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$550 billion solar farm in the Sahara

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Last week came word that a number of German industrial and financial giants, including Siemens (SI) and Deutsche Bank (DB), are planning a massive solar farm to be built in the North African desert. The farm would supply roughly 15 percent of Europe's power requirements. Power would flow through cables under the Mediterranean and into the European grid.

The kicker on all this? The farm would rely on a technology called Concentrated Solar Power (CSP) that involves using mirrors to collect and redirect the heat of the sun into a small beam that heats up a container of liquid (oil or water). Does this $550 billion plan signify a turning point with the world moving away from standard photovoltaic arrays that use silicon to produce energy and towards CSP?

The ambitious plan is being spearheaded by the DESERTEC Foundation, an organization founded to shepherd the massive solar effort. Already 12 major companies have signed a Memorandum of Understanding (MOU) to establish a DESERTEC Industrial Initiative (DII). The MOU is the first step in the initiative which remains in the very early stages. Signers included insurer Munich Re, Deutsche Bank, solar photovoltaic panel giant SCHOTT Solar, utility giant E.ON, and industrial conglomerate Siemens.

The choice of CSP over traditional panels is instructive. Unlike PV arrays, CSP installations can continue to produce power for a number of hours after the Sun has gone down. That's because its fairly easy to insulate hot liquids, thus conserving the generating power of the installation. And because CSP plants rely on heat to turn turbines, in a pinch standard fossil fuels can be used to generate power and ensure an uninterrupted supply -- something that is considered a major problem with photovoltaic systems. Also, CSP systems are not reliant on the supply of fluctuating commodities such as silicon and can be built without the use of toxic materials such as cadmium telluride, a heavy metal that is a key ingredient in many of the emerging thin-film photovoltaic panel technologies.

The logic behind putting this plant in the desert is simple. The Sahara is vast and empty. Yet it captures enormous solar energy -- far more than even could be captured in the sunny confines of Southern Italy, Greece or Spain. According to DESERTEC's website, the solar farm will cover 16,900 kilometers in the the North African desert. That might seem like a huge amount of land but its actually only a small portion of the Sahara.

While political instability could be a concern, a number of North African nations, including Tunisia, appear to be interested. And the economic benefits of the plants could prove a much more powerful benefit to North Africa than the oil wealth of the Middle East to the South. In theory, the plants would not only provide power to Europe but would also provide hundreds of thousands of new green jobs in Africa and Europe. Another key goal is to use the power to run massive desalination plants, addressing a key need of the region and potential allowing for a significant expansion of power in North Africa.

CSP is rapidly gaining speed and ground on photovoltaics. According to consulting company Emerging Energy Research, there are already 480 megawatts (mw) of CSP installed as of early 2009 with another 800 mw under construction. Over the next five years that will soar to roughly 15 gigawatts of CSP production capacity. That's a small chunk of the entire segments and industry analysts emphasize that CSP will be dwarfed by standard photovoltaic technologies for some time to come. That being said, its quite possible that they were not counting on projects such as DESSERTEC or other massive initiatives that could make utility-scale CSP a far more dominant force in the fast growing renewable energy space.

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