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Influence of solar energy resource assessment uncertainty in the levelizedelectricity cost of concentrated solar power plants in Chile

Matías Hanel, Rodrigo Escobar*

Department of Mechanical and Metallurgical Engineering, Ponti ficia Universidad Católica de Chile, Vicuña Mackenna 4860, Macul, Santiago, Chile

Keywords:

Solar power

Chile

Parabolic trough

a b s t r a c t

The deployment of renewable energy power plants is a priority of the Chilean government. A mandatory

quota system requires that 5% of the electricity generated in the country must come from renewable

energy sources, gradually increasing to 10% by 2024. As of 2010, solar energy has received attention only

for small-scale future demonstration projects. Concentrated solar power (CSP) plants are an interesting

option for the country, especially when considering the high levels of solar radiation and clearness index

that are available in northern Chile. Here we present a thermal and economic analysis of CSP plants of the

parabolic trough type, comparing five different configurations including thermal energy storage and

fossil fuel backup. The electricity yields are obtained from hourly simulations that consider radiation

levels, solar field, and power plant characteristics. An economic model that includes the costs of 

construction, operation and maintenance allows predicting the levelized electricity cost (LEC) as

a function of plant configuration and location. The results indicate that the plants can produce dis-

patchable electricity at a cost that is competitive and inversely proportional to radiation levels. A

sensitivity analysis is conducted in order to determine the influence of solar field area and radiation

levels, and the optimal plant configuration and solar field area are obtained as a result.

Ó 2012 Elsevier Ltd. All rights reserved.

1. Energy in Chile

The main energy sources that the country utilizes are oil and its

derivates, coal, and natural gas. The country does not produce any

of them in significant quantities, and it does not hold any mean-

ingful reserves that could be explored and exploited in the future.

As of 2009, Chile relies on fuel imports to meet its growing energy

demand, which combined with limited fossil fuel resources make

Chile a growing net importer of energy. Renewable energy sources

in use by the country comprise only hydroelectricity and wood-

based biomass, accounting for 24% of primary energy consump-

tion, while non-renewable sources account for the other 76%. The

electricity sector has begun to rely heavily on coal-fired powerplants, with up to 3 GW of capacity being planned to enter the

system in the next three tofive years. Thus, Chile is not only staying

dependent on imported energy, but is also switching to more

expensive sources such as liquefied natural gas, and to fuels of 

greater environmental impacts such as coal. These two concrete

actions that Chile is taking in order to secure energy supply go

directly against the sustainable development definition. Therefore,

it is of critical importance for the country to achieve three primary

strategic goals: first, to provide adequate energy supplies in order

to continue its economic growth; second, to ensure that imported

energy is accessed through international markets to satisfy any

requirements that cannot be met by indigenous production; and

third, to ensure the development of indigenous energy sources at

a suf ficient rate such as needed for the substitution of imported

energy resources in order to rapidly achieve energy security and

a degree of energy independence.

Starting on 2010, a new law has been passed which requires

electricity distributors to provide 5% of their energy sales from

renewable energy sources, at average bided prices, increasing this

contribution to 10% by 2024. Thegovernment hopes to promote theuse of renewable energy for electricity generation, as a result of 

modifying the electricity sector law, effectively removing barriers

for the incorporation of renewable energy plants. The law has

resulted in several wind and biomass energy power plants being

planned and entered into the environmental impact assessment

mechanisms. In general, Chile is thought to be abundantly endowed

with renewable energy but no large scale renewable energy

resource assessment has been conducted, and in particular for wind

and solar. Therefore, any energy planning effort that considers

these renewable sources is seriously impeded for the time being. In

the case of solar energy, large scale systems are not being planned* Corresponding author. Tel.: þ56 2 3545478.

E-mail address: rescobar@ing.puc.cl (R. Escobar).

Contents lists available at SciVerse ScienceDirect

Renewable Energy

j o u r n a l h o m e p a g e : w w w . e l s e v i e r . c o m / l o c a t e / r e n e n e

0960-1481/$ e see front matter Ó 2012 Elsevier Ltd. All rights reserved.

doi:10.1016/j.renene.2012.01.056

Renewable Energy xxx (2012) 1e5

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or even discussed. Regarding the power generation sector, the solar

thermal power plant technology is scarcely known. Solar energy

development in Chile is small, mostly focusing on water heating

applications for the residential sector. The total contribution of 

solar energy to the primary energy consumption of Chile is negli-

gible [1].

1.1. Parabolic trough plants

It has been argued that Concentrating Solar Power (CSP) tech-

nologies are the most convenient in economics terms, with their

cost projections being such that they are becoming competitive

with traditional power plants even today [2,3]. The Parabolic

Trough Collector (PTC) power plant is the most developed and

proved, with commercial use in the US since 1985, and new plants

being built in Spain, USA, Morocco, Algeria, and plans to build in

other countries as well. The PTC concept is simple, and basically

focuses direct solar radiation in an absorber tube, which is located

at the center of an evacuated glass tube for minimizing thermal

losses. The concentration factors can be as large as 90 [4], and

commercial systems are available from 14 to 80 MW. The HTF is

heated in the absorber element of the concentrator array to

temperatures close to 400 C, and then transfers thermal energy tothe power block through a heat exchanger. A fossil-fired boiler can

supply backup heat during non-sunlight hours, or can stabilize the

steam thermodynamical state in order to maintain a constant

power generation. Given suf ficient solar input, the plants can

operate at full rated power using solar energy alone. Most of the

research on PTC plants is focused on achieving higher plant avail-

ability and ef ficiency, by means of thermal energy storage (TES),

improvement of the HTFs, better prediction of available solar

radiation, and direct steam generation (DSG) techniques [2e5]

(Fig. 1).

The PTC plants are becoming very competitive in the actual

context of high energy prices and environmental pressures [6e8]. A

great effort has been devoted to the development of adequate steps

for cost reduction, defining several research priorities with anestimated cost reduction potential of up to 40%: increase the scale

to plants larger than 50 MW, improve concentrator structure and

assembly, utilization of advanced energy storage schemes,

advanced reflectors, increase HTF temperature, and reduction of 

parasitic loads [9,10]. Improvedassessment of solar energy resource

is perceived to be the first step in developing a technical program

that will lead to proper installation of CSP plants with economical

feasibility. An erroneous input for direct solar radiation can lead to

an erroneous size of collector field, which can result in severe

financial dif ficulties for the plant during operation. In this context,

computational simulation is perceived as the best tool for properly

estimating collector field size during the design stages of CSP PTC

plant planning [10,11]. Since all research and commercial applica-

tion of CSP plants has been done in geographical regions that

receive a lower average of solar energy than Chile [4,12] (Fig. 2), this

seems to indicate that the country presents a distinctive advantage

for CSP utilization, and that PTC plants installed in Chile could

display a better performance than what has been achieved in other

countries.

2. Potential in Chile for CSP plants

The potential in Chile for CSP plants has not being determined

on a large scale. It is possible to af firm that the Atacama Desert in

the northern part of the country is one of the best regions forsolar energy, based on energy density data from several sources

[4,12,13]. Chilean skies in the northern part of the country exhibit

the highest number of clear days of any region in the world, and as

such have attracted many astronomical observatories. Consump-

tion centers in the northern part of the country are mostly mining

industries, which consume the highest share of power generation

[1] with fundamentally constant demand. And the region is

a desert, with ample plains and flat, unused terrain. Therefore, all

three basic conditions for the development of solar thermal power

plants are met in the northern region of Chile: high levels of direct

solar irradiance during most of the year, availability of flat terrain,

and short distance to consumption centers [2].

However, the first necessary step in order to adequately perform

energy planning activities and especially solar energy conversionsystems design is to have precise solar energy availability databases

of low uncertainty, which unfortunately is not the case in Chile.

Although several data sources exist, they either lack on spatial and

Fig. 1. Schematic of a PTC CSP plant of the SEGS/LUZ systems, with thermal energy storage and auxiliary, fossil fuelfi

red backup boiler. From [16].

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temporalresolution, or exhibit highlevels of uncertainty thatmakes

them unsuitable for hourly simulation of solar power plants [13].

As seen in Fig. 3, which depicts several data sources for the city

of Calama in Northern Chile, there are significant differences in the

data: according to different sources for measurements, satellite

estimations, and weather simulation models, the maximum daily

values of solar radiation can be as high as 10.5 kWh/m 2day, or as

low as 6.7 kWh/m2day. This same situation is repeated for locations

throughout the country, where at least two or more data sources

are available. Thus, the question is: What data can a designer select

for dimensioning a CSP plant? And also, what is the impact on

selecting one data source instead of others? In what follows, we

briefly present the thermodynamical model that allows us to

perform hourly simulations of the CSP plant operation. This will

result in predictions of the total amount of electricity generated in

a year at a given location, for five different plant configurations.

Then, an economic model is also briefly described, which results in

a levelized electricity cost as a function of solar collector field area,

and radiation level.

3. Thermodynamic and economic model

A CSP plant can be of one of several different configurations,

depending on the solar field connection to the steam cycle, and the

presence of both a thermal energy storage and fossil-fuel backup

systems. Here we consider five basic configurations that include

most combinations present in a CSP plant. The first plant configu-

ration is direct power production, where a heat transferfluid passes

through the solar collectors and then through a series of heat

exchanger in order to produce superheated steam, which is in turn

injected to the power block. The second model uses indirect

Fig. 3. Several sources of solar radiation data in Northern Chile display signifi

cant differences.

Fig. 2. (right)e Annual mean of global horizontal radiation in Chile (from [13]; units in

kWh/m2day).

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thermal energy storage and adds a fossil backup. In this configu-

ration the heat transfer fluid in the solar collector circuit heats

a secondary fluid which is used for thermal storage, which in turn

delivers the thermal energy to the power block. The fossil backup

can be used in order to maintain continuous power production

when solar radiation is temporarily unavailable or at night. A

variation of this configuration lacks the fossil backup. The fourth

configuration id the direct storage with fossil backup, in which thefluid in the solar collector circuit is the same fluid used for thermal

storage. This fluid delivers its energy to the power block via a series

of heat exchangers. Finally another direct storage configuration

lacks the fossil fuel backup.

Details of the thermodynamic and economic models can be

obtained from [15], whichis readily available by email upon request

to the authors,and in [16,17]. For the solar field model the following

inputs are necessary: the aperture area measured in square meters,

which is set to 1,400,000 m2, computedbased onthe SEGS area that

have in average 6150 m2 per installed MW of aperture, with a solar

multiple of 2, andmultipliedby the relationbetween theyearly DNI

in the city of Antofagasta (w1.8 MWh/m2) and Kramer Junction

(w2.1 MWh/m2). The collector aperture in meters is the one for the

LS-3 structure. The hourly DNI and temperature are obtained from

databases [14]. For the thermal model the electricity production is

computed only for the first year; it is assumed that following years

behave in the same manner.

The economic model includes construction and operational

costs as indicated in Fig. 4. The result of the economic model is the

levelized energy cost, or LEC, which is the cost of energy that makes

the present value of the project zero. If the price of electricity is

higher than the LEC, the project is feasible. In other cases an

economic incentive from state should apply to make it interesting

to investors.

4. Results

The simulations weredone for Antofagasta (1800 kWh/m2 year),

Calama (3200 kWh/m2 year), and Santiago (1400 kWh/m2 year),

three cities in Chile that offer a range of annual radiation levels, and

which are located in the coast, desert, and central agricultural

regions.Fig. 5 shows the hourly electric energy produced with solar

energy for the 6th to the 11th of January at the three cities and for

different plant configurations. Both TES configurations flatten the

power production curve and translate energy to hours after sunset.

Fig. 6 shows the monthly average of hourly power production, with

bars indicating the best and worst months. Not surprisingly, Calama

is the best location for installing a solar trough plant of any config-

uration. All the plant configurations with direct energy production

show a better average with a large range between maximum and

minimum. A TES system modulates the energy production, making

the plants produce energy with a smaller range between max and

min. Finally, direct TES has a better performance than indirect TES,

since it doesn’t uses a heat exchanger between the storage system

and power block.

Fig. 6 also displays the computed LECs for each location, this

time adding the city of Copiapó (2500 kWh/m2 year). It can be

observed that the lower costs are associated to the Direct and

Indirect TES configurations using fossil backup. The highest cost

corresponds to the direct production strategy, which, as a solar-

only mode, is limited by the availability of sun hours and there-

fore has the least energy production for a similar investment as the

other configurations.

As mentioned, the sources for solar radiation in Chile display

a wide range of different data, which in occasions can reach a 40%

uncertainty or more as shown in Fig. 3. Thus, it is very dif ficult to

Fig. 5. Hourly simulation results for CSP plants in Antofagasta during six days in

 January.

Fig. 4. A schematic depiction of the economic model used to predict generation costs.

Fig. 6. Average daily energy production for different plant confi

gurations at three locations (left) and LEC for CSP plants at different locations in Chile (right).

M. Hanel, R. Escobar / Renewable Energy xxx (2012) 1e54

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argue that one has chosen the correct data until a good solar energy

resource assessment of validated, quality data has been developed

for the country. Fig. 7 shows the LEC and yearly Energy production

in Copiapó, as a function of the plant configuration, solar radiation,

and solar field area. It can be seen that, first, the optimal solar field

area depends on the radiation level for minimum LEC. Second, the

LEC variation as a function of solar radiation is significant, and

can result in a serious financial risk to investors if the uncertainty is

not taken into account. Also, considering terrain availabilityconstraints, the uncertainty in solar radiation data can also impact

site selection if one location is deemed to be too small when the

radiation is underestimated.

5. Conclusions

Chile is not a fossil energy producer; the country satisfies its

internal consumption based mainly on imported fuels. This makes

the country dependent on international markets in order to secure

its energy needs, which makes it vulnerable against supply

disruptions and price volatility.

The Chilean government is actively seeking to promote the

deployment of renewable energy plants by a mandatory quotasystem and also financial incentives. The successful deployment of 

renewable energy in the country will depend on providing an

adequate investment environment, which in turn is affected by the

availability and quality of the renewable energy resources. In this

respect, a proper assessment of the solar energy resource has not

yet been performed in Chile, which results in some regions of the

country where there is simply no data available and others where

plenty of data exist, although with wide dispersion and often even

contradictory. This uncertainty in the data introduces a large

uncertainty in thefinalcost of thesolarelectricity, andit potentially

can have a significant impact on the financial side of an operation.

Therefore, it is necessary for Chile to improve the quality of avail-

able data, and also to derive means of at least reducing the data

uncertainty and thus the financial risk of a CSP project in the

country.

In what was presented, five different configurations of CSP

plants were analyzed for the local conditions in Chile, and an

economic model implemented in order to predict the LEC and

optimal plant size. It was seen that the LECis inversely proportional

to available radiation, and that the best locations for CSP are in the

Atacama Desert. However, both the LEC and optimal solar collector

field for minimum LEC display a significant dependence on solar

radiation, which is larger for small-scale plants. Considering

that the government is actively promoting the deployment of 

a 5e10 MW plant, it is concluded that a strategy that minimizes

uncertainty in the LEC could gain an advantage by designing larger

plants.

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