Treasury's myopia is 'dooming' alternative energy

Infrastuctures Ministry director in bitter diatribe.

hezy kugler 88 (photo credit: )
hezy kugler 88
(photo credit: )
The death knell for alternative energy production in Israel has sounded because of the Treasury's lack of support, National Infrastructures Ministry Dir.-Gen. Hezy Kugler warned on Wednesday. "The national infrastructures minister [Binyamin Ben-Eliezer] approached the Finance Ministry in the last few days and asked them where the topic of renewable energy was in their stimulus package. The Treasury replied that an effective plan which brought in positive income was needed and not a subsidy to industry. "In light of that response, we can say kaddish over the renewable energy plan," Kugler declared during an address at the 2008 Electricity Conference of the Union of Electrical Engineers in Eilat. "The Treasury only looks at the cost rather than the wider picture," he continued, "From surveys done in other places in the world it is apparent that the consumer is willing to pay more for renewable energy. Are we ready to pay to see the Negev developed, hi-tech developed? And of course we can provide energy from our resource - the sun - and reduce our dependence on foreign sources, which is known as energy security. These are the right variables. This I say to those who aren't here - the Finance Ministry." Treasury representatives were not present at the conference. While the stimulus package does detail increased investment in infrastructure, there is no mention of renewable energy. Building new roads, sewage treatment and waste water reclamation and natural gas projects were all mentioned but alternative energy was not. Renewable energy production requires subsidies in the form of feed-in tariffs (FIT) to enable them to get off the ground and become economically feasible. FITs guarantee a higher rate and a long-term commitment on the part of the government. Without the tariffs, investors see no possible return on their investment, so the panels and plants don't get built. For example, a solar energy feed-in tariff for household production using photovoltaic panels buys each kilowatt hour for NIS 2.01 as opposed to about NIS 0.48, which is what a resident pays the Electric Company. However, major Israeli solar energy companies are still waiting for a FIT for plants from 50KW to 5MW so that they can swing into production. They are confident they could meet and even surpass the National Infrastructures Ministry's goal of 20% of the country's energy from renewables by 2020. In line with the surveys Kugler cited, a recent poll by of 21 countries found most of the respondents were amenable to paying more for alternative energy. US President-elect Barack Obama has talked a lot about investment in clean technology and alternative energy as one of his goals once he takes office. He has proposed investing $150 billion in environmentally friendly infrastructure over the next 10 years to create five million new jobs. Similarly, the EU's stimulus package also set aside several billion euros for green initiatives.