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« An Israeli dilemma? | Main | Guys, guys, guys pay attention... »


Amit Nisenbaum

Interesting report.

Also, it is actually mandatory to install PV cells for water heating purposes on all new homes in the South of Israel (cant remember the exact parallel south of which it is mandatory) for water heating purposes.


I wonder whether terrorism (which is funded by fosil fuel consumers) was included in the professor's calculation.


Of course alternative energy costs more than fossil fuels. But some people have other purposes in mind when installing solar panels than saving money.

If fossil fuels were more expensive, I'm sure we wouldn't be using them as much and instead fueling our cars and producing energy with the cheaper alternative.


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Jay Draiman, Energy Analyst

April 7, 2008
Renewable Energy Comes to Israel's Valley of the Sun
by Andrew K. Burger, International Correspondent
Arava Valley, Israel []
A heady mix of environmentalism, entrepreneurism, participatory democracy and shifting notions of energy and national security is brewing in Israel's Arava Valley. Bordering the Negev desert plateau in Israel's far south, the relatively sparsely populated region has already bloomed into an agricultural center, thanks to underground aquifers, desalinization and prudent, innovative water resource management. Now, the Arava Power Company, along with local kibbutz communities, are planning to turn the area into Israel's first hub for solar power.

"In age of missiles the best national and energy security plan for Israel is a distributed power model, meaning 25-50 MW plants dotting most of the country so that if one small plant or solar field goes don't have blackouts all over the country."

--Yosef Abramowitz, President, Arava Power

Arava Power — whose majority shareholders, taken collectively, are the 135 members of the Valley's Kibbutz Ketura — is hatching plans to develop distributed grid-connected solar energy fields that, if it spreads to include other kibbutz communities as planned, could scale up to 500 megawatts (MW) and cost as much US $2.5 billion to build and put into operation.

Led by local entrepreneur and Kibbutz Ketura resident Ed Hofland, the company has taken a leading role in Israel's budding renewable energy and distributed power movement, lobbying government at all levels for solar and distributed, renewable power to play a greater role in Israel's energy and national security mix.

Sun & Silicon in the Arava Valley

The intensity of sunlight in Israel's southernmost Eilot region is as high as it is anywhere in the world outside of the Sahara, making the region, and Arava Power, a magnet for solar power equipment manufacturers, venture capitalists and private investors.

"Germany, the world leader in solar power, receives 900-1,000 kilowatt-hours [of solar energy] per square meter (kWh/m2) annually," said Yosef Abramowitz, a transplanted Bostonian and former media company head who is now Arava Power's president. "Here we get 2,274 bankable kWh/m2 per year...It seems like a no-brainer."

Shunning what it decided were excessively high rates of return sought by venture capitalists, Arava Power drew on the financial resources of Kibbutz Ketura members and a group of private investors raised enough capital to build and launch a "proof-of-concept" 2-4 MW grid-connected solar mini-farm on approximately 20 square acres of scrub and desert at the fringes of Kibbutz Ketura.

The community is confident that the capital is there for it to scale up and realize its grander ambitions of building a series of 20-25 MW solar power fields generating as much as 500 MW and making the Arava Valley Israel's first solar energy hub. All of this is conditional, however, on receiving proper government approvals and the establishment of a viable, long-term feed-in tariff structure.

Local Community Stakeholders

There are high upfront capital costs associated with building a large-scale solar power plant, but given the region's exceptional environmental attributes renewable energy capital is gravitating here, said Abramowitz. "When we first started we thought we would need a couple of hundred million dollars. Raising that much, and possibly much more, doesn't look like a problem."

The Eilot region — comprising the Negev and Arava Valley — is home to 53 kibbutz communities, ten of which are in the Arava Valley. At least ten others in the area have come out in support of the Arava Power project, Abramowitz said.

Kibbutz residents tend to be well-educated and ecologically conscious, but ecological concerns haven't traditionally been high up on the national government's list of priorities, said Daphna Abell, director of ecotourism at neighboring Kibbutz Lotan. "'Ecology is a luxury we cannot really afford,' has been the attitude of the Israeli national government up until about ten years ago," Abell said.

"On the other side, locals [in the Eilot region] consider ecology an element that contributes to the security of our future..." Israel's environmental ministry has been growing in size and authority during the past ten years, Abell recounted, but it still lacks "enough authority and influence in government."

And therein lies the rub. Israel's only solar power program, run by the Public Utilities Authority (PUA), to date is capped at 50 MW for seven years and as written is only attractive for individual homeowners.

There are 280 kibbutzim in Israel that wouldn't qualify for the PUA's draft resolution. Collective communities such as kibbutzim are effectively excluded from participating in it, according to Abramowitz, due to the fact that power feed-in is capped per meter and kibbutz communities collectively draw from, and would potentially feed power back into, the grid through one high-capacity meter and switch.

Moreover, at ILS 0.876 [US $0.28] per kWh, the PUA's feed-in tariff rates for independent power producers are among the lowest in the world. Not one IPP has signed up for the program, testimony to its failure to meet its intended goals of stimulating solar power adoption and use not only by individual homeowners but among small- and medium sized IPPs, Abramowitz stated.

Abramowitz and Arava Power, along with Kibbutz Ketura and local community support, are advocating for change. "We think there are at least 50 kibbutz communities in Arava that would participate with the right feed-in tariff, around ILS 1.7-1.8 per Kwh [US $0.48] at current exchange rates with mandatory reductions after 2010 of 2 percent per year for 7 years," he explained.

The PUA is expected to announce news regarding changes to its draft resolution this month but it might not actually happen until May or June, according to Ed Hofland, the chairman of Arava Power and other successful ventures in the region. "We have all the technological, zoning and logistical issues solved, but there's still the problem of the tariff. We need to make a decision whether or not to move forward [with the initial 2-4 MW pilot project] without a final decision or wait a few weeks or more...It's a relatively small investment and we may be willing to get started even without final word on the tariff from the PUA."

Doing so might serve as a catalyst for the government as well as other independent power producers looking to launch renewable energy projects, Hofland thinks, but what's really going to serve as a wake-up call to Israelis more broadly speaking will come with this and ensuing summers.

Forecast electricity shortages mean that the state electric company is planning scheduled brownouts across the country for this and ensuing summers, Hofland noted. That's going to galvanize broader public interest and government action, just as occurred years past in California and is happening now in South Africa.

"In the long-term I'm sure the government understands that it has to raise the tariff if they want to be active in this field, but we have to make a decision whether to wait for the government or move ahead regardless," Hofland said.

Waiting for the Inevitable

Development of solar energy farms in Israel is inevitable for several reasons, Abramowitz said. "Israel will have decent tariffs because by 2013 it graduates from its current developing nation status under the Kyoto Protocol to developed nation status and so mandated greenhouse gas emissions reduction targets will be set."

Another factor renewable energy proponents believe supports an aggressive commitment to developing solar power and other clean energy resources is national security, which, for obvious reasons, takes precedence over all other concerns in Israel.

A few weeks ago a GRAD rocket was fired from Gaza into Ashkelon and hit the edges of a major industrial center. "As it happens, the center is home to one of Israel's largest coal-fired power plants, one that produces 900 MW of electricity, and supplies about 8% of the nation's needs. "It's a wake-up call and the clock is ticking," Abramowitz said.

"In age of missiles the best national and energy security plan for Israel is a distributed power model, meaning 25-50 MW plants dotting most of the country so that if one small plant or solar field goes don't have blackouts all over the country," Abramowitz argues.

Fostering peace and better relations with neighbors such as Jordan is another point in favor of developing the Arava Valley's solar resources, Abramowitz added, saying that "the sun doesn't recognize international boundaries." Israel and Jordan share the Valley floor and Jordan's majestic Edom Mountains frame the eastern edge of the Arava Valley. "Regional economic development is one of the unrealized promises of the 1994 peace treaty signed by King Hussein and Prime Minister Itzhak Rabin with President Clinton presiding," Abramowitz noted.

Energy policy in Israel is further complicated by the fact that demand is outstripping generation capacity and distribution infrastructure.

"The only real planning thus far is for traditional carbon-based plants," he said. Ashkelon has been chosen as the site for another huge coal-burning plant. The state power company fires up back-up generators that burn diesel and even more expensive jet fuel to meet peak demand at present at a cost of more than US $1 per kilowatt-hour, according to Abramowitz.

"Here, we could not only provide daytime electricity and meet peak demand, but become self-sufficient and lower pressure to build additional coal-fired power plants...Three to four kibbutz can provide the entire region, including Eilat, with enough electricity to meet their daytime and peak energy needs, he claimed.

"This makes it inevitable that solar power will have to take off in a major way, and that's in addition to the environmental and economic reasons that are true for every country...We have everything but the right policy...We can vault from last to first place if the government makes the right decision."

Interested in learning more about why type of plant Arava Power is planning? Watch for a closer look at the technology the company is testing in an upcoming feature on

Andrew Burger is a International Correspondent currently working out of Israel.

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post a new comment Reader Comments (14) Author:
Jim Berry

Date Posted:
April 7, 2008
Oh God,

"Here we get 2,274 bankable kWh/m2 per year...It seems like a no-brainer."

So loosing money on every single watt of power versus nearly any other form of energy is a no brainer. Let's review Solar PV is at best $.20 to $.60 per kwh depending on who you ask while coal/wind/nuke are $.02 to .08 per kwh.

I will bet he is either a government sector employee (who don't have to worry about making money) or a private sector person that sells a product to Gov't sector employees.

At least we don't have to worry about the American money being used to do anything to further or hinder the Arab/Jewish conflict.
Comment 1 of 14
Dimitar Mirchev

Date Posted:
April 8, 2008
Fine with me while we dont have to dig CO2 from the ground and release it in the atmosphere.


In your deliberations you continuously overlook the cost reductions that the solar power is experiencing and the future cost reductions that we will see. Coal and , especially, nuke recieved far bigger subsidies and help from governments than all renewables combined. Now its time for the energy from nothing industry to recieve some help. I dont mind that.

After all - the energy dont grow on the trees - it falls from the sky.
Comment 2 of 14
Jim Berry

Date Posted:
April 8, 2008
"After all - the energy dont grow on the trees - it falls from the sky"

I disagree since trees are an inherent source of renewable energy through burning them.

As for the great Solar PV cost reductions, I did give a valid range of figures of $.20 to $.60 per kwh for Solar PV. The lower figure is often mentioned by supporters of Solar PV on this page while the higher figure is your out the door price from sources like Home Power (a pro Solar mag) from 2006 in articles by people who installed Solar PV them in their homes.

What did I leave out? Nothing. Next year Solar PV might be cheaper. So might Wind, Nuke, Coal, Geothermal, Nat. gas, Wave and so on. We don't know what the prices are 1 or 2 years from now.

What you do know is that Solar PV is 9 to 28 times more expensive than its competition. It is at least 4 times more than Wind right now --- I heard that Wind is Green. Also, the subsidies for other energy don't significantly close the gap. Unsubsidies coal is not 9x more expense than subsidies coal.

If 5 years from now Solar PV is $.03 per kwh without a welfare check, then by all means install them.

But what sense does it make to say that the Soalr Pv system 5 years from now will be cost effective at $.03 kwh, so lets install Solar PV today at $.20 to $.60 per kwh today!!!! What Great economics!!!
Comment 3 of 14
Jeffrey Viola

Date Posted:
April 9, 2008
Where are you getting your figures from Mr. Berry?
Nuclear power costs as much or MORE for a new built plant than Solar does.
Florida Power & Light recently got approval to build two new nuclear reactors at Turkey Point. One option includes two reactors with a total of 2200 megawatts of power, and the other would be comprised of two reactors with 3040 megawatts.
The technology with the lower megawatts will cost $12 billion to $18 billion, and the other $16 billion to $24 billion.
Hmmmm... that's $ 5.26 to $8.18 PER GENERATED WATT!!! Not counting nuclear fuel... If they placed an order for 3040 Megawatts of Solar panels , I'll bet they could get them for $1 or $2 a watt.
Nuclear power is .02 to .08 cent per KW in the USA ONLY because the utilities don't have to pay for nuclear waste disposal or re-processing. They just let the waste pile up outside their doorsteps!
Mr. Berry also seems to miss the point that Solar will allow Israel to have de-centralized sources of power generation - not a small concern in view of the daily rocket barrages Israel experiences. IT IS a no-brainer to use the technology most appropriate for a given eco-niche, whether that be solar in the desert, wind in windy areas, etc.
Comment 4 of 14
Matthew Morris

Date Posted:
April 9, 2008
Mr. Viola :

I'm not stumping for Nuclear power, but you apparently don't understand the difference between killowatts and kilowatt-hours. The first is a point-in-time figure that indicates capacity, and the second is a quantity of outputted electricity. From your post:

"Nuclear power costs as much or MORE for a new built plant than Solar does.
Florida Power & Light recently got approval to build two new nuclear reactors at Turkey Point. One option includes two reactors with a total of 2200 megawatts of power, and the other would be comprised of two reactors with 3040 megawatts.
The technology with the lower megawatts will cost $12 billion to $18 billion, and the other $16 billion to $24 billion.
Hmmmm... that's $ 5.26 to $8.18 PER GENERATED WATT!!!"

Electricity is billed by KWh. Nuclear plants will run essentially 24x7x365. Assuming 100% output and no downtime, a 3040MW plan then will produce 26,630,400,000 KWh per year. If we assumed a $24 billion dollars in construction, no other costs and a plant disposable at the end of a single year, the cost per KWh would be about 90 cents/kWh. Both assumptions are stupid, mind you. A plant would typically be expected to last a minimum of 30 years, so the cost per KWh (still ignoring operating costs) would be about 3 cents/kWh. I have no good way of reliably estimating operating costs over the 30-year period. If I were to hazard a guess, I might assume 400 people employed by the plant at an average salary of 100K for the 30-year period. This would sum to $1.2 billion. Including that into the costs of the plant would bump the cost per kWh to 3.15 cents/kWh. I have *no* idea how to estimate fuel or disposal costs but there's still a heck of a lot of wiggle-room before reaching operating costs that are prohibitive.
Comment 5 of 14
Jeffrey Viola

Date Posted:
April 9, 2008
I understand perfectly the difference between Kilowatt hours and kilowatts:
I was just providing a simple easy to understand cost of an installed watt of generating capacity!
If 3,040 Megawatts of Solar Panels were installed, it too would generate X amount of power per year, and also have a life expectancy of 25-30 years (and maybe alot more).
For Nuclear plants, there is a huge operating expense in parts that need to be replaced on a regular basis (like in Turbines, and the many pumps and valves, etc. etc.).
And currently the Utilities just store the spent fuel rods on site at each plant - there is no "cost" in dollar terms (other than keeping them secure and cool) and if they had to pay for real disposal or recycling that would add a great expense.
The real story is the part I left out: New laws passed in Florida (and Georgia and other states) allows utilities to recover from ratepayers the cost of plant construction when it's incurred: years before the plant goes online, and allow utilities to charge ratepayers whether the units are completed or not. So the ratepayers are forced to finance the nuclear plant for 8-10 years before it even generates 1 watt.
And the Utility also gets Federal subsidies to build nuclear plants.
So if the playing field was really level, and "true" costs were compared, Solar would be competitive.
Comment 6 of 14
william hughes

Date Posted:
April 9, 2008
I wonder if the people living in the Arava valley are considering wind turbines. This area has the most constant, moderately strong wind I have seen anywhere. It comes up in the morning, blows all day and goes down in the evening. There is almost no vegetation in much of the valley so the wind is almost as clean (laminar) as wind blowing off the sea. At a guess I would think their capacity factor would be around 50%. About 35% is considered suitable for a commercial wind farm.
Comment 7 of 14
william hughes

Date Posted:
April 9, 2008
The Israelies have experimented with another sun collecting device which is very inexpensive per square metre. It consists of ponds with a graded salinity to stop convection. In the absence of convection, the very salty water in the bottom of the pond gets very hot. A conventional piston type generator using a low boiling point working fluid turns the heat energy to electricity. One of these used to exist (maybe still does) by a cluster of hotels half way down the Dead Sea.
Comment 8 of 14
william hughes

Date Posted:
April 9, 2008
And for that matter, why don't they use "sea water greenhouses" (put these search words into Google). Much of the ground water in the Arava is brackish at best and these devices bypass energy wasting energy conversion and actually produce a small but valuable excess of fresh water in excess of the water needed to grow the crop. This excess can be used or allowed to sweeten the ground water. If the brine from the waste side of the process is evaporated in ponds, it is either a resource or can be got rid of and thus slowly rid the ground water of salt. The Israelies are in the cat bird seat. If they only realized it.
Comment 9 of 14
Jim Berry

Date Posted:
April 9, 2008
I am frequently asked to document my figures on this site. I believe so more than anyone else. I try to always respond. My figures noted above that Wind, Coal, and Nuke come in at $.02 to $.08 is mostly accurate. There is a currency conversion issue of dollar to pound in 2004 versus now. So you could jump on that.

I can't find my original site which was an American article that included price summaries from a British/Scottish report. My error. I mis-saved the bookmark somewhere.

HERE IS THE original British article from the Royal Academy of Engineering.dated 2004. Is that good enough

It supports me. Note the Chart on page 7 only goes from 1 penny to 8 pennies, with Nuke, Wind and Coal fallen in the stated range. OF COURSE SOLAR PV could never fit on this chart since it comes in 9 to 28 times the other power sources.

Since I have documented my sources, surely you now agree with my point???

Sorry to challenge your Green religion with facts.
Comment 10 of 14
Dimitar Mirchev

Date Posted:
April 12, 2008

Correct me if I am wrong but you are basically saying:

"We must not invest in solar power generation unless it is cheaper than other power sources"

and :

"We must stall the solar power market (to stop installing PV plants) until they are cheaper than the other power sources"

Or put in other words:

"We must wait all other types of power generation to become more expenaive than solar in order to begin installing solar power generations"

Well. If get you right that means that sooner or later we will have to install solar power with the current prices due to the rising prices of fossills and uranium wich rise mainly because they are finite.

Some governments have decided to speed up the development of solar marked by stimulating this. That is their right.

And please dont trow facts about nuclear power. It is more than obvious that they can not supply enough nuclear plants to replace the existing ones, not to mention new ones. The nucelar industry lacks public support, econominc feasibility (even if your facts are right, there is another fact that there are no investors that are keen to install in nuclear plants), enough trained people to support expantion in the nuclear share of power generation and not enough uranium.

And remember - there is not even one (NOT EVEN ONE) 100% private nuclear plant. All nuclear plants all over the world are build with governmental help and subsidies.

The coal plants recieve enough help for not keeping account on the pollution they make.
Comment 11 of 14
david mason

Date Posted:
April 13, 2008
the cost of pv includes the costs at every stage of it's construction and manufacture, from mining and making the silicon through to transport of the finished product.
the quoted per kilowatt costs of coal or nuclear are never this complete.
The quoted price for nuclear does not take into account the costs of mining and enriching the uranium, transporting fuel rods, safe storage of waste and importantly, the decommissioning costs when the plant's life time is over - which is more than the cost to build the plant in the first place.
Once these are taken into account, and the energy expended in each of these processes is realized, it is clear that nuclear power is not and will never be a source of cheap power.
Comment 12 of 14
Steve Buzzell

Date Posted:
May 30, 2008
Something you should keep in mind is that most of the cost associated with pv production and installation is labour costs. People who would otherwise might be on welfare or unemployment, better to pay them and get something in return rather than give money to arabs and iranians to buy bombs and guns.
Comment 13 of 14
Jay Draiman

Date Posted:
July 13, 2008

A more efficient and cost effective renewable energy system is needed. R2
A more efficient and cost effective renewable energy system is needed.
To accelerate the implementation of renewable electric generation with added incentives and a FASTER PAYBACK - ROI. (A method of storing energy, would accelerate the use of renewable energy) A greater tax credit, accelerated depreciation, funding scientific research and pay as you save utility billing. (Reduce and or eliminates the tax on implementing energy efficiency, eliminate increase in Real estate Taxes for energy efficiency improvement). Tax incentive and rebates have to be tripled.
In California, you also have the impediment, that when there are an interruption of power supply by the Utility you the consumer cannot use your renewable energy system to provide power.
In today's technology there is automatic switching equipment that would disconnect the consumer from the grid, which would permit renewable generation for the consumer even during power interruption. Energy storage technology must advance substantially. "Energy conservation through energy storage".
New competition for the world's limited oil and natural gas supplies is increasing global demand like never before. Reserves are dwindling. These and other factors are forcing energy prices to skyrocket here at home. It's affecting not just the fuel for our cars and homes, it is affecting food prices and it's driving up electricity costs, too. A new world is emerging. The energy decisions our nation makes today will have huge implications into the next century. We must expedite the implementation of renewable energy.
A synchronous system with batteries allows the blending of a PV with grid power, but also offers the advantage of "islanding" in case of a power failure. A synchronous system automatically disconnects the utility power from the house and operates like an off-grid home during power failures. This system, however, is more costly and loses som

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