Israel has set a goal of having 10 percent of the energy it consumes coming from renewable sources by 2020. But there is still some disagreement within the government on how best to proceed, which could delay Arava’s plan.
Arava, which is 36 percent owned by German conglomerate Siemens, said it secured 80 percent of the funding for the Keturah plant from Bank Hapoalim, Israel’s second-largest bank.
“Arava plans to build nearly 50 solar fields for well over 400 megawatts, an investment cost of roughly $2 billion,” David Rosenblatt, the company’s vice chairman, told Reuters.
With backing from Siemens, he said, the company is confident it will raise the money without a hitch.
Siemens Israel President Eliezer Tokman said Siemens “certainly sees Israel as a country with high potential for solar energy.”
He said the business model was attractive because of the relatively secure income, which will come from the state-owned Israel Electric Corp.
The electric company will pay 1.52 shekels (45 cents) per kilowatt-hour from the Keturah plant over 20 years, but that price could drop to as low as 1.08 shekels when the larger plants are in place, Arava said.
The company said it has signed agreements with communities and even with Bedouin families in the Negev to build on their land, but it still needs the government to increase its official quota on solar fields.
The Infrastructure Ministry, which is ultimately responsible for the matter, has decided to allow hundreds of additional megawatts of electricity to come from solar fields. But the Finance Ministry has been holding up the move.