How Australia got hot for solar power
Down under, they're all over alternative energy - starting with a 1,600-foot-tall "solar tower" that can power a small city.
By Todd Woody, Business 2.0 Magazine assistant managing editor

SAN FRANCISCO (Business 2.0 Magazine) -- The editors have identified the Best business ideas in the world, which will appear here in a series throughout the next month. Check back daily for updates.

Rattling down a red dirt road on the edge of the Australian outback, Roger Davey hits the brakes and hops out of a rented Corolla. With a sweep of his arm, he surveys his domain - 24,000 acres of emptiness stretching toward the horizon, the landscape bare but for clumps of scrubby eucalyptus trees and an occasional sheep.

Electrifying exports
Australia is home to many alternative-energy innovators that are targeting foreign markets.
Energetech Technology: Wave-powered electricity
There's no shortage of surf in Australia, so it's only natural that Sydney startup Energetech has developed an offshore power plant that generates electricity from ocean waves. A parabolic wall magnifies the energy of incoming waves, which force air into a hollow chamber. The air activates a turbine that powers a generator. The first plant is expected to produce enough energy to power 1,500 homes or desalinate nearly 800,000 gallons of water per day.
Pulse Energy Technology: Biomass power generation
This Brisbane company uses rotary kiln technology licensed from the Australian Commonwealth Scientific and Industrial Research Organization to generate green electricity by incinerating sugarcane waste and other low-grade fuels. Pulse is building 10-megawatt power plants in southern China, one of the world's biggest sugarcane-growing regions. "At the moment they burn sugarcane waste in the fields. Six months out of the year, you can't even see the sky," says Pulse executive Damien Weis. "We're able to capture the energy and bag up the pollutants." Pulse has also struck a deal to study the feasibility of building plants in China powered by rice husks.
Roaring 40s Technology: Wind turbine arrays
A spinoff of state-run utility Hydro Tasmania, Roaring 40s operates state-of-the-art turbines in some of the world's windiest latitudes. But its most important innovation is its business model: exporting large-scale renewable-energy projects to developing countries. One of Asia's largest power companies, CLP of Hong Kong, bought a 50 percent ownership stake, providing the cash and contacts needed to fuel expansion into China. Next up: India.
Windlab Systems Technology: Wind farm simulations
It usually costs big money to assess the viability of potential wind farm sites. Windlab Systems, a Canberra startup spun out of CSIRO, reduces that risk for its investment bank clients with its sophisticated virtual wind-farm software. The technology creates an information-rich map of a wind farm site, detailing everything from weather patterns to the impact of the terrain on airflows and identifying local transmission grids, roadways, and land ownership patterns. "As we keep adding layers to the data,'' says Windlab's Keith Ayotte, "we eventually get to a point where bankers can assess the risks sufficiently enough to wade into the fray."

It's a dead-calm antipodean winter's day, the silence of this vast ranch called Tapio Station broken only by the cry of a currawong bird. Davey, chief executive of Melbourne renewable-energy company EnviroMission, aims to break ground here early next year on the world's first commercial "solar tower" power station.

"The tower will be over there," Davey says, pointing to a spot a mile distant where a 1,600-foot structure will rise from the ocher-colored earth. Picture a 260-foot-diameter cylinder taller than the Sears Tower encircled by a two-mile-diameter transparent canopy at ground level. About 8 feet tall at the perimeter, where Davey has his feet planted, the solar collector will gradually slope up to a height of 50 to 60 feet at the tower's base.

Acting as a giant greenhouse, the solar collector will superheat the air with radiation from the sun. Hot air rises, naturally, and the tower will operate as a giant vacuum. As the air is sucked into the tower, it will produce wind to power an array of turbine generators clustered around the structure.

The result: enough clean, green electricity to power some 100,000 homes without producing a particle of pollution or a wisp of planet-warming gases.

"We're aiming to be competitive with the coal people," says Davey, 60. "We're filling a gap in the renewable-energy market that has never been able to be filled before."

And although its final dimensions are still being tweaked, the 50-megawatt Tapio Station plant is just the small model: A half-mile-tall version is in the works for China, and EnviroMission is scouting sites in the American Southwest for other possible skyscraping power plants.

Tower of power

The solar tower is the most audacious of a host of renewable-energy projects under way in Australia that are making the country the global hotbed of alternative-energy entrepreneurship.

Among the sea of slick suits crowding the Qantas Club at Melbourne Airport just after dawn on a clear June morning, Davey, stands out in his brown-checked sports jacket. EnviroMission communications director Kim Forté leans over and whispers to Davey; she thinks she spots a familiar face amid the preflight caffeinating: a government bureaucrat involved in dispensing $370 million to low-emission energy projects. EnviroMission has applied for a $75 million piece of that pie, and a decision is imminent.

It's a crucial time in Davey's eight-year quest to turn the space-age images on EnviroMission's website into steel and glass. Secure the cash from the feds and a third of the cost of the solar tower's construction is in the bank. That in turn will likely open the wallets of Australian investment banks.

So today Davey and Forté are taking a 36-seater prop plane to Mildura - "Gateway to the Outback" - to rally support in the rural towns near the tower site.

Energy without the mess

With a solar tower, there's no fuel to dig out of the ground, transport, or dispose of, no smog, no scarred landscapes from open-pit mining. The sun rises every day and is not subject to embargoes, geopolitics, or commodity markets.

And once the solar tower's capital costs are paid off, the price of producing electricity should drop dramatically, as operating and maintenance costs are expected to be minimal. Despite its monolithic scale, the technology behind the tower is based on an elemental scientific truth: Hot air rises. The solar tower's only moving parts are its turbines.

Davey's mobile phone trills. "Hello? Yes, mate. 2:30 at your office. Done. Thanks, mate." On the line was an executive with AGL, one of Australia's largest utilities. Early on, EnviroMission locked up a deal to provide AGL with electricity produced by the solar tower. Davey has also secured the services of Macquarie Bank, one of the country's most prominent investment banks and a financier of major infrastructure projects in Australia and overseas.

In 2002 executives at Xiang Jiang Industrial, a Shanghai developer and construction company, stumbled across press mentions of Davey's project. Xiang Jiang subsequently became EnviroMission's second-largest shareholder and has created a joint venture with the company to build and operate solar towers in China.

At some point, almost everyone who comes across Davey and his tower ends up asking the same question: Is this for real? As far as Davey has come in his quest, many hurdles do remain.

But out at Tapio Station, Davey insists that the solar tower will be built whether or not the government gives EnviroMission $75 million. "This used to be a dream," he says, staring out at the horizon where the tower will rise. "Then it became a concept. Now it's becoming reality."


This is an excerpt from a longer story in Business 2.0's August issue. Click here to read the complete version. Top of page

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