ACWA Powers Up All-Night Solar At Bokpoort
On time and on budget, Saudi Arabia’s ACWA Power has just begun operation of its 50 MW Bokpoort CSP project in South Africa.
Nandu Bhula, Solafrica Bokpoort CEO for ACWA Power said that not only was Bokpoort on time and on budget, but it has begun operation with no ramp-up period. “We reached full load in December of 2015. Part of our PPA rules was that we had to be 100% before commercial operation, which began in February, 2016.”
Bokpoort features traditional parabolic trough technology, but it includes full-sized thermal energy storage for power after dark, with more than nine hours of thermal energy storage.
“We have 9.3 hours storage, which makes it possible to run as a continuous operator,” said Bhula. “We have already set a record of 6 days continuous operation and will likely increase this further. We either can run after dark at full load for nine hours or, as we have done, we can drop output to 60% at night and then manage to run through the night.”
Paddy Padmanathan, CEO of ACWA Power, told this writer some years ago that tower, not trough, is where he sees the future of CSP, but for its first CSP project, he decided that trough, with its longer history, would be “more bankable.”
For CSP to compete in the market, both cost and risk must be curbed — cutting cost requires innovation, while reducing risk favors known technology, like trough.
“My personal view is that tower will become probably the technology that develops in much more scale going forward rather than trough,” Padmanathan explained.
“But I don’t necessarily want to eliminate trough from the portfolio, because in our view there is a lot more advancement possible even in trough so you don’t want to write it off. The whole world of composites has yet to be fully explored or discovered. Right now its glass or aluminium but going forward I expect to see more composite materials. The point is there’s a lot of scope for improvement in all the technologies, so its early days to pin your hope on one or the other.”
Bokpoort is a relatively small CSP project at just 50 MW, because South Africa’s REIPPPP (Renewable Energy Independent Power Project Procurement Program) initially limited CSP to 50 MW in Round 1, then allowed up to 100, and now it wants 150 MW.
According to Eskom’s CSP program manager, Vikesh Rajpaul, nine or more hours of storage, like these two plants, are perfect for South Africa’s grid. South Africa’s evening peak is well-known, but there is also a peak in the early morning before sunrise.
CSP is cheaper than gas in South Africa
Between lengthy delays in building coal plants in South Africa, and a high price for gas, Rajpaul says Eskom needs CSP because of the thermal energy storage.
“Gas is completely out of the question, because it is very expensive,” Rajpaul told CleanTechnica. “It may become an option in the future, where we could import it. Although it could have problems here, just like in the US with fracking issues. But, as things stand, gas is more expensive here than any renewable, even CSP.”
(In the US, though gas prices are volatile, the cost is only $2 per mmbtu at this point, whereas in most countries that don’t utilize fracking, it costs about $10.)
Even though CSP is more expensive than PV or wind, Rajpaul said CSP is a cheaper option than gas for keeping the lights on in South Africa at night.
For its second CSP project, ACWA Power is partnering with US-based SolarReserve, which developed and permitted Redstone for the South African market, a 100 MW tower plant with 12 hours of storage for Round 3, due to break ground this summer.
Both SolarReserve and ACWA Power have also just bid into South Africa’s next round of CSP Round 4.5, with winners due to be announced soon. This time, REIPPPP encourages larger CSP plants up to 150 MW. Both are bidding 150 MW tower projects.
The $23 billion Saudi powerhouse ACWA Power is experienced in developing traditional thermal energy. Padmanathan, an engineer by background, was able to bid a very low PPA for Bokpoort for the time (2011). At 12 cents per kWh, it was 28% lower than competing bids.
With its long experience in traditional power plants in Saudi Arabia, ACWA Power was able to build Bokpoort at just $327 million, and complete it in just two years. The back end of a CSP project is identical to any steam-powered electric plant, as only the thermal storage system and the heliostat collector field are different.
“As a utility company – which is what we are – we invest in plants that are very large capital cost, and we recover our money over 20-30 years, so people need to understand that the tariff, whether high or low, is not a profit for immediately today,” Padmanathan said.
“We have consistently delivered these kinds of tariffs, for every bid that we have done from the time we were founded eight years ago. We have bid on fossil fuel plants, gas fired, oil fired, coal fired; every one of them; there’s plenty of public record that shows that we have typically delivered an average 20% tariff difference by adopting this approach.”
In order for prices of novel technologies to drop, projects must get built and PPAs paid out, even when better prices are now possible, because previous projects got built, which allowed prices to drop.
Padmanathan gave a great explanation of some of the issues faced by any new renewable tech in delivering and getting paid over a 20 year PPA, even as subsequent prices keep on getting lower.
“For us to recover all our investment we actually need every dollar to be paid back to us over the twenty years. The reality we need to deal with is that over the next decade (and renewables is the best example) as technology develops, it becomes more efficient, plant costs come down, tariffs bid for those new plants will come down,” he said.
“So the tariff those new plants will be seeking for CSP at that future time will be substantially lower. But those who don’t understand PPAs won’t recognize that a decade earlier we already spent the money on what was then the most competitive plant of the time.
They’ll say: ‘Hey, why are you still paying ACWA Power this crazy tariff with all this new capacity available at half the price?’ and even the most honorable government or off-taker can then only do the sensible thing and see if they can convince the seller to reduce the tariff.”
(Some of the recent fuss over Ivanpah missing its generation target is an example of this problem when you innovate new technology. Ivanpah did not miss substantially as the Wall Street Journal falsely claims; it actually missed its 2015 target by only 3%. )
South Africa has had a dangerously unstable coal-powered grid with blackouts.
Although now several rounds of PV are coming online quickly from the previous rounds of bidding, and soon it will be in a much stronger position for daytime, South Africa’s grid needs nighttime power.
Cheaper than battery storage at utility-scale, and fast-to-build, this thermal energy storage project can supply a peak load at night.
With its speedy two year build, and “top heavy” ratio of generous storage in a relatively modest plant, Bokpoort is perfectly aligned with South Africa’s needs to get clean power online fast, and to cover night time.
Bokpoort trough CSP project: Image Credit ACWA Power
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According to this article, solar thermal is a better option than natural gas. I would add solar PV and wind are also better options than NG. It is simply untrue that NG must be used as a bridge fuel to transition into 100% renewables. This is a bogus argument. As Germany and other countries are clearly demonstrating, by quickly scaling up wind, and solar, along with biogas, from animal and food waste, any country can achieve 100% renewable energy. It will take time, but it can be achieved with persistence. NG with it’s fracking issues, is unacceptable, and poses a clear threat to the water supplies of millions of people.
In a word, that’s kind of why I’m a little bummed about Ivanpah. It’s nice that they’re increasing output year after year at Ivanpah and I’m a huge fan of CSP, but the fact that they didn’t incorporate thermal storage into their design and have to use NG to keep the entire system from getting too cold during the night is sort of the Achilles heel fossil fuel pundits will use to try to give Ivanpah a black eye. My opinion is until solar + battery takes off at the utility level, CSP with thermal storage is the way to go.
The PPA negotiator for Mojave CSP in California once told me that in 2008 (when the CSP PPAs were negotiated for Ivanpah and Mojave) PG&E had no interest in storage.
Considering the percentage of the currently installed PV capacity that was installed since then, I guess that shouldn’t be too surprising.
True, almost all renewables are better choices than NG.
However, that CSP is a better choice than NG financially (and manages to compete with PV and wind power in auctions) is almost a uniquely South African situation.
Unlike Germany, the US or China, South Africa is operating an electricity grid with no spare capacity . That means that it struggles to provide back up for intermittent renewables or for old coal plants that fail at the most unexpected times.
Modern CSP plants are one of the only truly flexible 24/7 renewable power sources (large hydro and biogas are the other ones). That should allow CSP to maintain a healthy share of the RE market, at least until battery costs fall far enough to make PV
I take it that SA has very limited hydro potential, being dry and mostly flat like Australia. There are quite a few countries in the same position: think of North Africa and the Middle East. ACWA are not making a quixotic bet.
SA has about 2GW worth of large hydro plants and several times that in the form of pumped storage.
Further growth in big hydro is impossible, but there is still considerable growth in the small hydro and especially pumped storage market.
You are right of course in CSP being an unusually good bet for SA and arid countries around the world. The problem is that there isn’t a desert Germany (yet?), a country that is willing to pay for the growth of CSP into a mature mass market product.
Saudi Arabia looks well placed, thanks to its vast potential, wealth and local expertise in the form of ACWA. Not much happening though, sadly. Morocco, South Africa and Chile are making a valiant effort but are too small.
The Munich to Tripoli distance is about the same as New York is to Miami. If Libya could get its stuff together, they could easily provide dispatchable 24/7 CSP to Europe. Buy off the warring families in control and carpet just a small part of their empty desert with solar thermal. Libya’s clean economy would soar.
There is actually small transmission link from North Africa to Spain already. So far its been used to send power the other way, from Spain.
Of those three, Chile might be most promising due to its industrial/mining backbone. Australia could be contestant from purely technical/solar perspective, but due to political issues is not.
Its political issues might change next election? And Australia seems to have incredible “reverse NIMBYs”: (IMBys?) at Port Augusta really pushing hard for solar to replace coal
Yes, South Africa is ramping up PV and wind too. It is only for the night peak that CSP with storage is a better option than NG. PV and wind are even cheaper.
ACWA impresses. SolarReserve is another company in the same mould, focussed on execution and performance rather than headlines. With Abengoa in crisis and BrightSource rather flaky, it looks as if the future of CSP is in their hands.
ACWA’s worry about the political sustainability of PPA contracts in the long run as prices fall is legitimate, assuming the initial strike price is fair. The risk is highest for foreign developers – but Spain and Italy reneged on solar FITs held by national developers. The best protection is still to make a long-term commitment to a country and establish strong local partnerships, so you are not seen as an exploitative foreigner.
From what I gather, ACWA is mostly involved with financing and project management. The actual equipment and infrastructure is designed and built by Abengoa or (as in this case) Acciona.
As such, the sorry state of the CSP companies is not at all good news for ACWA. If ACWA wants to stay in the CSP market, it might have to become more vertically integrated by taking over the CSP assets of a company like Abengoa.
Or permitted designed and built by SolarReserve, in the case of Redstone, which ACWA is partnering in.
“it might have to become more vertically integrated by taking over the CSP assets of a company like Abengoa.” interesting idea: NextEra did that; taking over SEGS after Reagan bankrupted Luz. Now NextEra built and operates the 250 MW Genesis CSP project, online in California since 2013, without problems or publicity.
Is there any refinancing of previous PPAs with new PPAs to average out the costs and make them less vulnerable to defaults on payment as the costs of renewables continue to decline?
That money is spent, though. That’s not fair to innovators/developers.
Also; South Africa is no Spain. Its REIPPPP was so well designed with input by so many stakeholders that I doubt they would reneg on PPA rates like the Kingdom of Spain did with its unstable shaky politics.
And it’s also worth bearing in mind that a lot of the non-renewable power coming onto the grid in SA will be very expensive too, so these PPA rates may not stick out at all. The existing nuclear plant and older coal plants produce relatively cheap power, but the new mega coal plants have had endless delays, industrial action and cost overruns. There has been speculation that that new coal power could cost more than renewables despite SA using its own coal. And now there’s talk of new nuclear (to save fresh water compared to coal plants, but there are political and other factors which would take a post of their own to discuss), and one can only imagine what that would cost.
So yes, these renewable auctions have been designed well and are one of the few bright spots when it comes to SA electricity provision, but even relatively more expensive CSP may be a bargain for the life of the contract. At the moment during peak times very expensive and inefficient diesel peaker plants chew through huge amounts of imported diesel, which is a complete joke. Finally, for those talking about hydro and pumped storage, check out the Lesotho highlands projects which were great engineering feats in an inaccessible region, and the new Ingula pumped storage scheme which will help to cut down on some of that diesel.
Very true. Are you in South Africa? This is exactly what people have said locally.
Yes, been here for a couple of years after living in London previously, so moved from one power outage in ten years to regular blackouts (which have recently abated, mainly due to mines and other intensive users closing, although a number of renewable producers are also coming on line as you’ve reported). Still, despite the inconvenience, it’s been interesting to see people become more self-sufficient and adapt, which will no doubt accelerate as people turn to solar etc.
Does any body know what kind of storage they have?
It’s molten salt
Thank you