ENERGY SECTOR OVERVIEW

Israel has depended on energy imports since its creation in 1948, primarily through the Arish-Ashkelon pipeline from Egypt. The discovery of vast natural gas reserves (including the Tamar gas field in 2009, the Leviathan in 2010, and the Karish-Tanin fields in 2013) brought about a long-sought era of energy independence. Israel began commercial gas production from Tamar in 2013, which today meets most of the country’s electricity demands. Leviathan’s gas reserves are mainly exported to Egypt and Jordan, and the Tanin-Karish wells, scheduled to begin operations by 2022, are largely intended for export. 

The Tanin-Karish wells are owned by Greece-based Energean, while (Texan) Noble Energy built, operated and partially owned the Tamar and Leviathan wells until 2020, when Chevron bought it out, entering Israel amidst widespread concerns over its pollution and clean-up record. 

All the wells are located between 55 to 75 miles offshore. The Tanin-Karish wells feature a nearby floating processing rig, while the Tamar and Leviathan wells pipe their crude gas over long distances to processing rigs near Israel’s populated coast and water desalination plants.

Israel’s gas wells were critical at their discovery since renewables were not yet a viable option. However, solar energy is now cheaper to produce than gas, thanks to new production and storage technologies. Moreover, the existential climate crisis coupled with the severe threats posed by fossil fuels to Israel’s national security, environment, public health, and tourism, all dictate the urgent transition to a low-carbon economy.

Key Regional Energy Player

In 2020, Israel set out to position itself as a key regional energy player, co-initiating the East Mediterranean Gas Forum (EMFG) with Egypt’s Minister of Petroleum, Tarek El-Molla. It also began exploring energy collaborations with the United Arab Emirates, Morocco, Sudan, and Bahrain, following the normalization of ties with these countries. 

Plans include using Israel as an energy corridor to transport crude oil from the Persian Gulf to Europe. The project will turn the cities of Ashkelon and Eilat into hubs for oil and liquid natural gas. Oil from the Persian Gulf will arrive at Eilat’s bay to be transported to the Mediterranean through massive pipelines running through Israel’s Negev and Arava regions. In parallel, gas extracted in the Mediterranean will be pumped to Eilat to be liquefied and exported. 

Gas-Fired Power Plants

Israel’s Electric Corporation (IEC) is the country’s primary electricity producer and distributer, controlling more than 95% of the energy sector. Working with Israel’s Ministry of Energy, the IEC, is advancing plans for 200 gas-fired power plants, including the OPC-2 in Hadera, planned near schools and residential neighborhoods. 

Renewable Energy

In 2020, only 7-8% of Israel’s electricity came from renewables, despite Israel’s plentiful sun, hi-tech capacities, and declared goal of 17% renewables set in 2015. In  2021, Prime Minister Naftali Bennet committed to phasing out coal for energy production by 2025 and reducing Israel’s greenhouse gas emissions to net-zero by 2050. However, critics point out that Israel still lacks an action plan to achieve this target. Moreover, the country’s interim target, of a 27% fossil fuel reduction by 2030, is still only half the amount pledged by the United States and European Union.  

[See: IHG report to Israel’s Electric Authority urging the transition to 80% renewables by 2030 instead of the 30% proposed (In Hebrew)]. 

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