Israel approves new plant to avoid energy crisis

Israel Electric Corp (IEC) the state-run utility said on Tuesday it would invest $1.3bn in building a new coal-fired power plant after the National Infrastructure Ministry approved the construction plans.

The new plant will be in two units each having 550 MW capacity. The exact location and date for the commencement of building works has yet to be decided.

“It’s a necessity to build new plants to answer Israel’s growing energy needs,” an IEC spokeswoman said.

The IEC anticipates the plants will be operating by 2007 at the earliest. The new plant will be Israel’s tenth. Five are in the central city of Hadera while four are located in the coastal city of Ashkelon.

A spokesman for Infrastructure Minister Avigdor Lieberman, who gave the green light to the project earlier on Tuesday, said a new plant was needed to “prevent a growing energy crisis”. No public funds will be used to build the plant.

As part of an effort to increase privatization of the country’s power sector, Israel’s Ministry of Energy has directed IEC to purchase at least 900 MW of power from independent power producers (IPPs) by the year 2005. Of this, 150 MW is expected to come from solar and wind facilities, with the rest mainly natural gas-fuelled. Israel’s goal is for ten per cent of all electricity to be produced by IPPs.

In June 1997, IEC announced the first tender for a large-scale private power plant in Israel – a 370 MW, dual-fired, combined-cycle plant to be built at Ramat Hovav (by a consortium of PSEG Global and the OPC energy company) in the Negev Desert by 2002. In March 2001, OPC signed a contract with Siemens of Germany to purchase $200m worth of gas turbine equipment for the plant, which is under construction. In July 1998, the first IPP tender issued by the IEC was awarded. A second and third IPP are possible, including the 400 MW, gas-fired Alon Tavor power plant in northern Israel.

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