Gross Potential of the Residential Segment of the Israeli PV market is at least 3 Billion €
Posted by Budyansky (budyansky) on 30-07-2010
Business News >> Business news

On July 28 Israeli Public Utility Authority has released the continued regulation for residential and small commercial grid connected rooftop PV systems. As in the first quota, the regulatory framework limits maximal installation capacity per system: for the residential facilities it is allowed to install PV rooftop systems up to 15 KWp; and for the small commercial up to 50 KWp. The interesting fact is that PUA decided not to limit the quota of the residential plants.

This regulatory decision opens a unique window of opportunity for module, inverter and other components manufacturers as well as for dozens of the Israeli system integrators. For instance, according to the Israeli Statistical Bureau, in Israel just in the period between 1995 – 2008 were built more than 200,000 private houses. Thus, relying on this data, even with the minimal installation of only 4KWp on private roofs, the gross market potential could be measured as least as 800 MWp.

With an average cost of 4 KWp PV system (16,000€), companies' profits from sales of only the necessary equipment (modules, inverters) are reaching, by the most modest calculations, 3 billion €. This is only partial, very minimalistic counting, but if we'll try to calculate the total amounts of financial capital that should be involved (and will be involved) in Israeli solar market after the implementation of new regulation, the numbers will be much higher.

Taking into account 10-months long Israeli summer (in some areas the sun shines all year long almost without any interference), well developed infrastructure, different financial aspects like insurance, banking, loans, etc., we can understand that in some further months there will an "Israeli solar rush hour" accompanied with huge amounts of capital.

For an average Israeli the information above indicates the possibility of obtaining a stable income from fast-investment. Simply saying, investing about 80,000 NIS (appx. 16,000 €) in an average PV 4KW/p system (including installation and insurance), the consumer will receive annual profit of 15,000-16,000 NIS. This calculation brings us to 5 to 6 years ROI and overall income (20 years) of 300,000 – 320,000 NIS (app. 60,000 – 64,000 €)

For the PV manufacturer or distributor, the above information means that now is the real "money time" for investing in business development, marketing and sales in this emerging market. In addition to the growth of the market, additional factor should be taken into account: all the needed equipment is imported either by local offices of foreign manufacturing companies, distributors or directly by the system integrators.

"The Israeli market for solar energy is one of the most attractive in the world today. Being in constant growth since 2008, due to the careful attention of the state authorities and the current "green tariff", with the introduction of the current quota, Israeli market automatically becomes even more attractive for investment," - said Vladimir Budyansky, CEO of Quantum Business Group. "Now is precisely the time when companies can take the leading positions, investors get the maximum benefits, and consumers make their real estate to work for themselves."

Vladimir was one of the first who noticed the trend of growth and high potential for development of the renewable energy industry in Israel. His company Quantum Business Group this year organizes an international business platform focusing on Israel and other emerging markets. The event, EnergyTech 2010, is for wide professional audience of manufacturers, distributors, EPCs, system integrators and installers, land and roof owners, investors and officials.

EnergyTech will open its doors on 27-28 of October in Trade Fairs and Convention Center, Tel-Aviv. The uniqueness of EnergyTech 2010 is in its premiership of this kind of event in Israel. It is a large-scale business platform, focused only on renewable energy and energy efficiency. It is difficult to overestimate the importance of this project for the Israeli, Middle Eastern and Southern European markets. The exhibition will present more than one hundred companies from around the world and the latest achievements and technologies in the field of photovoltaics, solar thermal energy, wind power, bio-gas technology, bio-fuels and others.

The conference, entitled "PV Power Plants", which will be held during the exhibition, will bring together experts and professionals from different countries and different specializations around the most interesting discussions. Also, special attention is devoted to the political aspects of the emerging markets. For this purpose, the organizers took care to invite several Israeli ministers, politicians and officials from various countries, representatives of the European Union.

Last changed: 30-07-2010 at 4:15 PM