By Karl-Erik Stromsta in London
Tuesday, March 04 2014
Several weeks ago the Israeli government signed off on plans to put another 290MW of capacity up for grabs – a significant amount for a country which added just 120MW of PV in 2011, its peak year of installation.
Plans for how those 290MW will be allocated should be spelled out “over the next few months”, says David Rosenblatt, co-founder and executive vice president at Arava Power.
Perhaps more significantly, the government is close to cementing an enduring “grid parity programme” for PV, which could set the market up for sustainable long-term growth.
“Theoretically, there’s now a path forward for solar power” in Israel, Rosenblatt tells Recharge.
“Over the next few months we expect they’ll come back and say, ‘This is how the quota is going to work.’ And there should also be some certainty forming around how the grid parity [programme] gets rolled out beyond that quota.”
“I hope that by the second and third quarter we’ll be in the process of securing [quota for our] projects.”
Rosenblatt notes that when the Israeli government talks about grid parity, it is taking into account the full “economic benefit of solar power compared to other sources of energy”, rather than a purely cost-based measure.
Arava Power, which is backed by Siemens Project Ventures, owns roughly 20% of Israel’s installed PV capacity and has a pipeline exceeding 150MW – the country’s largest, according to Rosenblatt.
The company is currently building out 100MW of ground-mount capacity allocated in earlier rounds, with Siemens acting as EPC on a number of the arrays.
Israel is widely seen as one of the world’s most natural markets for solar energy, comparable to other countries with immense solar resources and relatively high power prices, such as Australia and South Africa.
Several years ago the Israeli market appeared to have built a strong head of steam, with Arava taking the country’s first utility-scale project on line in 2011, and many of the world’s pre-eminent solar developers and EPCs establishing local presences, including Conergy and Belectric.
By 2012, however, the well of feed-in tariff (FIT) money available for new projects had been exhausted, and for a variety of reasons the government failed to get a follow-on programme in place in a timely manner.
But last month the government finally approved a long-touted plan to snatch 290MW of FIT-eligible quota from other renewable sources – principally concentrating solar power and wind – and instead give it to PV, which it sees as better value for money.
All the fundamentals for a thriving large-scale solar market are in place in Israel – good roads and infrastructure, competitive financial and construction sectors, a solid legal system, Rosenblatt says.
“There’s nothing really systematically challenging,” he says.
“The real challenge has more been the bureaucracy and decision-making pace of the government. If we can get certainty around this new quota and how this grid parity will roll out, then I believe it’s full-steam ahead.”
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