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Cablegate: Israel Makes Progress On Desalination Substitution

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RR RUEHAST RUEHDH RUEHHM RUEHLN RUEHMA RUEHPB RUEHPOD RUEHSL RUEHTM
RUEHTRO
DE RUEHTV #2149/01 2731518
ZNR UUUUU ZZH
R 301518Z SEP 09
FM AMEMBASSY TEL AVIV
TO RUEHC/SECSTATE WASHDC 3638
INFO RUEHJM/AMCONSUL JERUSALEM 2882
RUEHAM/AMEMBASSY AMMAN 6638
RUEHZN/ENVIRONMENT SCIENCE TECH COLLECTIVE
RUEHRC/DEPT OF AGRICULTURE WASHDC
RHMFIUU/HQ EPA WASHINGTON DC

UNCLAS SECTION 01 OF 02 TEL AVIV 002149

SENSITIVE
SIPDIS

STATE FOR OES/ENV, NEA/RA, NEA/IPA
USDA FOR FAS/ICD/RSED
AMMAN FOR ESTH - BHALLA
EPA FOR INTERNATIONAL

E.O. 12958: N/A
TAGS: SENV ENRG EINV IS
SUBJECT: ISRAEL MAKES PROGRESS ON DESALINATION SUBSTITUTION

1. (U) Summary: Now entering its fifth year of substandard
rainfall, Israel is making notable progress in substituting
desalinated sea water for natural source fresh water for public
consumption. Expanded production from existing seawater facilities
should reach 160 million cubic meters (mcm) annually shortly, with
an additional 36 mcm of water from brackish water desalination
operations. A new seawater desal plant in Hadera will add 127 mcm
in phases starting by the end of 2009. Capacity for another 250 mcm
is at the tendering stage, and a further 50 million mcm is under
review for future action. By 2013 Israel should have about 578 mcm
of desalinated water per year available - 75 percent of household
consumption needs. This will come at the price of heavy demand on
the country's power infrastructure, however, which is very dependent
on foreign energy sources. This additional power demand will have a
negative impact on Israel's CO2 emissions, making potential climate
change gas reduction targets harder to achieve. End Summary.

Good News on the Water Front
----------------------------

2. (U) ESTH officer recently toured Palmachim desalination plant,
opened in 2007, that presently desalinates 30 mcm per year.
Executives of Global Environmental Solutions (GES), the
Israeli-based company that constructed the Build-Operate-Own
project, said it is undergoing a 50 percent expansion, to produce up
to 45 mcm annually. The expansion will take up to a year to
implement. The Israel Water Authority has also asked the
French-Israeli IDE group that operates the Ashkelon Desalination
facility, a BOT operation that came on stream in December 2005, to
increase its capacity. Ashkelon will move from 100 mcm to 120 mcm
per year once additions are completed. Before the end of 2009, a
new plant located in Hadera will start to produce desalinated water,
initially 100 mcm annually to be expanded to 127 mcm in coming
years.

3. (U) On September 9, the European Investment Bank, which is the
European Union's long-term investment arm, announced that it will
provide about half of the financing for the Ashdod desalination
plant, a facility in the tender phase which is expected to provide
100 mcm by the end of 2012. EIB financing of NIS 1.5 billion (USD
400 million) is important as the EIB's low interest rate will lower
the final price of the water produced. Financial closing for the
Ashdod facility, which will be a BOT operation, is expected in March
2010. The EIB has also expressed willingness to offer financing for
a desalination facility at Sorek that will produce 150 million cubic
meters annually. The Sorek plant is in the tender process and
should also start operation in 2012.

4. (U) In sum, by the end of 2010 Israel may have as much as 292 mcm
of desal water available, some 38 percent of consumer use fresh
water consumption. If planned constructions keep to schedule, a
total of 578 mcm of manufactured water may be available by 2013.
Given that Israel's domestic household consumption use of water in
2007 was 767 mcm, desalinated water will cover more than 75 percent
of household fresh water needs. This represents 37 percent of total
water use, the balance being agricultural use at 57 percent and
industrial use at 5.7 percent of the total, whose needs can be
filled in part by treated wastewater. The fall in demand on
natural freshwater supplies may be more than the exact counterpart
amount, in fact, because of the high rate of wastewater recycling in
Israel. With nearly 80 percent of first use freshwater captured,
treated, and reused for agricultural or industrial purposes, each
gallon of desalinated water can replace 1.8 times the volume of
direct-use natural fresh water. Authorities hope this will relieve
the stressed and over-pumped rivers, springs, aquifers and Lake
Kinneret.

The Good News is the Bad News
-----------------------------

5. (SBU) While water self-sufficiency would be good news, it comes
at a high price. Desalination requires large amounts of energy to
pump sea water through reverse osmosis membrane filters. These
filters trap the salts and minerals in a residual brine which is
returned to the sea. Achieving up to 80 bars of pressure for
desalination is costly, even with the recapture of some energy
through an innovative system that improves the energy efficiency of
the process by 60 percent. The Ashkelon desal plant was constructed
with its own natural gas-fired generating plant, so as to be
independent from the public grid. Officials at the Ministry of
National Infrastructure acknowledge that the energy demands of
desalination impact their plans for augmenting generating capacity
in the Israeli grid. Each cubic meter of desalinated water needs 4

TEL AVIV 00002149 002 OF 002


to 5 kilowatt hours of electricity to produce - the major cost
factor in production. Estimates of the energy needs for all the
desalination capacity present and planned run from 3 up to 6 percent
of total national power. Israel already expends five percent of its
total energy capacity pumping water around the country.

6. (SBU) Last year Israel tendered its first major solar power
plant, and passed regulations creating an incentive structure for
renewable energy producers to feed-in to the national grid.
Nonetheless, conventional sources like coal (69%), natural gas
(20%)and fuel oil (9%) still provide most of Israel's electric
energy. The national goal is 10 percent of alternative energy by
2020. So far only four of the 12 major power plants have been
converted from coal to natural gas. The discovery of the Tamar
natural gas field, holding 88 billion m3, off Israel's Mediterranean
coast near Haifa may help speed other conversions, but CO2 output
from power generation will rise regardless of its coal or gas
source. The director of a leading environmental NGO in Israel
estimates that the current and new desalination facilities will
together increase Israel's CO2 emissions by 4 percent due to their
energy needs.

7. (SBU) Comment: Israel's quest for desalinated water capacity is
putting in jeopardy its ability to achieve any actual reduction in
CO2 emissions. Although Israel has not officially committed itself
to an emissions reduction target, the country's growth in water
desalination capacity, its growth in consumer electric energy demand
(4-5 percent most years), and growth in population (about 2 percent
annually) imply that a reduction in the absolute output of emissions
(compared to a decline in the relative rate of growth) may be very
difficult to achieve. Additional sources of CO2 and other GHGs such
as the transportation and the building/housing sector also
contribute substantially to Israel's emissions. However improving
vehicle mileage and building heating/cooling efficiency progresses
slowly, as these are not point sources and implement requires
several years. Nonetheless, Israel's population has responded well
to previous calls for conservation, reportedly saving 15 percent in
consumer water usage over the past year, and may do so again. A
campaign dedicated to water, electricity, and lifestyle conservation
may modify the present path which is leading towards a trade-off
between water sufficiency and climate change emissions reductions.

CUNNINGHAM

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