On Sunday, the government approved the plan of the Ministry of Energy to build power storage installations and connect them to the public grid in crowded urban areas. These installations are intended among other things to provide a response to the demand of the United Torah Judaism party in the coalition agreements for "kosher" electricity on the shabbat and festivals, when the operation of power plants breaches religious law. The pilot installation, with an output of up to 30 megawatts, will be run by the Israel Electric Corporation (IEC), which is contrary to the 2018 reform meant to encourage competition in the power industry.
In the background to this decision, until last Thursday evening, a broader discussion of the expansion of Israel’s power production capacity to meet future needs was on the agenda, but this discussion was sidelined. It is estimated that in 2025, or in 2027 at the latest, Israel will start to suffer from a power shortage.
Four power plants with a doubtful future
In 2021, the National Infrastructure Committee approved for deposit a plan for the construction of the Kesem power plant on land of Kibbutz Givat Hashlosha, a kilometer from Rosh Ha’ayin.
This is a privately-held power plant with an output of some 450 megawatts fueled by natural gas meant to help meet consumption in the Greater Tel Aviv area. In 2020, a year before approval was granted, power consumption in Israel amounted 21.7 terawatts in the domestic sector, 16.2 terawatts in the commercial sector, and 14.3 terawatts in industry - altogether, 72.8 terawatts. This is 75.8% more than in 2000. The residents of Rosh Ha’ayain, however, united in opposition to the construction of the plant, mainly because of fears of air pollution and impairment of their quality of life.
Another factor in the mix is Reindeer Energy, a company that seeks to construct a 450 megawatt natural gas-fueled power plant on land of the Southern Sharon Regional Council. The Ministry of Energy has yet to decide between the two projects, as it does not make much sense to construct two natural-gas fired power plants in such a small area.
One of the main problems in the lack of a decision about the two plants is the time it takes to construct a power plant. The Ministry of Energy must surely remember that after the National Planning and Building Committee approved the plan to construct two new power production units at the Orot Rabin power station in Hadera in 2020, the ministry declared that the first would be operational by last September and the second six months later. Neither deadline has been met.
Experienced people in the power industry with whom "Globes" talked said that construction of a power plant generally takes ten years. Looking to the future, then, the shortage of electricity supply is liable to result in power cuts, but it doesn’t end there. A possible solution is the policy adopted in Europe after the Russian invasion of Ukraine and the consequent disruption of natural gas supplies, which was to resuscitate polluting coal-fired power plants, and even to use diesel-fueled generators. That will result in higher electricity tariffs.
In June 2021, the Electricity Authority warned of a power shortage in Tel Aviv by 2027. Forecasts of demand for power in 2030 (in billions of kilowatt hours of production) range from 97.2 (meaning average annual growth of 2.7%) according to the Bank of Israel, to 100.4 (average annual growth of 3%) according to IEC, and 105.9 (average annual growth of 3.5%) according to BDO.
The gaps arise from the fact that the main factor in the growth in demand in the forecast of the Bank of Israel and IEC is the rate of growth of GDP, whereas BDO takes into account additional factors such as the demand for electrically powered vehicles, the light rail system, and the electrification of Israel Railways, rising demand in the Palestinian Authority, and the effect of government policy to switch to a low-carbon economy, which encourages the use of electricity instead of fossil fuels.
Dr. Moshe Tshuva, head of the Department of Mechanical Engineering at Afeka Tel Aviv Academic College of Engineering, says, "The great challenge arises from the substantial increase in the population expected by 2050, but it is is also connected to the fact that the State of Israel committed to 100% of new cars in the country being electric by 2030. In addition, Israel is switching to electric trains."
Despite the warnings, production of electricity at the Reading power station in Tel Aviv was halted in October last year until 2026 to facilitate the removal of asbestos.
Minister of National Infrastructure, Energy, and Water Israel Katz therefore proposes to set up mobile production units, peaker plants, at the Tel Aviv power station after it is renovated. Peaker plants work on gas turbines using jet fuel. Their efficiency is low and their pollution levels are high. They are meant for use only at peak demand times. Peakers are Katz’s preferred solution, and the idea has already been set in motion.
In addition, with regard to the Greater Tel Aviv area, last February the Accountant General Division at the Ministry of Finance reported that, in accordance with a government decision of October 2020, the inter-ministerial tenders committee was working on a tender under the PPP (public private partnership) method for the construction of a conventional power plant using natural gas with an output of 600-900 megawatts at the Sorek site, next to the Sorek A and Sorek B desalination installations and the Shafdan wastewater treatment plant.
A final possibility that the ministry is examining for boosting power production is expansion of the Dorad power plant, which currently has a maximum output of 800 megawatts, and which is located on the EAPC (Europe Asia Pipeline Company) site in south Ashkelon. Unlike peakers, which work on an open cycle, meaning that they can be rapidly fired up and shut down, Dorad, which is based on natural gas, works on a combined cycle, in which waste heat is recovered for use, and cannot be fired up and shut down regularly in accordance with consumption.
Limited development in renewable energy
Most of the power generated from renewable sources in Israel is solar power, but that is not available at night or all year round. Consumption, on the other hand, is mostly in the evening hours, when most people are at home. In 2020, the breakdown of power production was 67% from natural gas, 26% from coal, 6% from renewable sources, and the rest from other types of production. By 2022, Israel reached 10.1% power production from renewable sources, a target that had been set for 2020. The Electricity Authority’s target for power production from renewable sources in 2030 is 30%.
Without appropriate energy storage solutions deployed nationwide, the development of power production from renewable sources in Israel, which is mostly based on solar energy, will be very limited.
Storage allows electricity produced from, for example, solar energy, to be used at designated times. The pilot storage program in Bnei Brak, however, is not a one-to-one match with the needs of a major center like Tel Aviv, and although energy will be stored and used throughout the week, the main aim is to accumulate energy for a single neighborhood that before shabbat commences will be connected to batteries, and thus will obtain "kosher" electricity for the 25 hours duration of the shabbat.
Furthermore, in this scheme there will not necessarily be an accompanying installation of solar panels, which means that the stored power will be generated from fossil fuels. On the other hand, there is no doubt that the haredi population that requires "kosher" electricity needs a solution, since at present on shabbat it uses polluting and expensive diesel generators.
Published by Globes, Israel business news - en.globes.co.il - on May 9, 2023.
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