Cost and Potential for Cost Reductions

Since concentrating solar power uses direct sunlight, the best conditions for this technology are in arid or semi-arid climates, including Southern Europe, North and Southern Africa, the Middle East, Western India, Western Australia, the Andean Plateau, Northeastern Brazil, Northern Mexico, and the Southwest United States. The cost of concentrating solar power generated with up-to-date technology at superior locations is between USD 0.10 and USD 0.15 per kWh. CSP technology is still too expensive to compete in domestic markets without subsidies. The goal of ongoing RD&D is to reduce the cost of CSP systems to USD 0.05-USD 0.08 per kWh within 10 years and to below USD 0.05 in the long term. Improved manufacturing technologies are needed to reduce the cost of key components, especially for first plant applications where economies of scale are not yet available. Field demonstration of the performance and reliability of stirling engines are critical.

The European Commission (EC) has undertaken a coordination activity, the European Concentrated Solar Thermal Road-mapping (ECOSTAR), to harmonize the fragmented research methodology previously in place in Europe, which previously led to competing approaches on how to develop and implement CSP technology. Cost-targeted innovation approaches, as well as continuous implementation of this technology, are needed to realize cost-competitiveness in a timely manner.

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