In October 2016, the Electricity Authority published a draft
resolution to hold a hearing regarding the arrangement of a
competitive proceeding to set the tariff payable for electricity
generation using photovoltaic technology.
The purpose of the proceeding is to allot additional quotas of
approximately 1,300 MW for generating electricity, for the purpose
of achieving the target set by the Israeli government, according to
which 10% of all electricity produced in Israel shall be from
renewable energy sources by the year 2020.
For the first time in the solar energy sector, the Electricity
Authority is not pre-setting the electricity production tariffs
which the bidders will receive, but rather, the tariff shall be set
according to the bids to be tendered by bidders during the
competitive proceeding, and the said tariff shall become a uniform
tariff for all winners in that proceeding.
Furthermore, it appears that, compared to past proceedings, this
proceeding will be easier for the bidders, who are not required
this time to fulfill various conditions, such as receipt of a
provisional license or the achievement of various milestones until
the start-up of commercial operation of the PV power plants.
However, the proceeding does stipulate a specific deadline for
connecting the PV power plants to the electrical grid and the
start-up of commercial operations.
The Electricity Authority is also contacting entities operating
in the renewable energy market, including licensees holding expired
provisional licenses who had performed a grid connection survey in
the past, and is enabling them to use the survey to satisfy the
precondition for participating in the bidding proceeding, despite
the fact that the survey had been performed for a provisional
license that has expired. In this way, the Electricity Authority is
hoping that these bidders will be able to connect relatively
quickly to the electrical grid, since they do not need to obtain
requisite construction licenses and permits.
We note that the announcement of the Electricity Authority's
resolution marks the end of a long period of stagnation in the
initiation, planning and construction of photovoltaic power plants.
The Electricity Authority is hoping that this will lead to renewed
growth in the industry and to accelerated volumes of renewable
energy production in Israel.
Originally published December 1, 2016
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