Solar Offers Bright Future

Thursday, November 06, 2008
Sarah Ruppenthal

Expert explores successful development of solar technology on the Valley Isle. “A sustainable future starts with solar power… It’s just so cool.”

As the glow of the afternoon sun faded into the evening sky, more than 100 residents arrived at the Kihei Community Center on Tuesday, Oct. 28, for a “Public Meeting for a New Solar Energy Future.”

Eager to learn more about harnessing the sun’s rays to energize Maui’s homes and businesses, audience members settled into their chairs to hear Abengoa Solar Inc. Chief Operating Officer Scott Frier discuss the development of solar technology on the Valley Isle. As he introduced the evening’s guest speaker, Sierra Club Maui Chapter Chairman Lance Holter reiterated the mounting energy challenges facing island residents, asking all in attendance to take a moment and recognize, “All of what we see around us is because of the sun… the sun is the energy that gives us the power to live.”

As he took the stage, Frier echoed Holter’s sentiments. “A sustainable future starts with solar power,” he said. “I see an enormous opportunity for energy independence here on Maui.”

Heralded as the world’s leading developer of solar technologies, Abengoa Solar Inc. has been building and managing Solar Electric Generating Systems (SEGS) for more than two decades. Based in Spain, but operating worldwide, Abengoa is currently developing the 280-megawatt (MW) Solana Generating Station project in Southwestern Arizona. When completed, it will be the largest solar facility in the history of mankind.

And given the company’s impressive record of success, Abengoa may very well be the optimistic ray of sunshine that Maui’s energy-conscious residents have been waiting for. While he admitted there is a lot of misinformation circulating about solar technology, Frier reminded audience members that solar power has been a trusted source of energy for “a very long time,” as the ancient Greeks used the sun to ignite the first Olympic torch. It is a stable, reliable resource, he said, which not only produces clean, renewable energy, but also stems the tide of imported fossil fuels and “harnesses local resources while retaining local wealth.” If Maui were to utilize a large installation of SEGS, Frier assured it would be a steady and “rock solid” investment that would create lasting environmental and economic solutions to our current energy woes. Calling his initial discovery of Hawai‘i’s electric rates and power grid structures “a jawdropper,” he encouraged audience members to consider solar as a viable alternative to the volatile economic and environmental impacts of fossil fuels.

Traveling to Maui last week on a “reconnaissance mission,” Frier said he thoroughly examined the lay of the land, including the present energy infrastructure, topography and weather patterns, in addition to the “political will and the will of the people.”

Following his in-depth assessment, he overwhelmingly gave a stamp of approval for developing and operating a solar facility on Maui. “I see a healthy nexus here,” he said.

Simply put, solar power plants convert sunlight into deliverable thermal energy by capturing the heat of the sun’s rays in parabolic mirrors and sending it along a pipeline where, at elevated temperatures, it drives a set of steam turbines to generate electricity. The end result, called concentrated solar thermal power, can provide energy to thousands of homes and businesses, and at a significantly lower rate than a fossil fuel burning electrical plant.

According to Frier, “You can craft a solar system to meet specific needs,” customizing facilities according to variables such as fossil fuel hybridization, energy storage and managing output for peak times and seasons.

For Maui, Frier said parabolic troughs would be the most suitable system; parabolic troughs are sleek, mirror-like structures that look like props from a science fiction movie—but offer a quiet, unobtrusive and low-profile collection system. “They are elegant in their simplicity,” he said. “And they easily maintained… and durable and resilient under wind stresses.”

So, where would Maui’s solar facility be located? Frier said an ideal site for a 50-MW solar power plant would be a 250-acre (five acres for every megawatt) stretch of land between Kaupo and ‘Ulapalakua, a veritable “hot spot” that would maximize the output of solar power. And as for the price tag, a 50-MW solar power plant would cost around $320 million. While the amount may seem staggering, Frier said a 50-MW facility would generate enough electricity to power one-fourth of the island, or 50,000 people, for nearly half of the current per-kilowatt hour cost—and save our precious natural environment in the process.

But the advantages don’t stop there—in addition to powering Maui’s homes and businesses, Frier said the construction of a solar generation facility could also jumpstart the local economy. “When you’re building solar, you’re building jobs,” said Frier. “You’re looking at creating hundreds of jobs during the construction phase of the power plant, and dozens of full-time jobs afterwards.” But the first step, he said, is encouraging government officials to see the light—literally. Faced with a plethora of alternative energy sources, legislators have encountered difficulty in narrowing it down to one choice for our renewable energy future.

Frier said he believes the lasting benefits of solar technology will speak for themselves, citing a proven track record, an ability to produce clean, renewable energy, immunity to price volatility and a boost to local economies.

But above all, he said, “It’s just so cool.”

For more information, visit http://www.abengoa.com/ or email abengoasolar@abengoa.com.

Calls for oil price reform as world prices fluctuate

By Ding Qi (chinadaily.com.cn)

Volatile oil prices may be in for further rises in the future, and experts are now suggesting the pricing system of oil in China be reformed.

At the Energy and Finance World Forum in Beijing over the last two days, economists from around the country gathered to consider China's next steps to safeguard energy security as unstability in oil prices and financial markets continues.

Uncertainty remains in oil prices
Oil futures traded in the New York Mercantile Exchange dropped nearly 33 percent in October, the largest monthly loss in history. Despite the plunge, economists said it was still too early to say the crude price had hit bottom, nor to assume a cheap oil supply in the coming years.

According to them, the trend of oil price currently is largely affected by two uncertain factors: demand and dollar.

"The global economic slowdown caused by the financial crisis has greatly cut oil demand worldwide," said Dong Xiucheng, professor and an oil expert at China Petroleum University. He added the trend will continue for a certain period as economic indicators of major industrial nations show no signs of quick recovery.

On the other hand, the swinging exchange rate of the US dollar also adds to the uncertainty of the oil price. "In the short term, it's difficult to reshape the existing international monetary system which takes the US dollar as a major denomination and settling currency. Therefore, the dollar factor is always considered in the estimation of oil prices," said Xia Bin, director of the Financial Research Institute of the State Council's Development Research Center, a government think tank.

Although the exchange rate of the greenback has rallied some 20 percent since July, both experts doubt whether the strong dollar could last given the huge capital release in the unprecedented US financial bailout plan.

In addition, Dong worried part of the bailout money may sneak into resource and commodity markets, which will revive speculation and push the oil price higher.

Based on above factors and the benefits of oil producing nations, Dong predicted that the oil price will be likely to run between $80 to $100 a barrel next year, although any extra factor could lead to unexpected scenario

Multiple efforts to carry out energy strategy

According to Chen Ji, professor from Capital University of Economics and Business, the financial crisis has helped squeeze most speculative bubbles out of the crude oil price. As part of the nation’s energy strategy, he suggested the country seize the opportunity to reform the pricing system of oil and other resources and make the prices reflect actual market demand and supply.

At present, domestic prices of refined oil were mainly under government control. With the diving of international crude price, the price gap between domestic and overseas market is waning, which analysts said is a good chance for China to mobilize its energy prices.

"I believe the authority will deal with the oil pricing issue before the financial crisis ends," said professor Dong.

To function efficiently, the new marketized system should adopt an improved price linking mechanism and speed up the frequency of price adjustments according to the international oil price, he said.

In terms of overseas oil trading, Xia suggested the country seek multi-currency settlement for oil deals and possible currency swap between China and oil producers to avoid the impact of dollar fluctuation.

In addition, a diversified foreign exchange reserve would also be beneficial to the country's financial and energy security.

"Among all the reserve options, oil reserves can be very important one," he added.