eSolar scores $130 million from Google, other investors
PASADENA, Calif. — Solar power plant builder eSolar has raised $130 million from Google’s philanthropic arm, Google.org, and other investors.
That was the headline news that eSolar chairman and Idealab founder Bill Gross slipped to Green Wombat during dinner Sunday night as Fortune’s Brainstorm Green conference kicked off in Pasadena. The other investors include Idealab and Oak Investment Partners. Big numbers grab attention but the far more interesting angle is the technology that eSolar is developing. If it lives up to its claims, eSolar could help break the logjam that has put Big Solar on the slow track in California.
“We just completed tests at our test site this week and we will be able to produce electricity that is competitive with coal,” said an animated Gross Sunday evening.
That is the Holy Grail of renewable energy and the charge set out by Google (GOOG) founders Sergey Brin and Larry Page when they launched their green power initiative, RE<C (Renewable Energy less than Coal), in November. Google.org subsequently invested $10 million in Pasadena-based eSolar. (eSolar did not say how much of the $130 million Google.org ponied up in the latest round.)
eSolar has been operating in stealth mode but Gross shared details of the company’s technology and how it intends to produce greenhouse gas-free electricity so cheaply — a claim sure to be met with some skepticism by competitors like Ausra, BrightSource Energy and Solel.
At first glance, there doesn’t seem much radically different about an eSolar solar thermal power plant — it’ll use fields of mirrors to focus the sun’s rays on a tower containing a water-filled boiler. The resulting heat will create steam that will drive an electricity-generating turbine.
The tipping-point innovation, according to Gross, is the mirrors and the software that controls them as well as the modular design of the power plants.
While Oakland, Calif.-based BrightSource is developing a similar system, Gross says eSolar is able to use smaller mirrors — called heliostats — that can be cheaply mass produced from off-the-shelf glass like that used in bathroom mirrors. Proprietary software developed by eSolar controls each sun-tracking mirror, increasing their efficiency to produce more electricity. “It’s all about the software,” Gross said.
Smaller more powerful solar fields means that eSolar can build power plants on far less land than competitors for less money, according to Gross. For instance, a 500-megawatt solar power plant can cost more than $1 billion to build and requires thousands of acres of land — which is why most will built in remote deserts. But eSolar plans to build modular, 33-megawatt power plants that can be constructed on a couple hundred acres and plugged into existing transmission lines near urban areas.
“We’ve already bought up rights to enough land to produce more than a gigawatt of electricity,” said Gross, showing Green Wombat a map of California polk-a-dotted with the locations of potential eSolar power plants. A gigawatt can power about 750,000 homes.
The small size of each power plant has another benefit — solar thermal power stations under 50 megawatts do not have to be licensed by the California Energy Commission. That means eSolar can cut at least a year or two off the process of getting a solar power plant online.
That will certainly be attractive to the Golden State’s big utilities — PG&E (PCG), Southern California Edison (EIX) and San Diego Gas & Electric (SRE) — which face a mandate to obtain 20 percent of their electricity from renewable sources by 2010 and 33 percent by 2020.
Although all those utilities have signed massive megawatt deals with solar energy companies, no plant has been yet built.
Gross says that while eSolar has been talking to the utilities it’s not going to wait to have a power purchase agreement in hand before building its first plant.
“Sergey said to go for it and we are.”
Agreed that operating costs will typically be more for smaller plants but the idea of putting the plants closer to the homes is that it will save money in line losses. Hopefully the line loss savings will offset the operating cost difference. God bless them, I hope it works.
This is extremely exciting stuff. I love the fact that there are numerous organization out there trying new technologies… taking a chance to see what works. By doing so, we get more innovation and experimentation. We can become less reliant on foreign oil and fossil fuels. Taking chances and working are will get us there. Even on a smaller scale, we all can seek out solar equipment and systems for our homs… check out this site. http://www.solarequipmentsource
.com for the best solar energy equipment links. Also http://www.altenergystation.com for great information on how alternative energy and power systems work.
The momentum is building. Thank God! This can only help shove Washington, and the rest of the country in the right direction.
I am thinking that Google is not only a good internet investment, but a catalyst for positive change in our country’s future. Maybe it’s time to buy?
Wonder how google wants to tap this opportunity. I think alternate energy is the next big cash cow. Remember, ex-CEO of SAP Mr. Shai Agassi is after his ambitious electric car or green project venture. Google must be having similar plans.
Regards,
Ajith
http://www.dollarshower.com/
http://www.ajithprasad.com/
It’s good to see more companies getting into the solar thermal game. I do have some doubts about eSolar’s business model though. First it seems it seems that they are relying on their software to give them a major advantage. While it may be in the beginning I doubt it would be a long term advantage as others would surly copy it, if it were that much of an advantage. The idea of using cheap mirrors seems to have an advantage but all mirrors are not created equal. The current solar thermal plants use high reflectivity mirrors to maximize efficiency. Ausra is planning on using a more conventional type of mirror so we will have to see how it goes.
Ok I like the modular design but question the logic of building only 33 MW plants. Yes they are quicker to get permitted but would have much higher operating costs. The current theory, held by many in the industry, is that we need much bigger plants, than we have now, to help bring operating costs down. One last problem I have is putting them next to where the energy will be used. While this may be great in Las Vegas or Phoenix I have some serious doubts it will work well in non desert areas. There is just simply much less solar radiation and solar-thermal plants need continuous sun to operate properly. Ausra does plan on building a plant in the Central Valley of California and I would love to be proven wrong. I have no doubt it will operate but think they may be giving up too much efficiency to operate profitably.
I do wish eSolar luck. The more different designs we try the more information we will get.
How quickly can we get these things built out!!! Lets get off of foreign energy as soon as possible
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Silicon Valley these days is all about making the green by being green. A senior editor for Fortune in San Francisco and a veteran environmental and technology journalist, Todd Woody writes about green tech as climate change drives new business models, technologies and opportunities. Before joining Fortune, Todd was an editor at Business 2.0, and the business editor of the San Jose Mercury News. Previous posts included senior writer and senior editor at The Industry Standard magazine, freelance writer for Wired magazine in Australia and a senior writer and environmental reporter at The Recorder, a San Francisco legal daily. He's one of the few people on earth who have seen the rare northern hairy-nosed wombat in the wild.
Another reason for locating close to the customer is to offset peak loads - the greatest power consumption occurs in the heat of the afternoon in the summertime. The power provided by the solar power systems relieves some of the overcapacity needs of the conventional power-generating system (coal, gas-fired, etc.). However, at least here in Central and South Texas, the summertime heat of the day lingers well into the evening. I remember 1998 having temperatures in the 90s at 10:00 pm in July. And with the sun down, while more heat is not being pumped into the enviroment by our sun, the solar power system is also not providing any power for the air conditioners cooling homes and business buildings. I could tolerate the nighttime “heat” when I was under 30 years of age, but now that I am over 50, it is really difficult to have any personal energy.