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That year a major sewage conduit in Tel Aviv burst and the raw sludge streamed straight into the Mediterranean for months on end. The state declared it Israel's worst environmental catastrophe in a decade and a public outcry ensued. In March 2007 the court fined the Dan Region Association of Towns for Sewage and Environmental Issues NIS 800,000 and again sentenced its leaders to community service.

Even though these sentences were trifling, the press intensely covered the court cases, and corporate Israel grasped that it had to mend its ways. It had to stop obfuscating and start cooperating with the Environment Ministry.

So far the heavy industrial polluters, mainly in Ramat Hovav and Haifa Bay, have invested about NIS 100 million in waste treatment facilities, and double that amount is planned for the coming years in smog prevention.

IEC: master of procrastination

A company that doggedly refuses to change is the Israel Electric Corporation. The IEC is the Environment Ministry's worst headache. The utility doesn't strain itself to follow directives and drags its feet on trying to reduce smog, which emanates mainly from its giant power plant in Hadera. Though there has been some progress, it basically does as it pleases.

Yossi Inbar, the senior deputy director-general for infrastructure and industry at the Environment Ministry, calls the IEC his "toughest client". "It is building an anti-smog mechanism at Hadera, but it has been delayed for years. They're masters of procrastination. They're also delaying any reduction of electromagnetic radiation from their power lines. It isn't that they aren't doing anything - they are - but we want much more."

Inbar acknowledges that the investment required is vast. "Today when building a power plant, half the investment is environmentally related," he explains. "The Hadera plant needs to invest $150 million in handling particle pollution." All told, the IEC needs to invest about $1.5 billion in reducing pollution, he says.

Until a few years ago the reluctant companies would evade ministry directives because of the massive sums involved. But trends changed abroad and green legislation in Israel is forcing change, too.

It has become trendy abroad to inquire whether a product is made by a "clean" company or a polluter, and here laws have been passed that force accountability, including personal responsibility by management.

The major polluters like Haifa Chemicals don't deride the law anymore, Inbar says, and Israel has started to close the gap with the West regarding 'green industry'. "It's even ahead of Europe regarding waste disposal into the sea, but regarding smog, Israel remains five to 10 years behind international standards," Inbar says.

Israel has thousands of companies that pollute, including 100 heavy offenders such as Israel Chemicals, Makhteshim Agan, the oil refineries in Haifa and Ashdod, Teva Pharmaceutical Industries, steelworks and the ports, Inbar says. There are between 200 to 300 moderate polluters as well.

The ministry's main weapon is to deny noncompliant companies a business license, or toxin permits, which are required for any company working with hazardous materials. And no company can stream waste into the sea without a permit - so streaming has now fallen by 90 percent.

In pollution of the air and sea, Israel has adopted European standards, Inbar says.

How does it work? Ministry inspectors sample waste (smog or other) emanating from a plant, without advance coordination with the company, and if a firm is breaking the rules, it takes steps. If it doesn't comply at the civil level, criminal proceedings start. The police are called in to investigate when necessary.

Sometimes foreign influence helps; for example, Intel Israel must meet the standards of its parent company, Inbar says.

Another acute problem is land contamination. Fuel companies will be investing a total of about NIS 60 million in cleanup operations, but Israel Military Industries alone needs to invest hundreds of millions, Inbar says.

He dreams that the sea, air and land will be clean. A pipe dream? Not entirely, Inbar insists. In five or 10 years, Israel will meet international standards.