eSolar is one of a dozen startups that are looking to build solar thermal plants in the deserts of California. While the company says it’s using the lessons of infotech — computing and algorithms — to make low cost modular solar, we were wondering what really makes eSolar stand out? The company has certainly gotten a lot of attention — receiving at least $130 million from Google.org, Bill Gross’ Idealab, and other investors, and inking a deal with California utility Southern California Edison for a 245 MW solar thermal power plant. We thought we’d check in with eSolar’s CEO Asif Ansari and see what all the fuss is about.
1). There’s about a dozen other companies building solar thermal plants in the desert, why will eSolar be a leader in this area?
eSolar is producing easily scalable and rapidly deployed concentrating solar power plants and we’ve brought the minimum economic size of our power plants down to just 33 MW. We build power plants in these 33 MW modules, and replicate the number of modules depending on the size of plant a utility needs, so it’s just as easy for us to build a 33 MW plant for a smaller utility as it is to build a 245 MW or larger plant for a huge utility like Southern California Edison.
This uniform modularity makes it easier for any sized utility to incorporate concentrating solar thermal power into the grid. It also substantially increases the addressable market in developing countries. Most other companies in the United States right now are only building huge power plants, even though companies such as Acciona and Abengoa are also following the trend toward the smaller, mid-sized utility-scale plant in projects in Spain.
2). eSolar has said its replacing “expensive steel, concrete and brute force with inexpensive computing power and elegant algorithms.” Can you elaborate on lessons learned from the Internet and IT worlds?
We learned that leveraging computing power and developing algorithms can be a very smart way to address big challenges. Rather than relying on large curved mirrors and tons and tons of steel to efficiently concentrate sunlight, eSolar is trying a different approach that leverages Moore’s Law. eSolar is making solar electric plants using an array of thousands of smaller flat mirrors – one meter square in size. High-powered software dynamically tracks the mirrors to perfectly catch the sun and reflect it to a collecting tower creating a perfect, continual concentration system.
3). Are the company’s power plants less expensive to build than competitors, and do you have a data point to explain the cost difference to the competition?
We are confident we can drive down costs due to our prefabricated, easily transported and modular design; the on-site assembly, lack of heavy machinery required to assemble our power plants; and the fact that we use fewer materials in construction. All these things translate into reduced construction times and costs.
4). What is the reasoning for using smaller heliostats? Why is this cost effective or a better solution?
Our heliostats are about one square meter in size—human sized, when you think that many other companies are using heliostats that are up to 100 square meters. There are some distinct advantages to the less is more approach. Because our heliostats are made of small, simple, prefabricated parts, they can be shipped and assembled more quickly and at a lower cost. Our heliostats avoid on-site precision-engineering—a task that is costly, involves highly specialized laborers and equipment and overall slows down the time it takes to get a solar power plant online.
Additionally, we use fewer materials in construction, since our heliostats are low to the ground—we don’t need all the steel and concrete that is used to anchor systems.
5). Given the company was one of Google’s first solar investments for its cleantech fund plans, how did the company get connected with Google?
Google.org made an investment in eSolar as part of its RE less than C campaign, which is its initiative to develop electricity from renewable sources cheaper than the electricity produced from coal.
6). The $130 million last investment raised won’t cover the cost of the construction of several solar thermal power plants. Is the company raising more funding? And in what form? (VC, project financing, etc.)
This is an exciting field with immense growth potential—we can’t preclude the possibility of further funding, both from private equity and project finance.
7). Can you talk about the company’s other planned plants and locations where the company has “secured land rights” in the southwestern U.S. to produce over 1 GW of power?
We are currently in ongoing discussions with major utilities in the American Southwest. We recently announced a 245 MW deal with Southern California Edison that will be producing power by 2011, fully operational by 2013 and built in the desert in Antelope Valley. Our modular design fits into a one-quarter square mile plot, which offers us many more options close to power lines, and we’ve secured land in sunny areas scattered across the southwest.
8). Many solar thermal companies are seeking loan guarantees to build these solar power plants — is eSolar seeking DOE loan guarantees?
We can’t comment on that at this time.
9). The federal government might not renew the federal tax credits for solar — what is the company’s plan if these are not renewed?
We are building a sustainable, global business which cannot depend upon subsidies which are clearly not sustainable, so our goal from the get go has been to continue to be cost-competitive in the U.S. as these subsidies are phased out.
10). What are the biggest hurdles for starting construction on these plants? Transmission lines? Permitting?
Both of those issues—transmission lines and permitting—are serious obstacles that have to be overcome before construction can even start. Because eSolar uses significantly less land for its plants than other companies—we use about one quarter of a square mile for each 33 MW plant and a traditional CSP plant uses 2.5 square miles—we are less constrained by those hurdles. There are literally thousands of these smaller sites scattered across the southwestern United States, and many of them are adjacent to current transmission lines.
So that solves another problem—transmission lines and integrating these power plants into the grid. We basically are able to get these plants deployed faster than anyone else, since we have preemptively addressed the problems facing larger power plants.