Israel's 2030 Energy Goals Come Under Fire From Interest Groups, Environmentalists

Energy minister is pushing for more natural gas and renewables, but not everyone is convinced, with one government official calling the ambitious plan 'sad joke'

Israel's electricity power plant in Ashkelon, June 19, 2017.
Ariel Schalit/AP

Who could object to an energy future where imports of cars emitting pollutants are banned, where trucks and business run on emission-free electricity and natural gas, where coal will no longer be used to generate electricity and renewables will be the source of close to a fifth of Israel’s electric power?

Apparently a lot of interest groups - and not just the obvious ones in the fossil fuels industry.

The result is that an ambitious program led by Energy Minister Yuval Steinitz to set goals for the Israeli energy industry in 2030 has come under fire from the treasury, the oil and gas industry and environmentalists.

>> Read more: Israel's Energy Ministry plans to end coal as energy supply by 2030

Steinitz had hoped to have the proposals called “The Plan to Save Israel from Polluting Energy” approved as soon as possible for fear that early elections would waylay the government.

Electrifying Planned savings from the energy
sector envisioned by 2040, NIS billions

The plan envisages savings of 5.8 billion shekels ($1.55 billion at current exchange rates) annually by engineering a transition to a new mix of energy sources and saving many of the approximately 2,200 lives that the Organization for Economic Cooperation and Development estimates are lost to air pollution every year in Israel

Among other things it wants to make much more use of Israel’s abundant and growing reserves of natural gas as well as its abundant sunlight.

Natural gas would be used in much greater quantities not only by electric power plants, thus eliminating the use of highly polluting coal, but also by big industrial plants, all of which would have a direct hook-up to the nationwide natgas pipeline network.

Cars would be power by natural gas, too, instead of with gasoline. Even more would use electricity. The Energy Ministry estimates that in the first 10 years after the program is implemented, use of electric cars would save the Israeli economy 45 billion shekels and natgas cars another 17 billion.

Enabling factories to use natural gas would save another 8 billion, and a similar amount saved by power plants moving over to gas and renewable energy.

The oil and gas industry, which is represented by the Israel Institute for Energy and the Environmental, opposes the government setting energy goals. “Technology is a means, not an end,” said Shlomi Parizat, an economist who wrote a report on the pan for the institute.

Among other things, he said the crackdown on gasoline-powered car would cause 12 billion shekels in losses to the Israeli energy industry. He warned against the government trying to predict technology trends and said it was up to the automotive industry to decide what technologies to adapt and promote.

Meanwhile officials at the Environmental Protection Ministry as well as green organizations have objected to the big role natural gas plays in the targets at the expense of renewable energy, especially solar.

They claim that the Energy Ministry favors gas because the government shares in the profits from Israel’s natural gas fields and wants to encourage more oil and gas exploration by ensuring there is growing domestic demand.

At a recent energy conference the Environmental Ministry Director General Israel Danziger called the plan a “sad joke.” He said renewables should accounts for halfof all energy by 2030, not 17%, “The energy economy needs to be based on the sun, not on gas,” he said.

“Natural gas is being presented by the [Energy] Ministry as a magic solution to the problem of greenhouse gases, but research shows that in order to produce of kilowatt hours of natural gas greenhouse gases equivalent to more than 400 grams of carbon dioxide are emitted into the atmosphere, compared with 43 grams carbon dioxide with solar energy production,” said Adam Cromer, CEO of the environmental group Green Insight.

The treasury has also weighed in against the targets, saying the government stood lose billions of shekels of tax revenues it now collects in taxes on gasoline.

Steinitz is reportedly ready to compromise on two key elements of the plan – on the number of electric cars in 2030 and the share of renewable energy in power generation.

But he is holding fast to his demand that Israel cease using coal. He also insisting that all factories have access to natural gas, even though to date the government and pipeline companies have failed to meet even near-term targets.

“They will find a compromise under which half or a third of the car imported into Israel in 2030 won’t use gasoline,” said one govenrment source, who asked not to be identified. “The Finance Ministry will cover thie difference from tax revenues collected on travel or entry into cities with car as they do in London.”