Israeli Government Failing to Encourage Natural Gas Use in Transport Sector

Despite huge domestic reserves, precious few experimental cars run on natural gas in Israel, new study finds

File photo: Israeli gas platforms in the Mediterranean sea.
Reuters/Amir Cohen

Seven years after Israel’s government declared it would use the country’s vast natural gas energy reserves to power cars and trucks, virtually nothing has been done, according to a study released this week by the Samuel Neaman Institute for National Policy.

As of today, just two or three cars on an experimental basis are fueled by natural gas even though Tamar, the largest field at present, boasts an estimated 318 billion cubic meters of gas and the much bigger Leviathan reservoir, with 613 BCM, is due to begin production in 2019.

Meanwhile, globally, over the last seven years, the number of natgas-powered cars on the roads doubled to 23 million vehicles, most of them in Asia and a $23 billion market, the researchers point out. By 2024, that number should reach about 30 million.

“Natural gas has many advantages for use in transportation – it’s cheaper than diesel fuel, and it meets the requires of Israeli and world governments to reduce emissions and noise,” said Prof. Gershon Grossman, who heads the Neaman Institute’s Energy Forum, which sponsored the study.

“It doesn’t pollute the ground or water. It’s lighter than air, which makes it safe for use, unlike liquefied natural gas,” he added.

Natural gas now provides as much as 70% of Israel’s electric power and the government’s goal is to reach the same level in the field of transportation, with a focus on trucks and busses. Grossman noted, however, that achievement of that goal has been thwarted by a lack of infrastructure for natgas-powered vehicles and by regulatory obstacles, including problems concerning the pricing of gas for transportation.

The institute’s report pointed to a chicken-and-egg problem: There is no demand for natgas-powered vehicles because there is no easy way to fuel them, and natgas pumps are not widely available at filling stations because there are no vehicles that need them.

Among the most important recommendations the Neaman report makes is that the tax on natural gas should not be introduced until 2030. Right now, the Finance Ministry plans a gradual rise in the levy from nil today to 2 shekels (56 cents) a liter by 2026, thus undermining the goal of increasing natgas consumption.

The Neaman Energy Forum proposed that the government accelerate development of the national natural-gas pipeline network, which faces a host of statutory obstacles, so that the gas can reach the filling stations.

It also urges the government to end its financial support of the production of liquefied petroleum gas, which doesn’t have as many applications in terms of being a source of energy, in favor of natural gas.