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De-risking Solar Thermal Investments

Submitted by Nigel Cotton on February 2, 2017

 

Hard Financial Facts about solar thermal

An open source database to support investment in solar thermal technologies through improved transparency on costs and heat prices in buildings and industry.

 


 

China: Himin’s Largest Solar Process Heat Installation

Submitted by Baerbel Epp on October 10, 2016
Himin Process HeatLast year, Chinese vacuum tube manufacturer Huang Ming internationally known as Himin Solar installed its largest system for solar process heat to date. The company said that it had set up a 9,903 m² installation in Shandong province in October 2015, a system which had since produced heat for a textile factory owned by the Ruyi Group. The RMB 12.46 million (EUR 1.66 million) project had been entirely financed by the customer, which had not received any public subsidies. Ruyi had had the plant built because of a lack of electricity. “The local government had restricted electricity supply to Ruyi, which meant that the business could no longer fulfil its annual output targets,” stated a press release by Himin.
Photo: Himin
 

South Africa: Solar Green Beer Production Creates High IRR

Submitted by Baerbel Epp on September 14, 2016
CBC Installation South AfricaSouth Africa’s solar process heat installations remain profitable when they have to compete against other heat sources, such as diesel, paraffin, petrol or gas, the Centre for Renewable and Sustainable Energy Studies (CRSES) at Stellenbosch University, South Africa, has concluded in a recently published paper. The researchers at the CRSES conducted a feasibility study of a 120.7 m² collector field that was to cover 60 % of the existing hot water requirements of Cape Brewing Company (CBC) based in Suider-Paarl, Western Cape, and analysed ten proposals submitted after the company’s invitation to tender in January 2015. South African E3 Energy won by offering an installation with a levelised cost of energy of 7.9 EUR cents/kWh, an internal rate of return of 16.7 % and a payback period of 9.3 years. CBC´s daily hot water demand is estimated to be 7,000 litres at 85 °C during 245 days a year, i.e., during a full year except for weekends, public holidays and two weeks of summer holidays. The system went into operation in November 2015 and the COO of CBC, Andy Kung, seems satisfied with the performance and the energy saving it offers. 
Still image taken from the short film
 

India: Process Heat System Monitoring Shows Fair Performance but Room for Improvement

Submitted by Baerbel Epp on August 12, 2016
Himachal Pradesh Dairy Case StudyThe SoPro India project has scientifically monitored two solar water heating systems for a year with the aim of presenting reliable data on system performance (see the attached PDFs). The measured 20 % solar efficiency would put the ROI between 2 and 3 years, depending on the development of fossil fuel costs. The researchers from German institute Fraunhofer ISE see new systems offering “good opportunities for further technical improvement.” SoPro was implemented by the German Agency for International Cooperation (GIZ) in cooperation with the Indian Ministry of New and Renewable Energy (MNRE).
 

Mexico: Solar Process Heat Beats Fossil-Fuel Boiler in Energy Cost

Submitted by Baerbel Epp on July 25, 2016
Inventive Power MexicoMexican company Inventive Power helps industrial customers to reduce their energy costs, which in turn reduces pollution in major cities. “Besides traffic, industrial boilers are responsible for much of the pollution in urban areas,” Ángel Mejía Santiago explained during the Intersolar Europe. The founder and CEO of Inventive Power emphasised that concentrating solar systems could offer energy at significantly lower cost than thermal power generation by natural gas or oil. Santiago sees great market potential in the technology, as there have been 32,000 boilers and water heaters installed across the country – at hotels and hospitals as well as food and beverage companies. The photo shows a parabolic trough installation with 433 m² of mirror aperture at the Nestlé dairy factory in Lagos de Moreno, central Mexico, which started operating in 2014. 
Photo: Inventive Power
 

Tunisia: Good Hotel and Hospital Investment Opportunities

Submitted by Baerbel Epp on June 8, 2016
Tunisia StudyA great deal of sunlight, large investment grants and subsidised energy prices: These are the factors determining the profitability of big solar thermal systems in Tunisia, according to the authors of the study Opportunities for solar thermal systems in the tertiary and industrial sectors in Tunisia, a publication by the German Agency for International Cooperation, GIZ, (see attached document in English, the French version is under consultation). Under certain circumstances, a solar thermal system can achieve a double-digit Internal Rate of Return (IRR), for example, if it is installed at LPG-dependent hotels or hospitals on the Tunisian island of Djerba. When solar replaces natural gas in commercial buildings in Tunisia’s capital, Tunis, the IRR is still significantly higher than the estimated 4.3 % inflation per year. However, there are difficulties with the economic feasibility of solar process heat applications because not even top reference cases have fulfilled investor expectations. The authors emphasise that the importance Tunisian businesses currently place on payback periods for investing may lead them to overlook valuable projects.
Figure: GIZ study
 

IEA SHC: Levelised Cost of Heat and the Calculations behind It

Submitted by Baerbel Epp on May 28, 2016
The main objective of IEA SHC Task 52, Solar Thermal in Energy Supply Systems in Urban Environments, is to call attention to both the technical and economic aspects of solar heating and cooling usage in densely populated urban areas. Urban planners and commercial clients want to know the costs compared to the energy output generated by various solar heating technologies. A method to benchmark different solar heat production systems is Levelised Cost of Energy (LCOE). This method is described by the IEA as the “average price that would have to be paid by consumers to repay exactly the investor/operator for the capital, operation and maintenance and fuel expenses, with a rate of return equal to the discount rate”. The chart shows the LCOE for different applications and system sizes in northern / central European climates, taken from the most current Task 52 study Technology and Demonstrators (for further details see table below). The author of the study, Franz Mauthner from Austrian research institute AEE INTEC, contributed to this article, which elaborates on the method and the calculations behind it. 
Chart: Task 52 / Technology and Demonstrators study
 

Germany: Solar Heat Costs Less than Oil and Gas in Multi-Family Buildings

Submitted by Baerbel Epp on August 11, 2015
Solar thermal is economically viable in Germany in multi-family buildings – that is the clear message of the Excel-based tool which German solar thermal system supplier Remeha, a brand of the BDR Thermea Group, uses to calculate solar water heater performance at multi-family dwellings. The Excel tool was created for installers and planners to support their offers of solar hot water or space heating for blocks of flats. The tool calculates a kWh price, as well as the investment’s Internal Rate of Return. The solar heat produces the most cost-effective kWh with 43.3 EUR/MWh, assuming a 20-year lifetime. During this period, earnings are double as high as investment costs.
 

Italy: Solar Steam for Cheese Production

Submitted by Baerbel Epp on July 24, 2015
CSP San NicoloDirect steam production, 50,000 litres of diesel saved per year and the advantage of the Italian incentive scheme for renewable heat: All these favourable conditions allowed a small dairy in Sardinia to choose a concentrated solar thermal plant with Fresnel collectors for generating 200 °C steam. The steam is used to supply heat to the industrial processes for cheese production. The investment of EUR 400,000 will have a payback period of about 4 years.
Source: CSP-F Solar
 

India: Solar Process Heat with less than 18-Month Payback Period

Submitted by Baerbel Epp on July 14, 2015
Sharman Shawls“Where there’s a will, there’s a way” is the slogan at Sharman Shawls, one of India’s leading garment industry and export companies. Based in Punjab state in northern India, Sharman Shawls uses diesel to meet the hot water requirements for dyeing, bleaching and washing garments. The enterprise’s daily consumption is close to 200,000 litres of water and the processes require almost 1,700 litres of diesel per day. 180 flat plate collectors preheat hot water to 80 °C, saving 82 litres of diesel at 300 days a year. Space constraints have limited the diesel saving per day to 5 %.
Photo: Jaideep Malaviya
 

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