Energy Blue Print
Israel 2012

Moving from principles to action for energy supply that mitigates against climate change requires a long-term perspective. Energy infrastructure takes time to build up; new energy technologies take time to develop. Policy shifts often also need many years to take effect. In most world regions the transformation from fossil to renewable energies will require additional investment and higher supply costs over about twenty years

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climate and energy policy

1.1 policy roadmap for israel

Israel is in the midst of a rapid shift in its primary energy source mix. Following the latest mega natural gas discoveries offshore Israel, the country is experiencing the fastest shift recorded in the world from coal and oil utilization to natural gas in power generation, as well as quick shift to gas in industry and other sectors of the economy. Nevertheless, despite the major benefits of natural gas utilization compared to coal, due to energy security and environmental consideration, it is curtail to diversify the fuel mix by increasing the share of renewable energy sources, especially in power generation. In addition, Israel has the possibility of switching the fuel in most of its auto flit from oil (gasoline and diesel) to natural gas and renewables as primary energy sources by utilizing several technologies. Moreover, to achieve financial, energy security and environmental benefits it is also essential for the country to enhance its energy conservation efforts by implementing a variety of energy saving and efficiency measures.

1. Renewable energy utilization

In recent years interest in energy security and the need to develop renewable energy sources has been rekindled, with even greater intensity. There are three main reasons for this: aspiration for political-economic security, achieving job-creation and multiplayer economic growth, and environmental-health aspects.

2. Targets and forecasts for the use of renewable energy

Based on achievable targets we estimated the progress towards electricity production from renewable energy from 0.5% in 2012 to 2.5% in 2015, 10% in 2020 (GOI decision), 20% in 2030 and 30% in 2040 onward.

According to this estimate, achieving the targets will necessitate the establishment of power plants using renewable energy technology in the huge magnitude of some 8,000 MW by 2030, and this in relation to the overall installed production capacity in Israel (natural gas and coal based) of some 13,000 MW in 2012.

3. The potential of producing renewable energy

Meeting government targets of any kind, but especially long range targets in industries with high capital intensity, require a strong government long term commitment. Because the timelines of business and government tend not to sync perfectly it is critical to make energy policy broadly, and renewable energy policy specifically, an across the board policy priority.

Energy policy must be crafted in a way that it survives political changes over several election cycles. This long term stability can be achieved by incorporating the specific steps outlined below, but also requires education of both policy makers and the public to make sure that support for forward looking energy policy is strong and long-lasting. This education includes a transparent licensing process and clearly examined and publicized cost benefit analysis showing the benefits that stem from incorporation of renewables.This education should also highlight real life benefits (e.g., job creation, energy security, environmental and health benefits) from incorporating renewables.

It is recommended that the following policy measures and consideration will be taken into account:

  • A “carrot-and-stick” approach to developing RE, consisting of a combination of improved non- quota based feed-in tariffs and enforceable emissions standards, such as Emissions Performance Standards that will favor Israeli base technologies. Such feed-in tariffs would also signal to the investment community abroad that Israel believes in the level of its domestically developed renewable energy technology.
  • A non-bypassable public benefits charge on all electricity sales, in order to ensure adequate funding for R&D in renewable energy
  • Regular updates of environmental costs that are reflected in the PUA tariff to account for worldwide changes in emissions values as emissions markets become larger and more liquid.
  • Development of net metering, beyond the initial tariffs issued in mid-2008 for small residential and commercial facilities.
  • It is in the interest of Israel to increase the percentage of renewables manufacture and innovation that happens inside its borders. Bridging the gap between innovation and manufacturing is a suite of government policies, merits and subsidies, that can encourage the best ideas to become players on the national stage. Given this chance, the best of these technologies might be the seed for a new export industry and increase local manufacturing, jobs, and tax revenues. Nevertheless, due to international trade regulations, Israel must be careful in how it structures any program that tilts the playing field in favor of national manufacturing industries.
  • Another powerful tool to increase local manufacture and innovation is likely to be some sort of local purchasing authority. In Israel, there are already regulations that govern the required investment in the country by a company that sells to the government. These purchasing authorities must have strong enforcement ability; they can be very effective in spurring local investment.
  • To develop a series of regulatory steps and financial incentives aimed at encouraging the production of alternative electricity by medium-sized producers, first of all at the expense of built or partially built areas, abandoned and destroyed land with low environmental sensitivity and converting non-economic agricultural uses.
  • To locate vast areas with low environmental sensitivity in the Negev and the Arava that are suitable for the large scale production of electricity (PV or thermo-solar), in the scope of tens of thousands of dunams.
  • To include the issue of the value and importance of open areas and their inherent natural, scenic and heritage assets in costbenefit considerations when deciding on suitable technologies for renewable energy, their location and scope.