Areva announces withdrawal from solar thermal business, leaving questions about Australian projects

French nuclear giant Areva has announced that it is pulling the plug on its solar thermal business, citing weak sales and falling revenues across nuclear and renewables.

The move casts doubt over the future of Areva’s concentrated solar power technology – the Australian-made compact linear Fresnel reflector (CLFR) solar steam generator technology the company acquired when it bought Ausra.

Ausra – formerly and Solar Heat and Power – was a Sydney-based firm that relocated to the US in 2007. It was sold to Areva in 2010.

At the time of its move to California, in 2007, the CSP start-up managed to attract more than $40 million in venture capital funding from cleantech investment big shots Khosla Ventures and KPCB. Ausra’s CSP technology, which was based on research by Australian David Mills, who developed the evacuated tube technology used in much of the world’s solar hot-water systems.

Ausra VP John O’Donnell once claimed the CLFR technology could potentially produce power at 6.7 cents per kilowatt-hour at scale with its mirrors, lenses, and thermal fluids.

But for Areva Solar – a unit of the company that basically consisted of what remained of Ausra – revenues of €100 million ($US134 million) were outweighed by  “tens of millions” in losses on that figure.

And for all developers of solar thermal trough technology, market pressures were building.

As GreenTech Media Research has noted, “declines in PV module costs have undercut trough technology and put it at a significant cost disadvantage. Since the beginning of 2013, 1 gigawatt worth of CSP projects have been suspended, and an additional 305 megawatts have been delayed.”

In Australia, Areva’s CFLR technology is currently being used at the 44MW Kogan Creek project – which aims to provide a boost to the power station’s 750MW capacity – a work in progress that has struggled with delays said to be caused by scheduling and technical issues.

The project’s developer, CS Energy, said in an email that it “remained to be seen” whether Areva’s decision to exit concentrated solar would have any further impact on the plant’s progress.

“We expect AREVA Solar to meet its contractual obligations,” CS Energy CEO Martin Moore said in an emailed statement.

In its 2013 profit results, Areva revealed it had suffered a fall in revenue due to “the difficulties encountered” at the the Queensland project. As we reported in February this year, a 15 per cent fall in revenues suggested that costs may have blown out. In the US, however, the first Areva CLFR plant using molten salt has been commissioned for testing at the US Department of Energy’s Sandia National Laboratories, and is said to be a contender for the Sunshot target of $US0.06 per kWh.

In India, the first 125MW stage of the Reliance/Areva CLFR plant is set to be connected to the grid as soon as next month, with plans for a second.

Top image via Areva Solar

© 2014 Solar Choice Pty Ltd 

Giles Parkinson

Giles Parkinson regularly contributes unique content to Solar Choice News. Giles is the founder and editor of clean energy industry news service RenewEconomy. He is a journalist of 30 years experience, a former Business Editor and Deputy Editor of the Financial Review, a columnist for The Bulletin magazine and The Australian, and the founding editor of Climate Spectator.
Giles Parkinson