The natural gas sector needs appropriate regulation to keep it from becoming a predatory monopoly, said Antitrust Commissioner David Gilo on Tuesday, speaking at a session of the interministerial committee on natural gas exports.
Gilo was responding to attacks from gas companies against increased regulation. "It is important to intervene now," he said, referring to the contracts between the Israel Electric Corporation and Tamar offshore gas field partners.
In a surprise announcement, the Natural Gas Authority in the Ministry of Energy and Water Resources revealed on Tuesday that it had corrected its calculations and will require natural gas producers to provide more gas for the Israeli economy and leave less to be exported.
The authority added 20%, or some 80 billion cubic meters of gas, to its forecast of Israeli needs through 2040. The authority's original estimates seem to have relied on overly optimistic figures for energy savings and efficiency measures.
In an attempt to rescue a number of mid-sized and large plants in the periphery because of the shortage of natural gas, the Manufacturers Association and the Finance Ministry will meet to discuss the establishment of a bailout fund.
The plants, mostly in traditional industries, were scheduled to switch to gas, but due to the halt in Egyptian gas supplies and the problems with the supply from the Tethys Sea offshore field. Present forecasts are for the companies to switch to gas only in a few years.
Now the firms are asking for bridge loans, claiming they will become more profitable when they can finally run on natural gas. .
The Manufacturers Association said the steep rise in energy prices over the past two years has severely harmed businesses that use large quantities of energy. For example, heavy fuel oil prices have risen 45% since May 2010.
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