‘It’s All About Energy, Stupid!’

Ausra; solar-thermal power

Say "Solar," and most people think of the trendy photovoltaic panels popping up on the roofs of houses and office buildings around the country. But physicist David Mills knows that the power of the sun is best captured by gigantic fields of mirrors arrayed on the ground, which can generate enough electricity to run an entire power plant. Mills, a physicist, spent decades developing his technology—called a Compact Linear Fresnel Reflector—at the University of New South Wales in Australia. After his attempts to commercialize the process stalled, Mills, 61, thought about retiring. But two well-known Silicon Valley venture capitalists got to him first. Lane of Kleiner-Perkins and Vinod Khosla, the valley's leading renewable energy evangelist, offered Mills a $40 million investment and a top management team to get him to come to California and start over.

Last week, Ausra signed a 20-year contract with Pacific Gas and Electric to provide electricity from a $500 million, 177-megawatt solar-thermal plant under construction in California's Central Valley. The plant, which is set to go online in 2010, will be the world's largest solar installation. The blueprint is disarmingly simple. Rows of flat mirrors that follow the path of the sun are arranged in a one-square-mile grid. The mirrors reflect the sun's heat onto water-filled pipes above, creating steam that cranks a turbine in a nearby power plant. The electricity produced doesn't emit a molecule of greenhouse gas. "Big solar," as Ausra's concept is known, is especially attractive in California, where public utilities are required to get 20 percent of their power from renewable sources by 2015.

The bigger the plant, the cheaper each kilowatt-hour produced. "A field of mirrors 91 miles square could power the entire United States," Mills says. Though that field is unlikely to ever be built—strong-enough transmission lines don't exist—the emerging solar-thermal industry has sparked a land rush in the American desert. The conference table at Ausra's new offices in Palo Alto is littered with the maps of remote southwestern tracts and marginal farmland, bearing little flags where the company or its competitors have snapped up land to develop solar fields. "The hotter and nastier, the better," says Mills of Ausra's most desirable real estate.

Last year, solar-thermal sales tripled in the United States to $121 million, and demand is expected to soar as other states develop renewable power standards. With help from their venture-capital mentors, Ausra has a management team drawn from the normally change-resistant utility industry. "I don't own a pair of Birkenstocks," says CEO Bob Fishman, a former Navy engineer who spent decades in the natural-gas business before joining Ausra. "We are serious guys. And we are doing this because it's a viable business, not because it's a crusade." In other words, lots of mirrors, no smoke.

Amyris; synthetic biofuels