This article excerpt is taken from the newly released November/December issue of Renewable Energy Focus magazine. To register to receive a digital copy click here.
Manufacturing of solar cells and panels has reduced in the United States, but some firms have found success by shifting their focus onto building utility scale power plants. Indeed, the shift has provided the landscape and scope for the construction of the world’s largest utility scale power plant in California’s hot, dry Antelope Valley outside Los Angeles. The power plant is owned by investment firm Berkshire Hathaway’s MidAmerican Renewables and is being built by SunPower, San Jose, California.
In fact, dozens of projects from 10 MW to nearly 600 MW are dotting this immense basin between the Tehachapi and San Gabriel mountains. The development represents a trend throughout the entire United States, as more manufacturing operations go “under water” (where production and operational costs have exceeded revenues) and ambitious plans for new ones get cancelled (i.e. First Solar has vacated a $300 million panel plant in Mesa, Arizona, and GE recently scrapped plans for a Colorado facility.)The sky’s the limit: In recent times PV at Utility scale has been the order of the day for many PV project developers.
M+W Group, the Germany-based construction firm that built First Solar’s Mesa facility, told Renewable Energy Focus magazine that solar remains a major business driver. However, the company has recalibrated its motions away from upstream manufacturing facilities to downstream utility scale power plants. This is primarily because of a capacity glut.
“The Chinese invested so heavily in solar manufacturing capacity that it drove a lot of players out of business,” said James Ellington, M+W U.S. executive vice president for advanced technology infrastructure. “The incentives and demand for utility-scale power plants are much stronger at the moment than the need for increased manufacturing capacity of cells and panels.”
Building utility scale power plants has added some sense of maturity to the industry, and SunPower’s share price is up 27 per cent on the year as activity in Antelope Valley has been ramped up. MidAmerican Solar and SunPower have begun major construction at the Solar Star Power plants, co-located and totalling 579MW of (AC) generation capacity. Berkshire Hathaway bought the projects earlier this year for in excess of US$2 billion.
As utility scale construction takes hold more and more, companies like SunPower are increasingly placing the emphasis on engineer, procure, construct (EPC) services.
But with this focus comes additional pressures. Environmental concerns are key for example. So how does this manifest itself to a company that wants to build at utility scale? And what more needs to be done?
“These sites consist of several square miles, they’re vast and builders must provide minimal disturbance to the land,” SunPower president and CEOTom Werner told Renewable Energy Focus. “One of the things we do to mitigate environmental impacts is to plant grasses between the rows of the system. We changed fencing for the pit fox, for instance, so that it can go in and out. In fact, we’ve had to address the needs of two endangered species, as well as mitigate dust issues.”
As it closes in on completing the world’s largest solar power plant, Werner speculates the future is in selling power not panels.
“The industry hasn’t focused enough on EPC, and the task of converting these solar cells into 20 year to 30 year power stations," Werner stated. "Companies doing this more are being rewarded with more growth and more shareholder value.”