An area less than 3 % of the Sahara desert covered in parabolic trough power plants would be enough to supply the world’s ongoing electricity requirement. The scenario sounds suspiciously simple. But German renewable energy company Solar Millennium is convinced that solar power generated in this way is the best long-term solution for assured energy supply because of its capacity to generate and store energy efficiently, even if wind power is the current growth market in renewable energy.

Wind energy production is a cheaper, more mature technology, with a developed supply chain and production facilities for turbines in the 1000 to 10,000 mega watt (MW) range, says company founder Henner Gladen. “If a big investor wants big gigawatt investments then they can only buy wind in the current market and this will be true for the next two to five years,” he says. But in the longer term, big investors will look into other technologies for a predictable power supply. “Reliability of power supply is our advantage but this industry needs a couple of years before the supply chain is ramped up; we are just not ready for the 10,000MW a year production yet,” he says.

The company is currently constructing a third parabolic trough power plant in Andalusia, southern Spain, following two other fully commissioned plants on the same site.

Parabolic mirrors with a surface area of about 500,000 square meters concentrate the sun’s rays, generating heat energy. This is then used to generate electricity, via a steam turbine, which will supply energy to 200,000 people. Government support was the main driver for choosing Spain as the site for the three $300m plants. “Spain has the perfect conditions for project development – it’s a European country with 25-year guaranteed income so project financing is pretty easy,” he says.

California dreaming

The company now has its sights set on the south west US for its next global expansion, starting in California with the possibility of expanding into Arizona, Nevada and New Mexico. “Many global locations have the natural solar resources but the US and Spain have the government support and they have bankability,” says Dr Gladen.

A small country in Africa, for example, is not prepared to think in 20 or 40-year dimensions because with a one-year outlook the solution is that it’s cheaper to build a coal powered plant, says Dr Gladen. “With a solar plant you make the investment now and for the next 40 years have negligible operating and maintenance costs,” he says. And that is the logic behind expanding only in high-value markets.

New administration

The US solar-thermal power plants will involve investments of between $800m to $1.2bn. The company is currently planning about a dozen projects up to 250MW in the next couple of years and is eagerly awaiting a new US administration after which new investment tax credits are expected to come into force. In principle, it takes four years for project development and construction time, says Dr Gladen, which would make the new plants operational in around 2013, all being well. He predicts the south west US will be a rapidly growing market in the next two to five years. “The region is brilliant for solar radiation, the best in the US, and just 1% of Californian desert could supply the whole of the south west US with power,” he says.

But expansion is not limited to the US and Solar Millennium has activities in the Middle East and Africa with a couple of projects already under construction in Algeria, Morocco and Egypt. Future expansion plans include plants in Australia, a tender in Abu Dhabi this year, and a feasibility study for the first parabolic trough power plant in China.

“These are all regions where the funds are available for investment today,” he says. And, of course, where the sun shines.

COMPANY PROFILE:

SOLAR MILLENNIUM

Headquarters: Erlangen City, Germany

Turnover 2006/07:

$47mSubsidiaries: Man Solar Millennium - Essen, Germany; Solar Millennium LLC - Berkeley, California; MilenioSolar - Madrid, Spain; Flagsol - Köln GermanyBusiness sector: Alternative/renewable energyMain business activity: Electricity