Such an investment program would provide the critical mass of investments necessary to attract significant private sector interest, benefit from economies of scale to reduce cost, result in organizational learning in diverse and several operating conditions, and manage country and technical risk. An investment program at this scale would firmly establish the region on the transformational path of achieving 5 GW of installed CSP capacity by 2025 and provide the stimulus necessary for replication in other developing countries.The proposed program would give a much-needed boost to solar thermal power, whose growth has been threatened by the global economic recession. Despite the credit crunch, some companies are still moving forward in developing countries. It was recently announced that U.S.-based eSolar has licensed its technology to India’s ACME Group, which will construct up to 1,000 megawatts of solar thermal power capacity in India over the next ten years – without subsidies if necessary. This major commitment strongly supports our own finding, summarized in Desert Power, that a scaled-up solar thermal power sector can be cost-competitive with coal-fired power. The CTF may have gotten off to a shaky start, but acceptance of the North Africa/Middle East solar proposal would certainly reassure the environmental and development policy communities – not to mention Capitol Hill – that the CTF is serious about focusing on renewable energy. To promote this goal, the CGD climate team will soon release the first edition of its CTF Monitor – a detailed analysis of CTF investment proposals that have already been approved by the Trust Fund Committee.
CGD blog posts reflect the views of the authors, drawing on prior research and experience in their areas of expertise. CGD is a nonpartisan, independent organization and does not take institutional positions.