Solar-power upstart Ausra bags more dough

NEW YORK--Being a hot solar start-up apparently requires a lot of money to keep the wind at your sails.

Ausra, which manufactures equipment for solar-thermal power plants, has secured $30 million in venture debt and is negotiating for an "add-on" round of $15 million from original investors Khosla Ventures and Kleiner Perkins Caufield & Byers, according to a company executive.

Ausra's pilot solar-thermal power plant in Australia.

(Credit: Ausra)

Speaking at the Piper Jaffray's Clean Technology and Renewables Conference here on Wednesday, Ausra executive vice president Glen Davis outlined the company's capital needs in the coming months.

He added that the company intends to go public by 2010.

Ausra has already signed a deal to build a 177-megawatt solar-power plant and supply electricity for Pacific Gas & Electric in California.

The company is in discussions for another 1,000 megawatts of production and has another 6,000 megawatts "in the pipeline," Davis said. He said electricity from its system is 30 percent to 40 percent cheaper than solar-photovoltaic plants and equivalent in price to natural-gas power plants with the 30 percent tax credit that renewable-energy projects get.

To finance construction of these plants and company operations, notably the purchase of material and manufacturing of equipment, Ausra is looking to raise series C venture funding of $100 million to $150 million in the third quarter this year. The company will also need two project financings in 2009, he said.

The big projected capital outlays are required for construction of huge solar-thermal power plants, which capture the sun's heat in the desert to make electricity with a steam turbine.

The PG&E plant, for example, will take up a square mile in the California desert when it goes online in late 2010.

Davis also described Ausra's planned revenue model. He said the company will initially make its own power plants and sell the electricity to utilities.

But it intends to sell the equipment for its solar-thermal plants, which includes mirrors and "collectors" where water is turned into steam. Within a few years, the company projects making two-thirds of its revenue from equipment sales.

He added that the company is in the process of developing a storage component to its power plants, which it hopes to finish by next year.

The basic idea is to store water at high pressure and turn it into steam, as needed, which will enable plants to dispatch power when there's no sun or when demand is high.