Brightsource’s CEO steps down as the solar startup changes business model

BrightSource Energy’s CEO John Woolard is stepping down as the company finds it increasingly difficult to build solar power plants in the United States.

Woolard, who led the Oakland company for seven years, will remain on BrightSource’s board of directors, said San Jose Mercury News, which first reported Woolard’s departure on Thursday.

The company, founded in 2006, is completing its first solar power plant in the United States, the 377 MW project in California’s Mojave Desert called Ivanpah. BrightSource applied for approval for two other projects, Hidden Hills and Rio Mesa, and tried to line up power sales contracts for additional projects, all in California. But the company faced big regulatory hurdles with Hidden Hills and Rio Mesa over issues such as the environmental impact, power plant designs and transmission line upgrades. California regulators also declined to approve several power purchase agreements between BrightSource and Southern California Edison. BrightSource has since canceled Hidden Hills and Rio Mesa.

As a result, the only other power plant that BrightSource expects to build in California between now and 2016 is the 500MW Palen project, Woolard told the Mercury News. BrightSource is co-developing Palen with Abengoa, which in the past only competed against BrightSource.

In a blog post­ on Thursday, Woolard and BrightSource’s executive chairman, David Ramm, said BrightSource is shifting its business model from being primarily a power plant developer to a technology provider. As a technology provider, BrightSource will design power plants and help run them. The change will enable BrightSource to win more businesses internationally, the two men wrote.

This transition has been in the making for some time. BrightSource previously announced plans for projects in India, Australia, Africa and Israel.

BrightSource’s technology uses giant mirrors to concentrate and direct sunlight onto the top of a tower to boil water and generate steam. The steam then goes to a turbine and generator to produce electricity. This technology can be used to help oil companies improve their production. BrightSource completed a pilot project for Chevron in California to show how steam piped underground could pry loose the sticky crude and make it easier to pump out of the ground (see the photos I took when I visited the solar field at Chevron).

BrightSource and other companies that also use sun’s heat to generate steam and produce electricity have been facing tougher competition in the past few years from developers that use solar panels. Solar panel prices have fallen quickly because supply has exceeded demand. California, the largest solar market in the country, also is moving away from promoting giant solar farms because of their environmental impact and the cost of shipping power from remote corners to towns and cities.