Ashalim solar thermal tender delayed again

The tender for the solar thermal power project at Ashalim, Israel has suffered its third delay, because not all the regulatory permits have been obtained, the electricity production license has not yet been written, and the financial aid criteria for the winner have been formulated, according a report in Globes.

Globes reports that the deadline for submitting bids to the joint Ministry of Finance and Ministry of National Infrastructures tender committee, headed by Deputy Accountant General Avi Dor, has been pushed back from October 21, 2009 to December 10, 2009 .

The Ministries of Finance and National Infrastructures have allowed the seven bidders who passed the prequalification stage of the tender more time to prepare their bids.

The $700-800 million build-operate-transfer (BOT) tender is for construction and operation of two solar thermal power plants with a total output of 220 Megawatts.

The seven consortia participating in the Ashalim tender are:

• Shikun u'Binui Holdings Ltd. (Housing and Construction), Solel Solar Systems Ltd., and Bateman Engineering NV;
• Dor Alon Energy in Israel (1988) Ltd., Minrav Holdings Ltd., Germany's Solar Millennium AG, and France's Alstom SA;
• IDB Holding Corp. Ltd. unit Clal Energy Ltd. and Spain's Abengoa SA;
• BrightSource Energy Inc., Veolia Environnement SA, Dalkia Israel Ltd., and Solar Power Inc. of the US;
• Shafir Civil and Marine Engineering Ltd. and France's EDF Energy SA;
• Ormat Industries Ltd. and Germany's Bosch Solar Energy AG;
• Israel Corporation subsidiary IC Green Energy Ltd. (ICG) and Canada's SkyPower Corporation

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Ormat installing solar panels at factory in Israel

Ormat Industries Ltd., the parent of NYSE-listed Ormat Technologies, a world leader in geothermal and recovered energy power generation, will collaborate with Sunday Solar Energy Ltd. to install an NIS 20 million ($5 million) photovoltaic power system on the roof of Ormat's factory in Yavne, Israel.

The system will have a capacity of 1 megawatt and surplus power not used by Ormat will be sold back to the Israel Electric Corporation. Ormat will thus benefit from the feed-in tariff established by Israel's Public Utilities Authority (Electricity) for the sale of electricity at NIS 1.97 per kilowatt/hour.

Ormat is also participating in the tender for construction of a solar thermal power plant at Ashalim in the Negev.

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Arison plans private solar thermal power plant in Negev

Arison Holdings Ltd. subsidiary Housing and Construction Holding Co. Ltd. (Shikun u'Binui) plans to build a large solar power plant in the Negev, costing $400-500 million, according to a report in "Globes".

The solar thermal power plant would reportedly generate at least 100 megawatts of electricity on a 3,500-dunam (875-acre) site. If constructed, it will be Israel's largest privately owned solar power station.

Shikun u'Binui is also participating in two government tenders for the construction of solar thermal and photovoltaic power plants at Ashalim in the Negev. Shikun u'Binui is partnering with Solel and Bateman Litwin NV in the tender for the solar thermal power plant, and partnering with Spain's Elecnor SA in the tender for the photovoltaic power plant.

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Israel sets renewable energy target of 10%

Israel's government this week set a target of producing 10 percent of the country's electricity from renewable energy sources by 2020.

The decision was made by the socio-economic cabinet, headed by Finance Minister Roni Bar-On. The panel also set an interim target of 5 percent by 2014.

The Negev and Arava regions will become "national preference" regions for renewable energy, according to the plan put forward by Minister of National Infrastructure Binyamin Ben-Eliezer. Ben-Eliezer's plan calls for the construction of 10 solar power stations in the Negev and Arava between 2010-2020.

Israel has already initiated a process of building solar thermal and photovoltaic power plants at Ashalim, in the Negev desert, that are expected to be operational by 2012.

"Promoting the generation of renewable energy will not only lead to a reduction in the dependency on fossil fuels and the promotion of environmental values but advancing this industry in the south will lead to the development of the periphery in the south," Bar-On said in a statement.

Israel currently produces only 1% of its electricity from renewable sources, while 69% is produced from coal, 23% from natural gas and 7% from diesel fuel or fuel oil, according a report in YNet News.

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Solar Roundup

What follows is a selection of recent stories and links related to the solar industry in Israel.

Arava planning $2.5 billion solar power station

An international project management firm recently signed a memorandum of understanding for construction of a $2.5 billion solar power station in the Eilot Region in the Arava desert. The project, which is expected to develop over a five-year period, involves installation of photovoltaic (PV) panels that will eventually supply up to 500 megawatts of electricity. The agreement was signed by the Arava Power Company of Kibbutz Ketura located in the southern Arava.

SolarPower raises $1.1m

Photovoltaic energy system integration company SolarPower Israel has raised $1.1 million at a company value of a few million dollars from Precede Technologies and Rosenram Development Ltd. The company plans to use the funding to expand its business in Israel and internationally.

SolarPower co-CEOs Avinoam Levy and Alon Tamari founded the company in 2003. The company anticipates rapid growth in Israel's photovoltaic energy market following an update to the Electricity Regulations to allow the government to buy electricity generated by solar energy systems installed at businesses, commercial enterprises, and private homes at nearly four times the rate of electricity generated by usual means.

IEC wants to bid on Negev solar plant

Israel Electric Corporation (IEC) is seeking to participate in the tender for the construction and operation of the solar power plant to be built at Ashalim in the Negev. IEC wants to be a sub-contractor, providing planning, management, and construction services for one of the consortia that will participate in the tender. IEC has begun negotiations to this end with Solel Solar Systems Ltd..

Skypower mulls bid for Negev solar project

Sources inform ''Globes'' that Canadian renewable energy company SkyPower Corporation may participate in the tender for the Negev solar power plant at Ashalim. The $600-700 million tender is due to be published by the end of the month.

A SkyPower delegation recently visited Israel and held preliminary talks about cooperation with some of the Israeli companies planning to bid in the tender. SkyPower also asked for full information about the project from the Ministry of Finance, the Ministry of National Infrastructures, and the Ministry of Environmental Protection.

SkyPower is one of Canada's largest renewable energy companies. It specializes in the development, construction, and management of wind farms and solar energy power stations. The company is currently involved in 70 renewable energy projects in various stages of development, with aggregate capacity of 7,000 megawatts (MW). Most of the projects are in Canada and the US.

The BOT (build, operate, transfer) tender is for a 250-MW solar power station that will produce 2.5% of Israel's electricity needs. Other potential builders of the plant include Israeli solar power companies Solel and Luz II, a subsidiary of BrightSource Energy, Israel Corp. unit IC Green Energy Ltd., and Housing and Construction Holding Co. Ltd. (Shikun u'Binui). Spanish energy giant Abengoa and Babcock & Brown Capital Ltd. of Australia have also expressed interest in participating in the tender.

Finance and Infrastructures Ministries in dispute over technology for Israel's first solar power station

"If the Ministry of National Infrastructures insists on building a photovoltaic power station at Ashelim in the Negev, it will have to pay producers four times more per kilowatt/hour than for a thermal power station," Solel Solar Systems Ltd. EVP and CTO Eli Mandelberg told "Globes". He made the comment in response to the dispute between the Ministries of Finance and National Infrastructures over the technology to be used in Israel's first solar powered station.

Solel Solar is building solar power stations using its proprietary thermal technology developed several years ago. The company is expected to participate in the tender for the 250 megawatt solar power plant at Ashalim in the Negev. Mandelberg said that all tenders for solar power stations currently being published around the world are based on thermal solar energy, rather than photovoltaic energy, because it is too expensive. For this reason, photovoltaic technology is mainly used for small household or communications facilities, which cannot be linked up to electricity grids.

Mandelberg added that countries interested in photovoltaic technology are those willing to pay household electricity producers a premium to sell the electricity to the grid. Even then, only small electricity producers are involved. He said that if the Ministry of National Infrastructures insists, Israel would become the first country in the world to build a large photovoltaic power station. "It's easy to understand the Ministry of Finance's objections to the idea, since we're talking about a large expenditure on an immature technology. The Ministry of National Infrastructures isn't looking at the economic side of the picture, but wants to participate in technological development," he said.

Photovoltaic technology in based on the using silicon crystals to convert light rays into electricity. Thermal solar energy uses parabolic mirrors to collect sunlight and convert into heat to generate steam, which in turn operates turbines to produce electricity.

UK's Ecofin buys 40% of Solel Solar Systems

It is being reported that UK infrastructure investment company Ecofin is buying 40% of Israeli solar energy technology company Solel Solar Systems Ltd. at a value of $150 million.

The world's largest solar thermal company, Solel designs, manufactures and installs solar fields for utility scale power, on-site power plants and industrial solar heating & air-conditioning systems. Solel's patented technology uses reflectors to concentrate the sun's energy and produce heat, which is then transformed into electricity through the use of steam-powered turbines.

In 2007, Beit Shemesh-based Solel entered into an agreement with Pacific Gas and Electric Company to build the world's largest solar plant - to be established in California's Mojave Desert. The project will deliver 553 megawatts of solar power, enough to power 400,000 homes, to PG&E's customers in northern and central California. When fully operational in 2011, the Mojave Solar Park plant will cover up to 6,000 acres in the Mojave Desert.

Solel's technology has already been in use for almost 20 years at a group of solar power plants in California's Mojave Desert, providing 350 megawatts of clean, renewable energy and eliminating the need for 2 million barrels of oil a year.

Solel also has an agreement to build three 50 megawatt solar thermal power plants in Spain, and last week Solel signed a landmark contract to supply 46,000 solar thermal receivers to to Aries Termoelectrica, which is building a solar power plant in Castile-La Mancha, Spain.

Next up for Solel: bidding for a contract to build and operate Israel's planned 250 megawatt solar power plant at Ashalim in the Negev Desert.

As described on its web site, Solel’s technology converts sunshine into useful thermal energy, and subsequently into electricity, by way of parabolic mirrors that concentrate the solar energy onto solar thermal receivers containing a heat transfer fluid. The heat transfer fluid is circulated and heated through the receivers, and the heat is released to a series of heat exchangers to generate super-heated steam. The steam powers a turbine/generator to produce electricity delivered to a utility’s electric grid.

A central computerized tracking facility enables optimal absorption of the sun’s energy by automatically adjusting the alignment of the parabolic mirrors. From the moment the sun rises until it dips over the horizon, all of its rays are captured and converted into usable energy.

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IC Green Energy to enter Negev solar power plant tender

Sources inform "Globes" that Israel Corp. subsidiary IC Green Energy will participate in the BOT (build, operate, transfer) tender for the Negev solar power plant at Ashalim.

IC Green Energy (ICG), headed by CEO Yom Tov Samia, was founded in 2006 by Israel Corp. to serve as its renewable energy arm. So far, ICG has examined a number of overseas projects in the field of alternative fuel and electricity generation. According to its web site, the company is focused on biofuel (biodiesel & ethanol), solar energy and the production of biofuel and energy from biomass.

Israel's first tender for a solar power plant will be for the construction of two power stations that will generate 250 megawatts altogether, amounting to 2.5% of Israel's power production. The project is valued at $600-700 million.

Other potential builders of the plant include Israeli solar power companies Solel and Luz II, a subsidiary of BrightSource Energy. Spanish energy giant Abengoa and Babcock & Brown Capital Ltd. of Australia have also expressed interest in participating in the tender.

For additional background information on this project, see:

"Israel Plans 250-MW solar power plant"

"Australian fund considers Negev solar plant bid"

Australian fund considers Negev solar plant bid

Sources inform ''Globes'' that Babcock & Brown Capital Ltd. of Australia is considering participating in the tender to build a $600-700 million solar power station in the Negev. The tender is due to be published in 2008.

Babcock & Brown wants an Israeli energy company as a partner. The Australian investment company is the second international company expressing an interest in the tender; Spain's Abengoa Bioenergy SA has contacted the Ministry of National Infrastructures about it.

The 250-megawatt solar power station will be built at Ashalim in the central Negev under a BOT (build, operate, transfer) contract.

Babcock & Brown's portfolio already comprises thirteen operating power stations representing over 3,300MW of generation and a further 1,700MW under construction. The firm announced in June 2007 that it was opening an office in Israel to be headed by the former privatization chief Eyal Gabbai.

Israel plans 250-MW solar power plant

Israel recently announced plans for the construction of a 250 megawatt solar power plant in the Negev, which is estimated will cost $600-$700 million. When completed, it will be one of the largest solar power plants in the world.

"Globes" reports that the World Bank is considering financing the project.

According to Ha'aretz, the tender for building the plant will not give preference to local firms, meaning that foreign firms can participate in the tender without a local partner. The decision was made, among other things, to avoid the impression that the tender was written for the benefit of the only two Israeli companies who could compete for the power station: Solel and Luz II, a subsidiary of BrightSource Energy.

The cabinet hopes that this change will make the tender more attractive to international firms with experience in the solar energy industry, and that the new conditions will allow the setting of appropriate minimum requirements for professionalism and financial strength for the bidders on the project.

Minister of National Infrastructures Benjamin Ben-Eliezer recently announced that the first stage of the tender will likely be published next month.

The power plant, which will be located near Ashalim in the western Negev and produce 250 megawatts of electricity, will be Build-Operate-Transfer (BOT), similar to Route 6, the Trans-Israel Highway. The winning bidder builds the plant, operates it for the license period, and at the end of the franchise transfers full ownership to the state.

A number of foreign companies have already expressed interest in the project, including Spanish energy giant Abengoa. Abengoa created a U.S. subsidiary earlier this year, Solucar Power, Inc., to respond to utility requests for electricity using concentrating solar power (CSP) technologies.

The real remaining question is which technology will be required for the power station: solar thermal or photovoltaic. The solar thermal method harnesses the sun's energy to heat a material, such as oil or water, from which it is possible to generate electricity, while the photovoltaic system transforms solar energy directly into electricity.

However, it also appears that even if one of the possible two tenders requires a photovoltaic system, the total amount of electricity from such a plant will not be over 50 megawatts, out of the total of 250 megawatts.