NCPA - National Center for Policy Analysis


March 5, 2008

A new solar technology gaining popularity in both the United States and Europe, known as "concentrating solar power" (CSP), can generate up to 64 megawatts (MW) -- enough to power more than 14,000 homes, says the Economist.


  • As their name suggests, CSP plants generate electricity by concentrating the sun's rays, usually to boil water.
  • The resulting steam drives turbines similar to those found at power plants that run on coal or natural gas.

Solar power, of course, does not produce climate-changing greenhouse gases.   Even so, CSP is still not as cheap as coal- or gas-fired plants:

  • America's CSP boom is driven by state laws requiring utilities to generate a certain share of their power from renewable sources, and by generous federal tax breaks, which offset as much as 45 percent of development costs, according to SEIA.
  • In Spain, meanwhile, utilities must pay an extra €0.25 (about U.S. $0.37) per kilowatt-hour on top of the market price for power from CSP.

America's tax breaks are due to run out at the end of the year, and without them, says Rhone Resch of the Solar Energy Industries Association (SEIA), no more CSP plants will be built there.  But in the long run, he argues, costs should come down.  And if fossil-fuel prices continue to increase and American power-plants have to start paying for their greenhouse-gas emissions, CSP might just achieve "grid parity" with the wholesale power price.

Source: Editorial, "The power of concentration," Economist, February 21, 2008.

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