Despite the fact that solar thermal companies like Ausra are pulling back on the business model of “bigger is better” solar farms, massive solar deals are still being done. This morning utility Southern California Edison says it’s reached an agreement on “the world’s largest solar deal” with Oakland-based solar thermal startup BrightSource Energy. The deal is for 1.3 GW across seven projects, the first of which will be built in Ivanpah, Calif.
That massive size trumps the huge deal BrightSource already has with northern California utility Pacific Gas & Electric to build a potential 900MW of power from five large solar thermal plants. BrightSource is actually developing the plant in Ivanpah to accommodate 300 MW for its PG&E deal and another 100 MW for its SCE contract, says BrightSource’s
PG&E’s Keely Wachs, senior director of corporate communications. In total, BrightSource has 4.2 GW of solar sites under development, Wachs says.
Of course, developing 4.2 GW of solar power in the deserts of California takes massive funds — the five plants with PG&E will cost on the order of $2-3 billion. The SCE deal will likely cost a bit more than that. And it’s certainly not a good time to raise project financing for solar plants. Reuters had reported that BrightSource hadn’t secured financing for its first plant for the deal with PG&E and was waiting for funds from the stimulus package before starting construction. The company has raised more than $160 million, including a massive $115 million Series C round announced in May. Investors include Google.org, BP Alternative Energy, StatoilHydro Venture, Black River, VantagePoint Venture Partners, Morgan Stanley, DBL Investors, Draper Fisher Jurvetson and Chevron Technology Ventures.
Massive solar farms also take a long time to get regulatory approval. BrightSource had been facing possible regulatory delays for its first projects and had been attending hearings on how to streamline the approval process. The first plant in Ivanpah for SCE isn’t expected to be operating until early 2013.
But BrightSource’s contract with SCE shows the firm is still doing major deals while others are pulling back in this tough economic climate. BrightSource uses a central power tower design, which includes an array of mirrors that reflect the sun’s light onto a central receiver full of water, creating steam and powering a turbine.