Israel Electricity Authority Slashes Solar Rooftop Payments Dramatically
Translated & summarized from Globes by baba
Israel's Electricity Authority will significantly reduce payments for new solar rooftop electricity generation starting in 2027, moving towards a market-based model. Tariffs for small rooftops will decrease by approximately 20% by 2030, and the guaranteed payment period will shorten. Medium-sized rooftop owners will be able to sign contracts with private suppliers, introducing competition. These changes aim to lower overall energy costs and reduce government subsidies.
The story in 6 lines · by baba
- Israel's Electricity Authority will drastically cut payments for new solar rooftop electricity generation.
- New solar installations from 2027 will see tariffs reduced by up to 20% by 2030.
- The guaranteed payment period for solar rooftop electricity will be shortened from 25 to 20 years.
- Medium-sized solar rooftops can now enter direct contracts with private electricity suppliers.
- Existing solar rooftop installations will maintain their current payment rates for 25 years.
- Incentives for energy storage will be eliminated, with reliance on private suppliers for storage solutions.
Israel's Electricity Authority is set to implement a significant reduction in payments for electricity generated from solar rooftops, moving towards a free market model from a long-term fixed tariff. For smaller rooftops, which will retain a guaranteed tariff for a shorter period, the rate will drop to 35.5 agorot per kilowatt-hour (kWh) in 2030, down from the current 48 agorot, subject to currency fluctuations. These changes will only apply to new solar installations starting in 2027, with existing systems continuing under their original agreements for 25 years.
Starting in 2027, the tariff for small rooftops (up to 15 kW) will decrease annually by 5%, resulting in an approximate 20% cumulative reduction by 2030. The tariff will also be influenced by the shekel-dollar exchange rate, with half of any currency shift affecting the price. For instance, if the dollar remains around 3.1 shekels, new installations in 2027 could see an 11% price drop compared to today.
The guaranteed period for the tariff will also shorten from 25 years to 20 years starting next year, aiming to encourage quicker installations. For medium-sized rooftops (up to 100 kW), such as those on schools and small commercial centers, a new model will allow direct contracts with private electricity suppliers. Owners can choose between a fixed rate from the grid or a market-based contract with a private supplier, supplemented by a decreasing government premium.
This new system is expected to incentivize private suppliers to develop their own solar installations. From 2028, applications for grid connections for rooftops over 15 kW will not be automatic but will involve competition, encouraging owners to waive parts of their premium to be prioritized for connection. The draft decision, open for public comment until November 10, also proposes eliminating existing incentives for energy storage, citing reduced costs and more efficient alternatives.
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