Israel to Continue Gas Exports, Energy Security Debated

A government committee, chaired by Energy Ministry Director General Yossi Dayan, has released its final report on natural gas policy, recommending Israel continue its existing policy of reserving gas for the domestic market while also pursuing exports, expanding exploration, and accelerating renewable energy transitions. The report, delayed for two years, estimates Israel's proven and contingent gas reserves at 826 billion cubic meters (BCM) as of early 2026, with projected domestic demand reaching 515 BCM by 2048 under a baseline scenario. While ministry officials highlight the report's projections of stable prices and low costs, citing potential state revenues of 300 billion shekels, some experts and the public are questioning the reliance on conservative forecasts that only guarantee supply for 20 years.

The committee's recommendations aim to break up market concentration and increase competition. These include reducing the domestic reserve requirement for smaller gas fields (under 50 BCM) to 15-25% to incentivize new developers, implementing an "Open Access" mechanism for export infrastructure, establishing a public trading platform for natural gas, and allocating funds from the "sovereign wealth fund" for renewable energy projects. The report also acknowledges the need to explore carbon capture technologies and establish a permanent inter-ministerial monitoring forum.

Director General Yossi Dayan emphasized the inter-ministerial nature of the committee's work, involving representatives from various government bodies, and stressed that finding new gas reserves is crucial. He stated that the conclusions are intended to form the basis for a balanced policy ensuring domestic needs, encouraging investment, fostering competition to combat the cost of living, and promoting a cleaner future. Dayan also noted that while companies estimate lower reserves, Israel must maximize its potential, and that current export levels, alongside domestic supply guarantees, strengthen Israel's regional standing.

Energy Minister Eli Cohen endorsed the report's findings, stating that they will significantly encourage gas exploration, with potential for over 100 BCM more gas in Israel's economic waters. He described natural gas as a strategic asset that bolsters Israel's political standing and economy, and the ministry is working to expand exploration and production for both domestic use and export while maintaining competition. When asked about market concentration, Cohen expressed hope that major energy companies like Chevron would participate in exploration, reiterating that new discoveries are key to achieving national goals.

Despite the optimistic tone from the report's leaders, energy experts express serious concerns. They argue that the committee's demand models are outdated and do not account for the dramatic increase in electricity demand expected from AI-driven data centers, transportation electrification, and industrial expansion. This increased consumption could deplete reserves faster than anticipated. Furthermore, internal disagreements are evident, with representatives from the Treasury, Environmental Protection Ministry, and Competition Authority advocating for a stricter supply surplus to prevent price hikes and shortages. Public advocacy group "Lobby 99" criticized the recommendations, calling them a "surrender" to energy insecurity and high gas prices, warning of future import dependency and urging the next government to make significant changes.