A bright idea
THE STATE’S ENERGY POLICY is a dysfunctional mix of regulatory and deregulatory approaches that is helping to create a growing gap between the supply and demand for power in Southern California.
One element is working better than the others, however: the state mandate that power suppliers obtain 20% of their electricity from renewable resources within five to 12 years. An announcement this week from Southern California Edison shows why.
On Wednesday, Edison announced a 20-year contract to buy power from Stirling Energy Systems of Phoenix. The contract will enable Stirling to build the world’s largest generating plant powered by the sun, a facility that is expected to churn out enough wattage to power a small city.
The deal is remarkable for several reasons, not least because Stirling’s technology has yet to see its first commercial use.
Some of the technology, which involves giant mirrored dishes reflecting sunlight onto a chamber filled with liquid hydrogen, has been around since the early 19th century, when a Scottish minister named Robert Stirling patented an engine whose pistons were moved by hot air. But Stirling Energy Systems’ dishes have been put to work only in a small-scale test at a U.S. Department of Energy lab in New Mexico.
The initial cost is so high that the technology isn’t practical unless a large number of dishes are deployed in a single facility serving lots of customers. The plant that Stirling plans to build in the Mojave Desert near Victorville will place about 20,000 dishes across 4,500 acres, or about 7 square miles.
There is no chance a bank or Wall Street would put up the money for that kind of venture, particularly not since the California energy crisis. That’s where the state comes in. By requiring Edison and other providers to enter long-term contracts with companies like Stirling, it is effectively creating a market for renewable power and spurring innovation.
Stirling claims that its technology is more efficient than any other approach to solar power, generating more megawatts for a lower investment. Edison has smartly hedged its bet, however. Its deal calls for Stirling to start with a 40-dish facility generating 1 megawatt of power, which is expected to be online in early 2007, before expanding to 500 megawatts and, possibly, 850 megawatts. If Stirling’s technology proves to be a bust, Stirling will be stuck with the costs, not Edison’s investors -- or its customers.
