Solar thermal is coming. But where will it land?

South Australia is uniquely poised to finally bring Australia into the solar thermal game – but much will hinge on the upcoming state election.

With the news that Chile is to join the solar thermal club, Australia could before long become the only inhabited continent without this revolutionary electricity generation technology.

Spanish developer Abengoa is set to build a large solar thermal 'power tower' with a capacity of 110 megawatts for the Chilean government. Solar thermal plants already exist or are actively being developed and constructed, on all other continents.

The solar thermal technology concentrates the sun's free energy with a field of mirrors onto a heat receiver mounted on a central tower, and then uses that heat to generate electricity, and also stores the heat to generate electricity after sundown. The Chilean plant is to have storage capacity for 17.5 hours of operation after sundown, enabling it to provide 24-hour solar power.

That a poorer country like Chile is now building this technology highlights that a wealthy country like Australia should also be building this technology. Figures from the Bureau of Resource and Energy Economics in December show the estimated cost of building solar thermal power plants has fallen 30 per cent in the last year.

The best bet to start the solar thermal industry in Australia is at Port Augusta in South Australia, with Beyond Zero Emissions publishing a proposal to replace Alinta's two coal power stations with solar thermal generators in 2012, and a well organised community campaign in support of the project.

The news that Alinta is now undertaking a $2.3 million feasibility study with $1 million of funding from the Australian Renewable Energy Agency, and $132,000 from the South Australian government, has been welcomed by many as a positive step forward, but there is still a long way to go. 

Let's imagine that this was a traditional oil and gas project. The feasibility study would be an open process, would be completed in a shorter timeframe, and involve serious funding and resources. This type of process has also been run for large scale renewable energy projects. As an example, when the ACT government advertised a contract for building large solar PV in the territory, it was an open process rather than closing it to the incumbent ACTEW (as it turns out, ACTEW didn't win it).

In South Australia, Alinta would be one potential bidder, but Alinta has a vested interest in maintaining their assets at Port Augusta and the Leigh Creek coal mine. One of their favoured options has been a solar/coal hybrid, where the solar thermal aspect is relegated to pre-heating water for a coal power station.

As the Chilean, and other world examples show, solar thermal technology is expanding from being a niche industry in Spain to an accepted power supply option worldwide. Strategically, Australia should be positioning itself to be at the forefront of these developments. Nor should we waste time on solar pre-heaters for coal – which is surely the energy industry equivalent of the electric typewriter, or the DAT (Digital Audio Tape), the last refinement of a dying technology.

More importantly, solar thermal technology can replace coal generators for reliable 'baseload' power supply, as the recent South Australian Parliament's Select Committee report into BZE's proposal acknowledges. Falling electricity demand in Eastern Australia provides the opportunity to close outdated coal plants and replace them with emerging technologies. 

Funding from ARENA should not only be allocated to feasibility studies, but also to building large scale renewable energy projects. With ARENA funding, companies will fund their own bankable feasibility studies. A state backed power purchase agreement combined with ARENA funding can get a solar thermal plant built in South Australia with little or no state government funding.

This would be a huge win for jobs and manufacturing in South Australia. It would be great for the health and prosperity of the people of Port Augusta and the region as well as the climate.

The news from BREE shows that it's inevitable that we will see this technology land in Australia. The choice for the parties in the South Australian election is whether they select that landing place at Port Augusta, or pass up on the opportunity.

Dr Stephen Bygrave is chief executive at Beyond Zero Emissions. He has worked nationally and internationally on climate change for 20 years.