Sources inform ''Globes'' that Afcon Industries Ltd. (TASE: AFIN) is expanding it renewable energy interests from wind energy to solar energy. The company is considering participating in a Ministry of Defense tender for the installation of solar receptors at IDF bases nationwide.
The sources added that Afcon is in negotiations with foreign companies to join it in the tender, including Spanish energy infrastructures giant Cobra Group SA, a subsidiary of Grupo ACS SA (IBEX: ACS). A deal with Afcon would be Cobra's first foray into Israel, although another ACS subsidiary, Dragados SA was a partner in the consortium that built the Jubilee Port at Ashdod Port Company Ltd., and bid in a Israel National Roads Company Ltd. road maintenance tender.
In June, the Ministry of Defense published a tender for the installation of photovoltaic systems of up to 50 kilowatts each at IDF bases. Most of Israel's solar energy companies are bidding in the tender, including Shikun u'Binui Solaria Ltd., Arava Power Company, Sunray Israel Blue White Ltd., and Sunday Ltd.
The bidders have been asked to propose various contractual methods, including BOT (build, operate, transfer) and turn-key. The final tender will reportedly be published in 2010, and is estimated at tens of millions of dollars.
Last year, the Ministry of Defense decided to promote solar energy at IDF bases as part of its effort to make a more environmentally friendly army. The first tender was for the installation of a thermosolar system at the Nevatim Air Force Base at an estimated investment of $40-50 million. The ministry is expanding the program, following July 2008 decision by the Public Utilities Authority (Electricity) to offer an incentive of NIS 1.98 per kw/h for electricity generated by small solar energy installations.
The Ministry of Defense is also considering including solar energy in its giant tender for the IDF Training Base City in the Negev, at a cost of tens of millions of dollars.
Afcon CEO Avi Winter said in response, "The company is examining the matter. Everything is preliminary at this time."
Afcon chairman Shlomo Shmetzer owns 55% of the company through S. Shlomo Holdings Ltd. (TASE:SHLD). Afcon's share was unchanged by midday at NIS 32.
Published by Globes [online], Israel business news - www.globes-online.com - on August 11, 2009
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