Will solar developers strike gold in the Sahara?

Will solar developers strike gold in the Sahara?

Last fall, as Morocco prepared to power up Noor-1, the first 160-megawatt installment of its sprawling 580-megawatt Ouarzazate solar-energy project, the world seemed closer than ever to realizing a perennial dream: harnessing the Sahara desert’s colossal solar resources, and delivering abundant clean energy to European markets. In the last days of December, however, Moroccan officials abruptly postponed Noor-1’s inauguration, without any explanation — an inauspicious start for the 580-megawatt project, and a reminder of the immense logistical and technical difficulties that have dogged large-scale solar projects, both in Africa and in the rest of the world. 

It’s easy to see the appeal in projects such as Noor-1: it’s been calculated that capturing just 1 percent of the blazing sunlight falling on the Sahara would deliver as much energy as all the world’s other solar plants combined. Solar farms covering just a sixth of the desert — or a patch of land about the size of Connecticut — would be enough to fully meet the energy needs of Europe’s 500 million people. And transmitting Saharan energy to Europe, while challenging, is perfectly feasible: Brazil’s Rio Madeira transmission system already moves electricity over a distance of almost 1,500 miles, for instance, while in recent years China has built a sophisticated long-distance transmission network to connect cities to far-off power sources.

Despite that, turning the Saharan solar dream into reality has proven remarkably difficult. Morocco’s troubled Noor-1 project has its roots in Desertec, a failed $560 billion attempt, underwritten by a consortium of investors including Siemens (ETR:SIE), RWE (ETR:RWE), Deutsche Bank (NYSE:DB) and E.ON (ETR:EOAN), to meet 15 percent of Europe’s energy needs with a 100-gigawatt network of Saharan solar plants. Most of Desertec’s backers left the project in 2013 and 2014, citing technical difficulties and saying that Europe’s booming domestic renewable-generation market meant that exporting Saharan energy was no longer economically viable.

Desertec’s failure, and problems experienced by similar projects around the world, have left lingering questions about the core technology used by almost all large-scale desert solar plants. Like Noor-1, Desertec relied on thermal solar energy, also known as concentrating solar power (CSP). Rather than using photovoltaic panels to turn sunlight directly into electricity, such projects rely on banks of mirrors to concentrate and collect the sun’s heat, which is then used to heat boilers and drive conventional generating turbines. 

CSP brings several key advantages — most notably, that the collected heat can be stored for later use, allowing developers to deliver baseload energy rather than the peaking supply provided by conventional wind and solar projects. That’s a vital capability for the Saharan projects, which aim to displace European coal and nuclear baseload generation.

But it’s also an expensive approach, and one that introduces some serious technological challenges: the molten salt typically used to store thermal energy is highly corrosive, creating serious maintenance headaches and additional costs for plant operators. And even without storage capabilities, concentrating-solar plants can be glitchy and hard to maintain. Keeping banks of curved mirrors clean in dry, dusty environments can be problematic — and in deserts, the water needed for routine cleaning operations can be hard to come by.

For a glimpse at the potential problems in store for Saharan solar-energy developers, look to California’s Mojave desert, where the 2.2 billion Ivanpah thermal solar plant has thus far failed to deliver anything close to the energy initially hoped for. The plant’s first-year output totaled just 420,000 megawatt-hours, far short of the expected 1 million MWh, leaving Ivanpah at risk of losing its vital power-purchase agreement with PG&E (NYSE:PCG).

In Europe, meanwhile, Abengoa (NASDAQ:ABGB), one of Europe’s biggest CSP players and the operator of California’s 250-megawatt Mojave Solar project, is currently teetering on the brink of bankruptcy. The solar giant has proposed a restructuring that would sharply reduce its revenues and its international operations, in a move that’s unlikely to reassure investors skeptical about the long-term viability of utility-scale solar thermal projects. “After strong government support and a lot of hype, large-scale concentrating solar plants continue to disappoint with poor performance,” says Tyler Ogden, an analyst with Lux Research. 

Despite such rumblings, there’s one ray of sunshine for the Saharan CSP sector: in the Tunisian desert, Britain’s Nur Energie is developing a 2.5 gigawatt project called TuNur that is intended to send energy to UK markets, via a dedicated undersea cable, at a cost 20 percent below that of the country’s offshore wind turbines. If Nur can deliver on that promise, officials say, it would be the proof of concept Saharan energy developers have been waiting for, and could breathe new life into other solar-energy projects across the region.

“There is actually a huge requirement for base-load or dispatchable renewable power and CSP with storage is one of the few technologies, if not the only technology, that can provide that at this scale,” says TuNur director Daniel Rich.

It remains to be seen whether Nur Energie can sidestep the technological and regulatory hurdles that have dogged other large-scale CSP projects around the world. Still, for energy investors and others with an interest in tapping the Sahara’s enormous solar resources, the TuNur project is helping to keep the dream alive.

Companies to watch

*  British renewable-energy investment and development firm Blue Energy is currently constructing Africa’s largest photovoltaic solar facility in Ghana. The 155-megawatt facility, due to go online next year, will feed into a regional grid serving Ghana, Ivory Coast, Togo, Benin and Nigeria.

*  European solar-panel manufacturer REC is working with an Orascom (OTMT:CA) subsidiary on a 50 MW project in Egypt, and regional SVP Luc Graré says he believes the Egyptian solar sector will boom in coming years. “I think in 2020 or 2025 Egypt might have the possibility to export power to other countries,” he says.

*  Saudi-based developer ACWA Power is working on numerous large-scale solar projects across the Middle East and northern Africa, including Noor-1 and a proposed 1.5 GW solar plant in Egypt. CEO Paddy Padmanathan says it’s “absolutely realistic” to believe that Saudi Arabia will become a solar exporter in coming years. 

Ben Whitford is the US correspondent for The Ecologist. He has written for the Guardian, Newsweek, Mother Jones, Slate, and many other publications.

 

 

Originally published on January 28, 2016