LCOE reduction potential of parabolic trough and solar tower CSP technology until 2025

Abstract

Concentrating Solar Power (CSP), with an installed capacity of 4.9 GW by 2015, is a young technology compared to other renewable power generation technologies. A limited number of plants and installed capacity in a small challenging market environment make reliable and transparent cost data for CSP difficult to obtain. The International Renewable Energy Agency (IRENA) and the DLR German Aerospace Center gathered and evaluated available cost data from various sources for this publication in order to yield transparent, reliable and up-to-date cost data for a set of reference parabolic trough and solar tower plants in the year 2015 [1]. Each component of the power plant is analyzed for future technical innovations and cost reduction potential based on current R&D activities, ongoing commercial developments and growth in market scale. The derived levelized cost of electricity (LCOE) for 2015 and 2025 are finally contrasted with published power purchase agreements (PPA) of the NOOR II+III power plants in Morocco. At 7.5% weighted average cost of capital (WACC) and 25 years economic life time, the levelized costs of electricity for plants with 7.5 (trough) respectively 9 (tower) full-load hours thermal storage capacity decrease from 14-15 $-ct/kWh today to 9-10 $-ct/kWh by 2025 for both technologies at direct normal irradiation of 2500 kWh/(m²·a). The capacity factor increases from 41.1% to 44.6% for troughs and from 45.5% to 49.0% for towers. Financing conditions are a major cost driver and offer potential for further cost reduction with the maturity of the technology and low interest rates (6-7 $-ct/kWh for 2% WACC at 2500 kWh/(m²·a) in 2025).