REhnu, a solar company that spun out of the University of Arizona optics department, was awarded a $1 million grant from the U.S. Department of Energy to help bring its technology to market.

REhnu received one of 10 SunShot Incubator awards and was the only company working in the high-concentration photovoltaics realm, according to a release from the company.

The company has to pay for its advances up front and will receive the $1 million as it reaches specific benchmarks, said Justin Elliott, REhnu CEO.

“I think it’s a pretty good model,” Elliott said.

There are a few things that set REhnu apart from other concentrated solar startups. First, the company’s founder, Roger Angel, is a talented optics professor. He saw a way to concentrate the sun on solar cells in a more cost-efficient and flexible way that can significantly reduce the overall cost of solar and make it more competitive with fossil fuels, Elliott said.

The trick was to break it down. Most CPV companies build fully-integrated systems. REhnu disaggregates the three primary functions of CPV – optics, power conversion and structure.

“When all of that is integrated, that’s it,” Elliott said. “You’re locked into whatever efficiency you have when you buy your system.”

But innovation in the solar photovoltaic space means solar cells and panels are constantly becoming more efficient. By developing a modularized system, REhnu clients can trade out their older solar panels and keep the REhnu concentrating system to gain greater power output.

The reason solar companies only sign 20- or 25-year power purchase agreements, Elliott said, is that the photovoltaic material degrades over time and that is about the life of the material.

“There’s no reason we couldn’t get to 40 years with our system,” Elliott said. “We would expect to make two to two-and-a-half times the energy over a typical CPV system.”

And that means levelized costs would be dramatically lower, he said.

“The next challenge for startups – not just solar startups – is how do you get to market?” Elliott said.

Fully-integrated CPV systems are complex and require a big investment to get off the ground.

By disaggregating the three functions, REhnu can use existing supply chains that are already producing on economies of scale. That means REhnu can get to market faster and cheaper than other concepts.

The next step for the company is to build an improved version of its product. Elliott said he expects the new prototype to be ready by 2014 and for the company to be prepared for market by 2015.