The electricity sector in Israel is undergoing a period of transformation, in similarity to electricity sectors of other developed economies. As of 2016, we can witness several dominant trends in the Israeli electricity sector, including an increasing privatization of the electricity generation segment, domination of natural gas as primary energy resource and a sharply increasing, though still minor, role of private renewable energy facilities. In addition, the rise of electricity demand per capita seems to have become arrested and though there is still a certain growth due to demographic expansion, the main drive for introduction of new private generation facilities is retirement of obsolete IEC (Israel Electric Corporation) units. On the other hand, the transmission, the distribution and the grid control are almost entirely controlled by the IEC and this is not planned to change in foreseeable future, unless a major disruption is encountered. The off-grid electricity market in Israel is essentially small, estimated at several megawatts deployed in desolate locations, including diesel generators and solar PV collectors.
By the end of 2015, Israeli national electric generation capacity was at 16.8 GWp, with the installed capacity of the IEC consisting 78.6% of total grid connected capacity, while private producers consisted the remaining 21.4% of capacity. The electricity sector in Israel is undergoing a period of transformation, similarity to electricity sectors of other developed economies. The Israeli electricity production segment is still dominated by the IEC, though its share is steadily declining over the past decade.
Figure 1. Installed electricity generation capacity in Israel for 2015: IEC (blue) and Private Producers (red).
In terms of actual generation, 65.4 million kWh were produced in 2015 (revised up from 63.9 million kWh), as IEC produced 77.4% (revised down from 79.2%) and added with electricity purchased from private producers IEC controlled altogether 84.0% (revised down from 85.9%) of total grid production, whereas the remaining 16.0% (revised up from 14.1%) consisted of output of private producers designated directly to customers or generation output, self-consumed by small PV facilities.
Figure 2. Actual generation of electricity in Israel for 2015: IEC (blue), Private producers who sell to private consumers (red) and Private producers who sell electricity to IEC (green).
As of 2015, we can witness several dominant trends, including an increasing privatization of the electricity generation segment, domination of natural gas as primary energy resource and a sharply increasing, though still minor, role of private renewable energy facilities.The generation segment was relying on a mix of fuels, dominated by natural gas and coal - both utilized by the IEC as primary fuels. Secondary fuels of the IEC were diesel, oil fuel and methanol. Private generation facilities were primary relying on natural gas, while diesel, oil fuel, kerogen and renewables were secondary energy sources.
Figure 3. Fuel mix of the electricity generation segment in Israel by primary fuel, correct for December 2015. Notes: diesel is calculated combined with methanol; natural gas is including both CNG and LNG.
The total production of electricity per capita was slightly above 7.7 thousand kWh annually (revised up from 7.5 thousand kWh annually), which was very similar to 2008-2010 levels. The demand was about 6.0 thousand kWh per capita annually (revised down from 6.7 thousand kWh per capita annually). The rise of electricity demand per capita seems to have become arrested in recent years and though there is still a certain growth due to demographic expansion, the main drive for introduction of new private generation facilities is mostly retirement of obsolete IEC units.
This publication was updated on 07 September 2017.
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