Experts: Israel stagnant on wind, renewable energy

06/17/2012 23:10
Ahead of Global Wind Day, groups call for clearer regulations and incentives for entrepreneurs.

The Israeli government has not demonstrated any solid commitment to developing a wind energy sector, and must establish clearer zoning regulations that will enable entrepreneurs to develop their projects, experts say.

Global Wind Day, which was technically on Friday, is being celebrated in Israel on Monday.

While large wind installations can potentially cause interference with military surveillance as well as disturbances to birds in flight, the proper combination of strategically placed large farms and small, residential installations could be the perfect addition to Israel’s developing renewable energy repertoire, field advocates agreed.

“Global Wind Day is supposed to raise the awareness of the governments to the benefits of wind power,” Eitan Parness, head of the Israel Renewable Energy Association, told The Jerusalem Post in an interview last week. “Wind power has a special advantage when you mix it with solar. It produces energy in times when solar shuts down.”

With an increased use of photovoltaics alone, the country would still need to turn to fossil fuels by sundown, Parness explained. Instead, he said, Israel should be optimizing its use of wind energy during those hours.

“Israel is far behind the western world in terms of renewable energy and we might even be behind other countries in the Middle East,” said Dr. Daniel Farb, CEO and founder of Leviathan Energy.

Leviathan Energy last year launched the vertical, small wind turbine called the Wind Tulip – actually in the shape of a tulip – which aims to provide silent, cost-effective wind energy from rooftops. In addition to its work in wind, Leviathan is also building a hydroelectric unit with 55 percent efficiency – currently in its experimental phase at Kibbutz Re’im, after which it will be sent to Italy.

“Everybody has big plans except for Israel,” Farb added, noting that Saudi Arabia has massive solar plants, while Egypt already has many wind farms.

Denmark supplies over 20% of its electricity from renewable energy sources, while Israel does so with less than 1%, according to Farb.

“I believe that there has to be a real commitment to it from the prime minister on down,” he said. “The minister of energy is a really wonderful advocate, but there are so many other industries and stakeholders involved in renewable energy.”

While there are many companies with wind technology solutions that work and can be implemented quickly – including his own, the quiet, vertical Wind Tulip – there is essentially no government financing for developing such wind projects, Farb said.

Perhaps first and foremost, however, the Israel Lands Authority needs to make zoning policies easier for constructing wind facilities, the experts agreed.

“It’s a specifically neglected area,” Parness said, stressing that zoning issues continue to cause a bureaucratic mess when dealing with wind. “It’s not from logic or facts – they just don’t know the potential.”

Banks in Israel do not yet view wind as secure an investment as solar energy because it is a territory that simply has not been explored here, according to Parness.

“Those things are not being done for wind because it’s like an egg and chicken [scenario],” he said. “You need a market and then the financial players will come and act. But you need to jumpstart the market. The government has not only not allowed this jumpstart, but it has sabotaged it by not dealing with zoning.”

When developers construct apartment buildings, they usually want to maximize the number of floors. However, turbines at the moment constitute another entire floor, Parness explained. This policy, which he called “completely wrong,” is in the process of being overhauled by the Interior Ministry, and new rules will likely be in force in about a year and a half, according to Parness.

Nimrod Rosenblum, a partner in the Epstein, Rosemblum and Maoz law firm – which specializes in energy – agreed that a national zoning plan defining exactly what must be done in order to construct wind farms is absolutely critical.

Potential investors do not yet understand the risks of wind energy as they have not yet received clear-cut regulations, and therefore “feel that it is too early to commit to anything,” Rosenblum said.

After establishing zoning laws, Israel should be following in the footsteps of advanced wind countries like Denmark, which not only invests in wind projects but also finances technology development, according to Rosenblum. Companies in Israel with these innovative technologies, such as Leviathan, should likewise be receiving backing from the Israeli government, Parness agreed. “What has happened here is that because there is no special clause exempting Israeli innovative technology from the zoning law, technologies like [Farb’s] are being closed out from development,” he said.

While the experts agreed that Israel should have a combination of both small and large-scale turbines, small-sized facilities are likely easier to implement at the moment. Due to military interference concerns, for example, large fields have to be in very isolated areas, Farb explained.

For the 30-megawatt cap for small-scale wind installations, developers are set to receive a feed-in tariff of NIS 1.6 per kilowatt-hour for up to 15-kilowatt installations, and NIS 1.29 per kilowatt-hour for between 15 and 50-kilowatt installations, Parness said. For the large-scale wind energy quota, which is 800 megawatts, developers will receive around 60 agorot per kilowatt-hour. Electricity prices are currently about 62 agorot per kilowatthour, including taxes.

A single small turbine that is about 4.5 meters tall by 2.5 meters wide, on a flat rooftop, costs about $10,000, while a cluster of 15 would cost about $135,000, Farb said. The 30- megawatt quota has hardly been used at all, with only two small turbines built since the quota’s establishment in 2009, while the 800-megawatt quota approved last July has not yet been touched. Israel will likely never see more than 15 large projects of wind energy, and the government’s decision to approve such an enormous quota is “completely artificial,” 4according to Parness.

“They have approved a big quota of wind because it is hard to fulfill,” he said. “It is quite funny that the decision-makers have decided up on wind without even seeing one wind turbine,” Parness added, noting that the government conducted no studies of wind turbines abroad before determining these numbers.

Parness, however, was optimistic that changes for the better are on the way. For example, the old Golan Heights wind farm is slated to expand soon from its current 6 megawatts to 14 megawatts, although funding is a huge obstacle due to its politically controversial location. Meanwhile, a 55-megawatt project is being promoted in the Eilat region, and Gilboa as well as certain areas in Judea and Samaria show great potential for wind energy, Parness said.

“I think the awareness of the damages of fossil fuels is transforming the public opinion throughout the world,” Parness said. “Also, in a place as small in Israel, when this summer you won’t be able to drive without seeing black smoke coming out of the chimneys, the public will be aware and will make it easier for a small number of projects to be built.”

“I believe that when wind turbines will be built and the public will see them, it will be out there – they will see that it’s not as frightening as it seems now,” he added.

A cocktail hour and short conference in honor of Global Wind Day will take place on Monday evening in Tel Aviv, arranged by Parness’s Renewable Energy Association of Israel, the Global Wind Energy Council and the European Wind Energy Association.

Solar support
06/11/2012 23:20

Last week, renewable energy experts from around the world gathered in Herzliya. Participants in the International Conference on the Future of Solar Energy toward Grid Parity reached an embarrassing consensus: Israel of all places, known for its hi-tech acumen and its “start-up nation” innovations – not to mention its abundant sunshine – is missing out on perhaps the most important technological revolution of the 21st century.

Representatives from international alternative energy firms such as Suntech, the world’s largest producer of solar panels, US-based Hoehner Research and Consulting Group, Power-One, the world’s second-largest producer of solar inverters, and Italian-based Enerpoint criticized the State of Israel’s political leaders for placing obstacles in front of the development of a vibrant alternative energy sector.

Part of the problem is planning. Countries such as Germany, which gets 40 percent less sun than Israel, and Denmark, which gets even less, have set the goal of 100 percent dependence on renewable energy in coming decades.

Israel’s goal is profoundly more modest. After bickering with the Treasury, the cabinet last year rolled back the goal of reaching 20% dependence on renewable energy by 2020 to just 10%. And even this modest target will not be met unless a radical change is made in the way the government encourages the use of alternative energy sources.

The most absurd aspect of our renewable energy policy is the ridiculously low caps placed on production of electricity via renewable energy sources. In theory, small, medium-size and large entrepreneurs can sell energy produced from the sun, the wind and bio-gas to the Israel Electric Corporation. But the government puts limits on the amount of energy it must buy in this way.

This made sense as long as the state provided significant subsidies in the form of a “feed-in-tariff” for each kilowatt of solar or wind-produced energy fed into the electric grid.

This subsidy reimbursed the entrepreneurs for the extra cost of producing energy via alternative energy sources as opposed to via coal, oil or other polluting means.

But we are fast approaching what is known in renewable energy circles as “incentive parity” or “grid parity” – a situation in which the cost of producing electricity using conventional sources of energy is the same as the cost for renewable energy sources – particularly solar. And this is true even in Israel, where electricity prices are artificially low due to government regulatory intervention. A kilowatt hour of electricity produced by the Israel Electric Corporation costs 62 agorot, including value-added-tax.

The feed-in-tariff for renewable energy is 65 agorot. Nevertheless, the government continues to impose strict caps, despite the fact that even at “grid parity” there is a tremendous willingness on the part of entrepreneurs of all sizes to produce electricity via renewable energy sources. In a recent tender of feed-in-tariffs, the 30 megawatts were sold off within minutes of being offered to the public.

It makes no sense for the government to prevent entrepreneurs from selling electricity at almost the same price as the Electric Corporation, but without all of the negative side effects (pollution, environmental damage, health risks) connected to the burning of fossil fuels.

Open market forces should be allowed to determine supply and demand.

Adding insult to injury, the government, in preparation for a shortage of natural gas resulting from an end to the Egyptian deal, purchased huge generators powered by diesel fuel to meet our energy needs. The shortfall – or at least a part of it – could have been filled with solar energy, particular in the summer months. And solar energy’s output peaks at midday when the sun is hottest, corresponding to peak demand hours for electricity as people turn on air conditioners.

Unfortunately, the government not only lacks long-term vision regarding use of renewable energy, it is placing illogical caps on production of energy from non-polluting sources. And we have not even mentioned debilitating red tape and bureaucracy governing the process of receiving a license to produce energy from renewable sources.

The government needs to take to heart the criticism voiced last week in Herzliya by a slew of alternative energy firms. They might have been motivated by capitalistic interests. But developing a dynamic renewable energy sector in Israel is not just good for business, it is good for Israel.