2023-09-22 15:37:44
The Electricity Authority published yesterday (Thursday) for public comments its plans for the evacuation of 2,300 megawatts in the distribution network for electricity produced by renewable energies. The Authority has high hopes for the new decision, noting that with the addition it will be possible to reduce the gap in relation to the government’s goals, and reach the goal of producing 20% of the electricity from renewable energies in 2026, compared to 2025.
Within the new cap, at least 1,200 megawatts are guaranteed for low-voltage installations. In addition to this, an additional quota of about 1000 megawatts will be allocated for the integration of additional facilities in the discharge at night, which is possible with the use of storage facilities. If the move is successful, this is impressive and significant news for the electricity sector, the solar industry and the reduction of air pollution.
However, it must be remembered that in order to replace the electricity output of a polluting power station, 4 or 5 times more solar installations with similar power must be installed in its place. Thus, the full realization of about 2,300 megawatts of renewable energies is expected to save only the output of one medium-sized power plant powered by polluting fuels.
The new proposals come against the background of a very difficult reality in the Israeli solar industry, where some negative answers were given to many who asked to connect production facilities with renewable energies. According to the authority, this year there was a dramatic drop in the installation of solar facilities. If in 2022 the network managed to absorb over 1,000 megawatts of new facilities, then in the first half of the year only about 250 megawatts were absorbed, a decrease of about 50%.
Therefore, in recent months, the regulators of the electricity sector, especially the Electricity Authority and the Nega system management company, decided to carry out an in-depth inspection regarding the existing allocations and their actual utilization. The tests included additional methods for the precise characterization of all the substations of the electric company: which of them is only an ‘importer’ of electricity to consumers in its vicinity, and which of them ‘exports’ electricity to the national transmission network. This test makes it possible to create additional allocations for flows in areas where local consumption prevents most of the year from ‘exporting’ electricity, which may cause transmission loads.
A solar power producer will risk up to 17% of the annual output
The hearing actually proposes to increase the operational risks on the electricity grid for the coming years, and to create mechanisms to manage the additional risk. The integration of the additional facilities may lead to congestion on the electricity network. In order to face this challenge, the Authority proposes to add a mandatory mechanism for curtailment of new production facilities (stopping the flow of electricity from the facility to the electricity grid) for up to 200 hours of operational curtailment per year at the manufacturer’s expense.
According to the new model, the Authority expects the electricity company to connect any facility that is expected to cause loads on the network as a result of its connection for 300 hours per year or less. The manufacturer will bear alone the result of the pruning – loss of income from production of up to 200 hours, while every additional hour beyond that will earn him financial compensation.
Beyond these 200 hours, and if necessary, the Authority proposes to allow Nega and the electric company to cut down existing and new facilities while fully compensating the manufacturer for cutting down, with the general public bearing the cost of the compensation, through the electricity bill. This is a new risk sharing mechanism between the producers, the electric company and the customers.
The public hearings were published on the Authority’s website, and will be available for public comments for three weeks.
The right to the new allocations will be given through a lottery
In order to ensure equality in access to the additional quota, the Authority publishes a temporary order according to which the order of examination of all applications for the connection and integration of new production facilities will be based on a lottery, starting from the date of the hearing and up to ten days after the decision. The Authority also proposes updates to verify the extent to which low-voltage renewable energy production facilities are integrated, so that the timetables for their establishment will be between one and three years in relation to the work required to integrate them into the grid, another step to increase the number of positive responses.
Chairman of the Electricity Authority, Amir Shavit: “A large number of departments in the Electricity Authority have been dealing with the issue day and night during the past months, and with great complexity they managed to bring about an optimal solution to the challenges that arose from the field in favor of connecting facilities to create green electricity.”
Chen Herzogthe chief economist at the financial consulting firm BDO and an expert on the energy sector, tells ‘Davar’ that “effective utilization of network resources must be based on using the network resource as a competitive economic resource. The Authority’s decision is a step in the right direction, but is based on arbitrary limitations and central planning, instead of creating incentives Economic ones that will allow market forces to operate. Instead of conditioning the establishment of production facilities on a certain connection to the grid, entrepreneurs should be reflected on the state of the network and allow entrepreneurs to weigh the chances and risks, and allow entrepreneurs to hedge these risks through participation in the wholesale electricity market, and the establishment of storage facilities according to economic considerations.”
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