Groups criticize cuts of summer solar tariffs

Environmentalists slamm Public Utility Authority’sdecision to slash solar equity returns from 14% to 7%.

May 30, 2012 02:48
2 minute read.
Solar panels

Solar panels 370. (photo credit: Ariel Jerozolimski)


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Although pleased with the recent government decision to increase the quota of solar rooftop panels for the coming summer, environmentalists slammed the Public Utility Authority’s Monday night decision to slash solar equity returns from 14 percent to 7%, with a new rate of 69 agorot per kilowatt-hour.

On May 13, the cabinet approved a plan to help cope with the expected summer energy shortages, which included bringing forward the 2014 solar rooftop quota of 30 megawatts for use now, with a requirement that new panels be installed by August 1. This amount, with each roof carrying a capacity of up to 50 kilowatts each, is equivalent to about 600 rooftop installations, explained Eitan Parness of the Israel Renewable Energy Association.

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After the Public Utility Authority’s plenary session on Monday evening, the body announced that the new tariff rate for those people installing the panels would be 69 agorot per kilowatt- hour, a price drop that Parness said includes a cutback in consumer equity yields from 14% to 7%.

Only in March, the tariff rate had been 90 agorot per kilowatt- hour, and Parness blamed the Energy and Water Ministry for demanding the reduction.

The decreased normative costs for constructing solar systems caused the government to slash the consumer’s equity yield in half, according to Parness. In doing so, however, the authorities are minimizing the entrepreneur’s return on his or her investment, he explained.

By cutting the yields, the entrepreneurs will now need about 14 years to make up for their investments, as opposed to an original seven or eight years, Parness said.

“What they have done is to say no to the entrepreneurship,” he told The Jerusalem Post.


“He who reduces the yield for entrepreneurs by 50% is interested in eliminating the domain,” Parness said.

“The Israeli government decided to provide incentives for solar entrepreneurs that will take part and assist in the production of electricity in the summer. But there are those in the Public Utility Authority who are interested in eliminating the entrepreneurship and eliminating the domain.”

In Parness’s opinion, the electricity regulation in Israel has no parallels anywhere else in the world, and the Public Utility Authority (PUA) unfailingly “abuses entrepreneurs,” making the public the “only loser.”

A joint response from the PUA and the Energy and Water Ministry stressed that their ability to bring forward the additional 30-megawatt allocation is another step to prevent electricity shortage expected in the summer.

“Two months ago, we turned to the PUA requesting that it execute professional work necessary in order to bring forward the 2013-14 quota, as long as the government would consent to this, and on the condition that the tariff set in the arrangement would be fair and would not impose upon the citizen public an unnecessary burden,” Energy and Water Minister Uzi Landau said.

Both the authority and the ministry stressed that the regulation determines that non-domestic installations only of up to 50 kilowatts, connected to grid by August 1, will receive 69 agorot per kilowatt-hour.

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