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A First in Israel: Domestically Produced Solar Energy Receives $28 million Investment

Submitted By: Chathri Munasinghe · Mon, 12/13/2010 - 19:13
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ARAVA VALLEY, Israel—An Israeli company started work Monday on the country's first large-scale solar field, a sign that new government policies may be succeeding in drawing investors to the country's alternative-energy sector.

The official groundbreaking by Arava Power Co., which is partly owned by Germany's Siemens AG, came after Israel's Bank Hapoalim said earlier in the day that it would provide $22 million in financing for the $28 million project. While a relatively small sum, it represents the first significant vote of confidence by a major Israeli financial institution in domestically produced solar energy.

"We now feel quite comfortable that the risk is not high," said Tazhi Cohen, the head of Bank Hapoalim's corporate division.

The deal could boost confidence among investors here that the government is following through on its pledges to streamline regulations and policies that critics have blamed for discouraging alternative-energy investments. The bank approved the loan after the Israeli Electric Corp. committed last week to buying $70 million worth of energy from Arava Power over the next 20 years.

For more information on this deal see WSJ's full coverage: http://online.wsj.com/article/SB1000142405274870468180457601762303454408...

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