Ministry of Energy Director General Udi Adiri presented the updated national plan for energy efficiency for the years 2020-2030 yesterday. The plan promises a 17% reduction in emissions by 2030 (compared with 2015), to eliminate the need to build expensive, land guzzling power plants, and to provide the economy with thousands of jobs to help it recover from the economic crisis following the Covid-19 pandemic.
The plan consists of a number of areas, some of which require a total of NIS 1.5 billion in budget resources for grants to government ministries and to public bodies for investment in energy efficiency, a leverage fund for renewable energy investment, and other support measures. In the regulatory area, the plan includes a series of measures intended to encourage the transition to more energy efficient activity in the economy, including regulations requiring greener, more energy-efficient construction, imports of more efficient electrical appliances, an efficiency index for vehicle tires, and the transition from gasoline and diesel-powered vehicles to electric.
Implementing the plan requires a government decision and the allocation of resources within the 2021 state budget. However, the Ministry of Energy intends to fund the plan in part through a NIS 250 million one-time Covid-19 allocation to accelerate economic activity.
The Ministry of Finance believes that successful implementation of the plan will also require an update of the electric power tariff structure. According to the Ministry of Finance, the current tariff formula does not reflect a mix of fuels that contains a significant solar power component, and therefore provides no incentive to switch power consumption from evening hours to daytime (when excess production is expected). The Energy Ministry said in response that the issue of updating the electricity tariff was the purview of the Electricity Authority.
The Ministry of Energy says that the new plan will address current challenges in Israel's energy sector, while adapting to global trends in the field and dealing with the crisis of climate change. This measure results from significant changes that have taken place in the energy industry in the world and in Israel in recent years, in particular the promotion of the transition to renewable energy production and the use of electric technologies instead of fossil fuel-based technologies.
As part of the plan, the Ministry of Energy proposes to establish a new energy efficiency index, which will reflect the improvement in t intensity of energy consumption, meaning energy consumption per unit of gross domestic product. The Ministry proposes setting an intermediate target of an 11% improvement in energy consumption intensity, as measured by the new index, by 2025 (compared with 2015), and an 18% improvement by 2030 (approximately 1.3% annual improvement on average).
The ministry explains that the new index and the targets will make it possible to correlate energy consumption with the volume of goods and services in the country. The ministry adds that the index is suitable for Israel, where rates of population growth and economic growth are among the highest in the OECD countries. It further notes that the index will facilitate a comparison between countries.
Minister of Energy Dr. Yuval Steinitz said yesterday, "Through groundbreaking energy programs, we are not only slowing the rise in energy demand, but also making Israel a center for the development and implementation of advanced technologies and work practices that will enable Israeli companies to break into new markets around the world, in this important and developing market."
Referring to the proposed government resolution, Steinitz said, "At the height of a health and economic crisis, this is a temporary order to channel budgets and investments towards infrastructure development that, in addition to providing significant benefits to the energy economy, will aid our ability to emerge from the crisis. The energy efficiency plan incorporates measures that will power the market forward, facilitate economic growth, and contribute to local employment."
Ministry of Energy director general Adiri said, "The global changes taking place in the energy market are reflected in the update of the national energy efficiency plan, and the measures presented in it are aimed at reducing energy consumption, reducing greenhouse gas emissions, and tackling two major challenges: the climate crisis and accelerated urbanization.
" The program is the product of a broad process in collaboration with the various government ministries and stakeholders from the public and private sectors," Adiri added. "Its outcome complements the other plans published by the ministry, will serve as a roadmap for reducing energy consumption, and will help the ministry fulfill its vision for a prosperous and sustainable economy by 2050. Our comprehensive activity in the energy sector is the only reason that the State of Israel meets the targets of the Paris Agreement."
Director of the Sustainable Energy Division at the Ministry of Energy, Uriel Babchik, who presented the plan, said that it included a wide range of policy measures, including a strategic plan on municipal electricity consumption, reform electrical product imports, provide support grants for energy efficiency, loans to encourage renewable energy production at local authorities, increasing efficiency and power production at government ministries and agencies, energy ratings on vehicle tires and housing units, and more.
The national plan also supports the Ministry of Energy's goals to ban the sale of polluting vehicles starting in 2030, through the establishment of an electric charging infrastructure, preparing the power production and distribution sectors, conducting R&D, offering incentives and tools, removing barriers to entry, and providing information.
The Ministry of Energy states that, "Implementation of the policy measures is expected to lead to a reduction in energy consumption of about 16.5 terawatts - a reduction of about 6 million tonnes of greenhouse gas emissions, which will be about 7.5% of total greenhouse gas emissions in Israel in 2030. These will be in addition to the savings achieved by the government's decision on 30% renewable energy by 2030."
According to the ministry, the savings in power consumption will translate into considerable financial savings as well as reducing the damage to open areas: the amount of electricity saved will eliminate the need to construct solar power plants with a capacity of 1100 megawatts, for which about 11,000 dunams (2,750 acres) of land would be required, as well as eliminating the need for construction of conventional, natural gas-fueled power plants with aggregate output of 860 megawatts.
The Ministry of Energy claims that implementation of the plan will provide the economy with thousands of jobs: about 10,700 new jobs as a result of the grant program for energy efficiency by 2025 and 4,000 new jobs resulting from the ministry's program for dealing with municipal electricity consumption. The ministry cites a report by the Global Commission for Urgent Action on Energy Efficiency, which operates on behalf of the International Energy Agency (IEA). The report, published in June 2020, demonstrates that investing in energy efficiency will contribute to faster economic growth and higher employment in the relevant sectors: electricity, transportation, buildings, industry and fuels.
Published by Globes, Israel business news - en.globes.co.il - on November 17, 2020
© Copyright of Globes Publisher Itonut (1983) Ltd. 2020