BrightSource solar array

First Solar announced yesterday that it and the Chinese government had agreed upon a memorandum of understanding that, if a few more bridges are crossed, will result in a 2 gigawatt solar power plant in Ordos City, Inner Mongolia, China.

That’s a huge plant. A story in today’s Wall Street Journal reports that it will be a 25-square-miles array.

This will be a 10-year, multiphase project beginning with a 30 megawatt demonstration project that is planned to get underway in June 2010. According to the company’s news release, phases 2, 3 and 4 will be 100 megawatts, 870 megawatts and 1,000 megawatts, respectively. Phases 2 and 3 will be completed in 2014 and phase 4 will be completed by 2019.

“This major commitment to solar power is a direct result of the progressive energy policies being adopted in China to create a sustainable, long-term market for solar and a low carbon future for China,” says First Solar CEO Mike Ahearn.

After building the plant, First Solar plans to sell it to yet-to-be-determined Chinese business. The value of such a power producer depends on the value of the hardware and, more importantly, the value of future revenue streams.

The latter, however, is uncertain at this time. China is expected to eventually enact a feed-in-tariff. Typically, feed-in-tariffs establish a guaranteed premium that will be paid for renewable energy, but the size of the tariff is currently under debate. Once it is set, it will provide a way of calculating the value of the electricity produced by the power plant over a long-term period.

“The Chinese feed-in tariff will be critical to this project,” Ahearn said yesterday. “This type of forward-looking government policy is necessary to create a strong solar market and facilitate the construction of a project of this size, which in turn continues to drive the cost of solar electricity closer to ‘grid parity’ – where it is competitive with traditional energy sources.”

The project still has a few more bureaucratic hurdles to cross, but according to the WSJ, it will be just one part of an enormous (12 gigawatt) renewable energy development zone in that area of Mongolia. The plan is to include wind, solar, biomass and hydroelectric energy sources.

Information, although sketchier, on two other mega solar projects has also just surfaced. The Clinton Climate Initiative has apparently just reached an agreement on an MOU to build a 3 gigawatt solar farm in the State of Gujarat in India:

Officials said the solar park will be developed on the non-cultivable wastelands available in Banaskantha and Kutch districts.

In an official press release, the government said that at present, about 34 internationally acclaimed companies are participating with the state government to develop solar projects in Gujarat.

The WSJ reports that CCI is also in talks for a second similarly size facility in Rajasthan.

Finally, a number of sources have just reported that Brightsource has signed contracts to supply more than 2,600 megawatts of solar electricity to Pacific Gas & Electric and Southern California Edison. BrightSource is expected to set up as many as 14 concentrating solar power plants to deliver on this energy goal. Construction is expected to get underway in 2010. More on Brightsource’s California goals can be read in this recent CTT post.