Israel Signs Landmark Solar Energy Agreement with Arava Power

Israel awards its 1st PPA to Arava Power

Arava Power, based in Kibbutz Ketura in southern Israel, is blazing the bureaucratic path for solar fields in Israel.

Israel reached a milestone yesterday in its efforts to add a substantial solar component to its electric grid: National Infrastructures Minister Uzi Landau signed the country’s first power purchase agreement (PPA) for solar energy with Ketura Sun, a joint venture of the Arava Power Company and Kibbutz Ketura.

The government’s commitment to a PPA is required for solar installations generating over 50 KW of electricity and is essential for securing project financing. As APC President Yosef Abramowitz explained to the Green Prophet, “what was a high-risk business until yesterday has now become a medium-risk business.”

As reported in the Jerusalem Post, the landmark agreement, valued at 250 million shekels, entails a 20-year commitment by the government to purchase the electricity generated at a 4.9 MW photovoltaic field at the kibbutz, located in southern Israel. The PV array is expected to be in operation by May, according to Arava Power’s CEO, Jon Cohen.

Infernal bureaucracy

“It was hell,” Abramowitz said about the bureaucratic battles the company waged until finally receiving the PPA. Cohen noted at the signing ceremony: “It’s not easy being the pioneer company, in a pioneering industry, in a pioneering state.”

Now that the ministry has awarded its first solar PPA, additional PPAs are expected to quickly follow. In fact, entrepreneurs have filed requests for medium-scale (50 KW to 5 MW) solar projects totaling some 700 MW of production capacity, according to Abramowitz. At the signing ceremony, he prodded the government to expand the 300 MW quota it has set for projects of this size. Referring to Israel’s goal of generating 5% of its electricity needs via renewable energy by 2014 (and 20% by 2020), Abramowitz argued:  “The only way to reach 5% by 2014 is to raise the caps on the medium-sized fields.”

The ministry is also expected to announce a feed-in tariff regime for large-scale (above 5 MW) projects during the coming weeks. Pending this announcement, Arava Power is planning a 40 MW project at Kibbutz Ketura.

The power of peace

Abramowitz views the significance of the PPA as extending beyond Israel’s borders: “This is the first solar PPA in Israel and in the entire region,” he said at the signing ceremony. “Solar power is the power of peace. We have just taken the first step in what should become a friendly competitive race to solar power in the Middle East.”

:: Jerusalem Post
:: Arutz Sheva

Read more about Arava Power on the Green Prophet:

Arava Power to “Electrify” the Negev Desert
Arava Power Company Signs Solar Deals with Negev Bedouins
Israel’s Kibbutzim: Renewal through Cleantech?

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