Is the Sun Setting on Solar Power in Spain?

With waning subsidies and other attractive markets, can Spain maintain its lead in solar tech?















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SOLAR ECLIPSE?: Generous subsidies have allowed solar power plants to flourish in Spain, such as the "power tower" outside Seville pictured here. But those subsidies are dwindling and new solar power may fade with them. Image: Courtesy of Abengoa

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On the outskirts of Seville, Spain, 600 rotating mirrors send shafts of light to a collector atop a soaring 380-foot- (115-meter-) tall tower. Its scalding 480-degree-Fahrenheit (250-degree-Celsius) steam drives a turbine generating a peak capacity of 11 megawatts (MW) of electricity for the national grid. This "power tower" is the first of nine to be built by Spanish engineering giant Abengoa Solar, which all told will produce enough electricity for 153,000 homes by 2013.

From power towers to parabolic trough plants and from photovoltaic farms to roof-mounted solar panels, solar energy is booming in Spain. This month, Europe's first commercial solar-thermal parabolic trough plant—a 15-mile (24-kilometer) curved mirror complex dubbed Andasol that focuses light on collector tubes with synthetic oil bubbling to 750 degrees F (400 degrees C)—revs up in Andalusia. Vast acres of solar farms using photovoltaics made from semiconductors to convert sunlight to electricity now span southern Spain: Celebrated ground-mounted photovoltaic (PV) plants include La Magascona and Jumilla with their array of 120,000 modules on 120 single-axis "follow-the-sun" trackers.

Even carmakers want a piece of the Spanish sun. In July General Motors said it will build the world's biggest rooftop solar power station in Spain, carpeting two million square feet (185,800 square meters) of the roof at its Zaragoza automobile plant with 85,000 flexible solar panels. And the 50-megawatt Andasol plant is also the world's largest facility employing molten salts to store renewable energy: 28,500 tons of molten potassium and sodium nitrate salt in two tanks that bank excess solar heat for more than seven hours.

Plentiful sunshine isn't the only reason entrepreneurs and industry have flocked to Spain. The Spanish advantage includes abundant land, strong demand for air conditioning, mammoth infrastructural firms to fast-track projects, and, most importantly, generous subsidies. The nation's feed-in tariffs guarantee 25 years of up to triple the market price for solar energy, making it the world's hottest solar market, trailing only subsidy-richer Germany as well as the U.S. with its historical lead in developing solar technology.

"Feed-in tariffs shift competition to manufacturers, creating an incentive for innovation," says Wilson Rickerson, a Boston-based energy consultant. "Manufacturers that can produce the most efficient and cost-effective ways of generating energy gain most."

In fact, money committed for Spanish PV projects (mostly ground-based) shot up nearly 500 percent from 2006 to 2007 to a total of $3.45 billion, according to London-based New Energy Finance, a renewable energy market research firm.

But obscuring the light are a few clouds. This month Spain slashed the maximum capacity of solar farms that can claim subsidies from 1,200 MW to just 500 MW. Installed PV capacity has already tripled to 1,500 MW in under a year, should double again by 2010 to 3,000 MW, and more than triple to 10,000 MW by 2020. Spain also cut PV feed-in tariffs by about a third to around 33 eurocents per kilowatt hour. Solar-thermal executives fear the same fate within 24 months as new plants add solar power.

That's led many companies to mull other markets. Though Spain backpedaled on severe cuts after panel makers balked, companies like Energias de Portugal Renovables are pulling out because of profit worries and, in August, BP shelved plans for the world's largest solar panel plant in Spain. Critics have warned that when subsidies dry up, so will solar's appeal. "PV project developers rushed to Spain because subsidies guaranteed returns well above the cost of generating power," explains Nathaniel Bullard, a solar associate at New Energy Finance. "Cuts will drive developers to other markets with high subsidies."



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  1. 1. David M. Clemen 05:11 PM 10/20/08

    I'm all in favor of renewable energy supplies, but 33 eurocents/Kwhr is a ridiculous price to pay for energy. This is worst than Denmark's 29 cents/Kwhr, which is extremely high because they subsidized 4 GW of wind energy. I pay 9 cents/Kwhr in Chicago, IL (Exelon Energy); and would be willing to pay 12 cents/Kwhr for more renewable energy, but not much more.
    I wonder what the efficiency rate is for solar energy collectors. Solar cells are only 15 -20% efficient at best; however, I think the solar collectors would have a higher efficiency. This is to be contrasted with wind turbines 40 - 45% overall conversion efficiency (wind to mechanical to electrical); and hydroelectric's 85 -90% efficiency (water to mechanical to electrical)

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  2. 2. David M. Clemen 05:16 PM 10/20/08

    I'm all in favor of renewable energy supplies, but 33 eurocents/Kwhr is a ridiculous price to pay for energy. This is worst than Denmark's 29 cents/Kwhr, which is extremely high because they subsidized 4 GW of wind energy. I pay 9 cents/Kwhr in Chicago, IL (Exelon Energy); and would be willing to pay 12 cents/Kwhr for more renewable energy, but not much more.
    I wonder what the efficiency rate is for solar energy collectors. Solar cells are only 15 -20% efficient at best; however, I think the solar collectors would have a higher efficiency. This is to be contrasted with wind turbines 40 - 45% overall conversion efficiency (wind to mechanical to electrical); and hydroelectric's 85 -90% efficiency (water to mechanical to electrical)

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  3. 3. Nathaniel 03:50 PM 10/21/08

    Solve the problem with a carbon tax. Just slap a 7-10% tax on fuels that generate carbon, such as oil and natural gas, and use that money to pay for the feed in tariffs. Making oil more expensive and solar/wind less expensive is a great way to really push it in the right direction. As time goes by, the carbon tax can be slowly increased and the subsidies for solar decreased (as less carbon emitting power and more solar/wind power is generated). In this way, oil and natural gas can be phased out while allowing alternative energy to take its place.

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  4. 4. Jose Luis 08:57 PM 10/21/08

    Even if tariffs have been cut, , they are still pretty attractive in terms of ROI - especially when you consider the high insolation rates in most of Spain,. Contrary to what you say there is also a brisk commercial development of projects in a wide variety of technologies, from Concentrating Solar Power to Concentration Photovoltaics to Solar cooling. Moreover, there is a powerful manufacturing industry in the country and world-class research centers, so I think the future of solar power in Spain is actually very bright indeed.

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  5. 5. Tan Boon Tee 10:24 PM 10/21/08

    Solar power has been a strong and tangible alternative as far as clean and renewable energy source is concerned. This is clearly illustrated by what happen in Spain and Nevada, US. Electricity thus generated is viable, albeit the cost can still be a bit too steep.

    The Spanish government ought to give fuller support to promote the solar power enterprise that promises a cleaner and greener environment. We must be prepared to pay a bit more for a better tomorrow, and for the sake of our children’ children. (btt1943@yahoo.com)

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  6. 6. Blueman 08:07 AM 10/23/08

    David Clemen said that solar cells are only 15 - 20% efficient at best... Well the concentrated solar collectors made by companioes like Pyron are actually closer to 40% efficient. 37 - 39% to be exact. The CSP suncube here in Australia runs solar collectors that are better than 30% efficient.

    Bravo to Spain - what they are doing is dramatically reducing Carbon emissions as well as saving their banks. Banco Santander in Spain has taken over Sovereign un the US. This bank is a major investor in solar - and seems, by compat\rison to the US banks - to be doing very well. So I think that the Spanish Govt have leveraged a great investment here...

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  7. 7. David M. Clemen 10:23 AM 10/23/08

    Blueman

    I was referring to the photoelectric solar cells (15-20% maximum efficiency); and was trying to obtain some info on the efficiency of the solar cells used with the concentrated solar collectors, which was not mentioned in the article. The 40% efficiency is a step up from the photoelectric solar cells.
    However, if you read the technical paper "Central Receiver System (CRS) Solar Power Plant Using Molten Salt as Heat Transfer Fluid" (look at other Sci America articles listed), you will see that this type(molten salt) of solar power, which is expected to be the most efficient, has only a 20% efficiency from the solar power collectors to electrical output. This includes efficiencies for the solar collectors, thermal storage, receiver efficiency, steam generator, and turbine generator. This should be contrasted with the 85% (minimum) efficiency of a hydroelectric plant, which is also a renewable energy source with zero emissions.
    I am in favor of renewable energy; I just believe that cost, efficiency, and practicality play a big part in which type of renewable energy should be favored.

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  8. 8. earthartist 12:12 PM 10/23/08

    I wonder how many fried pidgeons can be found at the base of this thing, having been unfortunate enough to fly through the hot zone?

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  9. 9. ductileironman in reply to Nathaniel 04:42 PM 10/23/08

    How about we let the market deal with the problem.. use up all the sources of carbon and there will be a renewed demand for other sources of energy. Subsidies just put undue burden on everyone and slow the overall process when the very problems that are occurring now become apparent. You run out of freebie money to hand out way too soon, and the process does not become efficient enough to be a long term solution either way. Government welfare for energy companies in any form is simply a formula for collapse and eventual government takeover followed by long term lack of real sources of affordable energy.

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  10. 10. Razorblade in reply to David M. Clemen 06:27 AM 10/24/08

    Just too note, that an area with the size of france would be enough space to provide the whole world with solar energy. With today current normal sollar cells. This has been calculated in Germany, so they started the biggest solar manufactory industry there. It's a multimiliard dollar industry.
    It will change the way we think about oil, and so it will change economics.

    Germany is the biggest export manufactury industry country in europe.
    So its safely to say, their export products will change the world.

    You know they even calculated that if you had a field with crops for biofuel that the same field in Germany provided with regular PV cells, provides 50 times more enrgy. So sollar energy has bypassed in efficiceny biofuel. Ofcourse Germany isnt in the Sahara dessert, so at optimal places in the world the revenue would be a lot bigger say a 40% or so. (thats a shocking 90 times more efficient the biofuels.

    Solar energy might not be as powerfull as diesel you might think, but think again, current average sollar cells last 20 years! and they dont require transport to get it, you dont need to dril it, or use ships to transport it. So if you would calculate in weight solar cells and raw-oil; then if you look at the energy it results in, then solar energy defeats that too. It took Germany a little calculation to discover that, but soon more countries will follow like spain did.



    Its only a matter of time now before we all go solar elecric. Oil industry is like an ancient technology to be replaced with this new technology.

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  11. 11. David M. Clemen 11:26 AM 10/25/08

    Razorblade
    Razorblade
    Solar energy is a good source of renewable energy, but it is not the world's saviour (like you write) in terms of renewable energy. It has the following problems:

    1. Very expensive, approx. 3-4x standard electricity rates (Reference Solarbuzz.com for the latest prices)
    2. Only functions on sunny days; and needs an associated energy storage system, or large grid to be functional on a large basis. Therefore, solar energy could not provide all the power of a nation without serious (large dollar) investments in energy storage systems.
    3. Low efficiency. Efficiency rates from solar energy to electricity are approx. 20%, even with the solar collector process versus photoelectric process. This is to be compared with hydroelectric overall efficiencies (potential energy of the stored water to electricity) greater than 85%, and wind overall efficiencies of 40 - 45%. Low conversion efficiencies mean you need more capital investment for more equipment to produce the same amount of electricity.

    If you can realize the shortcomings of solar energy along with the benefits of solar energy, a comprehensive renewable energy scheme can be implemented for a nation. The renewable energy scheme should utilize all types of renewable energy sources in various mixes, in order to be both practical and cost-effective. The goal to be practical and cost effective should be paramount, rather than focussing on only one type of renewable energy, as our saviour.

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  12. 12. Philosopher 04:49 PM 11/1/08

    solar power is very useful here on earth, but what if we used it in space. We would collect over 50% more of the the energy compared to the solar panels on Earth AND no pigeons will be hurt .

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  13. 13. Philosopher in reply to earthartist 10:12 PM 12/3/08


    solar power is very useful here on earth, but what if we used it in space. We would collect over 50% more of the the energy compared to the solar panels on Earth AND no pigeons will be hurt .

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  14. 14. pgtruspace 12:38 AM 4/14/09

    Philosopher is correct except for one small problem.

    We, as yet, have no dependable cost effective way to get it done!
    Roman candle transportation won't do it.

    It seems that many of the most talked about alternative energy systems are designed to scam the governments subsidies. History has shown that these will scraped as soon as the subsidies are ended. Carbon cap and trade is just an other way to force a subsidy distortion. The cost of which will paid by the end users, US you and me, and I'm getting tired of carrying you.

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  15. 15. Deepak gupta 01:10 PM 10/27/09

    since everything should be propagated keeping the future prospects,i think as the time will progress the power needs will multiply and there must be proper mechanism such that the output power can be extended without much damage.

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