Modern reality dictates the consumption of energy that comes from the burning of fossil fuels, the combustion of which emits carbon dioxide into the atmosphere. Energy consumption in its current configuration leads to alarming phenomena in the immediate term such as air, water and soil pollution. In the long term, there is unanimity among the scientific community regarding global warming and damage to the ozone layer. The growing awareness of today's phenomena has led to the development of an industry known as cleantech ("clean technology") which develops products and services which role is to help preserve the quality of the environment and our office accompanies a number of companies engaged in this field.
Following the Kyoto Protocol to the United Nations Framework Convention on Climate Change ("Kyoto Protocol"), in which 141 countries pledged to reduce emissions of carbon dioxide and other greenhouse gases that lead to global warming, one can see that the production of electricity through renewable energies such as solar energy, energy produced from natural gas as well as energy produced from wind are gaining momentum - even if it seems that Israel, despite its large solar resources, still lags behind other developed countries.
Solar energy is produced by installing photovoltaic solar collectors that convert solar energy into electricity. The electricity sector regulations that were installed in 2005 state that private producers, who have received a supply license, can sell energy to consumers at the price of a long-arm seller to buyer transaction, thus encouraging the establishment of private electricity production facilities.
There are three categories of private producers: small producers (industrial plants and rooftops of residential apartments) - those operating a facility with a capacity not exceeding 50 MW, medium producers (rooftops in the working settlement) - operating a facility with a capacity exceeding 50 MW but not exceeding 250 MW and large producers (Stations in kibbutzim and moshavim on agricultural land or land without a specific use and purpose) - those operating a facility with a capacity exceeding 250 megawatts.
The environmental, social and geopolitical benefits inherent in solar energy production are self-evident. Furthermore, there are notable economic advantages, and small producers receive an incentive of ILS 1.97 per kilowatt when, as of 2009, the electric company (provided that it approved the producer within the framework of the very limited quotas assigned to the subject) undertakes to purchase the electricity at this price for 20 years.
The initial investment in the purchase of photovoltaic collectors is a significant investment, at the same time there are technological improvements that lower the cost of the collectors and we are witnessing the encouragement of the major banks in Israel to take out convenient loans for the purchase of the collectors. From the taxation aspect, an approach is accepted according to which an asset such as a solar energy production facility is a fixed asset in the business whose expenses will be reduced in an accelerated manner for tax purposes over the lifetime of the asset which is 25-30 years.
The investment payback period may even reach a short period of 4-5 years. However, not all that glitters is gold - the procedure for obtaining a manufacturer's license is long and not simple and the electric company is reluctant to distribute the licenses within the insufficient quotas that have been allocated. Moreover, the procedure requires financing, which requires financing agreements that will be drawn up carefully, especially when the license from the electric company has not yet been received, and for this reason extra caution is required and it is important to consult lawyers who are not only familiar with the field of renewable energy but also deal in the field of financing.
[i] Electricity Sector Regulations (conventional private electricity producer), 2005-2005, K.T. 6368.