“It’s going to put about 1,000 people to work building a state-of-the-art facility. And when it’s complete, it will turn sunlight into the energy that will power up to 140,000 homes,” Obama said of Ivanpah in a weekly address in Oct. 2010.
President Obama was too quick to tout the benefits of the Ivanpah Solar Electric Generating System, and its expected electrical generating output. According to the Energy Information Administration, from January through August 2014, its three units generated 254,263 megawatt-hours of electricity, which is about one-quarter of the annual 1 million-plus megawatt-hours that had been anticipated for the plant, allegedly due to fewer sunny days than predicted. Its owners are now requesting a $539 million federal grant to help pay off part of a $1.6 billion federal loan it received to build the plant.
The Ivanpah Solar Generating System
The Ivanpah Solar Generating System, owned by NRG Energy, Google, and BrightSource Energy, has 173,500 twin mirror sets, called heliostats that heat water to generate electricity, and sprawls 3,500 acres in California’s Mojave Desert. It is the largest solar thermal power plant in the world. The 392-megawatt Ivanpah plant started commercial operation at the end of December 2013, and for the first eight months of 2014, it generated just 254,263 megawatt-hours of electricity—about one-fourth of the anticipated level. During the sunnier months of May, June, July and August, electrical output was higher than earlier in the year with 189,156 megawatt hours generated, which on an annual basis translates to electricity output of about 600,000 megawatt hours–still about 40 percent below the original level expected by the owners based on meteorological data (1,065,000 megawatt hours). Weather at the plant since February has been worse than anticipated, resulting in less generation than expected. Electricity production in June was the best of all 8 months, but dropped to about half of June’s level in July when sunshine was lacking.[i]
Ivanpah’s $1.6 billion federal loan came through the Department of Energy’s 1705 loan guarantee program and helped finance the plant’s construction, which began in 2010. Google also invested $168 million in the project. The DOE loan program was intended for technologies that were well past the pilot project stage, but that still needed to demonstrate full-scale commercialization.[ii]
On February 25, NRG Energy applied for an extension from the Department of Energy to pay off the first installment of its loan ($132 million). The company received an extension to February 27, 2015.Then, a $159 million loan payment due on June 27 was extended until December 27 and a $117 million loan payment due on October 27 was extended to April 27, 2015.
To help pay these installments, NRG has applied for a $539 million grant through the Treasury Department’s 1603 program that provides awards equivalent to 30 percent of the project’s total eligible cost basis. They’re asking for a government handout to cover the payment they must make on a government loan. Adding to the plant’s woes is a request to use 60 percent more natural gas in auxiliary boilers than was allowed under the plant’s certification that was restricted to 5 percent of the total annual heat input from the sun. The natural gas is used with auxiliary boilers to prime the system in the early morning, allowing the plant to begin generating electricity as soon as possible after sunrise; to maintain performance during intermittent cloud cover; and to eke out more energy as the sun sets at the end of the day. The auxiliary boilers typically need to operate an average of 4.5 hours a day during startup—one hour more on average than originally expected.
Bright Source is permitted to burn 1,575 million standard cubic feet of natural gas every year at the Ivanpah plant—enough gas for an average U.S. natural gas-fired power plant to produce about 200,000 megawatt hours of electricity, an average about 23 megawatts per day. Thus, at the current output of the plant, it is eking out just slightly more electricity being run with a combination of natural gas and solar power.
Financial struggles are not Ivanpah’s only problem. The plant has been criticized for causing the death of between 1,000 and 28,000 birds per year. The birds fly towards the mirrors, which they mistake for water, and are fried by the heat generated by the mirrors that produce temperatures of up to 800 degrees Fahrenheit. Airplane pilots also get blinded by glare when flying near the plant.[iii]
The 1705 program also funded Solyndra–the California solar company that went bankrupt in 2011 after receiving $536 million in federal loan guarantees. The Ivanpah project is one of many that have come under scrutiny following the Solyndra debacle, which the White House pushed despite concerns over the project’s risk. According to a March 2012 report by Congress that evaluated how the Department of Energy managed its loan guarantee program, the Ivanpah project’s recovery estimate was one of the lowest (55 percent) of all of the loan guarantees the Committee reviewed. Because of its very low electrical output, the Ivanpah plant is not producing enough power to obtain the revenues needed to pay its loans and has had to ask the government for a bailout. Bright Source had plans to build another single-tower, solar thermal plant in Palen, California but shelved it after the Ivanpah experience and because of lack of interest from California utilities to buy the expensive power.[iv]
[i] Green Tech Media, More Problems for CSP: Ivanpah Solar Plant Falling Short of Expected Electricity Production, October 30, 2014, http://www.greentechmedia.com/articles/read/ivanpah-solar-plant-falling-short-of-expected-electricity-production?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+GTM_Solar+%28GTM+Solar%29
[ii] Daily Caller, Google-Owned Solar Company Requests $540 Million Bailout To Help Pay $1.6 Billion Loan, November 9, 2014, http://dailycaller.com/2014/11/09/google-owned-solar-company-requests-540-million-bailout-to-help-pay-1-6-billion-loan/
[iii] Institute for Energy Research, Obama Looks the Other Way When Wind and Solar Power Kill Birds and Bats, September 2, 2014, http://instituteforenergyresearch.org/analysis/obama-administration-ignores-wind-solar-power-killing-birds-bats/
[iv] U.S. House of Representatives, The Department of Energy’s Disastrous Management of Loan Guarantee Programs, March 20, 2012, http://oversight.house.gov/wp-content/uploads/2012/03/final-doe-loan-guarantees-report.pdf