“Israel can become a global powerhouse in solar and photovoltaic energy,” says Prof. Gershon Grossman, of the Department of Mechanical Engineering at the Technion - Israel Institute of Technology, and head of the Center for Research in Environmental and Water Resources Engineering. “What prevents this is a lack of government awareness, problematic legislation, and the fact that ministers at the Ministry of National Infrastructures are constantly rotating, and aren’t really interested in the field.”
Photovoltaic tehcnology converts solar energy into electricity. A photovoltaic cell is built from two layers of silicon. The upper layer has an extra electron, and the lower layer lacks one. Solar rays create an electrical current between the layers, which can be stored in a battery. The disadvantage with this method is the cells’ low efficiency (10-15% conversion), their high price, and the need for a large area of receptors.
Grossman’s comments were made in the same week that Israel Electric Corporation’s (IEC) Reading power station in Tel Aviv was switched to natural gas. This ought to have been a happy event, since natural gas is less polluting than other fossil fuels, and costs the state’s treasury less. Each day that Reading burns natural gas instead of crude oil saves $380,000.
We shouldn’t be too cheerful, however, since natural gas is also a fossil fuel that still pollutes, albeit a little less that other fuels. In contrast, the proper exploitation of alternative energy sources, such as solar, wind, and wave power, will avoid pollution, and the day will come, so it is hoped, that they will also save money.
It is very important to generate power from non-fossil fuels, because burning fossil fuels pollutes the air, increases mortality, damages the ozone layer, and contributes towards global warming. Global warming changes the world’s climate and has scary consequences for the land: melting glaciers, rising sea levels, floods, droughts, higher morbidity, and so on.
Grossman says, “The most interesting source of alternative energy on earth is the sun. There are few countries in the world whose conditions are so good for exploiting this energy. We have few cloudy days, and no less important, the temperature in the country rarely falls below freezing. That means there is no risk that installations will freeze, which happens in Europe. The most worrying problem is that, until a few years ago, when solar water heaters reduced electricity consumption by 3%, we were the leader in the field. Now we lag behind.”
“In the late 1970s, then-US President Jimmy Carter declared that his national goal was to achieve in 2000 what Israel had achieved long before. Today, while the rest of the world has made great progress in this area, we’re standing still. Although we’re still the leader in home solar water heaters, we lag far behind in other areas.”
Solar systems for tax purposes
“Globes”: What happened to the industrial sector?
Grossman: “Industrial use of solar energy is zero, even though industry is the most suitable consumer of this energy. Industry mostly operates during the day, when the sun is shining, so it doesn’t need to store energy. Factories’ roof areas are usually large enough to position solar receptors. Furthermore, industry is ideal for the manufacturers, too. The sale of a single system to industry equals the sale of hundreds of home units. Industry can also carry out small-scale maintenance, so it doesn’t have to buy expensive systems with long-term warranties.”
If that’s the case, why doesn’t it happen?
“There are all kinds of reasons. For example, fuel is recorded as a business expense. Existing tax laws do not take into account solar systems for tax purposes. I believe that a simple act, such as changing the tax structure, will make solar installations much more attractive.”
For whom are solar installations suited?
“Although these systems are not suitable for a steel mill, which needs furnaces capable of achieving thousands of degrees, they are suitable for food, textiles, chemicals, and cosmetics plants that need water temperatures of up to 90 degrees. With a little development, the temperature can be raised to 120 degrees. I don’t mean that they’ll be able to throw away their boilers and switch to solar power only tomorrow, because factories will need boilers on sunless days, but we can, and should, deploy differently. Instead of continuing to burn dirty fuels, industry can begin to cut its dependence on oil, and save the economy a lot of money and pollution.”
How much are we talking about?
“If factories begin to use solar energy just to heat water, it will save the economy NIS 5-10 billion a year.”
The big mission: Producing electricity from the sun
Two methods are now known to produce electricity from solar power. The first is the thermal method, which uses solar receptors to generate heat, which is transferred to a generator. The second method is photovoltaic energy. Israeli company Luz was a pioneer in the thermal sector. It built a 500-megawatt (MW) power station in California’s Mojave Desert, but went bankrupt when the California state government cancelled the incentives. Solel Solar Systems Ltd. continues on Luz’s path, and now has plans to build a solar station in Israel.”
What’s delaying you?
“The price of fuel, which was quite low until now, made the facility economically unviable. The cost of solar energy is $0.11-0.13 per kilowatt/hour (kwh). The cost of electricity produced by coal is $0.04 per kwh, and the cost of electricity produced by diesel is $0.07 per kwh. That’s the whole story.”
If the cost of externalities, such as air pollution, mortality, and destruction of the planet, were taken into account, would the results be different?
“If by developing the technology, we can cut the cost of solar energy to $0.10 per kwh, and at the same time compensate for the external costs by $0.03 per kwh, we’d be set. The problem is that there’s a great argument about the cost of the externalities that will take a long time to resolve. The question what is the price of a sick or dead person has not been answered anywhere.
“Regrettably, until now, no serious work has been done on the cost of the externalities, and the matter has been left hanging in the air. For example, the Public Utilities Authority (Electricity) announced that it was prepared to pay a premium of $0.02 per kwh for non-polluting energy. That very low, and until that changes, the chances of developing the sector are low.”
Are there technological developments on the horizon that will make the sector sexier?
“Regrettably, there are no breakthroughs in the sector. The problem is that there is a need for a learning curve, but as long as no installations are built, or they are only built infrequently, there’s no learning and no development.”
Is the case similar to that of desalination, which became popular when the price fell?
“Sort of. When the price for non-polluting energy falls, it will become more popular. If oil and coal prices continue to rise, the sun will become economically viable.”
What’s the state of photovoltaic technology?
“A photovoltaic system is based on semiconductors, which can be placed almost anywhere, on house roofs or poles. Another advantage is that the technology converts solar energy directly into electricity, in contrast with thermal technology, which requires a generator.
“The bad news in the sector is that we’re still in the range of $0.30 per kwh, which is very high. The good news is that, in contrast to the solar sector, here there’s a chance for a significant breakthrough. Photovoltaic cells currently operate at 15-17% efficiency, compared with 40% for coal or crude oil. We’re about to develop multi-junction cells, which can achieve efficiency of 50%. The price of this technology is still high, but it will come down.”
If there’s a breakthrough where will it be? What has to be done to make it happen?
“I believe that the breakthrough will be in these cells. The problem is that you’ll have to be patient.
“Investors will have to enter the field, and, just as important, governments will have to show interest. Germany already requires electricity companies to buy alternative energy, and pay a tariff of €0.50 per kwh, five time what consumers pay. At the same time, the state compensates producers in other places. As a result, Germany has passed Japan in photovoltaic cell production. There are rumors that the Germans did this to help Siemens AG (NYSE:SI; XETRA:SIE), but I think that, even if this is true, there’s nothing wrong with it, because Siemens is a leader in the field.”
What’s the global business potential of this sector?
“Regrettably, countries with a lot of sun don’t have enough money. But there’s a very large market in the US, Mexico, South America, and parts of Asia.”
Who is responsible for raising awareness?
“It’s the responsibility of the Ministries of Finance, National Infrastructures, and the Environment. These ministries should set up a committee to promote the issue. Everything begins and ends with economics.”
What do you propose?
“Set up a body that will include all the entities operating in the energy sector. This body will learn from experience accumulated worldwide, and reach conclusions about what suits the conditions in Israel, and what doesn’t. Since the government hasn’t picked up the gauntlett, the time has come to interest the Knesset, which might initiate legislation on the matter. After the laws are passed, investors will come.”
Published by Globes [online], Israel business news - www.globes.co.il - on July 19, 2006
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