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An unusual project that uses solar-powered steam and storage to decarbonize clean fuel production has started operating at a site in Southern California.

Why it matters: The companies say the financing deal behind the project represents the first industrial solar steam power purchase agreement, which could help the tech become more mainstream.

Driving the news: Renewable fuels maker Oberon Fuels and solar steam company Sunvapor have just turned on the solar steam and storage system at Oberon's facility in Brawley, Calif., near San Diego.

Oberon uses the solar-powered steam to heat the reaction needed to produce its clean fuel, replacing natural gas-powered steam. The process lowers the carbon footprint of the clean fuel.

The demonstration project, which is supported by the Department of Energy, also uses compressed steam as storage to be able to generate the needed heat when the sun goes down.

The power purchase agreement enabled Oberon to avoid the upfront capital costs required to deploy the system.

Zoom in: Sunvapor has also deployed its solar thermal boilers for an almond processor in Southern California.

The big picture: Power purchase agreements (PPAs) are standard deals in the solar panel project world.

However, the market for solar-powered industrial heat is just emerging, partly driven by industrial decarbonization incentives available in the Inflation Reduction Act.

A solar industrial heat PPA could help the nascent sector become more mainstream and grow as potential customers see they can avoid upfront capex costs.

Bottom line: It's still early days for solar industrial steam, but adopting attractive financing is a major step.

Exclusive: A solar steam project kicks off

The companies say the PPA for financing is a first

A solar-powered boiler and storage unit that is decarbonizing Oberon Fuel's clean fuel production in Brawley, Calif.

A solar-powered boiler and steam storage unit developed by Sunvapor and installed at the site of Oberon Fuels plant in Brawley, Calif. Photo: Courtesy of Oberon Fuels 

Solar power

An unusual project that uses solar-powered steam and storage to decarbonize clean fuel production has started operating at a site in Southern California.Why it matters: The companies say the financing deal behind the project represents the first industrial solar steam power purchase agreement, which could help the tech become more mainstream.

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Exclusive: A solar steam project kicks off

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