EMERALD: A Solar Thermal Power Plant Design

POWER PLANT DESIGN FINAL REPORT 2016 EDITION

Group Name

Emerald

Project title

A Solar Thermal Power Plant

Name of Students

ABULOK, Rex John D. BARANGOT, Johnrhey M. CASIPIT, Aldwin Leumer M. JUANDAY, Juhaira M. MIÑOZA, Michael Lance L. PUEBLAS, John Paul B. SUMILE, Judy Ann T. VERANO, Jeric S.

Emerald Solar Thermal Power Plant

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TABLE OF CONTENTS 1. EXECUTIVE SUMMARY....................................................................... 2. INTRODUCTION.............................................................................. 2.1. 2.2. 2.3. 2.4. 2.5.

3.

Background.............................................................................................. Objectives................................................................................................ Significance.............................................................................................. Rationale of the chosen technology............................................................. Bibliography review...................................................................................

2.5.1 2.5.2 2.5.3

Solar Thermal Power Systems Using Concentrated Solar Energy Types of Concentrating Solar Thermal Power Plants Existing Parabolic Trough Linear Concentrating Systems

METHODOLOGY.............................................................................

3.1. 3.2.

Project management............................................................................... Design Criteria........................................................................................

3.3.

Design Calculations.................................................................................

3.2.1 3.2.1.1. 3.2.1.2. 3.2.1.3. 3.2.1.4. 3.2.1.5. 3.2.1.6. 3.2.1.7. 3.2.2 3.2.3 3.2.4

4.

3.3.1 3.3.2

Power Plant Sizing System Calculations

DESIGN OUTPUT...........................................................................

4.1. 4.1.1 4.1.2 4.1.3 4.1.4

4.2.

5.

Technical Criteria Collector mounting frame Tilt angle collector orientation shading from direct solar irradiance diffused and reflected solar irradiance thermal irradiance wind Environmental Criteria Social Criteria Economic Criteria

Drawings and System Layouts.................................................................. Site Layout Plant Perspective Equipment and System Layout List of Equipment

Bill of Materials and labor.........................................................................

DISCUSSION................................................................................

5.1. 5.2. 5.3. 5.4.

6. 7.

Cost and Financial Analysis....................................................................... Environmental Impact Analysis................................................................. Social Impact Analysis............................................................................. Project Feasibility.................................................................................... CONCLUSION AND RECOMMENDATION.................................................. REFERENCES................................................................................

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1. EXECUTIVE

SUMMARY

Development of Solar Thermal Power: Compared to other renewable energy technologies, the solar thermal power industry is a relatively new industry with a limited operational experience. The rapid growth over the past few years has led to a fast development in Concentrated Solar Power (CSP) technology and to an increase in the scale and complexity of projects and associated risks. From an International Energy Agency study, it is estimated that by 2050 CSP could provide 11.3% of global electricity compared to an estimate of 9.6% from solar power. In the sunniest countries, CSP can be expected to become a competitive source of bulk power in peak and intermediate loads by 2020, and of base-load power by 2025 to 2030. Main Components: CSP plants use large mirror fields - sometimes 100,000 or more mirrors - controlled by sophisticated tracking systems to reflect and concentrate sunlight onto a focal line (e.g. parabolic trough collectors) or a focal point (e.g. solar tower) to heat a fluid and produce the steam that drives a turbine and generates electricity. Major CSP components include: - Mirror System - Heat Transfer Fluid (HTF) System - Heat Exchanger - Thermal Energy Storage (TES) - Controls System In addition to the solar components listed above, plants have many other elements that represent standard technology for generating electricity. These include natural gas boilers, steam turbine, steam generator, condenser, cooling tower, balance of plant and auxiliary systems. Risk Exposures: Throughout the process of financing, designing, building and operating a CSP plant, it is important to evaluate the various risks for the different parties involved with the project and their ability to manage those risks. This evaluation is part of the risk management process. Insurance is the most common mechanism to transfer risks from the risk owner to third parties (the insurers). Risk exposures can be categorized under two main headings: - Conventional Risks: These are risks related to the construction and the operation of a plant including technology risks (i.e. innovative design, scaling up of a design, project execution risks (i.e. lack of experience) and natural perils. They are often the cause of a physical loss or physical damage to the CSP plant which could also affect the revenue of the plant WG 84 (14)

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-

-

Solar Thermal Power Plant 6 Insurance for such exposures can be covered under Construction/Erection All Risks, Delay in Start Up, Property Damage, Business Interruption, Third Party Liability, and Marine Cargo. Non-Conventional Risks: These are risks which affect the CSP plant's revenue, and its volatility, like the unavailability of the plant due to lack of sun, strong wind, or regulatory / institutional risks, lack of performance, etc. Through adequate risk transfer insurance solutions, CSP projects could attract new potential investors and developers, and would reduce the barriers to their bankability. At the same time the insurance industry can also provide valuable benefits to the CSP industry through its loss control and risk reduction services (i.e. risks surveys). This paper expands and explains the above main themes and provided examples of claims, main risk exposures and the role of insurers

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2. INTRODUCTION 2.1. BACKGROUND Over its arrival a hundred years ago, electric power has radically transformed and advanced that it become an indispensable part of the modern society, providing comfort to everyday life and business. Our job, idle hours, healthcare system, economy and livelihood has been dependent to the constant supply of electric power that even a temporary stoppage or power shortages occur can lead to relative chaos, monetary setbacks and life endangerment. Due to population growth and needs of electricity, power generation has been one of the challenges that the power industry has been facing today. Wherein fact, almost one in four people live without power worldwide. (Kelly, 2001) In meeting the steady increase of energy demand and the conventional energy sources deplete, power generation has been discovering new types of energy generation; renewable resources and non-renewable resources, to meet and supply the shortage that distribution utilities need to accommodate the demand of the community. On the other hand, seasons have been affecting the power generation; hydroelectric power plant could not generate the demand during drought, nuclear power plant undergoes seasonal scheduled outages and photovoltaic power plant could not harness during rainy season. Considering Philippines as an archipelagic state and a vast dense water country, seasonal change has been affecting its power generation mostly during summer and drought season. Hence, this study aims to compensate the power shortage during this season through designing a feasible power generation plant, the Solar Thermal Power Plant. The designed thermal power plant is a high-thermal collectors using parabolic through design. 2.2. OBJECTIVES This project has the following objectives: 1. To design an off grid parabolic trough solar thermal power plant that utilizes high temperature collectors. 2. To implement the design by using applications such as RetScreen, AutoCAD, and Google Sketch-Up. 2.3. SIGNIFICANCE Solar Thermal Electricity (STE), also known as Concentrating Solar Power, is a technology that produces electricity by using mirrors to concentrate direct-beam solar irradiance to heat a liquid, solid or gas that is then used in a downstream process for electricity generation. Generation of bulk solar thermal electricity from solar thermal power plants is one of the technologies best suited to mitigating climate change in an affordable way by reducing the consumption of fossil fuels. Unlike photovoltaic technology, STE offers significant advantages from a system perspective, thanks to its built-in thermal storage capabilities. Solar thermal power plants can operate either by storing heat or in combination with fossil fuel power plants,

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providing firm and dispatchable power available at the request of power grid operators, especially when demand peaks in the late afternoon, in the evening or early morning, or even when the sun isn’t shining. The main benefit of STE systems is in replacing the power generated by fossil fuels, and reducing greenhouse gas emissions which cause climate change. Each square metre of STE concentrator surface, for example, is enough to avoid 200 to 300 kilograms of CO2 each year, depending on its configuration. Typical STE power plants are made up of hundreds of concentrators arranged in arrays. The life-cycle assessment of the components and the land surface impacts of STE systems indicate that it takes around five months to ‘payback’ the energy that is used to manufacture and install the equipment. Considering the plants last at least 30 years with minimum performance losses, this is an excellent ratio. In addition, most of the STE solar field components are made from common materials that can be recycled and used again. The cost of solar thermal power is going down. Experience in US shows today’s generation costs are about 12 US cents/kWh for solar generated electricity at sites with very good solar radiation. The US Department of Energy’s SunShot Initative predicts on-going costs as low as 6 US cents/ kWh. STE technology development is on a steep learning curve, and the factors that will further reduce costs are technological improvements, mass production, economies of scale and improved operation. Concentrating solar power is becoming competitive with conventional, fossil fuelled peak and mid-load power stations. One of the benefits of adding more STE to the grid is that it can help stabilise electricity costs, mitigating fossil fuel price volatility and the impact of carbon pricing when it takes effect. The development of STE project promotes the creation of local industries in emerging markets enlarging the supply chain. New local manufacturing operations are opened in order to supply the components needed, e.g. tubes, structures and mirrors. The construction and operation of STE plant can be a source of employment. A recent study showed that for each MW installed, 7 jobs are created during the construction of these types of plants. Solar thermal power plants have shown significant cost reductions in the recent years, even though the deployment level is around 5 GW worldwide. This means that there is huge room for further cost reduction based on both volume and technological improvements. For instance, commercial experience from the first nine SEGS plants in California, built between 1986 and 1992 and operating continuously since, shows that power generation costs in 2004 dropped by around two-thirds. The first 14 MW unit supplied power at 44 US cents/kWh dropping to just 17 US cents/kWh for the last 80 MW unit.8 With technology improvements, scaleup of individual plant capacity, increasing deployment rates, competitive pressures, thermal storage, new heat transfer fluids, and improved operation and maintenance, the cost of STE-generated electricity has dropped even further since then. 2.4. RATIONALE OF THE CHOSEN TECHNOLOGY Solar thermal power plants have shown significant cost reductions in the recent years, even though the deployment level is around 5 GW worldwide. This means that there is huge room for further cost reduction based on both volume and technological improvements. For

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instance, commercial experience from the first nine SEGS plants in California, built between 1986 and 1992 and operating continuously since, shows that power generation costs in 2004 dropped by around two-thirds. The first 14 MW unit supplied power at 44 US cents/kWh dropping to just 17 US cents/kWh for the last 80 MW unit.8 With technology improvements, scaleup of individual plant capacity, increasing deployment rates, competitive pressures, thermal storage, new heat transfer fluids, and improved operation and maintenance, the cost of STE-generated electricity has dropped even further since then. 2.5. BIBLIOGRAPHY REVIEW 2.5.1 SOLAR THERMAL POWER SYSTEMS USING CONCENTRATED SOLAR ENERGY To generate electricity in solar thermal power generation systems, sunlight is being collected and concentrated to produce the high temperature needed. Solar thermal power systems have solar energy collectors composed of reflectors (mirrors) that capture and focus sunlight onto a receiver. It may also hold a thermal energy storage system component that enables the solar collector system to heat an energy storage system during the day, and the stored heat is used to produce electricity in the evening or during cloudy weather [1]. 2.5.2 TYPES OF CONCENTRATING SOLAR THERMAL POWER PLANTS There are three main types of concentrating solar thermal power systems: A. Linear Concentrating Systems Linear concentrating systems accumulate the sun's energy using long, rectangular, curved (U-shaped) mirrors. The mirrors focus sunlight onto receivers (tubes) that run the length of the mirrors. The concentrated sunlight heats a fluid and then the fluid is sent to a heat exchanger to boil water in a conventional steam-turbine generator to produce electricity. There are two major types of linear concentrator systems: parabolic trough systems, where receiver tubes are positioned along the focal line of each parabolic mirror, and linear Fresnel reflector systems, where one receiver tube is positioned above several mirrors to allow the mirrors greater mobility in tracking the sun. a. Parabolic Troughs A parabolic trough collector has a long parabolic-shaped reflector that focuses the sun's rays on a receiver pipe located at the focus of the parabola. The collector tilts with the sun to keep sunlight focused on the receiver as the sun moves from east to west during the day. Because of its parabolic shape, a trough can focus the sunlight from 30 times to 100 times its normal intensity (concentration ratio) on the receiver pipe, located along the focal line of the trough, achieving operating temperatures higher than 750°F. b. Linear Fresnel Reflectors Linear Fresnel reflector (LFR) systems are similar to parabolic trough systems in that mirrors (reflectors) concentrate sunlight onto a receiver located above the mirrors. These reflectors use the Fresnel lens effect, which allows for a concentrating mirror with a large

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aperture and short focal length. These systems are capable of concentrating the sun's energy to approximately 30 times its normal intensity. The only operating linear Fresnel reflector system in the United States is a compact linear Fresnel reflector (CLFR)—also referred to as a concentrating linear Fresnel reflector—a type of LFR technology that has multiple absorbers within the vicinity of the mirrors. Multiple receivers allow the mirrors to change their inclination to minimize how much they block adjacent reflectors' access to sunlight. This positioning improves system efficiency and reduces material requirements and costs. B. Solar Power Towers A solar power tower system uses a large field of flat, sun-tracking mirrors called heliostats to reflect and concentrate sunlight onto a receiver on the top of a tower. Sunlight can be concentrated as much as 1,500 times. Some power towers use water as the heattransfer fluid. Advanced designs are experimenting with molten nitrate salt because of its superior heat transfer and energy storage capabilities. The thermal energy-storage capability allows the system to produce electricity during cloudy weather or at night. C. Solar Dish/Engine Systems Solar dish/engine systems use a mirrored dish similar to a very large satellite dish. To reduce costs, the mirrored dish is usually composed of many smaller flat mirrors formed into a dish shape. The dish-shaped surface directs and concentrates sunlight onto a thermal receiver, which absorbs and collects the heat and transfers it to an engine generator. The most common type of heat engine used in dish/engine systems is the Stirling engine. This system uses the fluid heated by the receiver to move pistons and create mechanical power. The mechanical power runs a generator or alternator to produce electricity. Solar dish/engine systems always point straight at the sun and concentrate the solar energy at the focal point of the dish. A solar dish's concentration ratio is much higher than linear concentrating systems, and it has a working fluid temperature higher than 1,380°F. The power-generating equipment used with a solar dish can be mounted at the focal point of the dish, making it well suited for remote locations, or the energy may be collected from a number of installations and converted into electricity at a central point. 2.5.3 EXISTING PARABOLIC TROUGH LINEAR CONCENTRATING SYSTEMS Parabolic trough linear concentrating systems are used in the longest operating solar thermal power facility in the world, the Solar Energy Generating System (SEGS), which has nine separate plants and is located in the Mojave Desert in California. The first plant, SEGS 1, has operated since 1984, and the last SEGS plant that was built, SEGS IX, began operation in 1990. With a combined electricity generation capacity of 354 megawatts (MW), the SEGS facility is one of the largest solar thermal electric power plants in the world. In addition to the SEGS, many other parabolic trough solar power projects operate in the United States and around the world. The three largest projects in the United States after SEGS are 

Mojave Solar Project: a 280 MW project in Barstow, California



Solana Generating Station: a 280 MW project in Gila Bend, Arizona

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

Genesis Solar Energy Project: a 250 MW project in Blythe, California

2.5.4. Trough Power Plant Efficiencies Efficiency of solar thermal power plant depends on collector efficiency, field efficiency and steam-cycle efficiency. Parameters such as the sunlight’s angle of incidence and the absorber’s tube temperature affect the collector’s efficiency, in which could reach up to 75%. Meanwhile, the steam cycle efficiency plays around 35% and has a great impact on the overall efficiency. Anually, STTPs have 15% total efficiency with below 10% field losses. (Quaschning 2003)

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3. METHODOLOGY 3.1. PROJECT MANAGEMENT Parabolic trough systems have been in wide use for utility-grade power generation since the mid 1980’s. In recent years, other CSP geometries such as parabolic dish, linear Fresnel, and central receiver or “power tower” have received considerable attention in the marketplace to meet the need of delivering cost effective electricity. While each of these designs has particular attributes and performance characteristics that make it a potentially attractive option, only parabolic trough has 30 years of experience that has been commercially proven and bankfinanced many times. 3.2. DESIGN CRITERIA “New standards, regulations and testing procedures, coupled with appropriate labelling, could aid accelerated market uptake by building up consumer trust in the manufactured products. This is especially important for new solar technologies such as evacuated tubes and combi-systems where many manufacturers are entering the market so that discerning a quality product is difficult for the consumer. Standard testing procedures on such details as hail resistance of the solar collector panel could also enhance international trade of the technologies”, IEA (2007) Solar thermal is one of the main sources of Renewable Heat for domestic use. It is already a mature technology, although continuously developing to improve its performance while reducing costs. The performance of a good solar thermal system relies largely on the quality of the equipment and of the installation. Therefore, to meet the increased demand, it is important to ensure that equipment and installations both comply with adequate quality standards. 3.2.1 TECHNICAL CRITERIA 3.2.1.1. COLLECTOR MOUNTING FRAME The collector mounting frame shall in no way obstruct the aperture of the collector, and shall not significantly affect the back or side insulation. Unless otherwise specified (for example, when the collector is part of an integrated roof array), an open mounting structure shall be used which allows air to circulate freely around the front and back of the collector. The collector shall be mounted such that the lower edge is not less than 0,5 m above the local ground surface. Currents of warm air, such as those which rise up the walls of a building, shall not be allowed to pass over the collector. Where collectors are tested on the roof of a building, they shall be located at least 2 m away from the roof edge. 3.2.1.2. TILT ANGLE In order to facilitate international comparisons of test results, the collector shall be mounted such that the angle of tilt of the aperture from the horizontal is: latitude ± 5 ° but

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not less than 30 °. Collectors may be tested at other tilt angles, as recommended by manufacturers or specified for actual installations. It must be noted that for many collectors, the influence of tilt angle is small, but it can be an important variable for specialized collectors such as those incorporating heat pipes. 3.2.1.3. COLLECTOR ORIENTATION The collector may be mounted outdoors in a fixed position facing the equator, but this will result in the time available for testing being restricted by the acceptance range of incidence angles. A more versatile approach is to move the collector to follow the sun in azimuth, using manual or automatic tracking. 3.2.1.4. SHADING FROM DIRECT SOLAR IRRADIANCE The location of the test stand shall be such that no shadow is cast on the collector during the test. 3.2.1.5. DIFFUSED AND REFLECTED SOLAR IRRADIANCE For the purposes of analysis of outdoor test results, solar irradiance not coming directly from the sun’s disc is assumed to come isotropically from the hemispherical field of view of the collector. In order to minimize the errors resulting from this approximation, the collector shall be located where there will be no significant solar radiation reflected onto it from surrounding buildings or surfaces during the tests, and where there will be no significant obstructions in the field of view. With some collector types, such as evacuated tubular collectors, it may be equally important to minimize reflections on both the back and the front fields of view. Not more than 5 % of the collector’s field of view shall be obstructed, and it is particularly important to avoid buildings or large obstructions subtending an angle of greater than approximately 15 ° with the horizontal in front of the collectors. The reflectance of most rough surfaces such as grass, weathered concrete or chippings is not usually high enough to cause problems during collector testing. Surfaces to be avoided in the collector’s field of view include large expanses of glass, metal or water. In most solar simulators the simulated beam approximates direct solar irradiance only. In order to simplify the measurement of simulated irradiance, it is necessary to minimize reflected irradiance. This can be achieved by painting all surfaces in the test chamber with a dark (low reflectance) paint. 3.2.1.6. THERMAL IRRADIANCE The performance of some collectors is particularly sensitive to the levels of thermal irradiance. The temperature of surfaces adjacent to the collector shall be as close as possible to that of the ambient air in order to minimize the influence of thermal radiation. For example, the outdoor field of view of the collector should not include chimneys, cooling towers or hot exhausts. For indoor and simulator testing, the collector shall be shielded from hot surfaces such as radiators, airconditioning ducts and machinery, and from cold surfaces such as windows and external walls. Shielding is important both in from of and behind the collector.

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3.2.1.7. WIND The performance of many collectors is sensitive to air speed. In order to maximize the reproducibility of results, collectors shall be mounted such that air can freely pass over the aperture, back and sides of the collector. 3.2.2 ENVIRONMENTAL CRITERIA Solar thermal power plant has an insignificant environment criterion. Only that, it must be designed to prevent animals, especially birds, to pass in the area. 3.2.3 SOCIAL CRITERIA The plant must provide social awareness to the surrounding community by conducting orientations and seminars. 3.2.4 ECONOMIC CRITERIA According to WTO (World Trade Organisation) the criteria that define a globally relevant standard are :  Effectively respond to regulatory and market needs (in the global marketplace)  Respond to scientific and technical developments in various countries  Not distort the market  Have no adverse effects on fair competition  Not stifle innovation and technological development  Not give preference to characteristics or requirements of specific countries or regions when different needs or interests exist in other countries or regions  Be performance based as opposed to design prescriptive It is a consensus building process and this consensus is achieved by bringing together different stakeholders having a particular interest in the development of a standard for a specific product, process or service. Therefore, the standard shall reflect the views and concerns of these stakeholders, ensuring via the standardization process that their expectations for basic requirements are met, be it product safety, durability, performance or other requirements. 3.3. DESIGN CALCULATIONS 3.3.1 POWER PLANT SIZING The calculation of the size of Emerald Solar Thermal Power Plant followed the equation below: Plant Size = each parabolic mirror consumes (6.5 x 5.5) x land area = (6.5 x 5.5) x 2650 = 94737.5 = 9.47 hectares

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3.3.2 SYSTEM CALCULATIONS The calculation of the size of Emerald Solar Thermal Power Plant followed the equation below: each parabolic mirror of (S.78D x 4) = 378 W # of mirrors = 1 MW / 378 W = 2,646 = 2650 mirrors

4. DESIGN OUTPUT 4.1. DRAWINGS AND SYSTEM LAYOUTS 4.1.1 SITE LAYOUT

Figure 1. Emerald Solar Thermal Power Plant Location Figure 1 shows the location map of the Emerald Solar Thermal Power Plant at Opol, Misamis Oriental.

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Figure 2. Emerald Solar Thermal Power Plant Layout The above figure shows the site layout of the Emerald Thermal Power Plant. The total area is around 118,510.51 sq.m (1,275,636.55 sq.ft). And the total distance is 1.51 km (4,960.85 ft).

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4.1.2 PLANT PERSPECTIVE

Figure 3. Emerald Solar Thermal Power Plant Perspective The plant perspective of Emerald Solar Thermal Power Plant is shown above. As you can see, we used a parabolic trough in our power plant. 4.1.3 EQUIPMENT AND SYSTEM LAYOUT

Figure 4. Emerald Solar Thermal Power Plant Equipment and System Layout

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The figure above shows the equipment and system layout of Emerald Solar Thermal Power Plant. It shows the process of how electricity is being produced. 4.1.4 LIST OF EQUIPMENT

Table 1. List of Equipment used in Emerald Solar Thermal Power Plant Equipment and Materials Equipment Mirrors Absorber Pipes Swivel Joints Trackers Heat Transfer Fluid Electronics, Controls, Electrical and Solar Equipment Foundations Pylons Thermal Storage Salt Storage Tanks Insulation Materials Foundations Pumps Heat Exchanges Balance of System 4.2. BILL OF MATERIALS AND LABOR

Table 2. Emerald Solar Thermal Power Plant Bill of Materials and Labor Equipment and Materials Equipment Mirrors Absorber Pipes Swivel Joints Trackers Heat Transfer Fluid Electronics, Controls, Electrical and Solar Equipment Foundations Pylons Thermal Storage Salt

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Cost 6144000 6816000 672000 384000 2016000 2400000 2016000 1046000 4896000

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Storage Tanks Insulation Materials Foundations Pumps Heat Exchanges Balance of System

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1728000 192000 576000 384000 1344000 960000

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5. DISCUSSION 5.1. COST AND FINANCIAL ANALYSIS

INITIAL COSTS Feasibility Study

Quantit y 1

Unit Cost ₱1,200.00

1

₱2,780.00

1

₱7,390,200. 00

Amount ₱1,200.00 ₱1,200.00 ₱2,780,000. 00 ₱2,780,000 .00 ₱7,390,200. 00

1000

₱15,300.00

₱15,300.00

23

₱2,400,000. 00

₱55,200,000 .00

Subtotal: Development Subtotal: Engineering Power System Solar Thermal Power Road Construction Transmission line Substation Energy efficiency measures Subtotal: Balance of system & miscellaneous Spare parts

₱70,500.00

Transportation Training & commissioning Contingencies Interest during construction

1 1 10% 18month (s)

₱6,000,000. 00 ₱22,000.00 ₱87,892,200 .00 ₱96,681,420 .00

Total Initial Costs

1.20%

2.90% 7.60%

72.90%

₱6,000,000. 00 ₱22,000.00 ₱87,892,200 .00 ₱14,811,22 0.00 ₱96,681,420 .00

Subtotal:

Relative costs

15.30% 100.00%

ANNUAL COSTS O&M Parts & labor

1

Contingencies

10%

Subtotal: ANNUAL SAVINGS Fuel cost- base case

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₱16,400,000 .00 ₱16,400,000 .00

₱16,400,000 .00 ₱16,400,000 .00 ₱18,040,00 0.00

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806120 Natural gas m2 Subtotal:

₱39.68

₱31,987.00 ₱31,987.00

FINANCIAL PARAMETERS General 2.50% Fuel cost escalation rate 2.50% Inflation rate 10% Discount rate 20 years Project life Income tax analysis Effective income tax rate 30% Depreciation rate 7.80% GHG reduction income Net GHG reduction 1503 tCO2/yr Net GHG reduction-20 yrs 30052 tCO2 Clean Energy (CE) production income CE production 2453 CE production credit rate 0.009 CE production income 20849 Fuel type: Solar 2453 MWh

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YEARLY CASH FLOWS Year no. 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

PROJECT COSTS SUMMARY Initial costs Feasibility study Development Engineering

Pre-tax

After-tax

Cumulative

-96,681,420 14,295,675 14,653,067 15,019,394 15,394,878 15,779,750 16,174,244 16,578,600 16,993,065 17,417,892 17,853,339 18,299,673 18,757,164 19,226,094 19,706,746 20,199,415 20,704,400 21,222,010 21,752,560 22,296,374 22,853,783

-96,681,420 10,006,973 10,257,147 10,513,575 10,776,415 11,045,825 11,321,971 11,605,020 11,895,146 12,192,524 12,497,337 12,809,771 13,130,015 13,458,265 13,794,722 14,139,590 14,493,080 14,855,407 15,226,792 15,607,462 15,997,648

-96,681,420 -86,674,448 -76,417,301 -65,903,725 -55,127,310 -44,081,485 -32,759,514 -21,154,494 -9,259,348 2,933,176 15,430,513 28,240,284 41,370,299 54,828,565 68,623,287 82,762,877 97,255,957 112,111,364 127,338,156 142,945,618 158,943,266

AND

SAVINGS/INCOME

1.20% 2.90% 7.60%

Power system

72.90%

Balance of system & misc.

15.30% Total initial costs

100%

₱1,200,000.00 ₱2,780,000.00 ₱7,390,200.00 ₱70,500,000.0 0 ₱14,811,220.0 0 ₱96,681,420. 00

Annual costs and debt payments O&M Fuel cost- proposed case Total annual costs

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₱18,040,000.0 0 ₱0.00 ₱18,040,000. 00

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Annual savings and income Fuel cost- base case CE production income - years Total annual savings and income FINANCIAL VIABILITY Pre-tax IRR - equity Pre-tax IRR - assets After-tax IRR - equity After-tax IRR - assets Simple payback Equity payback Net Present Value (NPV) Annual life cycle savings (Php/yr) Benefit-Cost (B-C) ratio GHG reduction cost

₱31,987,000.0 0 ₱20,849.00 ₱32,007,849. 00

1.61% 1.61% 10.60% 10.60% 6.9 8.8 ₱42,462. 50 498, 763.00 1.04 (332)

5.2. ENVIRONMENTAL IMPACT ANALYSIS Life-cycle CO2 emissions of solar-only CSP plants are assessed at 17 g/kWh against, e.g., 776 g/kWh for coal plants and 396 g/kWh for natural gas combined cycle plants.1 However, to the extent that some fossil fuel is used as a back-up, a CSP plant or an ISCC cannot be qualified as a “zero-emitting” plant. In Energy Technology Perspectives 2008, CSP would save annually about 1 260 Mt CO2 in the BLUE scenario – 7% of a total 18 Gt CO2 avoided in electricity production relative to the reference scenario. Other polluting emissions – from SOx to NOx , metals and particulate matters – would also be avoided. 5.3. SOCIAL IMPACT ANALYSIS The use of molten salts and synthetic oil in a CSP plant bears some risk of spillage or fire. This may in turn hinder acceptance of a project by the local population. Hazard to wildlife, such as birds. An 80 MW trough plant requires about 1.2 million cubic meters of water per year, mostly for cooling the steam cycle, and for cleaning the mirrors. Dry air cooling systems could considerably reduce the consumption of water, at a cost.

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5.4. PROJECT FEASIBILITY

Figure 5. Equity of the Project

Figure 6. Cumulative Cash Flows Graph In the span of the 20 years of working state of the Solar Thermal, breakeven is achieved near the 9th year. It is also shown on the risk analysis on Figure 5, the equity distribution showed a distribution of almost normal bell-shape. This indicates that a loss and gain is within the 10% range. This is appealing to the investors. The project is feasible for approval.

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6. CONCLUSION

AND

RECOMMENDATION

The solar thermal power industry has been growing rapidly over the past few years. A recent study by the International Energy European Solar Thermal Electricity Association suggested that CSP plants could provide up to 25 percent of the world's electricity needs by 2050. However, despite its potential, CSP technology lacks a long deployment track-record and still comes with high technology cost and risks. Therefore, more deployment experience is needed to increase understanding and make the technology more competitive. Adequate risk management measures have become fundamental to the success of this industry and to the acceleration of CSP market penetration. Risks need to be properly assessed from the design stage, through the installation, up to the operational stage of each CSP project. These risks need to be shifted to appropriate project participants with the ability and expertise to better manage those risks; technology challenges, nat cat exposure, and all other issues, if successfully addressed by the appropriate parties, would attract new potential investors and developers, and would reduce the barriers to bankability. In this risk management process Insurance has an important role as it offers insurance products adequate to cover the evolving risks in a CSP plant during its construction and operation, including innovative insurance products aimed at protecting a company's earnings volatility. But as the solar thermal power sector matures, to secure a bright and sunny future for this industry there is a need to engage the various players in securing skill and know-how transfer, to apply a thorough risk management approach on each project, and to share lessons learnt. The authors hope that this paper, for its small part, has contributed to the achievement of this intent.

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7. REFERENCES [1] https://www.eia.gov/Energyexplained/?page=solar_thermal_power_plants [2] Outlook, G. (2016). SOLAR THERMAL ELECTRICITY GLOBAL OUTLOOK 2016. [3] http://www.volker-quaschning.de/articles/fundamentals2/index_e.php [4] http://www.skyfuel.com/why-parabolic-trough.shtml [5] INTERNATIONAL STANDARD ISO Solar energy — Solar thermal collectors — Test methods. (2013), 2013. [6] ISO9806-1. (1994). Testmethods for solar collectors - Part 1: Thermal performance of glazed liquid heating collectors including pressure drop. [7] Various. (2012). Guide on Standardisation and Quality Assurance for Solar Thermal. Retrieved from http://www.estif.org/fileadmin/estif/content/publications/downloads/ standardisation_single_v02.pdf

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