Ministers approve renewable energy quota shifts to photovoltaic sector

Government tasked with underwriting debt for West Bank energy projects.

By SHARON UDASIN
Hiker walks past wind turbines in the Golan Heights_390 (photo credit: Ronen Zvulun/Reuters)
Hiker walks past wind turbines in the Golan Heights_390
(photo credit: Ronen Zvulun/Reuters)
The Ministerial Committee for Renewable Energy approved on Monday the transfer of a sizable chunk of renewable energy quotas to the photovoltaic industry, as well as provisions for the state to underwrite solar facilities in the West Bank.
The committee’s resolutions allow for the repositioning of 180 megawatts originally allocated for two solar-thermal plants for photovoltaic use – a decision to be finalized within 90 days. In addition to enabling the shift of these 180 megawatts, the committee also approved the diversion of 70 megawatts from large wind farms, 20 megawatts from small wind facilities, and an additional 20 megawatts from overall solar-thermal quotas to the photovoltaic sector. These new plans, according to the Energy, Water, and National Infrastructure Ministry, will lead to a savings of over NIS 2 billion for the Israeli economy over the next 20 years.
Not only did the ministerial committee approve these quota shifts, but they also authorized a measure that would allow the government to underwrite the financial debt for photovoltaic projects in the Judea and Samaria.
“We want to develop the renewable energy field and reach the target of 10 percent production in 2020, by creating a market and a significant and big economy in the field,” said Energy, Water, and National Infrastructures Minister Silvan Shalom.
Praising his predecessor Uzi Landau for kicking off and strengthening the country’s entrance into the renewable energy sector, Shalom stressed that he intends to continue this trend, while maintaining demand and reasonable price levels.
“We do not want to reach a level of tariffs in electricity that will be unsuitable for the economy and for our struggle against the cost of living,” Shalom said.
In addition to the quota shifts approved on Monday, Environmental Protection Minister Amir Peretz is also advocating the transfer of 60 megawatts from the 160-megawatt quota for biogas to the photovoltaic sector.
Such a diversion would save the country NIS 27m., according to the ministry.
That being said, because biogas generation is considered one of the most productive renewable energy sectors, committee members are taking more time to examine the need for biogas quota diversion.
They are also consulting the Defense Ministry about possibilities of constructing waste anaerobic processes in the West Bank.
A July 2011 government decision on renewable energy allocations determined that 10% of medium-sized facilities – 30 megawatts for medium- sized solar fields – would be dedicated to constructing plants in Judea and Samaria.
To date, however, banks have refused to fund such projects, out of fear that future political arrangements may affect their operations, the Energy Ministry explained. Therefore, the committee decided that the state would underwrite the debt owed by the developer to financial institutions.
Housing and Construction Minister Uri Ariel, who initiated this measure, praised the decision of the ministers, emphasizing that residents of Judea and Samaria should also have the opportunity to promote green energy.
“Weather conditions in Judea and Samaria will enable the production of clean electricity, and I am glad that a significant barrier has been removed, which will enable us to respond to a high demand,” Ariel said.
While the ministerial committee approved the quota shifts and Judea and Samaria debt provisions, the members have yet to authorize a series of principles for determining the economic benefits of renewable energy, developed under Prof. Eugene Kandel, the head of the National Economic Council. Presenting his committee’s findings in November 2012, Kandel explained how the government must make electricity- purchasing strategies based on the benefits derived by the technologies involved, rather than simply employing traditional feed-in tariff measures.
The Energy Ministry expressed support on Monday for adopting Kandel’s principles and recommended establishing a committee to update relevant procedures.
Although solar industry advocates praised the new decisions, those in the wind sector were less than thrilled.
In a letter last week to his organization’s members, Gadi Hareli – co-founder and CEO of the Israel Wind Energy Association – expressed that such slashes from the wind industry would “violate the underlying aims and programs of the Energy Ministry itself.” Meanwhile, it has just been confirmed that Israel will be home to the World Wind Energy Conference in 2018, he said on Monday.
Jon Cohen, the CEO of Arava Power Company – the firm responsible for Israel’s first medium-sized solar field – expressed some optimism.
“We hope that decisions taken today will enable developers to move forward with numerous projects already in position to receive tariff permits and move to financial close,” he said.
Cohen also voiced hope that the 8-megawatt project of Beduin leader Haj Mousa Tarabin, which has faced continuous delays, will be realized with the added quotas.
“We are extremely anxious and hopeful that finally, after five years of bureaucracy, the Tarabin project – the first ground-base Beduin project in Israel – will be green-lighted,” Cohen said. “This will create jobs, revenue, and dignity in the Beduin sector.”