They’re needed to look for lizards and other threatened fauna and flora, to draw up habitat-protection plans, and to comply with endangered-species laws to ensure that a desert tortoise or a kit fox won’t be inadvertently squashed by a solar array.

That has engineering giants like URS (URS, Fortune 500) in San Francisco and CH2MHill of Englewood, Colo., scrambling to hire biologists to serve their burgeoning roster of solar clients. “It’s a good time to be a biologist – it’s never been busier in my 15 years in the business,” says Angela Leiba, a senior project manager for URS, which is staffing the $550 million Ausra project. URS has brought onboard 40 biologists since 2007 to keep up with the solar boom. Salaries in the industry, which typically start around $30,000 and run up to about $120,000, have spiked 15% to 20% over the past year.

The work is labor-intensive. “It can take a 30- to 50-person team several weeks to complete just one wildlife survey,” says CH2MHill VP David Stein.

The economics of Big Solar ensure that wildlife biology will be a growth field for years to come. For one thing, there’s the mind-boggling scale of solar power plants. Adjacent to the Ausra project in San Luis Obispo County, for instance, OptiSolar of Hayward, Calif., is building a solar farm for PG&E that will cover 9 1/2 square miles with solar panels. Nearby, SunPower of San Jose will do the same on 3.4 square miles. Every acre must be scoured for signs of “species of special concern” during each phase of each project.

That adds up to a lot of bodies on the ground. URS, for instance, has dispatched 75 biologists to Southern California where Stirling Energy Systems of Phoenix is planting 12,000 solar dishes in the desert. “The biologists are critical to move these projects forward,” notes Stirling COO Bruce Osborn. For one project Stirling had to pay for two years’ worth of wildlife surveys before satisfying regulators.

Just about every solar site is classified as potential habitat for a host of protected species whose homes could be destroyed by a gargantuan power station. (Developers of California solar power plants, for example, have been ordered to capture and move desert tortoises out of harm’s way.) The only way to determine if a site is crawling with critters is to conduct surveys.

While that means a lot of jobs for wildlife biologists, it’s not all red-tailed hawks and pronghorn sheep for these nature boys and girls. The work can get a bit Groundhog Dayish, say, after spending 1,400 hours plodding through the same barley field in 90-degree heat in search of the same blunt-nosed leopard lizard. No wonder then when URS crew boss Theresa Miller asks for volunteers to reconnoiter a decrepit farmhouse for some protected bats on the Ausra site, hands shoot up like schoolchildren offered the chance to take the attendance to the principal’s office.

PG&E (PCG, Fortune 500) renewable-energy executive Hal La Flash worries that universities aren’t cranking out enough workers of all stripes for the green economy. “It could really slow down some of these big solar projects,” he says. Osborn can vouch for that: Biological work on the Stirling project has ground to a halt at times while the company waits for its consultants to finish up surveys on competitors’ sites.

For the young graduate, veteran biologist Thomas Egan wants to say just three words to you: Mohave ground squirrel. The rare desert dweller is so elusive that the only way to detect it on a solar site is to set traps and bag it. “There’s a limited number of people authorized to do trapping for Mohave ground squirrels,” says Egan, a senior ecologist with AMEC Earth & Environmental. “If you can work with the Mohave ground squirrel, demand is intense.”

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Thin-film solar startup scores a fat $300 million

Posted in alternative energy, energy, environment, First Solar, investment tax credit, OptiSolar, PG&E, solar energy, solar power plants, Southern California Edison, Uncategorized, tagged , , , , , , on August 27, 2008| 13 Comments »

The looming expiration of a crucial renewable energy investment tax credit doesn’t seem to have spooked investors. Silicon Valley thin-film solar startup Nanosolar said Wednesday that it has secured another $300 million in funding and is jumping into the Big Solar game as well.

Writing on the Nanosolar blog,  CEO Martin Roscheisen said that the latest financing round – the company’s funding now totals half a billion dollars –  comes from oldline utility AES (AES), French utility giant EDF and the Carlyle Group, among other investors. Nanosolar, which prints solar cells on flexible materials, will supply solar panels to the newly formed AES Solar, which will build medium-scale – up to 50 megawatts – photovoltaic power plants.

The Nanosolar news is just the latest of a spate of deals to take solar panels off rooftops and plant them on the ground to generate massive megawattage. Two weeks ago, thin-film solar startup Optisolar won a contract from utility PG&E (PCG) for a 550-megawatt PV solar power plant while SunPower (SPWR) will build a 250-megawatt photovoltaic solar farm for the utility. Leading  thin-film company First Solar (FSLR), meanwhile, has inked deals over the past few months to build smaller-scale PV power plants for Southern California Edison (EIX) and Sempre (SRE). And thin-film solar company Energy Conversion Devices is assembling a 12-megawatt array for a General Motors plant in Spain.

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California’s game-changing solar deal

Posted in alternative energy, Ausra, endangered species, enviro startups, environment, First Solar, OptiSolar, PG&E, renewable energy, solar energy, solar power plants, Southern California Edison, SunPower, tagged , , , , , on August 14, 2008| 24 Comments »

photo: David Lena

In a move that could alter the economics of the global solar industry, California utility PG&E on Thursday announced that it will buy 800 megawatts of electricity produced from two massive photovoltaic power plants to be built in San Luis Obsipo County on the state’s central coast. The 550-megawatt thin-film plant from Bay Area startup OptiSolar and a 250-megawatt PV plant from Silicon Valley’s SunPower dwarf by orders of magnitude the five-to-15 megawatt photovoltaic power stations currently in operation around the world.

Most of the industrial-scale solar plants designed to replace fossil-fuel power use solar thermal technology, meaning they deploy mirrors to heat liquids to produce steam that drives electricity-generating turbines. Photovoltaic power plants essentially take the solar panels found on suburban rooftops and put them on the ground in gigantic arrays. How gigantic? OptiSolar’s Topaz Solar Farm will cover 9 1/2 square miles of ranch land with thin-film panels like the ones in the photo above. Combined, the two solar plants would produce enough electricity to power 239,000 California households, according to PG&E (PCG).

“Obviously this is huge and a bold move,” says Reese Tisdale, a senior analyst who studies the economics of solar power for Emerging Energy Research in Cambridge, Mass. “It’s a pretty big jump in manufacturing capacity and a big opportunity for the PV industry, particularly for thin-film.”

If the power plants are ultimately built – and that’s a big if, given the challenges to get such facilities online – and other utilities follow PG&E’s lead, demand for solar modules could skyrocket. (Thin-film cells like those made by OptiSolar are deposited or printed in layers on glass or flexible metals. They are less efficient at converting sunlight into electricity than standard solar modules but they use far less expensive polysilicon and can be produced much more cheaply.)

First Solar (FSLR), a leading thin-film maker, has an annual manufacturing capacity of around 275 megawatts – which will rise to a gigawatt by the end of 2009. (First Solar is building two small-scale solar power plants for Southern California Edison (EIX) and Sempra (SRE).) SunPower (SPWR) is expected to produce 250 megawatts worth of solar modules this year; its California Valley Solar Ranch project for PG&E alone will be consume 250 megawatts.

“If we were trying to do it this year, it would be all of our production,” says Julie Blunden, SunPower’s vice president for public policy. “SunPower is ramping very quickly. By 2010 our production will be at least 650 megawatts.” SunPower’s solar power plant is set to begin producing electricity in 2010.

The PG&E deal puts OptiSolar in the spotlight. Founded by veterans of the Canadian oil sands industry, the stealth Hayward, Calif., startup has kept its operations under cover, avoiding the media as it quietly set up a manufacturing plant in the East Bay and prepared to break ground on a million-square-foot factory in Sacramento.

OptiSolar CEO Randy Goldstein told Green Wombat that the company will have no problem producing enough solar cells to build Topaz, which is scheduled to go online in 2011, as well as fulfill contracts for some 20 small-scale power plants in Canada.

“Our plan has always been to produce solar energy on a very large scale to make it cost-competitive, even in a market like California,” Goldstein says.

The terms of utility power purchase agreements like the ones OptiSolar and SunPower have signed with PG&E are closely held secrets, but it has long been an open secret that building massive photovoltaic power plants was not economically viable. Last year when I attended the opening of an 11-megawatt PV power station in Portugal – which offers generous solar subsidies – that was built by SunPower’s PowerLight subsidiary, PowerLight’s CEO told me that pursuing such projects in the U.S. was not an attractive proposition due to market incentives and public policy.

So what has changed too make constructing gargantuan PV power plants profitable?

“Lots of things have changed,” says SunPower’s Blunden. “Power prices are going up and public policy is requiring utilities to have a portfolio of renewables.”  And after building some 40 megawatts of power plants in Spain, SunPower has been able to improve its manufacturing processes and cut costs, according to Blunden.  “We could see where the cost reductions were coming down and the benefits of scale,” she says. “We saw there was a way for us to be competitive with other renewables.”

Goldstein says OptiSolar’s business model of owning the supply chain – from building its own machines to make solar cells to constructing, owning and operating power plants – will allow it to reduce costs. “By taking control of the value chain from start to finish, by being vertically integrated and cutting out the middleman,” he says, “we can be competitive not only with other renewable energy but with conventional energy.”

Photovoltaic power plants do have certain advantages over their solar thermal cousins. They don’t need to be built in the desert, thus avoiding the land rush now underway in the Mojave. PV is a solid-state technology and with no moving parts – other than the sun tracking devices used in some plants – they make little noise and are relatively unobtrusive. Most importantly in drought-stricken California, they consume minimal water. And the modular nature of solar panels means that a power plant can start producing electricity in stages rather after the entire facility has been constructed.

“The economies of scale does make PV cost competitive with other renewable energy generating technologies, and wouldn’t be possible without advances that SunPower and OptiSolar have been working on,” says PG&E spokeswoman Jennifer Zerwer. “We take a stringent look at all technologies and we’re not wedded to a particular one.”

With the PV plants, PG&E now has contracts to obtain 24 percent of its electricity from renewable sources.

But contracts are no guarantee the even a watt will be generated. The Topaz and California Valley projects must overcome a number of obstacles, not the least of which is the U.S. Congress’ failure so far to extend a crucial 30 percent investment tax credit for solar projects that expires at the end of the year. SunPower’s Blunden acknowledges the PG&E project is contingent on the tax credit being renewed.

PG&E executive Fong Wan said as much at a press conference Thursday afternoon: “That is a major hurdle. If the investment tax credit is not extended, I expect many of our projects will be delayed.”

Then there’s the question of how welcoming rural San Luis Obispo County residents will be to two massive solar power plants in the neighborhood. Along with a 177-megawatt solar thermal power plant being built by Silicon Valley startup Ausra for PG&E adjacent to the Topaz project, the county has become a solar hot spot. Ausra has run into some community opposition and state officials are growing concerned about the impact of the power plants on protected wildlife.

“The challenge is going to be the magnitude of these projects,” says Tisdale, the energy analyst. “Other projects are already facing opposition from the environmentalists.”

But for solar power companies like OptiSolar the impetus is to get big and get big fast. “I think it’s going to demonstrate that photovoltaics have the ability to be part of the energy mix,” says Goldstein of Topaz. “We can scale up and have a big impact. There’s not going to be a lot of room for niche players in the long run.”

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First Solar jumps into the utility business

Posted in alternative energy, energy, environment, First Solar, OptiSolar, solar energy, solar power plants, Southern California Edison, tagged , , , , , , on July 11, 2008| 8 Comments »

When it comes to solar companies, First Solar is the Google of renewable energy. The Tempe, Ariz.-based solar cell maker backed by the Wal-Mart (WMT)’s Walton family has seen its stock skyrocket over the past year, hitting a high of $317 on May 14. (It was trading at $275 Friday.) Now First Solar, which makes “thin film” solar modules, is getting into the utility business, winning approval Thursday from California regulators to build the state’s first thin-film photovoltaic solar power plant. The 7.5 megawatt project – expandable to 21 megawatts – will sell electricity to Southern California Edison (EIX) under a 20-year contract.

While First Solar (FSLR) supplies solar modules to power plant builders in Europe, this is apparently the first time it has acted as a utility-scale solar developer itself. First Solar tends to keep quiet about its projects and did not return a request for comment. But a troll through the public records reveals some details of what is called the FSE Blythe project. The solar farm will be built in the Mojave Desert town of Blythe by a First Solar subsidiary, First Solar Electric. The company paid $350,000 in January for 120 acres of agricultural land in Blythe, providing a tidy profit for the seller, which had purchased the property for $60,000 in June 1999.

Approval of the contract by the California Public Utilities Commission Thursday came on the same day that SunPower (SPWR) announced a deal to build two photovoltaic power plants – a 25-megawatt one and a 10-megawatt version – in Florida for utility Florida Power & Light (FPL). PV plants are essentially supersized versions of rooftop solar panel systems found on homes and businesses. Thin-film solar prints solar cells on flexible material or glass and typically uses little or no expensive (and in short supply) polysilicon, the key material of conventional solar cells.

Most large-scale solar power plants being developed in the United States use solar thermal technology that relies on huge arrays of mirrors to heat liquids to create steam that drives electricity-generating turbines. In fact, there is a solar land rush underway in the desert Southwest as solar developers, investment banks like Goldman Sachs (GS), utilities and speculators of every stripe scramble to lock up hundreds of thousands of acres of federal land for solar power plants. (See Green Wombat’s feature story on the solar land rush in the July 21 issue of Fortune.)

PV power plants, on the other hand, have not been cost-competitive with solar thermal and have been most popular in countries like Germany, Spain and Portugal, where generous subsidies guarantee solar developers a high rate for the electricity they produce. The situation in the U.S. seems to be changing, though, judging by the deals utilties are striking with companies like First Solar and SunPower. Meanwhile, thin-film startup OptiSolar is moving to build a gigantic 550-megawatt thin-film solar power plant on California’s central coast but has yet to sign a power purchase agreement with a utility.

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