Ivanpah: the value of first-of-line green energy projects, even when they fail

A major solar power plant project called Ivanpah, that was granted over a billion dollars in US Government federal loans is now on the road to closing two of its three units, with energy experts labeling it a “boondoggle”. While critics argue that the Ivanpah Solar Power Facility is another example of government waste, it’s essential to recognize the role such first-in-line projects play in advancing clean energy.

In 2011, the US Department of Energy (DOE) under former President Barack Obama issued $1.6 billion in loan guarantees to finance the Ivanpah Solar Power Facility, a project consisting of three solar concentrating thermal power plants in California. At the time, then-Secretary of Energy Ernest Moniz called it an “example of how America is becoming a world leader in solar energy.”

The Ivanpah Solar Power Facility, a $2.2 billion concentrated solar plant in California, was once hailed as a breakthrough in renewable energy.

It was a time when spending on green energy projects was flush, starting with a boon around 2006 and 2007. Investors and government subsidizers were looking to fund dreams and Ivanpah promised a world with free energy harnessed from the sun.

Related: Ivanpah company builds Ashalim in Israel’s desert

Solar thermal versus photovoltaic PV panels

Solar thermal technology uses mirrors to concentrate sunlight, generating heat that produces steam to drive a turbine for electricity. It is known to kill birds that pass by it, attracted to the light. In contrast, photovoltaic (PV) panels convert sunlight directly into electricity using semiconductor materials. While solar thermal can include energy storage with molten salt, PV is generally cheaper, more efficient, and easier to scale.

Ashalim is producing power but local financial estimates say it was not worth the cost.

Ashalim producing power in 2022. You will see a blinding light when you drive by it in the desert

Now, after more than a decade, Ivanpah is set to shut down 2 out of 3 of its units. The facility never lived up to its energy production goals and required backup natural gas to stay operational. Its primary buyer, Pacific Gas & Electric (PG&E), has canceled its agreement 14 years early, citing cost savings for customers. Critics argue that the plant was not only financially unsustainable but also had environmental drawbacks, such as harming wildlife in the Mojave Desert.

The plant’s operators plan to begin closing units in early 2026, with decommissioned units potentially being repurposed for photovoltaic solar energy production. Operator NRG Energy plans to shut down two-thirds of the Ivanpah Solar CSP plant after Pacific Gas and Electric (PG&E) decided to terminate two power purchase agreements (PPAs) with the facility to save ratepayers money.

Ivanpah sp;ar energy panels

But while Ivanpah may not have been a commercial success, dismissing it entirely as a failure ignores the bigger picture. Groundbreaking energy projects often face immense technical, financial, and environmental challenges—many of which only become apparent through real-world implementation. These projects are bold experiments that inform future innovations, providing invaluable lessons that improve the next generation of technology.

Ivanpah isn’t the only example. The solar thermal plant at Ashalim in Israel also fell short of expectations, proving too costly to compete with newer photovoltaic solar technologies. Similarly, MASDAR City in the United Arab Emirates, envisioned as a fully sustainable zero-energy metropolis, has struggled to achieve its initial ambitions and remains sparsely populated. We have an intern dispatch what it’s like. However, these efforts have contributed to advancements in green energy, from refining solar technology to informing large-scale urban sustainability planning.

Even failed projects serve as milestones on the road to a more sustainable energy future. Without Ivanpah and other early ventures, the solar industry wouldn’t be where it is today—producing cheaper, more efficient energy. Green innovation requires trial and error, and while not every project will be a financial success, the lessons they provide are often worth far more than their price tag. Saudi Arabia, for instance, is investing in hydrogen energy projects which may never be commercially viable without massive investments to sustain them. So let’s see “failing” as an outcome of bravery.

Ivanpah wasn’t the first to fail.

Ivanpah is connected to Israel through BrightSource Energy, the company that developed the solar thermal technology used in the plant. BrightSource is an Israeli-founded company specializing in concentrated solar power (CSP). The same technology used in Ivanpah was later implemented in Ashalim, a large CSP plant in Israel’s Negev Desert. Both projects faced challenges related to efficiency, cost, and environmental concerns, highlighting the difficulties of scaling solar thermal technology.

Ashalim, developed and owned by EDF Renewables, is operating today, but at a loss. There are more than 25 similar CSP towers across the world, including China, Spain, Morocco and the United States — but only one, in the United Arab Emirates, stands taller than the plant in Ashalim, Israel.

An Israeli business newspaper, Calcalist, called the Ashalim power plant “one of the saddest stories” in the history of Israeli infrastructure. Others say the tower’s more expensive energy is, in fact, almost imperceptible to Israeli citizens, since the higher cost is spread across the millions of consumers on the national grid.

Let’s look at a few failed power plants from the west:

• Investment Cost: $1 billion
• ROI: Negative – declared bankrupt in 2020
• What Happened? Crescent Dunes, a concentrated solar power (CSP) plant in Nevada, was backed by a $737 million federal loan guarantee. It was supposed to provide 10 hours of energy storage using molten salt technology, allowing it to generate power even after sunset. However, persistent technical failures—including leaks in the molten salt storage system—resulted in multiple shutdowns. In 2019, its sole customer, NV Energy, terminated its contract, leading to its financial collapse.

2. Kemper Clean Coal Plant (USA)

• Investment Cost: $7.5 billion
• ROI: Negative – converted to natural gas after exceeding budget by $5 billion
• What Happened? The Kemper Project in Mississippi was designed to be the first large-scale “clean coal” power plant using carbon capture and storage (CCS) technology. Initially estimated to cost $2.4 billion, expenses ballooned to $7.5 billion due to construction delays, cost overruns, and unproven technology. In 2017, after years of setbacks, the project was abandoned as a clean coal facility and converted to a conventional natural gas plant, making its CCS ambitions a complete failure.

3. Pelamis Wave Energy Project (Scotland)

• Investment Cost: Estimated £100 million+ (~$130 million)
• ROI: Negative – company went bankrupt in 2014
• What Happened? Pelamis was one of the first large-scale attempts at harnessing wave energy. It deployed snake-like floating devices off the coast of Scotland to generate electricity from ocean waves. While the technology showed promise, it struggled with durability, maintenance costs, and efficiency. After failing to secure further investment, the company went bankrupt in 2014, demonstrating the difficulties of making wave energy commercially viable.

These examples highlight the immense challenges of scaling up new energy technologies. Despite their failures, they provided valuable lessons that inform ongoing advancements in solar, clean coal, and wave energy.