DNV GL is exploring how a concentrating solar plant with thermal storage (CSP-TES) can dramatically increase its revenues through ancillary services provision. The key is to find the optimal design, by varying turbine and storage configurations, depending on which markets will be accessed. With the opening of the Ivanpah[1] solar power plant last week, the conversation around profitability of CSP plants, and the true costs and benefits of renewable energy, has been re-kindled (with green energy, presumably). Even as the dedication ceremony for the grand project concludes, the future for large-scale solar thermal in California is uncertain. The main culprit seems to be competition from photovoltaic (PV), which has seen a sharp decline in capital costs over the past several years. In a nutshell, if you are looking for green energy from the sun, PV is cheaper than solar thermal. But is this a fair comparison? The DNV GL study shows that revenue for the plant can more than triple if the plant is configured correctly for the ancillary markets. In addition, the grid system as a whole will benefit if CSP-TES plants focus on delivering flexibility instead of just green energy.

The increasing levels of renewable energy in California stems from an ambitious goal of reaching 33% renewable energy by 2020, and perhaps beyond in 2030 to 2050. As levels increase towards this goal, the California Independent System Operator (CAISO) is tasked with balancing a grid with more and more renewable resources on-line. This is not a trivial task, as most renewable resources are following the whim of the sun or the wind, not an hourly day-ahead schedule or an automatic dispatch signal designed to keep frequency on the grid in check. In other words, the energy market does not only buy and sell energy, it also needs to procure system flexibility, such as regulation and ramping capacity, and back-up energy, such as spinning reserves, in order to keep generation and demand in balance every second, every day. As levels of intermittent renewable energy increase, system flexibility is harder to come by and, hence, will become more expensive.

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