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Power Play

Solar Power on the Rise in Golden State

On the outskirts of Vegas, the world’s largest solar project is ready to power up.

Ivanpah: Online by year-end.(Amy Harder)

photo of Amy Harder
October 27, 2013

NIPTON, Calif.—Once we passed Whiskey Pete's, a tawdry castle-turned-casino/hotel where rooms go for $36 a night, I got my first glimpse of Ivanpah, the world's largest solar project, which cost $2.6 billion to build. The contrast between the two structures near the California-Nevada border some 50 miles south of Las Vegas was stunning.

Ivanpah, a solar-thermal system jointly owned by Google, BrightSource Energy, and NRG and built by Bechtel, uses more than 300,000 mirrors (technically called heliostats) to concentrate the sun's energy. The futuristic project will begin generating electricity by year's end for 140,000 California homes.

The day I visited was overcast, which raises the obvious question: How can Ivanpah work without sunlight?

 

"Because there are more mirrors at any given point of time than is needed, it compensates for weather conditions to ensure you're getting enough reflected sunshine," said Joe Desmond, senior vice president of marketing and government affairs at BrightSource, who gave me the tour. "By and large, this has some of the best sun anywhere on the planet," Desmond added quickly, referring to the Ivanpah dry lake, the Mojave Desert basin where the project is located.

Although the closest large city to Ivanpah is Vegas, the installation is situated in California and embodies the Golden State's ambitious energy and change-climate agenda.

"People are surprised they don't know that we're building the largest solar facility in the world in our country right now," said David Hayes, former deputy Interior secretary, who helped permit the 3,500 acres of public lands the project takes up.

Ivanpah is a prototype of how companies use a mix of government policies to make a business plan work for an innovative but not yet fully scaled technology. In April 2011, Ivanpah won a $1.6 billion loan guarantee from the Energy Department, the largest amount awarded under the stimulus-funded program. Once the project begins generating electricity, it will begin to pay back that loan. Enter another government policy: the 30 percent investment tax credit for solar systems. "Almost all of that [tax credit] will be used to pay the loan down immediately," Desmond said.

While it might seem counterintuitive that a company would pay back the government with federal money, Desmond says that's how the Energy Department designed it.

"One of the things DOE negotiated on behalf of the taxpayers is that when the tax credit becomes available that it be used to immediately pay back the balance to the benefit of the taxpayers," Desmond said.

Next comes the last—but arguably most important—piece of government policy that's helping make Ivanpah possible: California's alternative-energy standard, which is the most ambitious in the country. By 2020, the state must generate 33 percent of its electricity from renewable-energy sources.

"The traditional view that renewable energy is never going to get above a few percent, that's been blown up in California," said Hayes, who is now a professor at Stanford Law School near San Francisco.

Nationally, the traditional view Hayes speaks of remains dominant. Renewable energy, more than half of which is hydropower, generated 12 percent of the nation's electricity in 2012, according to Energy Information Administration data. Solar power makes up 1 percent of that 12 percent, which means its overall share of the electricity pie barely registers at 0.12 percent.

Brighter days seem to be on the horizon. EIA predicts that over the next 30 years, even without a significant boost in government promotion of renewable energy, production will increase by 150 percent. Solar power specifically is expected to go up by more than 1,000 percent. By 2040, EIA estimates, renewable energy, led by wind and solar, will comprise one-fifth of total U.S. electricity. While it still accounts for a distinctly minority share of power generation after coal and natural gas, renewable energy's relative projected growth is significant.

"It is not surprising that technologies that are earlier on a technology maturation curve have lower penetration rates and higher costs than those that are mature," said Jonathan Silver, who headed DOE's loan-guarantee program and oversaw the Ivanpah loan approval. "But moving up that maturity curve by definition increases their commercialization and drops their cost."

Silver, who left DOE in the summer of 2011 and is now a visiting senior fellow at Third Way, dismissed the tiny slice solar makes today in our electricity pie: "It's more important to understand the movie here than the photograph."

One photograph that Silver—and everyone else in the solar industry—would rather forget is Solyndra, the solar manufacturer that generated a political firestorm when it went bankrupt after receiving a $535 million loan guarantee from the federal government.

Desmond describes Ivanpah as the "anti-Solyndra." I wouldn't go quite that far. BrightSource had its share of troubles. But it is clear that Ivanpah is on the cusp of a successful launch, whereas Solyndra barely got off the ground.

In fact, Ivanpah was so close to its first day of full-scale power generation that our tour was limited due to the project's final preparations. We couldn't get too close to the heliostats or drive up next to what industry experts call the three "power towers," which stand 459 feet tall (more than 150 feet higher than the Statue of Liberty) and help generate the steam that creates the electricity.

Maybe I should have visited earlier, so I would have been able to see more up close. But mostly I was disappointed I hadn't visited one week earlier. I missed by mere days a visit by the band the Fray, which shot its forthcoming album cover with heliostats in the background. Its lead singer, Isaac Slade, "is very much a leader in renewable energy," Desmond told me.

After our tour, on the way back, I noticed another tacky hotel, Buffalo Bill's (with a roller coaster!), and another solar project. Apparently that's what grows well in the desert outskirts of Vegas: Cheap hotels and solar power.

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