Preheating water with solar energy will reduce coal use by 2 to 3 percent at Colorado coal-fired power plant.

In a traditional coal-fired power plant, coal that has been pulverized into a fine dust is burned to heat water until it becomes steam. The steam then turns the blades of a large turbine, which turns the generator and produces electricity. But if the fresh water is heated before it enters the boiler, less coal is needed in order to make the steam -- and that is the principal behind Xcel Energy's brand new solar-coal hybrid power plant in western Colorado.

The $4.5 million Colorado Integrated Solar Project connects thermal energy from a new parabolic-trough-concentrating solar plant built by Abengoa Solar with the steam cycle of Unit 2 at Xcel Energy's (NYSE:XEL) existing coal-fired Cameo Generating Station on the Colorado River near Grand Junction, Colorado. Xcel officials say it is the first actual demonstration of the concept using parabolic-trough solar technology anywhere in the world.

If this project works as we expect it to," says Marty Smith director of environmental policy at Xcel, "it would be possible to scale up the solar integration part to the point where it could possibly provide up to 10 percent of the peak generating capacity of a generating unit on a sunny day."

Xcel expects the pilot project to increase plant efficiency by three to five percent.

The project’s demonstration goal is to produce the equivalent of one megawatt of electric power from renewable solar energy at the plant’s existing 49-megawatt coal generating unit. But its larger goals are to show that you can use less coal while generating the same amount of electricity, reduce emissions from the plant, and test the commercial viability of concentrating solar integration.

"We have the opportunity over time to produce a lot more electricity from the sun and do it in  a way that really saves money for the company and for the customers," says Xcel's Smith.

The hybrid solar-coal project is the first under Xcel's Innovative Clean Technology Program, an initiative to test promising new technologies with potential to lower greenhouse gas emissions and result in other environmental improvements. Xcel Energy was one of the first utilities in the U.S. with a plan to reduce carbon dioxide emissions and has reduced emissions by a cumulative 26 millions tons since 2003.

Some critics make the argument, however, that the best case scenario of a 10 percent reduction in coal consumption at the Cameo plant only legitimizes an excuse to pollute and prolongs the life of an already dirty power plant.

The real question is whether the hybrid technology can be scaled up so that solar can replace even more coal in thermal power plants -- and whether it is worth the cost.