A promising approach to reducing the cost of solar power is moving forward with the construction of an installation in Indianatown, FL, that will combine a field of solar concentrators with a natural gas power plant.

Today The New York Times has an update on the project, which the utility Florida Power and Light (FPL) announced almost two years ago, and which we wrote about here. When completed later this year, the power plant is expected to generate up to 75 megawatts of power by making use of turbines at the natural gas plant, which itself has a 3,600 megawatt capacity.

The solar concentrators generate steam, which can be used to drive the turbines. Using existing turbines and generators can greatly reduce the cost of a solar power plant. FPL says the current project reduces costs by 20 percent, according to the Times.

Similar natural gas-solar hybrid projects are being built in Egypt, Morocco, and Algeria. There's also an effort to pair solar concentrators with coal fired power plants. Abengoa, the Spanish based company that's building natural gas plants in Morocco and Algeria, is working with Xcel Energy in Colorado to build solar coal hybrid test facility. According to Abengoa, such hybrids could cut the cost of solar power by 30 to 50 percent to as low as 6 cents per kilowatt hour, which is competitive with many fossil fuel power plants.

The U.S. Department of Energy has announced a $1.37 billion conditional loan guarantee for the Ivanhoe Solar Complex in the Mojave Desert. The project, managed by Brightsource Energy, will use mirrors to concentrate sunlight, creating high temperatures that can be used to generate electricity. The complex will include three power plants that together will produce about 400 megawatts of electricity.

Basically, the guarantees would cover the loans in the case of default. The money for the loans is expected to come from the Federal Financing Bank.

One of the biggest challenges that large solar developments face is getting financing, particularly because few such solar power plants have been built. The DOE guarantees help on this front.

But other challenges remain, including getting approval from the government to actually build on the chosen sites, and clearing the National Environmental Policy Act review. The application process for the plants started nearly 3 years ago, and construction on the sites has already been delayed. Before the process is over, new hurdles might get thrown up, a possibility illustrated recently when Senator Dianne Feinstein (D-CA) submitted legislation to ban solar projects from some parts of the Mojave desert, a move that threatened several projects already in the works.

First Solar, a leading maker of solar panels, based in Tempe, AZ, has announced that it will build an enormous, 2,000 megawatt solar power plant in China, starting next year. Bloomberg reports that it will be the largest solar power plant in the world.

The move is evidence of the falling prices for photovoltaics, which convert sunlight directly into electricity and have historically been seen as too expensive for very large power plants. But although the new power plant will be large by historical standards for solar, it's still a tiny fraction of the world's total energy needs, which number in the millions of megawatts. And some experts warn that the kind of solar cell that First Solar makes cannot be made in the large numbers needed to supply a large part of the world's electricity demands.

Typically, utilities have favored solar-thermal technology, which use heat from the sun to make steam that drives generators, for large power plants. For example, in California 6,000 megawatts worth of large solar projects are under review by the federal Bureau of Land Management, and all involve solar thermal. But First Solar, which makes "thin-film" solar cells, has been able to sharply drive down the cost of making photovoltaics, and is known for having the lowest manufacturing costs in the solar industry. (This is difficult to confirm, since not all solar companies publicly disclose their costs.)

However, First Solar's cells use tellurium, a relatively rare element, which could limit the number that can be built in a year. And, according to one recent report, the availability of tellurium could limit worldwide production of such cells to about 10,000 megawatts per year, even though very little tellurium is used in each solar cell.

First Solar has disputed concerns about the availability of tellurium, saying there is plenty to be had for the foreseeable future. But to reach millions of megawatts of solar cells, we will likely need a variety of solar cells, especially ones based on common materials such as silicon.