A BrightSource-led consortium has won a tender to build a 121MW concentrating solar power (CSP) plant in Israel, with power generation slated to commence by 2017.
The Magalim Concentrated Solar Power consortium of BrightSource Energy Inc. and France’s Alstom SA (Euronext: ALO) has won the BOT tender to design, finance, build, and operate the solar thermal power plant at Ashelim, the Ministry of Finance and Ministry of Energy and Water Sources tender committee announced today.
The announcement brings to a successful close the two tenders at Ashelim, Israel’s flagship solar energy project.
The government is still in talks with the Negev consortium, comprising Shikun & Binui Holdings Ltd. (TASE: SKBN) and Spain’s Abengoa SA (IBEX: ABG), which was delayed after Shikun & Binui’s original partner Siemens Solar Thermal Energy quit the tender last month, when Siemens AG (NYSE: SI; DAX: SIE) decided to quit the solar energy business.
Magalim will build one of the world’s largest thermosolar energy plants in the world – a 121 megawatt plant at an investment of $600-700 million. The plant will use solar tower technology. The tenders committee set a realistic electricity rate of NIS 0.79 per kilowatt/hour in the tender. The price is less than the norm for thermosolar energy in Israel and the world.
The tender, which attracted considerable international interest, took five years from the presorting stage in 2008. Multinationals bidding in the tender dropped out during the process, except for BrightSource, which brought in Alstom, one of the world’s largest power station builders, as a partner.
BrightSource, run by Israel Kroizer, is the incarnation of Jerusalem-based Luz II Ltd., a thermosolar energy pioneer. The company, owned by Alstom and US investors, is building three solar energy plants in California’s Mojave Desert with a total capacity of 400 megawatts. The design, management of the supply chain, and manufacture of the electronic components are carried out in Israel.
The tenders committee, chaired by Deputy Accountant General Yariv Nechama, said that the main advantage of thermosolar energy was its high reliability, making it a real alternative to power stations run on fossil fuels, compared with other renewable energy sources.
The Ashelim thermosolar power station is due to come on line in mid-2017. It will join the second Ashelim thermosolar power station of the same size and the 30-megawatt photovoltaic power station. Altogether, the power stations will provide 2% of Israel’s electricity production, and will be an important milestone to meeting the government’s target of producing 10% of the country’s electricity by renewable energy by 2020.
Megalim has promised to build the thermosolar power station within three years of winning the tender. It will operate the power station for 28 years, when it will revert to government ownership.
Ministry of Energy director general Shaul Tzemach said, "Winning the tender at this time is a vote of confidence in the Israeli economy, especially in its renewable energy market, which, despite all the difficulties, continues to establish itself as competitive, efficient, and innovative at the global level. The Ministry of Energy and Water Resources will continue to act with determination to meet the government’s renewable energy targets."
Accountant General Michal Abadi-Boiangiu said, "Construction of the thermosolar power station at Ashelim will be a big and important step toward realizing the government’s target for electricity production by renewable energy, while leveraging the private sector’s technological creativity and innovation, reflected in the BOT tenders promoted by the Accountant General’s Office."