BC: ECONOMICS OF SOLAR DISH STIRLING SYSTEMS
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High Noon In The Desert
(with apologies to both Julian Darley and Matt Simmons)
On November 17, 2005 The Wall Street Journal published an article titled Solar's Day in the Sun? by Rebecca Smith, a WSJ's staff reporter. (WSJ Online requires subscription, but the article can be viewed here as a PDF file or here in a text only version; curiously, Chicago Tribune ran the same story on December 4th)
The article describes some industrial-scale solar-based power generation projects currently in an early development stage, and comments on the prospects of the solar industry in general. One of such projects is described thus:
Solar's Day in the Sun?
High Costs of Supplying Electricity Embolden Two California Utilities to Bet on Alternative
By REBECCA SMITH
Staff Reporter of THE WALL STREET JOURNAL
November 17, 2005; Page B1
Ambitious plans to cover two big swaths of California desert with solar dishes could finally help the energy-producing technology make the leap to industrial-scale development. Stirling Energy Systems Inc., of Phoenix, hopes to construct 20,000 solar dishes covering four square miles of the Mohave Desert near Victorville, Calif., each dish pointing skyward to collect the sun's energy and convert it into electricity that would flow 80 miles south to power-hungry Los Angeles. The solar encampment, if eventually built, could produce 500 megawatts of electricity, enough to meet the daytime needs of 300,000 homes, doubling the state's solar capacity. The project cleared a hurdle last month when state regulators approved a 20-year power-purchase agreement between Stirling and Southern California Edison, a unit of Edison International.
The type of devices that Stirling Energy Systems Inc. (SES) is planning to use to convert solar energy into electric power are the so called stirling engines connected to electric power generators. A stirling is an incredibly ingenuous type of a heat engine whose early models go back almost two centuries. Stirling represents an external combustion engine type, whereby the flow of heat is applied from the outside of the engine and thus can be more easily controlled, unlike in an internal combustion engine found in a typical car, as well as in the vast majority of petroleum-burning engines today. Wikipedia, HowStuffWorks, and this and this articles in Mechanical Engineering Magazine offer good descriptions of this technology, its history, and associated pros and cons.
One of the most important "pros" of the stirling engine-based solar solution is its high efficiency, far exceeding that of photovoltaic (PV) systems. This press release from Sandia National Laboratories, a US Government-owned organization focusing on renewable energy research and working closely with SES, cites solar-to-electric power efficiency reaching 30% with stirling solutions, an unheard-of level of efficiency for PV. Another advantage is that power generated by stirling-based systems is grid-ready and can be fed into our existing electric infrastructure immediately at the point of generation, without requiring extra layers of costly conversion, inevitably leading to additional losses in efficiency. Needless to say, SES fully utilizes modern material science and computer technology in their solar units, which utilize space-age materials and advanced system automation. Sandia's PR release describes it thus:
"Each unit operates automatically. Without operator intervention or even on-site presence, it starts up each morning at dawn and operates throughout the day, tracking the sun and responding to clouds and wind as needed. Finally it shuts itself down at sunset. The system can be monitored and controlled over the Internet. Researchers want to make the six systems work together with the same level of automation. The controls and software that perform this integration will be scalable to much larger facilities."
On the other hand, even the most advanced PV systems show far less impressive efficiency (this article, for example, describes one cutting-edge PV system3 which demonstrates less that one-half of the efficiency level of SES systems)
So clearly, this technology represents a good shot in large-scale utilization of solar energy to satisfy the needs of "power-hungry Los Angeles" (as Rebecca Smith puts it), or other large-scale structures. For example, SES' public relations page lists a number of high profile endorsements of their solution for a large-scale use, from energy utilities to political leaders. This seems very timely, as solar is widely considered a large-scale solution to our future energy problems. Sandia's press release sited earlier contains this statement:
"A solar dish farm covering 11 square miles hypothetically could produce as much electricity per year as Hoover Dam, and a farm 100 miles by 100 miles in the southwestern U.S. could provide as much electricity as is needed to power the entire country."
Analogous statements can be seen at SES's FAQ page, as well as in publications and statements by business authors, economists, and various advocates for transition from petroleum to solar to satisfy the growing power needs of our energy-challenged economy.
[An interesting perspective on the US utilization of solar gives this table at US Geological Survey's site. (USGS is an agency of US Dept. of Interior). Although clearly dated (published in 1998), the table demonstrates how vastly "outpowered" the solar energy is by fossil fuels and such in our total energy consumption structure. The table lists overall solar usage at 0.07% of the total 94 Quad BTU of US energy consumption as of 1998, hardly enough to be even noticed. Without a doubt, the share of solar has increased since 1998, and will continue to increase going forward with projects such as described in WSJ' article above going online, however the extremely low starting base appears to indicate that the untapped solar potential in our present economy is enormous, especially considering the imminent deficit of petroleum energy, which our current economy and the entire living arrangement is based on.]
So, what would it take to scale the solar solution such as SES' to the level where it could make a contribution big enough to be noticed, or, better yet, to start a transition from petroleum-based to solar-based economy?
Unfortunately, the Wall Street Journal's article is more misleading than helpful, as it cites the value of 500 megawatts of output power for 20,000 (planned) units, which gives the power output of 25 kilowatts per unit. By itself this number doesn't tell us very much, as the WSJ correspondent forgot to consider that the energy is measured in kilowatt-hours, and as most readers of the WSJ know (with the exception, perhaps, of certain energy economists), the solar power is not distributed equally throughout the day (for example, at 7:00AM and 3:00PM the solar output is expected to be different on most days). No big deal -- not the most serious omission by the WSJ correspondent (a much more serious lapse will be discussed below). Indeed, the Sandia press release cites the same 25 kilowatts as the peak power output expected. Fortunately, SAS' FAQ page offers a more intelligent estimate:
"How much power does solar Dish Stirling system produce?
One dish on an annual basis can produce 55,000-60,000 kWh of electricity. This is equivalent to the total energy required for 8-10 homes in the U.S."
So, the energy output can be generated with a fair degree of confidence. Ok, how much will the economy required to pay for this amount of energy? What will it take to manufacture and install each solar unit?
Not a word from WSJ, and Sandia's PR only offers the number in dollars:
"The cost for each prototype unit is about $150,000. Once in production SES estimates that the cost could be reduced to less than $50,000 each, which would make the cost of electricity competitive with conventional fuel technologies"
Unfortunately, providing a number in dollars is also more misleading than helpful, as it fails to consider the changes that the society will need to undergo to implement this solution on a truly large scale.
In order to see this better let's take a look what each unit really is (a good image gallery can be seen at the SAS site or on Sandia's press release). Each unit is a massive structure approximately the size of a six-storey building, whose most visible element is a solar-reflecting dish 37' in diameter (this image gives a pretty good sense of scale). The area of the dish is cited by the Mechanical Engineering Magazine to be 90 square meters, which agrees, more or less, with the dish's 37 feet diameter. If, for example, the ultra-modern honeycomb aluminum panels that comprise the dish utilize only 2 grams of aluminum per each square centimeter of the dish's surface, they will require 1.8 tons of aluminum alone per dish, not counting other high-tech materials. Furthermore, consider the strength of the steel frame required to sustain a dish of this mass and square footage in a wind-swept desert, and to keep it steady, along with the generator unit described to be "the size of a barrel of oil", or roughly 14 gallons in volume. The structure is truly massive.
And how will this compare with the power output? Well, to put it in perspective, the 60,000 kwh of energy that each unit is expected to generate in a year represents only 7 kwh per hour (roughly). That is the power output easily produced by such a trivial petroleum-based device as a high-end scooter or a medium class motorcycle engine, connected to an electric power generator!
Compare the enormous difference in size and mass between the two types of devices, generating roughly the same power output -- a scooter engine and an SES solar dish. Is this because the SES units are inefficiently designed or poorly implemented compared to scooters? Quite the contrary: SES solar units are masterpieces of cutting-edge engineering, and represent the best of human knowledge in physics, material science and computer technology. What we are dealing with here is the vast difference in energy density between solar and petroleum. Energy economics of (renewable) solar are dramatically different from the energy economics of (nonrenewable) petroleum, and we will need to go through the process of adjusting our expectations accordingly if we are to go anywhere with the transition process.
Nonetheless, let us say that we decide to go ahead and implement a US economy-scale solar solution on systems such as SES' -- in anticipation of completely replacing our energy base from rapidly depleting petroleum to renewable solar. As Sandia and others are fond of repeating, a 100 x 100 miles swath of desert anywhere in the South West could provide enough capacity to satisfy (today's) energy demand of the entire US economy. As the solar encampment on the WSJ article mentions, 20,000 units occupy 4 square miles, so on 100 x 100 = 10,000 square miles we will need to allocate
20,000 x 10,000 / 4 = 50,000,000 (fifty million) units. Let's say (purely hypothetically) that starting next year we will be manufacturing and bringing online 1.5 million units per year, on average, thus smoothly completing the transition from petroleum to solar in a little over 30 years.
Before appreciating the implications of the above proposal (and I am not saying that this cannot be done), we need to consider the following numbers. 1.5 million units per year, with 1.8 tons of aluminum per unit will constitute 2.7 million tons of aluminum. Well, you may be interested to know that 2.7 million tons, per this statistics by USGS, was the entire US aluminum production in a recent year (2003). Of course, a lot of aluminum in the current economy is recycled, however we are discussing here an enormous scale development of gigantic solar dishes -- you don't expect the aluminum for them to come from recycled empty Coca Cola cans, do you? And you would still need to produce aircraft, packaging, electrical equipment, buildings, and consumer durable items to which the currently produced aluminum goes, as one would expect under "normal" economic conditions.
Again, I am not at all saying that the production of aluminum cannot be doubled to meet the demands of this project, nations are known to mobilize all of their resources under war conditions, for example, or when faced with credible threats to their existence. However, please consider the following statistics (again, from the same US Geological Survey's page):
Year Net US Aluminum production (primary) Total number of people employed by the aluminum industry Net reliance on aluminum imports
1999 3,779 76,300 31%
2000 3,668 77,800 33%
2001 2,637 71,200 38%
2002 2,707 62,200 39%
2003 2,700 60,000 41%
Source: US Department of Geological Survey website
URL: minerals.usgs.gov
Do you see a recognizable trend here, with ever-growing reliance on imports as a total percentage of consumed aluminum, and ever-shrinking number of people employed in the industry? This trend would need to reverse if we are even to pretend to get serious about implementing the discussed renewable solution, don't you think?
(Unless, of course, you believe that our reliance on imports from countries such as China, South Korea, et al can grow indefinitely, and that they will be happy to provide us with most of our supplies of this highly energy intensive and strategically important product well into the post-peak oil period, in exchange for our currency and our debt obligations.)
On a related note, I wonder if our economic luminaries and dignitaries such as Mr Greenspan are aware of such trends, or even consider them relevant, when they make statements such as the following:
"The energy intensity of the United States economy has been reduced by about half since the early 1970s in response to sharply higher prices. Much of the displacement was achieved by 1985. Progress in reducing energy intensity has continued since then, but at a lessened pace. This more-modest rate of decline in intensity should not be surprising, given the generally lower level of real oil prices that prevailed between 1985 and 2000. With real energy prices again on the rise, more rapid decreases in the intensity of use in the years ahead seem virtually inevitable."
[Source: U.S. Federal Reserve Web site
federalreserve.gov]
Do you really consider your energy intensity reduced when you rely on ever-growing imports of energy intensive, strategically important products from other countries? Isn't there an element of self-deception present when you pretend that potential energy problems of your importers will not quickly become your problems under such circumstances?
But back to our large-scale solar project implementation. Let's not loose focus of the purpose of the entire solar project, which is to provide the economy with more energy that has been spent on manufacturing of the solar units and relevant logistics. Thus, we need to estimate the energy spent on solar units, and compare it with the energy produced by units brought online (which is known to be estimated at 60,000 kWh per year), before we will be in a position to make a judgement on the energy viability of such project.
Well, it is very hard to estimate precisely how much energy will be required to be spent on manufacturing solar units from scratch. Large-scale manufacturing effort for them does not yet exist at present time.
However, we can get some cues from another mass-produced high-tech device whose production cycle has been exhaustively studied and optimized over decades of ruthless competition between manufacturers: an automobile. Interestingly, WSJ quotes an SES researcher who compared each unit to a car in comlexity (but not, of course, in size).
An organization called Institute For Lifecycle Environmental Assessment published this breakdown of the total energy impact of the lifetime of a typical Ford Taurus (the analysis was performed by Carnegie Mellon University researchers). According to this analysis, the manufacturing process of a typical car requires approximately 120,000 MJ, or 1/10 of the total energy consumed by the car over its lifetime. 120 MJ = 33,333 kWh. However, that's for a car, which is a tiny device next to the six storey building-tall SES solar unit, with its huge dish, barrel-sized engine and the massive steel frame. For example, per US Department of Energy statistics, the production of assumed 1.8 tons of aluminum of a typical dish alone would require about 24,000 kWh of energy. Steel for the massive frame would require about 2,300 kWh per ton. And that is just metal -- before the manufacturing process even starts.
Consider that the energy to manufacture each unit is required "upfront", so to speak, before the unit is brought online. This is what makes energy so different from money -- the rules of the game here are very different than in the monetary system. In the monetary system, anything that brings future cash flows can be valued against them, and this value immediately becomes a part of the economy and is included in the overall financial system before even the first cash flow is made. You can use the value of future cash flows as a colateral for a loan to expand your existing business, or to acquire a new one. The monetary system is capable of expanding through instruments like stock market and credit creation and thus can allow you, for example, to open or acquire a business with only a fraction of the capital that this business would generate over its foreseeable lifetime.
Not like that with energy. You cannot create energy required to manufacture a dollar unit by "expanding" the energy system against the future stream of "energy flows" that this unit would produce once brought online. Every single watt for this manufacturing process must exist in the energy producing capacity of the economy before it can be spent. The corollary of this is that there is always a time lag between the energy required for a unit's manufacture and the energy available from increased energy capacity once the unit is brought online. And because you start with the low base and target a very high base, over a relatively short period of time, you need to live through the period of the energy deficit -- even if you ignore any kind of peak oil-related decrease in already existing energy capacity.
The comparison with cars can ultimately also be much more misleading than helpful, as the car production happens in the framework of mature industries. Not like that with solar units. They will require first to build entire industries from scratch, before solar units can actually start being produced. Every single one of them would present a very non-trivial problem in the energy-short environment, and the time for planning these efforts is running short.
The bottom line is: to implement renewable energy solution on such a scale that would make a difference, you need to have an energy-rich economy to begin with. You also need to have a clear focus and understanding of the scope of the problem, as well as the political will and the grass-root support to go through a war-like economic development effort that will strain every economic muscle in such a society.
If Los Angeles, for example, ever comes to rely on energy this hard-won for a significant portion of its energy ration, it may still be "power-hungry", but not at all in the sense that Rebecca Smith currently observes it to be. |
