In 2011, BrightSource Energy was in the middle of building a $2.2-billion, first-of-a-kind concentrated solar power project in the Mojave Desert. Ivanpah was a 440-megawatt CSP plant that then-CEO John Woolard and his team hoped would be the first of many large-scale, commercial deployments.
At the time, CSP appeared to be on the verge of a breakout moment, and BrightSource planned to lead the charge. But then, everything changed. The cost of photovoltaics was falling fast, and CSP couldn’t keep up.
“We had … for years been following this curve of PV cost, but I think it really came in 2012,” Woolard said, speaking on the latest episode of The Green Blueprint podcast. “That’s when we basically said, we can no longer win this game. We are no longer competitive.”
Back in 2005, though, CSP had looked like a promising contender. Woolard explained that it was significantly cheaper than PV and could achieve higher capacity factors. Plus, it could pair with molten salt storage. At BrightSource, the team’s faith in the technology’s potential made it hard for the company to pivot — even after it became clear that PV was beating CSP on cost.
“I think if I had something to do over, I would have been more firm and more strong that the company was facing not just a decision, but an existential risk,” Woolard said. “And I would have been a lot stronger on that, saying that this company will not exist if we do not move to a new technology.”
At the time, internal debate at BrightSource focused on two options: stick to CSP or pivot to PV. Their engineers and investors believed that CSP “would have some breakthroughs and would be able to compete,” Woolard explained, which nudged them toward the more novel technology.
But other employees at BrightSource realized that PV was leaving them in the dust. They predicted that even lower-cost, next-generation CSP would lose to PV because the Chinese manufacturing boom was driving down the cost of crystalline silicon cells so dramatically. The costs of BrightSource’s technology was dropping from around $5 per watt to below $4, while PV was nearing $2.50 and dropping fast, Woolard said. It was a dynamic that made it difficult to secure new power purchase agreements or follow through on existing contracts.
So in 2012, their development team proposed an alternative path: repurpose their existing land and power purchase agreements for PV.
Woolard and BrightSource’s chief financial officer, Jack Stark, brought the proposal to the board. Woolard said it was a hard thing to encourage an engineering-led technology company to do, “because you’d like to believe that your design is better. It takes a lot to say, ‘It’s not. It’s now no longer cost competitive.’”
In the end, though, the board decided to stick with CSP.
BrightSource completed construction of Ivanpah in 2014, and the company did not repurpose its other assets, including land and PPAs, for PV. It was a decision that Woolard couldn’t stand behind — so he left the company, handing the reins to a new CEO, David Ramm.
When asked why the board refused to pivot, Woolard explained that the inertia behind an existing technology, even in the face of an existential competitive threat, is hard to overcome.
“I think you become very, very focused on your own technology sometimes, and you believe too long that sometimes it can prevail,” he said. “And I think there was a very strong affinity toward that initial technology and the belief that there was a way to engineer through — whereas the development team did not see that and said that even if you cut it in half, it would barely be competitive.”
CSP fell short of expectations. Ivanpah initially struggled to deliver enough energy to meet its PPAs. By 2023 it reached a nameplate capacity of 392 megawatts, or about 90% of its original planned capacity, according to the U.S. Energy Information Administration. More broadly, the dream of multiple, large-scale CSP projects fizzled. After Ivanpah, BrightSource built their final CSP project: the Ashalim plant in Israel, a smaller project subsidized by the Israeli government. After that, the economics just got too difficult.
“Even with the attributes of molten salt storage, it’s hard to see how solar thermal can be competitive today,” Woolard said. “That’s not to say somebody can’t find a new design and a new application for industrial heat or something in the future. But it’s likely to emerge, if at all, as a niche, where you have strong sun … and some reason to have heat rather than just electricity.”
Woolard cautioned that the lessons of CSP may apply to other technologies today.
“Take seriously the cost curves of things that might not be direct competitors, but even indirect competitors to you,” he said, offering new nuclear technologies as an example of a competitor that could disrupt the market for leading contenders, like renewables. “Just because something’s a little more expensive today, doesn’t mean that it’s not going to have a path forward that could change everything.”
This story borrows from an interview that appeared on The Green Blueprint, a Latitude Media podcast.
