The Solar Thermal Space or CSP (Concentrated Solar Power) is seeing increasing consolidation with numerous acquisitions and partnerships . There are 3 main reasons for this trend

1. Solar Thermal projects typically are built on a scale of Hundreds of Megawatts requiring large amounts of capital which is typically beyond a startup
2. These CSP Projects also require engineering and construction capabilities which are again beyond startup capabilities
3. Large Power Equipment and EPC companies like Bechtel,Areva etc possess the capabilities but lack innovative Technology in this space

The above 3 factors make the the sector fertile for partnerships and acquisitions some of which are  listed below

1. Seimens bolstering its capabilities by acquiring CSP pioneer Solel Solar Systems for $418 million
2. Bechtel partnering with Brightsource Energy in building a massive 440 MW plant in California
3. Areva buying up startup Ausra which was facing funding difficulties
4. Alstom taking a $55 million stake in series C funding of Brightsource Energy

Alstom today announced it is investing up to $55 million in BrightSource Energy Inc., with an equity stake that positions Alstom as one of the main shareholders in the company. This operation takes place as part of a capital increase of $150 million organised by BrightSource. This privately-owned company is a specialist in designing, building and operating tower based solar thermal power plants with operations in the USA, Israel and Australia.

BrightSource has contracts for a total of 2,600 megawatts with PG&E and Southern California Edison – California’s two largest utilities. To meet this demand, the company intends to build 14 solar power plants in the US southwest by 2016. BrightSource’s first U.S. power project, the 392 megawatt Ivanpah Solar Energy Generating System, is currently under development in San Bernardino County, California. On completion, the project will generate enough electricity to power more than 140,000 homes, and reduce carbon dioxide (CO2) emissions by more than 400,000 tons per year. The Ivanpah project has received conditional commitment for more than $1.3 billion in loan guarantees from the US Department of Energy (DOE). The first plant is scheduled to come online in the second half of 2012.

Meanwhile Consolidation in Solar PV has been Seriously Lagging Behind

While the consolidation in the CSP space has been fast and furious it has been seriously lagging behind in the Solar PV segment.This is mainly because most of the companies here lack any differentiation in process and technology.However its only a matter of time before the hundreds of companies are withered down to 10-20 as growing competition and price pressures l weed away the  weaker companies .

The only big acquisitions that have been done so far is by automotive parts giant Bosch buying Ersol and Aleo Solar (which I think seriously overpaid for a bunch of very ordinary companies).Considering the rock bottom valuations that some technology rich PV companies like Energy Conversion Devices and Sunpower are trading , this might be the right time for the Big Companies to make an entry .