One technology, two pathways? Strategic Niche Management and the diverging diffusion of concentrated solar power in South Africa and the United States

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Abstract

The transition towards a low carbon energy system requires significant deployment of renewable energy technologies. Concentrated Solar Power (CSP) plants could contribute to a low carbon energy system, with an estimated potential global capacity of over 600 GW by 2030. Despite this potential, however, the CSP industry lags behind other renewable technologies, with only about 4% of its estimated global potential expected to be realised in the next decade. This paper investigates the reasons for this by comparing CSP in the US, where 60% of worldwide capacity is currently located, with South Africa, where its development has been slow despite an abundance of natural solar-energy resources. Using strategic niche management analysis, we identify replicable success factors that could accelerate the uptake of CSP projects in developing countries. The results reveal that the main reason for the successful diffusion and adoption of CSP in the US is consistent policy support, which has made it possible to bridge the gap between research and development and emerge in the market. By contrast, the development of CSP in South Africa has been hindered by several technical and economic problems, including a lack of technological expertise, resources and funding.

Introduction

Despite consistent growth in the renewable energy market, current carbon emission targets are unlikely to be achieved globally. According to the IEA [1], to achieve the goal of limiting global warming to 2°C, low-carbon energy must replace approximately 850 GW of electricity currently generated by coal-fired power stations.

In 2015, developing countries accounted for 63% of global greenhouse emissions [2] and this percentage is increasing [3], [4]. South Africa is one of the biggest sources, being responsible for 40% of emissions in sub-Saharan Africa [4], [5], [6]. The country relies on coal-fired generation for around 68% of its total primary energy supply [7].

One technology that could contribute significantly to a low carbon future is Concentrated Solar Power (CSP). CSP plants can store thermal energy, which means they can supply electricity after sunset or when the weather is cloudy, making solar generation more reliable [8]. Utility-scale CSP plants were first installed in the US, in California, between 1984 and 1991, where they have proven to be a reliable contributor to the Californian grid [9].

CSP applications have grown more slowly than other types of renewable energy. One reason for this is that CSP projects require sites with high insolation, ideally direct sunshine of over 1900 kWh/m2 per year. This requirement restricts CSP’s potential deployment in Mediterranean regions like Spain, southern Italy, southern France, Greece, Cyprus and Malta [10], [11]. However, opportunities abound for the development of CSP in sunnier regions, such as in the Sun Belt region of the southern US, and in many developing countries in the Middle East, Central and South America, Africa and South Asia. In some of these locations, annual solar irradiation can be as high as 2500 kWh/m2 [12], [13]. In some parts of South Africa the solar irradiation is even higher than this. Upington in the Northern Cape Province, for example, has an annual direct normal irradiance (DNI) of 2800 kWh/m2 [14], one of the highest in the world. If South Africa fully exploited its solar resource, it could accommodate over 500 GW of CSP projects [15]. But despite this remarkable potential, the entire country currently has only 500 MW of operational CSP plant [16].

Worldwide, most CSP projects are in the US (60%, mainly in California) and Spain (27%) [8]. The most commonly cited reason for other countries being so slow to take advantage of CSP is the high capital cost involved [9], [13], [17]. Compared to other renewable technologies, constructing a CSP plant requires considerable investment, often a problem for a developing country like South Africa, where finance costs are high because of political and economic risk factors [10], [12], [17]. Schinko and Komendantova [18] note that the weighted capital cost of deploying a CSP project in an African country is more than double that in Europe. Trieb et al. [9] observe that importing low-cost power plants from developed countries and using subsidies from international institutions often does not sufficiently offset these costs and the associated risks to make a CSP project financially feasible for a developing country. They advise that successful diffusion of CSP requires a financial strategy that can compensate for the political and economic risks of the particular region.

Other obstacles besides finance may limit the uptake of this technology [17]. Mahia et al. [19] say that policy-related barriers and a lack of government support in developing countries, particularly in the Middle East and North Africa, are more critical than economic constraints. Opazo [20] says problems like a lack of technological expertise, insufficient resources, and limited involvement by industrial actors hinder the development of innovative technologies in developing countries, and Elmustapha et al. [21] say poor investment in research and development is a common hindrance.

Most published analysis of the slow development of CSP in developing countries has investigated these economic, political and technical barriers to uptake, but a more rigorous and systematic approach is now needed. This paper uses a strategic niche management (SNM) approach to investigate the diffusion and development of CSP projects. The SNM framework was developed by Kemp et al. [22] to analyse the way that technological change and its social acceptance evolve together. SNM, as a research method, can help to investigate how a new technology has been successfully introduced in the past, and to determine the required conditions for successful diffusion and development of radical innovations in the future. A few researchers have already applied it to the emergence of alternative energy technology in developing countries [21], [23]. We used SNM framework to investigate the faltering progress of CSP projects in South Africa as compared with their successful implementation in California. We wanted to know whether SNM helps to explain the marked difference between CSP development in South Africa and in the US, and whether any lessons from the successful introduction of CSP in the US could be transferred to a country like South Africa.

To find the answers, we first identified institutional, social and techno-economic obstacles that have restricted the development of CSP projects and used the SNM framework to evaluate and compare the development of CSP niches in the US and South Africa. We then considered what lessons might be transferrable, to accelerate the uptake of CSP in South Africa and other developing countries.

Section 2 reviews the literature on the CSP industry and identifies the barriers to its development, Section 3 explains the SNM framework, Section 4 describes our data collection methods, Section 5 reports our results, and Section 6 concludes with policy recommendations.

Section snippets

Overview of the development of CSP niches

Fig. 1 illustrates the four CSP technologies that are currently in use around the world: Linear Fresnel Reflector (LFR), Solar power tower, Stirling parabolic dish, and Parabolic Trough Collector (PTC). All of these four CSP typologies, regardless of the type of their technology, contain three main components: a solar field, a power block and storage [8].

The parabolic trough collector, first demonstrated in Egypt in 1913, is currently used in 81% of operational CSP plants and in many more that

Strategic niche management

The transition to a low carbon energy system requires many changes, not just from the consumers’ side but also in government policies and technical approaches [21]. Radical innovations and sustainable technologies can be developed in specialised areas called ‘niches’ [22], [50], [51], which can stimulate systemic change [21], [52]. Strategic niche management (SNM) is the process of managing niche formation through real-life experiments [52]. It can be a way of bridging the so-called ‘valley of

Method

In this study, we used Kemp’s three conditions for a successful niche (expectations must be defined and voiced, supportive social networks must be built, a learning process must occur) to analyse the diffusion of CSP in the US (California) and South Africa, two countries that stand in sharp contrast in the CSP industry. The US, a pioneer in the industry, has a long history of developing CSP plants. South Africa is just a beginner, despite enjoying some of the world’s highest levels of sunshine

Results

The purpose of this study was to identify the key factors in the successful development of the CSP industry in the US and the reasons for its comparatively sluggish growth in South Africa. These lessons should help to accelerate the global uptake of CSP projects.

5.1 Overview of the energy market in the US, 5.2 Internal niche process provide an overview of the energy market and the CSP industry in the US and explore the process of niche development in that country, and 5.3 Overview of the energy

Conclusion

This paper reviewed and compared diffusion and uptake of CSP technologies in the US and South Africa, with a focus on the internal niche process. Our study found that the main reason for the successful diffusion and adoption of CSP in California has been consistent policy support, including the 30% investment tax credit, the loan guarantees and the SunShot initiative. These policies have shaped the positive expectations for CSP projects and provided opportunities for CSP niches to emerge in the

Declaration of Competing Interest

The authors declare that they have no known competing financial interests or personal relationships that could have appeared to influence the work reported in this paper.

Acknowledgments

This work was carried out within the SOLWARIS project funded by the European commission EU Horizon 2020 – H2020-LCE-11-2017 under grant agreement n°792103.

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