SIEMENS TAKES SUN TO KIBBUTZ

Siemens backs Arava Power for biggest solar PV project in Israel; German firm pays $15 million for a 40-percent stake of the only company in Israel to have a permit to develop photovoltaic plants.
Emma Ritch, August 28, 2009 (Cleantech Group)

"Israel's Arava Power… sold a 40-percent stake to Germany's Siemens Project Ventures for $15 million, establishing a valuation of about $37.5 million for the solar photovoltaic power developer.

"…[Arava Power has 10-to-20 employees and] has the only license from the Israeli government to develop photovoltaic solar projects…The license gives Arava, founded in 2006, a head start against would-be competitors…"

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"Arava plans to start by developing a 4.9-megawatt solar photovoltaic power plant at an 80-dunam (861,000-square-foot) site in Kibbutz Ketura in the Arava desert…The company previously priced the project at NIS 120 million ($31.2 million), but…hardware costs are dropping so quickly that the company plans to revise that cost estimate.

"Arava has secured development rights to a number of sites in Israel…Arava has also been approved to build a 40 MW PV solar plant…[T]he 4.9-MW power plant can be built in several months, but the company and its competitors are awaiting word on the value of the country's feed-in tariff for solar…[T]he government announcement detailing the tariff for medium plants is 'imminent.'"

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"Israel Electric has proposed paying NIS 1.98 ($0.50) per kilowatt-hour for solar installations up to 50 kW—four times the going price of electricity for consumers. The tariff for installations larger than 50 kW but smaller than 5 MW is still being decided, but it’s currently expected to be about NIS 1.58 ($0.41)…The National Infrastructures Ministry said the tariffs are designed to help Israel reach 10 percent of energy supplied by renewable sources by 2020.

"The country's largest solar installation—just 50-kilowatts—was connected to the grid in December as part of a joint venture of Wuxi, China-based Suntech Power Holdings…[and] Israel-based [Ramat Gan/Solarit Doral]… Arava's advantage against its competitors is not a technological one…[but its] expertise in understanding the necessary laws and approvals to build large energy projects in Israel…Siemens is the only institutional investor to date in Arava [and the largest-ever by a foreign company in an Israeli solar developer. It]…has experience working in Israel, and with Israel Electric…"