Power of the Sun

The solar power industry is in its infancy. The Company estimates that the maturation of the solar power industry is where that of the wind power industry was approximately 10 years ago. There have been successful demonstrations of utility scale projects, but prices are very high and adoption is slow. However, the Company projects that, like wind power, solar power will become much more mainstream over the next 5-10 years as costs of installation drop and adoption gains momentum.

The solar industry is basically divided into two technologies: Solar Thermal and Photovoltaic. Photovoltaic cells transform the sun’s energy directly to electricity by means of a chemical reaction. Solar thermal technology transforms the sun’s energy to heat, which is used to drive a conventional steam electricity generator. While photovoltaic technology would be termed “high-tech”, solar thermal technology is decidedly low-tech (though there are some technical improvements being made in the technology that lower costs).

While the Company believes that large photovoltaic power plants may be developed in the future, it also believes that the commercialization of solar thermal is more proven and closer at hand. As evidence of this, there are no utility-scale (greater than 5 MW installed capacity) photovoltaic solar projects in operation anywhere in the world today. However, there are several solar thermal projects.

Solar thermal technology has been harnessed by man for millennia. Legend has it that the ancient Greeks at Syracuse used the concentrated power of the sun to defeat the Roman fleet in 213 BC. Then, the Greeks polished their shields to collect and reflect the rays of the sun onto the rigging of the Roman fleet, thus catching the fleet on fire and destroying it. The same process happens in modern solar thermal plant. A field of mirrors catches the sun’s energy and reflects it onto a flowing heat conduit – usually an oil. This heat conduit flows to a central water location where the heat is transferred to create steam. The steam then drives a conventional, low-tech steam turbine and electricity is produced.