page 1

SOLAR POWER
ON DEMAND
Least Cost Opportunity
for Sun-rich Countries
 page 3

Table of Contents
1. Executive Summary ....... page 4
2. DMS How it works
1 - The Linear Fresnel Collector ....... page 6
2 - The Thermal Energy Storage ....... page 7
3 - The Heat Exchanger ....... page 8
3. DMS Applications
1 - Solar Power Demand ....... page 10
2 - Seawater Desalination ....... page 12
3 - Enhanced Oil Recovery ....... page 13
4 - Energy Storage ....... page 14
4. Economical Sensitvity of DMS Applications
1 - Plant Scale ....... page 16
2 - Capacity Factor ....... page 17
3 - Project Internal Rate Return ....... page 18
4 - Solar Radiation ....... page 19
5 - Desalinated Water Price ....... page 20
5. Competitiveness
1 - DMS Compared with Conventional On-demand Power Plants ....... page 22
2 - DMS Multi-Tank as Grid-level Energy Storage ....... page 24
3 - DMS compared with Photovoltaic and Battery Storage ....... page 26
4 - DMS compared with Diesel Generator Power for Remote Supply ....... page 28
5 - DMS compared with Gas fired Steam Generation for EOR ....... page 30
6. Country Opportunities for DMS Applications
1 - China ....... page 32
2 - Oman ....... page 34
3 - Jordan ....... page 38
4 - Egypt ....... page 40
5 - Morocco ....... page 44
6 - Chile ....... page 50
7 - United States ....... page 54
7. Summary and Outlook ....... page 58
Abbreviations ....... page 60
Units ....... page 62
Appendix ....... page 62
References ....... page 64
 page 4
1. Executive Summary
FRENELL is a German technology company
specializing in the manufacture and turnkey
delivery of concentrated solar power (CSP)
plants with integrated energy storage sys-
tems. The firm works with global energy in-
vestors and advisors to design and deliver
cost-competitive solar solutions enabling
power utilities to transition from fossil fuel
to solar energy in providing base load and
peak power to consumers all day every day.
This White Paper presents FRENELLs new
Direct Molten Salt (DMS) technology as a
key enabler for this transition. It provides a
broad overview of DMS, its range of tech-
nical and situational applications, and the
related commercial economics.
The Paper is written against a background
of industry concerns that dismiss CSP as
way too costly to supply demand-matching
electricity compared with conventional po-
wer plants. These concerns have resulted in
continuing reliance on cheap but volatile
renewable energy sources such as photo-
voltaic and wind power with conventional
fossil-fuel based power plants to cover the
remaining supply gaps. Yet fossil fuels are
not without their problems.
New exploitation technologies in oil and
gas have stranded a number of large-scale
energy investments. Short-term hydrocarbon
supply and price volatilities have likewise
raised the investment risk on future multi-
billion-dollar energy infrastructure projects
disrupting national energy plans and bud-
gets alike.
Is there a solution to such problems? Can
we ease or end our reliance on volatile fossil
fuels as the primary source of base-load and
peak-demand electricity? And, if we can,
how? What technology must we use?
FRENELLs engineers have been asking
themselves these very questions. They deve-
loped DMS in response. It is a new techno-
logy using CSP to collect and store the suns
energy to provide an affordable, stable, on-
demand supply of electricity.
This White Paper explains this together with
the advantages of DMS such as:
DMS plants can deliver demand-dri-
ven electricity for as little as 5 - 12 US/
kWh, already break-even with the price
of coal-fired power and economically
competitive with gas-fired power
DMS CSP plants reach the lowest le-
velized electricity costs when designed
for base-load power delivering their
nominal power capacity 24 hours a day
from spring to autumn.
All-up production costs drop by 80%
once DMS power plants are fully de-
preciated, typically after 20 years with
a further 20 years remaining in the
plant life cycle
1. Executive Summary
DMS offers the potential for govern-
ments to end electricity subsidies and
remove the associated cost pressures
from their budgets
DMS plants provide the opportunity
for sun-rich countries to transition from
fossil fuels to solar energy and there-
by, for those countries with gas and oil
reserves of their own, to export these
or redirect them to export higher-value
industrial production
Built primarily using coil steel and
glass, more than 70% of DMS cons-
truction inputs can usually be sourced
within each user country thereby buil-
ding local industry and supporting the
countrys balance of payments
This White Paper will explain these and other
advantages of the FRENELL DMS in detail.
In doing so, it attempts to take the middle
ground by providing sufficient detail to satis-
fy industry professionals while limiting that
detail to make it as easy as possible for tho-
se with a more general interest to appreciate
the technological advance DMS represents.
page 5
 page 6
2. DMS How it works
2.1 The Linear Fresnel Collector
The FRENELL DMS technology is at heart very
simple. It collects, converts and stores the suns
energy as high-temperature heat to be converted
to steam when needed. The DMS system
essentially consists of three main systems:
This is the first stage. Sunlight is concentrated
through FRENELLs proprietary Linear
Fresnel collector where parallel rows of flat-
glass mirrors reflect direct solar radiation
onto a fixed-position receiver unit. Similar
to parabolic-trough systems, FRENELLs
Absorber tube
Reflected sun rays
Primary reflector
Figure 1:
FRENELL collector
receiver uses vacuum absorber tubes. In
contrast to parabolic-trough collectors,
molten salt heated to 550C is pumped
through FRENELLs receiver.
The molten salt collector system has been
thoroughly developed and tested over
the last two years. The primary reflector
technology has been successfully applied in
various commercial CSP projects since 2009.
Critical operational aspects of DMS such as
draining the molten salt from the receiver for
2. DMS How it works
repair works have been successfully tested
[1]. Particular attention has been paid to the
unlikely but possible event of salt freezing
inside the absorber tube if the circulation of
molten salt was interrupted for more than
five hours and operators forgot to drain the
molten salt from the receiver. It has been
demonstrated in more than 20 field tests
that the frozen salt can be re-liquefied in
the absorber in less than ten hours without
damaging any component.

2.2 The Thermal Energy Storage
In the second stage, the molten salts
collecting the daytime energy yield are
stored within a proprietary Thermal Energy
Storage (TES) system.
The Multi-Tank storage is an innovative
evolution of the state-of-art two-tank
molten salt storage technology. The
global installed capacity of molten salt
energy storage exceeds 11 GWhel with an
additional 5 GWhel under construction and
2 GWhel under development [2].
Figure 2:
Comparison of 2 Tank with FRENELLs Multi-Tank storage
page 7
Compared with a costly field-manufactured It also increases the system availability since
two-tank storage system, FRENELLs Multi- repair works at one of the units will not
Tank system consists of an array of pre- require a shutdown of the entire CSP plant
engineered and shop-manufactured tanks. as in the case of a two-tank system.
The main advantage of the Multi-Tank is
its modularity allowing a tailored thermal
energy system simply by determining the
amount of tanks needed to cover the
requirements. This minimises the need for
expensive, time consuming engineering
work.
 page 8
2.3 The Heat Exchanger
In this third stage, the molten salt drives a
Salt/Water Heat Exchanger to convert the
collected heat into steam. The total amount
of stored energy can be dispatched on a
day-ahead basis to match the customers
steam demand curve.
Those three primary components form
FRENELLs modular and scalable DMS
system. Heres what it looks like visually.
The conversion of heat from the molten salt
to steam through a single interface eases
significantly the integration of DMS in
various applications.
The steam parameters of up to 550C
(1,022F) and pressure levels of up to
200bar (2,900 Psi) cover the whole range of
steam applications.
Figure 3:
FRENELLs DMS (Direct Molten Salt) technology
1. Solar Field
2. Thermal Energy Storage
3. Salt/Water Heat Exchanger
4. Cold Salt Pump
5. Hot Salt Pump
FRENELL delivers DMS systems tailored
to the customers turnkey needs including
the complete tracking and power-control
system. Fully-automated cleaning devices
for the primary reflectors and receiver
system, requiring very little water allow a
daily cleaning of the optical components
maintaining an average cleanliness of
more than 98% even in very dusty desert
environments.
No single technical component of the
FRENELLs DMS system is new. All have
been well tested and proven over time.
FRENELLs primary reflector technology has
been successfully applied in commercial
projects since 2009 with a total thermal
capacity of more than 150 MW.
2. DMS How it works
Molten salt is a state-of-the-art energy
storage medium already applied in
GWh scale.
Molten salt as a heat transfer fluid has
been used in various reactors in the
chemical industry for more than 30
years.
Vacuum tube absorbers are the most
proven receiver systems in the CSP
industry having been in use for more
than 25 years.
DMS reconfigures these proven components
in creating the most flexible, lowest cost,
lowest technical risk system covering the
whole range of steam applications.
page 9
 page 10
3. DMS Applications
3.1 Solar Power on Demand
As a scalable source of low-cost, demand-
matching solar technology, DMS opens the
door to multiple applications in countries and
regions across the worlds Sunbelt. It has a
number of applications. These are the main
ones.
In case new power plants are required, the
DMS technology can be combined with
a state of the art, high efficiency steam
turbine power block. Because the solar field
uses available land very efficiently, DMS
can be installed adjacent to existing fossil
fired power stations to reduce or completely
Figure 4:
FRENELLs DMS technology with Power Generation application
1. Solar Field
2. Thermal Energy Storage
3. Salt/Water Heat Exchanger
4. Cold Salt Pump
5. Hot Salt Pump
replace their fossil fuel consumption.
Figure 4 shows the main components of a
DMS CSP plant.
The heat exchanger is designed to deliver
the nominal steam mass flow to meet
turbine needs while the solar field and the
Multi Tank can be tailored to the most cost
efficient configuration. This configuration
is achieved by over sizing the solar field
to provide 2-5 times more thermal energy
at peak times than the nominal capacity
of the steam turbine. The surplus daytime
solar energy is then stored in the integrated
6. Steam Turbine
7. Air Cooled Condenser
8. Feedwater Pump
9. Deaerator
10. Public Electricity Grid
3. DMS Applications
Multi-Tank thermal energy storage system.
As the solar irradiance declines in the late
afternoon, the turbine can continue to
run at nominal load for up to 20 hours by
dispatching the required thermal energy
from the storage system.
Figure 5 illustrates the load curve of solar
thermal energy collected during daytime
continuously increasing the level of heated
salt mass in the storage system. While
maintaining nominal turbine power load
overnight, the level of heated salt decreases
to its overnight minimum at sunrise.
 page 11

PV (photovoltaic) and wind power have
increasingly shown their capacity to
challenge fossil fuels as a primary energy
source. However, neither have the capability
to store the energy source nor the electricity
they produce, it becomes more and more
challenging to cover the remaining supply
gaps.
This is especially true for countries in North
and South Africa where PV and wind cannot
match the daily power demand peaks in the
evening and at night.
In such cases, Figure 6 shows how DMS
CSP plants can perfectly replace fossil back-
up power by throttling the turbine load to
a minimum during daytime hours before
ramping to maximum load during evening
and night time demand peak.
This enables DMS CSP plants to be the
first choice for base-load power generation
while also serving beside wind and PV
as a complementary renewable energy
technology paving the way for a 100 %
renewable electricity supply.

BASELOAD

Figure 5:
FRENELL DMS baseload power supply

0 am 6 am 12 am 6 pm 12 pm
DMS power supply Solar irradiance Storage level

DISPATCHABLE

Figure 6:
FRENELL DMS power on demand supply curve

0 am 6 am 12 am 6 pm 12 pm
DMS power supply PV power supply Typical demand of developing country
 page 12 3. DMS Applications

3.2 Seawater Desalination

Many sun-drenched regions are also water
scarce. This drives many countries towards
seawater desalination. The base load
electricity demand of reverse osmosis plants,
representing the highest market share in
the seawater desalination market, can be
covered by DMS CSP power.
Multi-effect Distillation (MED) requires
thermal energy at a temperature level below
120C. This can be delivered either directly
from a DMS system or from the exhaust
steam of a DMS power plants turbine.
A stand-alone solar MED plant might be
the better choice in case of small-scale
applications aiming for a lowest possible
complexity.
For mid to large scale MED desalination, the
cogeneration of electricity and desalinated
water is likely to provide better economics.

Figure 7:
FRENELLs DMS with MED application

1. Solar Field 6. Steam Transformer 11. Effect #3

2. Thermal Energy Storage 7. Condensate Pump 12. Effect #n
3. Salt/Water Heat Exchanger 8. Thermo Vapor Compressor 13. Final Condenser
4. Cold Salt Pump 9. Effect #1
5. Hot Salt Pump 10. Effect #2

Figure 8:
FRENELLs DMS with CoGeneration application

1. Solar Field 7. Condensate Pump 13. Effect #1

2. Thermal Energy Storage 8. Feedwater Pump 14. Effect #2
3. Salt/Water Heat Exchanger 9. Deaerator 15. Effect #3
4. Cold Salt Pump 10. Public Electrcity Grid 16. Effect #n
5. Hot Salt Pump 11. Steam Transformer 17. Final Condenser
6. Steam Turbine 12. Thermo Vapor Compressor

3.3 Enhanced Oil Recovery
Thermal Enhanced Oil Recovery (EOR) is
widely used to increase crude oil extraction
from matured oil fields. Major sun-belt
regions like Oman, Kuwait, Egypt and
California have long used the technology as
part of their extraction approach.
Currently, natural gas is used to produce
steam that is injected into a well to heat
the heavy oil thereby enabling it to flow
more easily to the pump well by reducing its
viscosity and surface tension.
Figure 9:
FRENELLs DMS with EOR application
1. Solar Field
2. Thermal Energy Storage
3. Salt/Water Heat Exchanger
4. Cold Salt Pump
5. Hot Salt Pump
6. Oil-Water Seperator
The process is energy intensive. It consumes
about 20% of the energy contained in the
total quantity of all the oil extracted to
generate the required steam for EOR alone.
FRENELLs DMS system can be applied here
to replace up to 100% of the gas consumed
for EOR thereby lowering the carbon foot
print of todays oil production. The existing
gas boilers can be maintained in idle mode
as a backup capacity for periods with
insufficient solar radiation to cover the
steam demand.
7. Water Treatment Station
8. Feedwater Pump
9. Injection Well
10. Production Well
page 13
The main advantage of FRENELLs DMS over
other CSP applications in the EOR sector is
its ability to deliver of solar generated steam
from storage on demand around the clock
as per the oil field operator requirements.
In addition due to its higher temperature of
up to 550C DMS CSP in contrast to 300C
state of the art solar EOR technologies can
be further used for power generation once
oil fields are fully depleted, thus mitigating
the risk of stranded investments.
 page 14

3.4 Energy Storage

FRENELLs DMS Multi-Tank energy storage thermal power station to run excess grid converted back into electrical power by
can serve as a grid-level energy storage power into high temperature thermal energy generating steam to drive the existing steam
technology. When used for this, a multi-tank using electrical heaters. Stored in the Multi- turbine when needed.
system can be placed next to an existing Tank system, this thermal energy is then

Figure 10:
FRENELLs DMS Thermal energy storage for renewables

1. Wind farm/PV plant 7. Steam Turbine

2. Electrical Heating System 8. Air Cooled Condenser
3. Thermal Energy Storage 9. Deaerator
4. Cold Salt Pump 10. Feedwater Pump
5. Hot Salt Pump 11. Public Electricity Grid
6. Salt/Water Heat Exchanger
3. DMS Applications
page 15
 page 16 4. Economical Sensitivity of DMS Applications

4. Economical Sensitivity
of DMS Applications
4.1 Plant Scale
Many factors influence the Levelized Cost
of Electricity (LCoE1) of DMS CSP plants.
To understand their relevance, FRENELL
has carried out a series of sensitivity
assessments varying only one factor at a
time while keeping all others constant using
the following base-case conditions:
Plant location Aswan, Egypt; solar
radiation 2,917 kWh/ma DNI
Plant size 50 MW
8% unleveraged project IRR; real, net
of inflation
Total investment as per FRENELL
turnkey EPC price calculation on
todays DMS cost and efficiency Basis
including development cost
O&M costs as per internal FRENELL
calculation
Solar field and storage hours is designed for
lowest LCoE at base case conditions.
The accepted commercial wisdom in
electricity generation is that the larger the
size of your generating plant the greater
the economies of scale. This is true for
conventional power plants mainly because
specific turbine costs decrease and thermal
to electric conversion efficiency increases by
scaling up the plant size.
The same principle applies for the power
block of DMS CSP plants. However, due
to the modular nature of DMS technology,
the cost of solar field and thermal energy
storage is close to linear, watering down the
overall economy of scale effects of DMS
CSP plants.
As a result, the LCoE ranges from
13 US/kWh at a scale of 5 MW down to
6,5 US/kWh at a scale of 100 MW.
At a plant scale larger than 100 MW, the
cost increase of the solar field header pipe
work starts to balance further power block
economies of scale. This explains why
there is no further LCoE reduction beyond
100 MW DMS CSP plant capacity.

LCoE and plant specific costs for various plant rated power

14

12

10
LCoE (US/kWh)

0
0 50 100 150 200 250 300 350 400

Plant rated power (MW)

Figure 11:
LCoE as a function of plant rated power

1
LCOE calculation method is shown in Appendix
 page 17

4.2 Capacity Factor

The capacity factor reflects the annual energy
production relative to a plant that would run
at nominal power 24 hours a day for all 365
days of the year.
Following Figure 12 shows the influence of
storage size on LCoE for plants with different
capacity factors. Higher capacity factors
require the integration of more storage hours,
not a simple increase in the solar field, which
would have to defocus if not supported by
the required storage capacity. This explains
the rapid increase in the respective LCoE
curves at specific storage hours beyond their
minimal turning.
The lowest LCoE can be reached with 12-
18 hours energy storage delivering capacity
factors of 60-80%. DMS CSP plants with
such layouts would deliver nominal power
rates 24 hours a day from spring to autumn,
when power demand is highest in sunbelt
countries.
Importantly, the graph reveals the sweet spot
of DMS CSP as the preferred base-load
power application.

25 Storage size:

0h
20
2h
LCoE (US/kWh)

15
6h
10
12 h

5 18 h

0 24 h
0 20 40 60 80 100
Capacity factor (%)

Figure 12:
LCoE as a function of capacity factor. Each line reflects a given storage capacity at different solar field
sizes, as necessary to achieve a specific capacity factor
 page 18 4. Economical Sensitivity of DMS Applications

4.3 Project Internal Rate of Return

This section of the White Paper assesses
the influence of project return expectations
or the cost of capital on LCoE. Profit return
targets on equity investment and also bank
interest rates are driven by current market
opportunities reflecting also the perception
of related technology and country risks of a
specific investment.
The underlying base case assumption of 8%
unleveraged project IRR should be attracting
to private investors given the current all-time
low of interest rates. Figure 13 shows that
LCoE would reduce more than 20% assuming
a moderate 4% unleveraged project IRR that
are likely to attract investments especially by
state-owned utilities mandated to minimize
electricity prices rather than maximize
investment returns.
In well-selected cases, DMS CSP plants
could deliver even higher project IRRs than
8% when power purchase prices are aligned
more closely with the prices of more costly
competing power generation technologies
such as diesel gensets.
FRENELL contributes to reducing the cost
of investor financing through the low-risk
nature of its proprietary technology. All
components of FRENELLs solar field and
energy storage technologies are based
on standard components, which are fully
proven. A large-scale system is simply
more of the same. FRENELLs DMS
CSP technology also removes the classic
dependencies on volatile fossil fuels, even
on water for cooling. This makes DMS CSP
running costs very predictable.

40%

30%

20%
Relative LCoE value

10%

0%

-10%

-20%

-30% Figure 13:

LCoE as a function of project unleveraged IRR /
-40% financing cost (base case is 8%)
2 4 6 8 10 12 14

Unleveraged project IRR [%/year]

 page 19

4.4 Solar Radiation

Since direct solar radiation is what fuels CSP
plants, the amount any country or region
receives is a key driver for the resulting
cost of DMS CSP power generation.
The measure used to determine this for
FRENELLs concentrating solar technology
is Direct Normal Irradiance (DNI). Figure 14
shows the DNI geographical distribution.
Energy yield and LCoE are directly linked
with a regions DNI. The following Figure 15
shows their almost linear relationship. The
DNI low-end for commercially feasible solar
power generation is most likely at 1700
kWh/ma. While the value of FRENELLs
DMS CSP plants may decline below this,
the related DMS multi-tank energy storage
system continues to grow in value to regions
with a lower DNI.

Figure 14:
World map of Direct Normal Irradiance (DNI) [3]

14

12

10
LCoE [US/kWh]

2
Figure 15:
LCoE variations with various weather data files 0
that are representative for suitable CSP sites 1.500 2.000 2.500 3.000 3.500
Annual DNI [kWh/(ma)]

Simulated results Trend line

 page 20 4. Economical Sensitivity of DMS Applications

4.5 Desalinated Water Price

Seawater desalination is particularly
important for coastal regions in Sunbelt
zones where water shortages are a constant
and ever increasing threat. FRENELLs DMS
plants offer a key solution for desalinizing sea
and brackish water. Coupled with a Multi-
Effect Desalination facility using thermal
exhaust from steam turbines to supply
the distillation process, DMS plants can
become significant cogeneration facilities
producing both water and electricity.
Since the total amount of desalinated water
and electricity per year is a given, the annual
revenues necessary to deliver the 8% project
IRR depend on the sales prices (costs) per
unit of water and electricity. The higher the
unit price of water, the lower need be the
price of electricity and vice versa.
In countries like Egypt, cost of desalinated
seawater is in the range of 0.9 1.2 US$/m
depending on the currency exchange rate
and the region of the desalination facility
[4]. This means a DMS-based cogeneration
plant would generate electricity at a price of
8 10 US/kWh, assuming an unleveraged
project IRR of 8%. The price of water and
electricity would need to increase for higher
returns on the investment. Alternatively,
markets allowing an increase in one may
provide room to offset prices in the other.

2
1,8
Levelised cost of Water [US$/m]

1,6
1,4
1.2 US$/m
1,2
Water market price range
1
0,8
0.9 US$/m
0,6
0,4
0,2
0
5 7,5 10 12,5 15 17,5
Electricity price [US/kWh]

Figure 16:
LCoE as a function of price for water (LCOW)
page 21
 page 22
5. Competitiveness
5.1 DMS Compared with
Conventional On-demand Power Plants
Since volatile PV and wind technologies
are not reliably matching the given power
demand curve in sunbelt countries, there is a
requirement for further power plant capacity
capable of producing power to cover the
remaining supply gaps. This is only possible
for power plant technologies with a fuel
stock such as fossil fuelled power plants and
CSP plants with integrated thermal energy
storage.
Figure 17 provides a detailed comparison
of levelized costs of electricity (LCoE) across
such dispatchable power generation plants.
Coal fired power stations are well known
for delivering the lowest cost electricity while
having the highest carbon footprint. They
are followed by gas-fired Combined Cycle
power stations. The levelized cost of DMS
CSP power plants ranges between 5 and
12 US/kWh and is therefore seriously cost
competitive with fossil power stations. The
cause of the LCoE bandwidth of DMS CSP
plants is explained in more details in further
sections of this White Paper.
5. Competitiveness
Some further aspects of DMS CSP plants are Since DMS CSP plants are running
worthy of mention: 100% on solar energy there is no added
fuel cost in the equation. About 90%
the LCoE calculations for DMS CSP of the levelized costs are caused by the
plants shown above take into account depreciation of the initial investment
the use of air cooled condensers (ACC) costs. Plant operation and maintenance
to avoid consuming water to condense including frequent replacement of spares
the turbines exhaust steam. ACC is and wear components account for 10 %
far more expensive than water cooled of the total. As a consequence, once the
condensers and also decreases turbine initial investment is fully depreciated,
cycle efficiency. However, the significant typically after 20 years, the cost of DMS
cost savings of FRENELLs solar field and CSP electricity will drop below 1 US/
thermal storage solution compensate for kWh for the remaining 20 years of the
this while still leaving DMS CSP plants plants technical life time.
one of the lowest cost on-demand
power solutions.
DMS CSP plants at a scale of only 100
MW are fully competitive with fossil
power stations that reach their cost
minimum at a scale of 500 MW or even
greater. DMS CSP plants thereby enable
a more distributed power system where
the generating capacities are spread
over a region rather than concentrated
in a single place. This helps to reduce the
power system spare capacity in cover
shut downs of a single power station
either due to overhaul or sabotage
events. It also reduces the investment
cost of electricity transmission grids.
 page 23

14

12

10
Levelized cost of electricity ($ct/kWhel)

0
Oil-fired Power Plant [1] Gas-fired Power Plant [2] Coal-fired Power Plant [3] [4]

[1],[2],[3] FRENELL internal LCOE calculations based on the following external source: [4] FRENELL LCOE:
Fraunhofer ISE - STROMGESTEHUNGSKOSTEN ERNEUERBARE ENERGIEN STUDIE NOVEMBER 2013 medium scenario:
site DNI 2300 kWh/(ma),
12% Project IRRreal / 25 a,
[1] Assumed Brent oil price [2] Assumed gas price [3] Assumed coal price 100 MWel , included:
30 to 70 $/barrel 6 to 12 $/MMBTU 50 to 100 $/t EPC, O&M, PD, land
good scenario:
site DNI 3000 kWh/(ma),
4% Project IRRreal / 25 a,
100 MWel, included:
EPC, O&M, PD, land
Figure 17:
Price competitiveness of FRENELL DMS plants versus conventional dispatchable power generation
 page 24
5.2 DMS Multi-Tank as Grid-level Energy Storage
Expansion of energy storage has been
considered as one of the key measures to
facilitate the grid-integration of high amounts
of volatile renewable energy generation in
a power supply system. Hydro pump power
stations are generally the cheapest energy
storage system on a grid level. These, however,
are not an option for sun-rich countries where
water is scarce and its application is constrained
by availability of land and environmental
impact. To date electro-chemical batteries
are discussed as a potential key storage
technology in the future. Battery technologies
have been improving driven in large measure
by a fast-growing industry developing battery
systems for electric cars. This has raised hopes
for an automotive-driven reduction in the cost
of electro-chemical batteries that may also be
economically viable for the electricity supply
and distribution sector.
In November 2015, Lazard published the
most recent study of current and future costs
for energy storage on transmission grid level
[5]. Three key parameters determine the cost
of electricity discharged from energy storage
to transmission grid level: the investment
cost per kWh electricity; the cycle efficiency
BATTERY
TODAY
Storage efficiency
75-85
[%]
Storage costs
500-750
[US$/kWh]
Lifetime
5-15
[years]
describing the ratio between the amount of
discharged electricity and electricity moved
into the storage; and the lifetime of the storage
system.
The table below compares Lazards view on
these key drivers for todays and future figures
of electro-chemical battery storage systems
with FRENELLs Multi-Tank storage when
combined with an existing thermal power
station.
The cycle efficiency of a lithium-ion battery
storage system ranges from 75-85% taking
into account the losses of AC/DC, reverse
conversion and battery storage losses.
With the DMS Multi-Tank, close to 100% of
the charging electricity is converted to high
temperature heat. The heat losses of a Multi-
Tank system are about 1 Kelvin per day or only
1%. The steam turbine efficiency of an existing
power station typically ranges from 35% to
45%, dominating the overall cycle efficiency.
While the cost of battery storage systems today
ranges from 500 750 US$/kWh, further
improvements are expected to see this fall to
300 US$/kWh. Regardless, lithium-ion batteries
BATTERY FRENELL
NEXT GEN. MULTI-TANK
75 35-45
300 55-91
5-15 25-30
5. Competitiveness
are still expected to account for around 56 %
of future generation costs followed by AC/DC
converters as the next major cost.
FRENELLs thermal storage system costs 24
32 US$/kWh. This includes the cost for
integration into an existing power station.
Taking into account the conversion losses of
steam turbines, the comparable investment
cost of discharged electricity from DMS
increases to 55 91 US$/kWh.
Add its much longer life span to the equation
and the far lower cost of FRENELLs Multi-
Tank system well and truly overtrumps
lithium-ion battery systems by far.
Which brings us to the levelized cost of
electricity discharged from the two systems.
The comparison charted below assumes one
charge / discharge cycle per day at a cost of
2 US/kWh for the electricity charged in the
respective storage systems.
It clearly shows that as a stand-alone product,
FRENELLs Multi-Tank energy storage system
discharges electricity at a cost of 8-10 US/kWh,
about 5 times cheaper than todays lithium-
Table 1:
Comparison of todays and future battery
storage system and FRENELLs multitank storage
regarding efficiency, costs and lifetime [5]
 page 25

ion systems and 2-3 times cheaper than
potential future cost of batteries.
What this all adds up to is that FRENELLs
Multi-Tank energy storage system is
particularly suited to markets like those in
the United States, United Kingdom, Australia
and Chile that have one or more of the
following characteristics:
high shares of intermittent renewable
energies requiring back-up power
sources like energy storage and/or
peaker plants to secure grid-reliability
at all times
the failure of peak supply energy from
renewable sources to match peak demand
resulting in an offer/demand imbalance
leading to high electricity price variability
significant coal-fired generation
capacity expected to retire soon
due to economic pressure from
competition with renewable energies
and compliance with greenhouse-gas
reduction goals

60

50
LCoE [US/kWh] (a)

40

30

20

10

0
Battery (b) Battery next gen. (c) (d)

Figure 18:
LCoE comparison of Batteries and
FRENELLs thermal energy storage
(a) 60% debt financing at 8%/a and
12%/a equity interest rate. 20 US$/
MWhel electricity price for charging for
all systems
(b) based on data from Lazards leve-
lized cost of energy analysis v8.0. 75%
to 85% charge-to-discharge efficiency,
500 to 750 US$/kWhel installed specific
storage cost, 25 to 27.5 US$/kWh
installed specific storage O&M costs, 15
year lifetime.
(c) based on data from Lazards
levelized cost of energy analysis v8.0.
75% charge-to-discharge efficiency,
295 to 305 US$/kWhel installed specific
storage cost, 5 US$/kWhel installed
specific storage O&M costs, 15 year
lifetime.
(d) based on FRENELL storage system,
35% to 45% charge-to-discharge
efficiency, 24 to 32 US$/kWhth (equi-
valent to 55 to 91 US$/kWhel) installed
specific storage cost including extra cost
for system integration, 0.7 to 1 US$/
kWhth installed specific storage O&M
costs, 25 year lifetime.
 page 26 5. Competitiveness

5.3 DMS compared with Photovoltaic

and Battery Storage
The admirable cost reduction PV has
achieved over recent years has also raised
hopes that PV combined with battery
systems might provide day and night solar
power supply at competitive costs. It is an
important point worthy of exploration.
To this end, we can compare the performance
of a 50 MW PV plant with lithium ion battery
storage located in Aswan, Egypt with that of
a 50 MW DMS CSP plant, both designed
for a capacity factor of 80 %. To do this, we
draw on a PV energy yield assessment using
the public domain tool SAM from NREL, US
Department of Energy; and make investment
cost assumptions for PV+battery based on
LAZARDS levelized cost of energy analysis
as shown in table 2 [6].
As the following pie charts show, the
capital costs for these two technologies
are markedly shaped by their respective
energy storage systems. The DMS CSP
storage costs are less than 10% of the total
investment whereas the battery costs for a
PV system account for more than 50% of
the total.
This provides the basis for further comparing
the LCoE curves of DMS CSP and
PV+battery over capacity factors as shown
in Figure 19.
The costs of PV are lowest around 6 US/kWh
without any battery storage. The LCoE of
combined PV rises as more battery storage
is added, tripling at capacity factors of more
than 70%. This trend will not change even
if battery costs fall. Comparisons with other
power-on-demand technologies, as shown
in Chapter 5.2, demonstrate PV+battery will
not become a competitive base-load power
option.
The opposite is the case with DMS CSP
plants. While DMS CSP plants without
storage start with a higher LCoE than PV
without battery, the DMS LCoE decreases
continually to its minimum of 6.5 US/kWh
at a capacity factor of 60% on todays cost
and 5.5 US/kWh at a capacity factor of
70% assuming further cost reductions by
2020.

25

20
25

15
[ US/kWh ]

20 PV + Battery (2016)

PV + Battery (2020 projection)

10
LCoE [ US/kWh LCoE

Frenell DMS (2016)

15
]

PV + Battery
Frenell (2016)projection)
DMS (2020
5 Lowest cost PV Lowest cost CSP PV + Battery (2020 projection)
10 design point design point
Frenell DMS (2016)

0 Frenell DMS (2020 projection)

5 0% 20%cost PV
Lowest 40% 60%
Lowest cost CSP 80% 100%
design point Capacity factordesign point
Figure 19:
LCoE as a function of capacity factor for the FRENELL DMS system and PV+Battery with potential cost projections 2020 at 8% project iRR.
0 The projections are based on 25% PV module price reduction, 300 $/kWh battery costs optimistic scenario
0% 20% 40% 60% 80% 100%

Capacity factor
 page 27

Inverter BoP Power block

3% 1%
18%
Balance of
This means that when a DMS CSP, is designed

System
PV modules
22%
18%
for a capacity factor of 60% (15 hour storage), Balance of
it can reach similar LCoEs today as PV without System
10% Solar field
any storage. 57%

Further reductions in the cost of battery Thermal Energy

Batteries
Storage
technologies over time will not change this. 56%
15%
DMS CSP will continue to improve as the
Figure 20:
preferred solar power-on-demand technology
Investment cost breakdown for 50 MW with 80% capacity factor for DMS plant(left) and PV Plant (right)
over PV+battery.

An Excursion: Why Dollar per MW is Not System cost Value

the Right Measure to Compare PV with PV module specific costs 0.7 US$/W DC
DMS CSP 500 US$/kWh (today)
Battery storage specific costs
300 US$/kWh (next generation)
Dollar per MW installed PV capacity has become Inverters specific costs 0.1 US$/W DC
the high level indicator to compare various PV
Balance of plant specific cost 0.4 US$/W DC
technologies. This might work within the PV
sector but not as a point of comparison between Table 2:
Cost assumptions for PV+battery plant according to Lazards study and SAM software
PV and CSP with integrated energy storage.
35
The diagram in Figure 21, demonstrates the
MONTHLY GENERATED ELECTRICITY [GWH]

30
difference between a 50 MW PV plant without
battery and a 50 MW DMS plant designed for 25
a capacity factor of 80%. The 50 MW PV plant
20
would generate an annual yield of only 118
GWh compared with 350 GWh per year for the 15
50 MW DMS plant. Put in another way, DMS
10
plants of an equivalent capacity can supply
three times more energy yield than PV without 5
batteries; and they do so with only a 10%
0
increase in LCoE, as seen in Figure 21.
The graph also shows that the DMS plant can
deliver 50 MW electricity 24/7 from March to
October thereby matching 100% the most often 50 MW DMS CSP with thermal storage (80% capacity factor)
occurring power demand peaks after sun set. 50 MW PV without battery storage (27% capacity factor)

Figure 21:
Monthly Energy yields of FRENELL DMS(80 % Capacity factor) and PVs most
economic configuration
 page 28 5. Competitiveness

5.4 DMS compared with Diesel Generator Power for

Remote Power Supply
Diesel power has been a favoured
technology for small-scale, off-grid power
supply, in some cases even for dispatchable
grid power during periods of peak demand.
Many countries, including those with high
solar resources, have in consequence come
to rely on diesel generators to supply a
major part of their base-load electricity. This
dependency exposes them to significant
LCoE risk directly connected to volatile fuel
prices making it difficult for those countries
lacking their own oil resources to provide a
price-stable power supply.
FRENELLs DMS offers a clean, reliable,
cost-competitive alternative. It already
compares favourably at plant sizes as low
as 5 MW. From there up, the cost efficiencies
grow along with the scale of the power plant
size. FRENELLs 20 MW DMS plant can, for
instance, generate electricity for a lower
price than a diesel generator assuming fuel
costs of only 22 US per litre, the highly
subsidized price of diesel in Egypt.
To provide a benchmark: The unsubsidized
price of diesel based on a crude oil price of
40 US$ per barrel would be approximately
30 US per litre not taking account transport
costs of diesel to remote sites.

10,5 2,6 13,1 Capital Cost

DMS-FRENELL1

O&M Cost
8,6 1,6 10,3 Fuel Cost

7,4 1,2 8,6

0,7 1,7 6,5 8,8

Diesel Generators 2

0,7 1,7 11,6 14,0

0,7 1,7 16,2 18,5

0 2 4 6 8 10 12 14 16 18 20
Levelized Cost [US/kWh]

1 DMS-FRENELL calcluated at location with DNI 2,900 kWh/m.yr; 25 yrs lifetime and
9%/yr unleveraged IRR
2 Diesel generators calculated acc. to assumptions from 2015 Lazard Levelized Costs of
Energy Analysis 9.0
https://www.lazard.com/perspective/levelized-cost-of-energy-analysis-90/
Figure 22:
Comparison of levelized cost of electricity between diesel generators and FRENELL small-scale application[7]
 page 29

The next two charts show this more clearly
than words alone can fully capture. The
first shows the significant fall in costs as
the size of a DMS plant increases and,
correspondingly, the sharp rise in the cost of
diesel power generation as diesel prices rise.
The DMS plants avoid the cost volatility of
diesel power. Requiring no fuel other than
the sun, their core cost is the initial capital.
Thereafter, their operating costs remain
negligible and predictably stable. This places
DMS ahead of diesel power in terms of cost
thereby making investments in DMS easier
and less risky.
Now to the second chart. It follows below,
listing the diesel prices of 25 sun-rich
countries, many heavily reliant on diesel
power, with the most expensive diesel at
the top descending to the cheapest at the
bottom.
Bear in mind here the direct relationship
between the cost of diesel fuel and the cost
of generating diesel power. This makes it
easy to see where the cost of DMS power
sits in the scheme of things. As the list
shows, DMS has immediate commercial
relevance as a preferred power provider in
22 of the 25 countries listed from Egypt up.

Cyprus 1,24
Mauritania 1,15
Mali 1
Madagascar 1
Chad 0,94
South Africa 0,84
Morocco 0,83
India 0,76
Namibia 0,64
Sudan 0,53
Jordan 0,51
Oman 0,43
UA Emirates 0,42
Kuwait 0,37
Egypt 0,21
Saudi Arabia 0,2
Algeria 0,18
Iran 0,1
0 0,2 0,4 0,6 0,8 1 1,2 1,4

Diesel cost [US$/liter]

Figure 23:
Overview of diesel fuel prices in various sun rich countries with the point of FRENELL competitiveness highlighted [8]
 page 30 5. Competitiveness

5.5 DMS compared with Gas fired

Steam Generation for EOR
With oil production of matured oil fields
requiring an increasing quantity of steam for
EOR operations, solar steam generation is
worthy of consideration as a cheaper option
than the current use of gas.
Costs for solar generated steam can be
directly converted into equivalent fuel costs
for natural gas. For this a standard gas
boiler efficiency of 85% has been assumed.
The energy amount of the generated steam
gives a direct relation to the energy unit
MMBTU which is commonly used for natural
gas prices.
When using DMS technology for EOR costs other environmental burdens to reduce CO2
ranging between 13-24 US$/ton of steam emissions.
can be achieved, depending on project IRR
and solar radiation. Considering the before Solar EOR also offers the further advantage
mentioned translation method this would of diversifying industry in oil producing
correspond to equivalent fuel costs of gas countries and, last but not least, creates
between 3-8 US$/MMBTU. Comparing DMS CSP assets that will remain in place
this with historical gas prices as shown in for further electricity generation as the oil
Figure 24, this strongly indicates that using fields are fully depleted.
DMS CSP instead of gas is the preferring
investment option in most oil fields using
thermal EOR. The balance will likely tip
further in favour of solar EOR when markets
penalize fossil fuels with carbon credits and

18
Cost equivalent of
16 solar generated
steam by using
14
FRENELL DMS
12 technology for EOR
[US$/MMBTU]

Japan cif (LNG)

10

8 Germany (AGIP)

6
UK (Heren NBP Index)
4
US Henry Hub
2

0 Canada (Alberta)
1996 1998 2000 2002 2004 2006 2008 2010 2012 2014

Figure 24:
Historical natural gas prices compared to cost equivalent of solar generated steam
page 31
 page 32
6. Country Opportunities
for DMS Applications
6.1 China
China has been a global leader in economic
growth for many years. Gross domestic product
and the energy sector are closely linked. Total
produced electricity is 5,500 TWh generated by
an estimated installed capacity of 1,260 GW, the
largest installed generation capacity in any single
country. Despite the strong growth in electricity
demand, production exceeds consumption and is
likely to continue delivering China a positive net
balance for its electricity market [9] with capacity
expected to nearly double by 2040 [10].
Various state-owned corporations and private
companies emerging from the State Power
Corporation manage the generation, distribution
and consumption of Chinese electricity. To
increase the efficiency of power generation
nationwide, the central government plans to
interconnect the regional grids with ultra-high-
voltage transmission lines to create a single
national grid [11]. This should help address
the challenge of Chinas geographical size that
16
14
12
10
LCoE [US/kWh]
8 LCoE FRENELL CSP DMS
6
4 Feed-in Tarif
0
5 6 7 8
Unleveraged Project IRR [%/yr]
6. Country Opportunities for DMS Applications
creates long distances between power producers
and consumers. A more widely distributed range
of small- to medium- power plants such as the
FRENELL DMS would further help.
Chinas energy mix is currently dominated by
coal power stations [11]. These gobble up almost
half of all coal consumed in the world [10]. The
resulting domestic power production in China
increased more than 300% between 2000 and
2013.
In 2014, China was already leading the world in
the money it was investing and the total capacity
it was building in renewable power. As a result,
the country has increased its non-fossil energy
output from 9.4% of primary energy consumed
in 2010 to 12% in 2015 [12]. The ambitious
minimum target for 2030 is set to 20% and
reliable predications suggest China will easily
achieve this target. In other words, the shift to
renewable energy is well underway and the
9 10 11 12
progress is likely to increase in speed over time.
The 13th Five-year National Development Plan
drafted by the National Energy Administration
(NEA) for the National Development and Reform
Commission (NDRC) sets a goal to support low-
carbon energy solutions and proposes installation
of a CSP capacity of more than 10 GW by 2020.
The draft also proposes a feed-in-tariff (FiT) of 1
RMB (0.15 US) per kWhel [13] and suggests
the regions of Qinghai, Shanxi, Gansu and Inner
Mongolia as possible sites for locating the CSP
plants. A first CSP project with a binding FiT of
1.2 RMB (0.18 US) per kWhel was approved by
the NDRC in 2014 for the 50 MW Delingha CSP
plant operated by SUPCON [14].
Many national research programs have been
carried out to promote CSP supply growth.
The research includes the techno-economic
analysis of various CSP technologies to define
FiT adjustments, a proven approach in Chinese
Range of
LCoE Combined Cycle
Range of
LCoE Coal
plant
Figure 25:
LCoE as a function of project IRR for a FRENELL
100 MW reference CSP plant
 page 33

FiT programs for other renewable energy sources
such as wind and PV.
To date, 14 CSP projects with a total capacity of
1,170 MW have been short listed [15] to build a
capacity of 1 GW in the envisaged pilot phase.
The forecast budget for these is around RMB 30
billion (US$4.7 billion).
Among these, 400 MW are based on parabolic
trough, 470 MW on power tower and 300 MW
on Fresnel collector technology.
The outlook for investing in the Chinese CSP
market is highly positive. The 13th Five-year
National Development Plan provides for a total
CSP capacity of 10 GW, more than double the
current worldwide installed CSP capacity. The
Plan supports investments in CSP plants through
an assured FiT providing a solid foundation for
the introduction of FRENELLs DMS system to
the Chinese market. DMS is perfectly suited
to support Chinese legislators in reaching their
ambitious goal in generating a clean, economic
source of renewable energy.
A techno-economic analysis by FRENELL for
a standard 100 MW DMS CSP power plant
with 14 hour storage and a capacity factor
of 44% demonstrates its keen commercial
competitiveness not only in Chinas current
electricity market but also well into the future.
Figure 25 shows the levelized cost of electricity
such a DMS CSP plant can achieve at different
project IRRs. At moderate IRRs of 5%, FRENELLs
DMS technology appears to be cost competitive
with coal, providing Chinas with a significant
strategic option for its long-term energy planning.
The economics of scale are unmistakeable in
China. It is a large and growing market with
significant potential to further extend the
renewable energy portfolio by using DMS CSP to
lower Chinas carbon footprint and dependency
on fossil fuel imports.

Solar Nuclear
0,2% 2,3%
Natural gas,
Wind bio-mass
2,6% 3,8%

Hydro
16,8%

Coal
74,3%

Figure 26:
Electricity production in China by source (2013)

Technology Capacity

Linear Fresnel 300 MW

Parabolic Trough 400 MW

Power Tower 470 MW

Total 1,170 MW

Table 3: Figure 27:

Chinas projected CSP plants for the pilot phase [15] DNI map of China
 page 34 6. Country Opportunities for DMS Applications

6.2 Oman
Oman is blessed with plenty of gas and oil The natural gas is produced domestically by
resources, also abundant solar radiation. an established exploration and extraction
industry. Oman exports more than a third
Oil production and exports play a major role of the gas from its production as shown in
in financing Omans national budget. The Figure 29. The main sales are of liquefied
use of natural gas for thermal-enhanced natural gas (LNG) to Japan and South Korea
oil recovery since 2007 has helped to turn as major trading partners. Figure 31 also
around declining oil production. shows increasing domestic consumption of
Omans LNG. According to the governments
ambitious aim of economic diversification, the
countrys industrial sector has grown heavily
during the past decade, consuming over the
same period more LNG than new gas-field
developments can provide. As a consequence,
the quantity of LNG exports slightly decreased
between 2010 and 2012.

1200

1000
Thousand barrels per day

800
Production
600
Consumption
400

200

0
1996 1998 2000 2002 2004 2006 2008 2010 2012 2014

Figure 28:
Oman petroleum and other liquids production, consumption and net exports [16]

1200
1200

1000
1000
Gas Usage [BCF/yr]
Gas Usage [BCF/yr]

800800 Others
Others
Industry
Industry
600600
Electricity
Electricity
Oil sector
Oil sector
400400
Exports
Exports

200200

0 0
2000
2000 2001
2001 2002
2002 2003
2003 2004
2004 2005
2005 2006
2006 2007
2007 2008
2008 2009
2009 2010
2010 2011
2011 2012
2012

Figure 29:
Usage of explored gas in Oman in different fields

Oman has successfully introduced its first
solar projects to substitute gas for steam
generation in the EOR sector in order to
reduce domestic gas consumption and
increase gas export volumes. The National
Centre of Statistics and Information notes
that Omans oilfields currently account for
more than 20% of the countrys total gas
consumption [17].
Since the currently applied CSP technologies
do not have energy storage, their contribution
to domestic gas consumption is limited to
daytime operation. DMS CSP offers the
potential to triple the contribution.
Figure 31 illustrates the economic benefits of
DMS CSP in Omans EOR business.
Figure 30:
DNI map of Oman
page 35
Two scenarios have been calculated. While
the optimistic DMS case assumes a
solar resource of 2,500 kWh/(ma) and an
unleveraged internal rate of return of 4%
(IRR), the conservative DMS case relies on
more conservative assumptions such as DNI
of 2,000 kWh/(ma) and 10% project IRR.
The derived levelized costs of energy from
the techno-economic evaluation of the two
 page 36 6. Country Opportunities for DMS Applications

scenarios can be transformed into fuel costs by 18

the use of a conventional boiler characteristic. 15,6
16

14 11,5
Furthermore, cost assumptions for selling prices 12,7
LCoE [US/kWh]

of natural gas have been made considering 12 11,0

9,3
two scenarios with high and low prices for LNG 10
sales revenues. 8,0 8,4
8
6,0
The resulting analysis shows that FRENELLs 6

DMS technology already offers a cost- 4

effective solution for EOR applications in DMS CSP at 8% project IRR
2
Oman. Given that more than 15% of the DMS CSP at 4% project IRR
natural gas consumed is used for oil fields [18], 0
0 20 40 60 80 100 120
the FRENELL DMS offers significant potential
Nominal Capacity [MW]
for generating additional profits by increasing
sales of natural gas to the LNG market. Figure 31:
Levelized costs of electricity (LCoE) for FRENELL power only application in Oman
DMS CSP could be also extended from EOR to
the power-generation sector to further reduce
domestic gas consumption. The scenarios are
Natural gas prices/ Cost equivalent of solar generated steam

based on conservative assumptions for a solar

16
resource of 2,000 kW/(ma) and vary in power 39
block size (10, 20, 50 and 100 MW) with
Levelized Cost of Steam [US$/ton]

14
35 High LNG
comparative internal rates of return (4% and price scenario
12
8% project IRR). The design of the solar field 31

has been optimized with a thermal storage of 27

10

15 full load hours to fully cover Omans day

[US$/MMBTU]

23 FRENELL DMS conservative scenario

8
and night power demand, especially in high
summer. The results of the case study are 19 6

summarized in the graph below Figure 31. Low LNG

Low LNG 4
15
price scenario
The small-scale application, including a power FRENELL DMS optimistic scenario
11 2
block size of 10 MW, provides levelized costs
of electricity of around 12 US/kWh assuming 7
Figure 32: 0
4% project IRR. Due to economies of scale, Costs of steam for FRENELL EOR application compared to saved fuel costs of natural gas by LNG sales
costs for a 100 MW power block can be
halved to 6 US/kWh by implying similar rates
of return.
page 37
 page 38
6.3 Jordan
Jordan is perfectly placed in the worlds
Sunbelt to take full advantage of CSP solar
technology to power its future. Sunlight
showers the country as a daily resource with
a DNI up to 2900 kWh/(ma). This provides
a tremendous opportunity to end Jordans
almost complete reliance on costly fossil
fuel imports by switching on the nations
economic lights using CSP power plants.
This switch offers the opportunity to end the
nations dependency on fuel imports.
The total energy consumed in Jordan has
been dominated by a strong and continuous
growth in energy consumption averaging 7%
per year from 1998 to 2014. Jordan needs
more electrical power. Installed generation
capacity is expected to grow from 4.3 GW in
2015 to 6.8 GW by 2020. [20]
Figure 33:
DNI map of Jordan
6. Country Opportunities for DMS Applications
In 2014, imported diesel and Heavy Fuel The Renewable Energy and Efficiency Law
Oil (HFO) provided 92% of Jordans power (REEL) of April 2012 secured the basis for
generation introducing vulnerabilities that investments in the renewable energy sector.
include several disruptions from sabotage It has two powerful elements:
to gas supplies imported via the Egyptian 1. A direct proposal regime allowing
Arab gas pipeline. High import costs and private companies to negotiate renewable
government subsidies impact adversely projects directly with the Ministry of Energy
on the countrys balance of payments and and Mineral Resources (MEMR)
seriously drag on the national budget. 2. A requirement for the National Electric
Power Company (NEPCO) and regional
Consequently, the Jordanian Government distribution companies to purchase
plans to invest US$15 billion in renewable electricity generated by renewable energy
and nuclear energy to boost domestic energy projects and pay for their grid connection
sources and begin stepping back from
reliance on fuel imports. The national energy These create a highly supportive environment
strategy includes plans to add CSP, PV and for operators to make significant investments
hybrid renewable systems of 300600 MW in renewable generation projects of which
to its supply mix by 2020 [21]. FRENELLs DMS CSP systems are likely to be
considered a standout contender.
Total Electrical Energy Consumption in Jordan [GWh]
Growth Rate per year of Total Electrical Energy Consumption
Average annual growth rate 1998-2014
16.000 16%
Energy Consumption Jordan [GWh]
14.000 14%
Growth Rate [%]
12.000 12%
10.000 10%
8.000 8%
6.000 6%
4.000 4%
2.000 2%
0 0%
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
Figure 34:
Total consumption and annual growth rate of electricity in Jordan (1998-2014) [19]

Jordans State-owned NEPCO is responsible
for purchasing all grid-connected power.
NEPCOs average energy purchasing price
was 137 JOD/MWh (193 US$/MWh) in 2014
at an average crude oil price of 90 US$/bbl
[22], while its subsidized average power sales
price was 127 US$/MWh. As a consequence,
NEPCO had a deficit of US$1.7 billion in 2014.
This is 4.6% of Jordans GDP, a tremendous
drain on the countrys economy.
FRENELLs DMS systems sail past these
commercial benchmarks with ease. The DMS
base-load power plants are commercially
competitive even on a small scale of only 10
MWel for classic IPP models. Costs come down
further with larger DMS plants offering even
greater economies of scale. In all cases, the
DMS power purchase price that is below the
67
Coal
48GWh Other
Natural gas
1296 GWh 67 GWh
Heavy fuel oil Diesel
7690 GWh 9168 GWh
Figure 35:
Electrical energy production by type of fuel in Jordan (2014)
selling price of Jordans subsidized electricity
tariffs can contribute to the nations public
budget and economy by ending the need for
any and all government subsidies.
While low oil prices since 2014 have eased
cost pressures on Jordan, the pressures
remain nonetheless. FRENELLs DMS CSP
plants of 20 MWel or larger still compete
with hydrocarbon power generation even
assuming a pessimistic scenario for long-
term oil prices of 30 US$/bbl over the next
25 years.
Jordans Energy Minister announced in
mid 2014 that his Government expects to
commission about 1,800 MW of solar and
wind power capacity by 2018. This is far more
than the renewable growth strategy laid out
250
200
LCoE [US/kWh]
150
100
50
0
0 20
Nominal Capacity [MW]
Figure 36:
FRENELLs electricity costs over plant size for different DMS CSP project IRRs in Jordan
page 39
in the National Energy Strategy and translates
into a growth in generation capacity of 600
MW per year. It speaks to the growing peak-
capacity demands increasingly placed on
Jordans electricity grid.
Given these developments and FRENELLs
global leadership in CSP capture and storage,
it is not unreasonable to assume the Jordanian
Government could assign to FRENELL at
least 10% of the renewable capacity it is
committed to adding. This translates to 60
MWel per year of power plant capacity.
To facilitate market entry, FRENELL is already
working with the Jordanian Government and
a Jordanian project developer to develop a 10
MWel power plant.
Average cost of grid power
NEPCO's average power selling
price 2014 (subsidized)
12% project IRR
6% project IRR
3% project IRR
40 60 80 100
 page 40
6.4 Egypt
Egypts energy mix is skewed toward
hydrocarbons with 88% of total installed
electricity capacity dependent on fossil
fuels. The share of wind and solar power
represents only 3% of the total capacity as
of 2014, see Figure 38.
Egypt anticipates an electricity demand
growth of 6% per year to cover population
growth and economic development [23].
If production capacity is to keep pace with
rising demand, it too will need to grow at
6% per year by 2022 and probably beyond.
Egypts primary energy source is natural
6. Country Opportunities for DMS Applications
gas. It accounts for 46 % of the power
generation based on the Egyptian Electrical
Transmission Company (EETC) annual
report. A lack of new gas field developments
and increasing consumption of natural gas
has led Egypt to switch from being a net
exporter to become a net importer of natural
gas. [24]
In order to compensate the negative impact
on Egypts foreign trade balance, the
Government of Egypt (GoE) has therefore
started initiatives to develop further gas
fields and also adopted a Renewable Energy
Plan (RE Plan) setting a target for renewable
energy to account for 20% of electricity
generation by 2020. This also includes a
feed in tariff for 2 GW of photovoltaic plants.
The Figure 40 plots Egypts power demand
curve for a summer day when total power
demand reaches its maximum. The power
demand curve is steadily increasing from
7 am before showing a strong peak from 6
to 9 pm, afterwards decreasing towards the
early morning low point.
An interpretation of the graph indicates that
PV can help save the gas consumption of
Figure 37:
DNI map of Egypt
 page 41

power stations during the day. This, however,
does not reduce the need for additional
power capacity to cover the steadily
increasing peak power demand after sunset.
While wind velocities vary both day and
night, the contribution of wind power
for matching demand peak will remain
stochastic.
This explains why Egypts current energy plan
proposes Gigawatts of new power plants be
built to supply electricity on demand. Such
plants include gas-fired Combined Cycle
plants and even coal fired power stations.
DMS CSP plants also supply on demand
power. But which of these would be the
lowest cost option for Egypt?
Solar radiation levels in Egypt are very
predictable. This provides a high level of
certainty for electricity costs from DMS CSP
plants.
Assessing the electricity cost of natural-gas-fired
Combined Cycle plants is not so easy as applicable
gas prices in Egypt, accounting for about 80% of
total costs of gas based power generation, vary
from 3 US$/MMBTU for operational onshore gas
fields to 4 - 6 US$/MMBTU for developing new
gas fields. The prices reach into two-digit values
for imported LNG.
In order to deal with price variety, Figure 41 below
shows the cost of electricity from gas Combined
Cycle plants resulting for various gas prices.
Since new gas power stations can only be
realized when new gas supplies become
available, it appears reasonable to pick
6 US$/MMBTU for domestic gas over the
next 25 years as a base case for gas CC
power generation cost.
Since DMS CSP would allow Egypt to reduce
expensive LNG imports, a 10 US$/MMBTU
could be seen as a reasonable gas price to
determine the avoided cost of gas Combined
Cycle power generation.
The resulting cost of electricity would
then be 7 US/kWh for the base case and
10 US/kWh from an avoided cost viewpoint.
The grey band in Figure 42 below represents

75
Wind Solar
Hydro 2% 1%
Natural gas production and consumption

70
9%
65

60
[BCF/yr]

55

Consumption
50
Production

45
Thermal
(Oil & Gas) 40
88% 2013 2014e 2015f 2016f 2017f 2018f 2019f

Figure 38: Figure 39:

Egypt Energy Mix (2014) Natural gas production and consumption for Egypt (in billion m)
 page 42 6. Country Opportunities for DMS Applications

the cost of conventional gas-fired base-load The high end of the rendered DMS CSP
power ranging between the gas base and electricity cost is 12 US/kWh at a scale of 10
high price. It also shows the LCoE curves MW assuming a total return on investment
for CSP DMS plants at various sizes and of 12 % per year. DMS CSP electricity costs
project return targets. can also get down to 4 US/kWh at a scale
of 100 MW when targeting only a 6% return
on investment per year.
Matching the base case of gas Combined
Cycle power plant costs would provide room
for a 12 % unleveraged project return, more
than high enough to attract independent
power producers.

25,000

20,000
Capacity MW

15,000

10,000
Base Load Peak Load

5,000

0
0 am 6 am 12 am 6 pm 12 pm
Egypt Load 2010 Egypt Load 2012
PV DMS Base Load Complementary ring Gas Turbine

Figure 40:
Egypt Load demand, Peak hours during night time

15
13,5 14
12,5 13
Levelized Cost of Electricity

Cost of Fuel [US$/MMBTU]

11,5 12
11
10,5
10
9,5 9
[US/kWh]

Imported Fuel Prices 8

8,5
7
7,5
6
6,5 5
5,5 Local Fuel Prices 4
4,5 3
2
3,5 1
2,5 0

Figure 41:
Local and imported gas prices and corresponding cost of electricity (considering all installed
generation technologies)
 page 43

However things progress, the following
points make it clear that FRENELLs DMS
CSP plants can add significant value to
Egypt:
Every Megawatt of installed DMS
CSP plant capacity will contribute to
covering the continuously growing
power demand peak making additional
peak power obsolete.
Electricity costs for DMS CSP base-
load power are highly competitive with
fossil power plants, dropping to ~1
US/kWh after full depreciation of the
solar plant.
While using the abundant solar source of
Egypt instead of gas, power generation
costs will become more reliable.
The mitigated consumption of gas for
power generation will improve Egypts
foreign trade balance.
The use of air-cooled condensers will
not further distress Egypts water
supply constraints.
Since FRENELL will manufacture key
components of solar field and thermal
energy storage in Egypt, the market
introduction of FRENELL would help
to create new employments in an
emerging and sustainable sector.
A DMS CSP can also help Egypt utilize the
benefits of the Red Sea coastline. This offers
the worlds the highest direct solar radiation
levels with abundant free space and water
access. Constructed as a combined power
and desalination plant beside the Red Sea
a deliver 50 MW base-load power plant
could also provide 50,000 cubic meters of
desalinated water every day. Since Egypt
currently depends on the Nile for nearly all
its drinking and agricultural water, DMS
CSP MED plants offer an attractive second
option to address Egypts water needs.

12
DMS CSP at 12% project IRR
10

8 DMS CSP at 10% project IRR

LCoE [US/kWh]

6 DMS CSP at 8% project IRR

4
DMS CSP at 6% project IRR
2

Gas Combined Cycle Power Plants

0
10 20 30 40 50 60 70 80 90 100
Nominal Capacity [MW]

Figure 42:
FRENELL LCoE with different financing schemes Current cost level of DMS CSP has been assumed for the range of 10-50 MW / future DMS CSP cost
savings have been considered for 100 MW) (Unleveraged Project rate of returns) compared to gas combined power cycle costs. Reference site for DMS
CSP plant is Hurghada (2,950 kWh/ ma DNI); Storage and solar field designed for LCoE minimum (>14 h storage / capacity factors approx. 70%)
 page 44 6. Country Opportunities for DMS Applications

6.5 Morocco
As a consequence of Moroccos growing
economy and population, the country has
faced a continuous growth of electricity
demand in the recent years, which is
expected to continue on short and midterm.
The total installed power plant capacity is
expected to more than double from 6,400
MW in 2011 to 14,000 MW in 2020.
Due to the lack of domestic fossil energy
resources more than 80% of the consumed
electricity has to be either imported or
generated using imported fossil fuels.
Figure 44 shows the accumulated power
demand curve of the days with highest
electricity consumption in the year 2013 and
2014. Demand is lowest from midnight to 8
am. It climbs higher from noon to 8 pm and
peaks significantly from 8 pm to midnight.
In 2014, coal-fired power stations
dominated Moroccos total power supply
followed by gas-fired combined-cycle plants
and diesel generators. Wind and hydro had
a share of about 11%.
In order to reduce carbon emissions and the
strong dependency on fossil-fuel imports,
Morocco has established a National Energy
Strategy aiming to increase the share of
renewable energy to 42% by 2020 and even
to 52% by 2030 while at the same time
reducing dependency on energy imports
and bringing the annual subsidies in the
electricity sector down to US$440 million.

Figure 43:
DNI map of Morocco
 page 45

To achieve these targets, Morocco has
established a regulatory framework with the
following elements:
Regulated tariffs for end customers
are being progressively raised to reach
production costs in order to reduce the
annual electricity subsidies.
The Moroccan Solar Energy Plan
(MSEP) implemented in 2010 is aiming
for 2000 MW of concentrated solar
power to be installed by 2020.
MSEP is coordinated by the Moroccan
Agency for Solar Energy (MASEN)
through big tender processes.
Liberalization of the electricity market
has resulted in access to the national
grid being opened to independent
producers of High and Medium Voltage.
A new regulatory authority, National
Authority for the Regulation of
Electricity (ANRE), was created in 2015
to fix the rules and clarify the roles of
public actors in the market.
These developments have set the framework
for private investments in renewable energy
systems such as wind, photovoltaic and CSP.
Production facilities with a capacity of 400
MW are already installed or in construction
on the Ouarzazate site.
The dominant share of coal, natural gas
and diesel power generation in Morocco is
reflected in the specific power generation
costs of the respective plants.

6
Electricity demand [GW]

5,5
5
4,5
4
3,5
27. Aug 14
3
09. Jul 13
2,5
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
Hour of the day

Figure 44:
Electricity demand profile Morocco (days with maximal power demand for 2013 and 2014)
 page 46 6. Country Opportunities for DMS Applications

Coal is well known to be Moroccos cheapest
fossil power source with an average cost
of 8 US/kWh [25] whereas Diesel power
generation has the highest specific cost of
more than 20 US/kWh. This results in the
average cost of fossil-fuel-based power
generation being around 12 US/kWh.
How will the implementation of Moroccos
renewable energy target affect the overall
cost of power generation?
The MASEN program so far has focused on
tendering CSP projects including thermal
energy storage to substitute for gas- and
diesel-based mid- and peak-load power
supply. The three tender rounds so far have
resulted in power purchase prices of 14.3 -
18.7 US/kWh.
Since these price levels remain above the
average cost of power generation, the
resulting cost gap is being closed with
government subsidies. Power Purchase
agreements (PPA) are formulated between
the producer of electricity and MASEN
and MASEN formulates another PPA with
ONEE and then electricity is sold to the end
consumer by the regulated prices; which is
subsidized at 2 levels, shown in Figure 48.
Meanwhile, the latest tender round for 850
MW of wind projects has achieved a new
low for the cost of wind energy, securing
average bids of just 30 US$/MWh. While
wind is a fairly constant source of energy
in Morocco, however, it remains a volatile
source that cannot be relied upon to entirely
match the demand profile.

Renewables
Power
11%
importations
18%
11%
14%
11% 28% 14%
Fuel + Gasoil 28%
7%
2011 48% 2020
48%
2011 2020 27%
27%
41% 41%
Natural
Coal 31%
Coal gas Solar
Solar 31%
17% Other fossil fuels Coal
Other fossil fuels Coal
Other fossil fuels
Coal Renewables
47% Other fossil fuels
Other renewables
Renewables Other renewables

Figure 45: Figure 46:

Moroccan energy mix (2014) Moroccan energy mix in 2011 and national energy strategy for 2020

ANRE (2015) MASEN (2010) ONEE

National Autority for the Regulation of the Moroccan Agency for Solar Energy National
National Office
Office for
for Electricity
Electricity and
and potable
potable Water
Water
Electricity market
Coordinates the Moroccan Solar Energy Plan Electricity
Electricity producer
producer
Regulates the Market, Responsible for the development of a National Solar Energy Purchases
Purchases electricity
electricity from
from private
private producers
producers and
and foreign
foreign
Set Prices to Access National Grid (VHV HV MV) Business Expertise countries through
countries through PPA
PPA (Power
(Power Purchase
Purchase Agreements)
Agreements)
Regulates comercial relations between ONEE and Nationa Chooses EPCs and supervises the work Ensures transmission and distribution
Ensures transmission and distribution
Grid users Will sell the produced power to ONE at a fixed price

Figure 47:
Moroccan Regulatory Environment
 page 47

Photovoltaic is expected to arrive at a low
cost level of around 5 US/kWh. However,
photovoltaic without battery storage cannot
contribute at all to meeting Moroccos
demand peak during evening and night
hours.
As a result, the requirements for a
dispatchable mid-load power supply will
increase proportionally to the expanding
wind and photovoltaic share.
FRENELL DMS CSP plants are able to
address Moroccos need for an affordable
and reliable renewable power supply. Even on
a scale of 50 MW, a DMS plant with 14-hour
energy storage delivers electricity prices of
9.3 12.2 US/kWh, already below todays
average cost of fossil power generation. This
would mitigate the need for subsidies to fund
the cost-gap as applied at NOOR 1-3.
FRENELLs large and adaptive energy storage
systems would also reliably mitigate the use
of expensive diesel generators covering the
late-night demand peaks.
On a larger scale of 100 MW, DMS plants
will deliver electricity price levels of 6.4
8.5 US/kWh. Lower even than coal, this
makes DMS todays lowest cost option for
Morocco and the best of all replacements
for the countrys conventional power supply.
FRENELLs DMS plant provides the
technology required to advance Moroccos
progress toward its 2 GW CSP target by
2020 and to do so at price levels below
the average cost of conventional power
generation. The larger DMS plants will

SUBSIDIES SUBSIDIES

PRODUCER PPA 1 MASEN PPA 2 ONEE REGULATED PRICE CONSUMER

PPA1 > PPA2 > REGULATED PRICES

Figure 48:
Power purchase agreement process in Morocco: Ouarzazate (500 MW) / Ain Ben Mathar (400 MW) / Boujdour (100 MW) / Tarfaya (500 MW) / Laayoune (500 MW)

OUAR ZAZATE Size Technology Storage Capacity MASEN PPA 1 TOTAL INVEST Progress

NOOR 1 160 MW Parabolic trough 3 hours 191 US$/M Whel 1,144 mio. US$ in production

NOOR 2 200 MW Parabolic trough 7 hours 142 US$/M Whel 1,870 mio. start up 2017

NOOR 3 150 MW Power Tower 8 hours 152 US$/M Whel start up 2017

Table 4:
Key facts of CSP project NOOR, Ouarzazate, Morocco
 page 48 6. Country Opportunities for DMS Applications

even deliver power purchase prices below
the actual cost of coal-fired power stations.
Midterm, FRENELLs DMS energy storage
systems likewise provide Morocco with a
serious opportunity to take full advantage of
low-cost investments in PV and wind power.
With these sources expected to over supply the
non-base/non-peak Moroccan energy market
in the midterm, storing excess PV and wind
energy is likely to become a priority in the not-
too-distant future. The DMS storage systems
provide the perfect technology to do this in the
most cost-effective way currently available.
DMS CSP plants are consequently positioned
perfectly to support PV and wind energy as a
complementary renewable base as well as a
mid-load energy source.
They also pave the way for Morocco to
make a 100% shift to renewable power
supply at substantially lower costs than
todays conventional power generation.
The cost advantages of DMS over coal-
fired power stations alone make it a sound
investment for commercial operators. Local
firms and employment will likewise grow
from manufacturing the DMS solar field
thermal energy storage components locally.
The government budget and foreign trade
balance will also benefit as subsidies are
reduced along with energy imports in a win-
win outcome for everyone involved including
end-consumers and the environment.

20

18
17,1
16
14,1
14
13,2 12,2
LcoE / Benchmark [US/kWh]

12
10,8
10 9,3
8,5
8
6,4
6
NOOR II power purchase price
4
cost of coal fired power generation
2 DMS plant LCOE at 12% project IRR
DMS plant LCOE at 8% project IRR
0
10 20 30 40 50 60 70 80 90 100

Nominal capacity [MW]

Figure 49:
FRENELL DMS performances for Morocco
page 49
 page 50
6.6 Chile
Northern Chile is well placed to take
advantage of FRENELLs DMS solar
technology. It is a sun-blessed country with
the Worlds highest solar resource of up to
over 3500 kWh/(ma) (DNI).
Chile is leading Latin America in
competitiveness, income per capita,
globalization, economic freedom and low
perceptions of corruption all healthy
signs for a prosperous economy with high
attractiveness for international investments.
Six regional electricity grids (currently not
interconnected) supply electricity to grid-
connected customers. Chiles North is
covered by the SING and SIC grids. These
account for over 99% of Chiles capacity.
Chiles copper mining industry drives a
constantly growing demand for base-load
electricity. Chile has been installing 600
MW/a of power-plant capacity over the
past 15 years rising to 1000 MW per year
over the past five years. The strong capacity
growth is expected to continue as new
copper mines will require more energy per
unit of exploited metal.
Chile has four major fuel sources for its
electrical generation. Hydro is the largest,
supplying a third of the total supply from
6. Country Opportunities for DMS Applications
dams in the south although with increasing
supply shortages due to longer periods of
dry weather. Together with Hydro power,
expensive imported fuels liquefied natural
gas (LNG), coal and diesel make up the bulk
of the remaining generation supply.
In view of the challenges presented by
hydros increasing unreliability and the high
costs and vulnerabilities associated with
imported fuels, Chile has taken significant
steps to expand its renewable portfolio
beyond hydro. It has done this by setting a
Renewable Portfolio Standard (RPS) for non-
hydro renewables. Starting at 5% in 2010,
the standard has been gradually raising. The
2025 standard is currently 20%, which could
rise as awareness and the competiveness of
wind and solar technologies grow. Giving
teeth to its RPS standards, the government
has introduced significant penalties for
operators who fail to achieve the RPS
targets 30 US$/MWh for the first violation
and 45 US$/MWh for the second.
Chiles liberalized power market has been
regulated for the past three decades. Once
a year, the National Energy Commission
(CNE) tenders electric energy through long-
term (20 years) supply agreements sub-
structured in time-of-day energy blocks.
Figure 50:
Map of Chiles available solar energy (Direct
Normal Irradiance) shows its peaks in Chiles
North [3]
 page 51

Nominal power has to be delivered within Block B (8:00-17:59): 7.9 US/kWh (550 GWh) daytime hours when the grids capacity has
each time block. As a consequence, weather- Block C (18:00-22:59): 9.7 US/kWh (280 GWh) reached its limits and, hence, cannot accept
dependent power production from PV and the entire available PV power. This has
wind plants needs to be filled up through Beyond the regulated tender for long- placed several planned and already realized
power trading. term PPAs, power can be traded bilaterally PV investments in severe trouble.
between IPPs and other market participants,
In the last tender round (2015), 100% of the such as electricity traders, utilities and off- At an annual direct normal irradiation of
energy was contracted to producers of wind takers. 3,350 kWh/m - which is extremely high
and solar power even though there was no in the global context but only average
specific prescription for renewable energies, Beyond such long-term power purchase for Chiles North - a 100 MWel FRENELL
a solid indication of the competitiveness of contracts, a spot market organises the DMS power plant produces electricity at a
renewables. The threshold PPA electricity short notice power trade. Recent capacity levelized cost as low as 5.2 US/kWh. With
prices for the three time blocks were: additions of PV plants in Chiles sunny North capacity factors of 8285%, the FRENELL
has led to the phenomenon that spot market DMS plants offer the cheapest source of
Block A (23:00-7:59): 9.7 US/kWh (370 GWh) prices regularly drop to 0 US/kWh during base-load power to Northern Chile. They

Peak Demand SIC Grid (Central&Northern Chile) [MW]

Peak Demand SING (Chile's Northern grid) [MW]

Annual Capacity Additions (SIC+SING) [MW/a] Solar

Wind 545 MW
Coal
8.000 2.000 Hydro 905 MW 3.554 MW
Annual Capacity Addition [MW/a]

6.452 MW
Peak Demand [MW]

6.000 1.500

4.000 1.000

2.000 500

Natural gas
0 0 3.216 MW
1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Biomass Diesel
462 MW 3.461 MW
Other fossil
942 MW

Peak Demand SIC Grid (Central&Northern Chile) [MW]

Peak Demand SING (Chile's Northern grid) [MW]

Annual Capacity Additions (SIC+SING) [MW/a]

8.000 2.000
Figure 51: Figure 52:
apacity Addition [MW/a]

Growth of Chiles peak demand and annual plant capacity additions [26] Power generation capacity in Chiles main grids (SIC and SING) [26]
eak Demand [MW]

6.000 1.500

4.000 1.000
 page 52 6. Country Opportunities for DMS Applications

are particularly well suited to supply Chiles
mining industry.
Here is a simple comparison. Take a modest-
sized FRENELL DMS generating 30 MWel
with a capacity factor of 82%. This can
generate electricity more cheaply than the
latest PPA price (11 US/kWh) awarded to
a much larger (640 MWel) Combined Cycle
power plant fired with natural gas with a
capacity factor of 68%. [27]
FRENELLs multi-tank energy storage is other CSP technologies
also increasingly important to northern both PV and wind alternatives because
Chile, particularly so with copper mines DMS supplies power on demand
demanding base-load power and day-time thereby removing the PV and wind
PV output falling out of favour. power trading risk
With its cost-efficient DMS solar and LNG-powered Combined Cycle plants.
storage technologies, FRENELL can
contribute to Chiles transition from fossil to
renewable energies. DMS provides power
on demand at highly competitive prices that
are cheaper than

12

10

8
LCoE [US/kWhe]

30 40 50 60 70 80 90 100

Nominal electrical Power [MW]

DMS CSP at IRR 12%/year

DMS CSP at IRR 8%/year

PPA electricity price of 640 MW Combined Cycle

Figure 53:
Levelized cost of electricity of FRENELL DMS plants in Northern Chile
page 53
 page 54
6.7 United States
With a high annual Direct Normal Irradiance
(DNI) of up to 3,000 kWh/m, the southwestern
states of the United States California,
Arizona, Nevada and New Mexico are well
suited for Concentrated Solar Power.
Southwest US is a wholesale electricity
market. Utilities typically own the generation,
transmission and distribution systems that
serve electricity consumers. Independent
System Operators (ISOs) operate the grid
transmission system independently of and
foster competition for electricity generation
among wholesale market participants.
6. Country Opportunities for DMS Applications
Presently, PV generation is one of the fastest
growing areas of renewable energy in the
US with 20 GW annual addition of PV
capacity projected by 2020 [28]. Especially
for California, the growth of variable PV-
generation will produce a duck-shaped curve
of net load (system load after subtracting
wind and PV) [29]. This is anticipated to
result in surplus power plant capacity in
idle mode during peak PV output with
the corresponding need for fast-ramping
power generation as PV output drops in
the evening. Estimates indicate a ramping
capacity of 13 GW will be needed over three
hours to meet evening peak demand. This
condition is most likely to occur on spring
days with mild temperatures and high
solar irradiation. Meanwhile, PV and wind
are already causing over-generation and
curtailment problems today that are likely to
further increase over coming years [30].
FRENELL DMS plants can play a vital role
here. They offer the ideal complement to PV
generation, as shown in Figure 55. During
the day, a FRENELL DMS plant can run at
reduced or minimum load while charging
its integrated storage system. When PV
Figure 54:
DNI map of United States

generation diminishes in the evening, it can
then ramp up power generation to full load to
meet the evening peak thereby shifting output
to periods that are also peak price. The ramp-
up rate is constrained only by steam turbine
capacity, not by the DMS CSP system having
the solar energy yield charged in the multi-tank
system ready to be dispatched.
The US has a supportive regulatory environment
for renewable energy. California in particular
has a policy framework that supports the
adoption of Concentrated Solar Power with
integrated energy storage. Key elements of
100%
80%
60%
40%
20%
0%
0 am 6 am
DNI Duck Curve - Net Load in California
Figure 55:
Typical load profile predicted for California with high share of PV generation for a spring day
Californias policy framework include:
Renewable Portfolio Standards to procure
up to 50% of electricity from renewables
by 2050
A mandate to add 1.3 GW of energy
storage by 2020
A Federal Solar Investment Tax Credit of
30% till 2019
the development of grid policies to
assist the integration of a high share of
renewables ultimately favouring CSP
with storage to offset non-demand-
driven growth of PV generation
12 am 6 pm
DMS power supply
page 55
Government policy aside, the straight
commercial advantages of FRENELLs DMS
are compelling by themselves. Compared
with 2015 electricity cost estimates by the
California Energy Commission (CEC) [31], the
FRENELL DMS is the cheapest dispatchable
energy technology at sun-rich locations in
southwestern US, as shown in Figure 56.
Even at a relatively small-scale, a FRENELL
DMS plant of 30 MWel capacity already
delivers cheaper electricity than other CSP
technologies at larger scale and is comfortably
cost competitive with far larger Combined
Cycle power plants fired by natural gas.
12 pm
 page 56 6. Country Opportunities for DMS Applications

FRENELL also has a clear competitive
advantage in another area of critical
strategic importance to the US power
industry cost-effective energy storage.
By combining FRENELLs thermal energy
storage technology with an existing steam
power cycle, excess power from the grid
can be stored and dispatched flexibly and
cheaply. The storage is charged during times
of low or even negative electricity prices,
i.e. when wind and PV are already being
curtailed from power supply to the grid.
The Multi-Tank storage technology is
particularly suited to the US market for the
following reasons:
The US Energy Information Administration
(EIA) expects 40 GW of coal-fired
generating capacity will be retired by
2025 [32] due to low prices for natural
gas, competition from renewables and
compliance with emission standards. The
steam power cycles of these plants can
be retrofitted with FRENELLs Multi-Tank
storage and participate in the market as
flexible backup power resources.
Additional storage resource capacity will
be needed for US grid reliability with a
high share of renewable energy, which
is why annual US storage capacity is
projected to grow more than 1 GW each
year by 2020.
Therefore, FRENELLs DMS Multi-
Tank storage technology is able to add
significant value to the US electricity grid
by providing cheap energy storage. At
the most fundamental commercial level,
it is significantly cheaper than the most
ambitious cost goals optimistically set for
future battery technologies.

capacity factor Figure 56:

PPA Crescent Dunes Levelized cost of electricity for FRENELL DMS,
58% 13,5
Tower 110 MW [a] Combined Cycle and other CSP technologies in
Southwest USA
CEC: Parabolic trough
59% 12,7
250 MW [b]

CEC: Tower 100 MW [c] 57% 11,4

CEC: Natural Gas

Combined Cycle 56% 11,6
550 MW [d]

30 MW [e] 43% 10,7

100 MW [e] 52% 8,3

0 2 4 6 8 10 12 14 16
LCoE [US/kWh]

[a] PPA of Crescent Dunes tower project in Tonopah, NV, 110 MW with 10 h storage; subsidized with Investment Tax Credit and Loanguarantee
[b] 250 MW parabolic trough plant with 6 h storage; 7% WACC; cost assumptions from California Energy Comission (CEC) study
[c] 100 MW tower plant with 11 h storage; 7% WACC; cost assumptions from CEC study
[d] 550 MW CC plant with taxes; 6.2% WACC; $4.5/MMBTU fuel price and 4.1% annual fuel price escalation; cost assumptions from CEC study
[e] FRENELL plants with 16 h storage; 7% WACC; costs for grid connection, project development, licensing and financing from CEC study
page 57
 page 58
7. Summary and Outlook
Solar power is coming of age. It has at last
moved from being a peripheral add-on to any
grid-level power investments to become a
mainstream choice worthy of the most serious
consideration. 2015 marked the first year
when more money was invested in renewable
energy than conventional fossil-fuelled
electrical power, a transformative trend likely
to continue and probably accelerate.
The early introduction of photovoltaic and
wind power opened the door to and set
the pace for the increasing adoption of and
ultimate full transition to renewable power
generation. PV and wind have become the
cheapest sources of electricity while also
paving the way to reduce the worlds carbon
footprint of power generation.
Commercially, it has made good sense
to start with the lowest cost options and
stick with them until they reach the point
of market saturation, which they are
close to doing, in some regions such as
the southwest of the United States. The
commercial downside of such investments
since it also leads to a significant increase in
the cost of of dispatchable power required
to cover the remaining supply gaps.
This in no way diminishes the importance
of PV and wind power. They continue to
be highly relevant. They also continue
to demand a commercially competitive
energy storage response to take full and
best advantage of their contributions.
Developments in battery storage may yet
7. Summary and Outlook
give them their day as a complete energy
package. Just not yet. Battery costs still
remain too high to be applied as energy
storage on transmission grid level, although
lithium-ion batteries could provide a return
in retail markets where high electricity prices
are charged to end-consumers.
In consequence, the search for cost-effective
grid level energy storage has become and
remains central to planning the future
energy needs of the world. It is here that
FRENELLs DMS CSP technology with
energy storage comes to the fore. It offers
the technological leap the industry has
been looking and waiting for. DMS solar
power plants provide the lowest-cost option
for base- to mid-load power that balances

supply gaps between volatile renewable
sources and the power demand curve. No
one should underestimate the importance
of this.
DMS is a significant breakthrough as
renewable energy can now deliver the entire
spectrum of power requirements more
cheaply than fossil fuels in regions where
rich loads of solar energy soak the earth. In
doing so, it provides the tool for leaping over
fossil power generation to make a transition
to 100% renewable power supply. Whats
more, the DMS energy storage technology
even provides countries beyond the sunbelt
with todays lowest-cost option for grid-
level energy storage and re-transmission.
The FRENELL DMS is adaptive to an
investors commercial needs and priorities.
It is designed to meet the full requirements
of any small to medium commercial power
provider. It is dispersive so can be widely
distributed to meet varying regional needs.
It is flexible as either a free-standing facility
or combined with others as a co-generator.
Above all, it is highly cost competitive with
conventional power generation.
These should be reasons enough for any
investor to give FRENELLs DMS serious
consideration when examining options for
any new or extending any existing power
facilities. Governments of sun rich emerging
countries also have much to gain as DMS
provides escape from the heavy financial
page 59
burdens they carry in subsidising the high
costs of conventional power generation.
FRENELL is a global pioneer in solar power
engineering. It is committed to delivering
renewable energy solutions giving the
highest value to investors for the lowest
cost. While the preferred energy mix in
any region will depend on a multitude of
factors, its DMS makes solar the standout
choice for investors looking to optimise their
renewable energy investment portfolio.
 page 60 Abbreviations

Abbreviations
ACC Air cooled condenser

ANRE National Authority for the Regulation of Electricity

(Morocco)
BOO Build-Own-Operate Ownership of a project remains usually with the project com-pany, which
gets the benefits of any residual value of the pro-ject.
BOT Build-Operate-Transfer Form of project financing, wherein a private entity receives a concession
from the private or public sector to finance, de-sign, construct, and operate a
facility stated in the concession contract
CC Combined cycle A CC power plant uses both a gas and a steam turbine together to produce
up to 50 percent more electricity from the same fuel than a traditional
simple-cycle plant. The waste heat from the gas turbine is routed to the
nearby steam turbine, which gener-ates extra power.
CEC California Energy Commission

CHP Combined Heat and Power Power station which generates electricity and process heat at the same time

CNE Comisin Nacional de Energa National Energy Commission of Chile

CO2 Carbon dioxide Gaseous emission produced by burning fossil fuels

CoGen Cogeneration of power and desalinated water see CHP

CSP Concentrated Solar Power Generation of solar power by using mirrors or lenses to concen-trate a large
area of sunlight onto a small area
DMS Direct Molten Salt. Registered Trade Mark by FRENELL. Describing a CSP technolo-gy using
molten salts as heat transfer fluid inside the solar field as well as storage
medium.
DNI Direct Normal Irradiance The amount of solar radiation received per unit area by a sur-face that is
always held perpendicular (or normal) to the rays that come in a straight line
from the direction of the sun at its current position in the sky
DoE Department of Energy, USA

EETC Egyptian Electrical Transmission Company

EIA U.S. Energy Information Admin-istration

EOR Enhanced Oil Recovery Thermal process for increasing the amount of crude oil that can be extracted
from an oil field
EPC Engineering, Procurement and Construction Project development with the goal to deliver technical systems turnkey to a
Services customer
EY Ernst&Young Multinational professional services firm headquartered in London, United
Kingdom
FIT Feed-In-Tariff Policy mechanism designed to accelerate investment in renewable energy
technologies
GDP Gross Domestic Product Monetary measure of the value of all final goods and services produced in a
period (quarterly or yearly)
GoE Government of Egypt

HFO Heavy fuel oil Fraction obtained from petroleum distillation, either as a dis-tillate or a
residue
HV High Voltage

IPP Independent Power Producer Entity, which is not a public utility, but which owns facilities to generate
electric power for sale to utilities and end users
IRR Internal Rate of Return Method of calculating rate of return which makes the net pre-sent value of
all cash flows (both positive and negative) from a particular investment equal
to zero
LCoE Levelized Cost of Electricity generation Economic assessment of the average total cost to build and operate a power-
generating asset over its lifetime divided by the total energy output of the
asset over that lifetime
 page 61

LCoS Levelized Cost of Steam Economic assessment of the average total cost to build and operate a steam-
generating asset over its lifetime divided by the total steam output of the
asset over that lifetime
LCoT Levelized Cost of Thermal ener-gy generation Economic assessment of the average total cost to build and operate a
thermal energy generating asset over its lifetime di-vided by the total thermal
output of the asset over that lifetime
LCoW Levelized Cost of desalinated Water generation Economic assessment of the average total cost to build and operate a desa-
lination plant over its lifetime divided by the total water output of the asset
over that lifetime
LFR Linear Fresnel CSP collector technology which uses long segments of mirrors to focus sun-
light onto a fixed absorber tube located at a com-mon focal line
LNG Liquefied Natural Gas

MASEN Moroccan Agency for Solar En-ergy

MED Multiple-effect Distillation Distillation process used for sea water desalination

MEMR Ministry of Energy and Mineral Resources (Jordan)

MSEP Moroccan Solar Energy Plan

MV Middle voltage

NDRC National Development and Re-form Commission

(China)
NEA National energy Administration (China)

NEPCO National Electric Power Compa-ny (Jordan)

NOOR Solar power plant in Ouarzazate, Morocco Three-stage project with total power output 2.000 MW in 2020

NREA New and Renewable Energy Authority (Egypt)

NREL National Renewable Energy Laboratory (USA)

O&M Operation and Maintenance

ONEE National Office for Electricity and potable Water

(Morocco)
PBT Parabolic Trough CSP collector technology which uses long segments of bended mirrors to
focus sunlight onto a tracked absorber tube
PPA Power Purchase Agreement Contract for the purchase of electrical energy

PT Power Tower CSP technology which produces solar heat by focusing sun light with multiple
heliostats at an absorber located at top of a cen-tral tower
PV Photovoltaic Technology of converting solar energy into direct current elec-tricity using
semiconducting materials that exhibit the photovol-taic effect
RPS Renewable Portfolio Standard Regulation that requires the increased production of energy from renewable
energy sources
SAM System Advisor Model Performance and financial model designed by NREL to facilitate decision
making for people involved in the renewable energy industry
SF Solar Field

SIC Sistema Interconectado Central Chile's central region's grid, which accounts for 68.5% of national generati-
on and serves 93% of Chile's population
SING Sistema Interconectado del Norte Grande Northern grid of Chile, which accounts for about 19% of national generation

TES Thermal Energy Storage

WACC Weighted Average Cost of Capi-tal the rate that a company is expected to pay on average to all its security
holders to finance its assets
 page 62

Units
a Year
bbl Barrel 1 BBL (U.S.) = 0,158 987 3 m
d Day
GW Gigawatt 1 Billion Watt (109 W)
GWh Gigawatt-hour 1 Billion Watt hours (109Wh)
h Hour
JOD Jordan dinar
km Kilometer
kWh Kilowatt-hour 1 Thousand Watt hours (10 Wh)
kWhel Kilowatt-hour electric 1 Thousand Watt hours (10 Wh) of electric energy
m Square meter
m Cubic meter
MMB-TU Million British Thermal Units 1 MMBTU 293,071 kWh
MW Megawatt 1 Million Watt (106 W)
MWel Megawatt electric 1 Million Watt (106 W) of electric energy
MWhel Megawatt-hour electric 1 Million Watt hours (106 Wh) of electric energy
MWth Megawatt thermal 1 Million Watt (106 W) of thermal energy
RMB Chinese Yuan
TWh Terawatt-hour 1 Trillion Watt hours (1012 Wh)
USD US Dollar
yr Year

Appendix
Levelized cost of electricity (LCoE)
By definition, the levelized cost of electricity (LCoE) is the price of electricity (p) resulting in a NPV of 0, thus:

In the same way, by definition, the project internal rate of return (IRR) ist the value (d) resulting in a NPV of 0.

The net present value (NPV) is defined as the difference between the total life cycle revenues and the total life cycle cost of a project. For a power generation
project with an initial investment I at year 0, annual constant O&M costs O, annual constant energy yield E and annual constant electricity selling price p all
between year 1 and n the net present value is:

With:

NPV the net present value in

E the energy yield in MWhel
p the electricity selling price in /MWhel
0 the annual O&M costs in /a
the actualization factor

The following assumptions have been made for calculating LCoE values presented in this White Paper:
Total investment in year 0
Annual energy yield and O&M costs constant over the time period (similar to assuming no increase in O&M over time and no performance degradation)
Annual energy yield and O&M costs accounted from year 1 to n (similar to assuming a 1 year construction time)
Units/Appendix
page 63
 page 64 References

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page 66

Whitepaper Version 1.0, Copyright FRENELL GmbH 2016; unless otherwise indicated,
this publication may be used freely, shared or reprinted, so long as FRENELL is
acknowledged as the source.

Source of photos: Tubo Sol PE2 S.L., Spain

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