The risk of power outages this summer has been greatly reduced, after Dorad Energy Ltd., which is building an independent power station near Ashkelon, agreed to provide up to 600 megawatts of electricity during peak demand times if an electricity shortage develops. Dorad can reportedly begin generating electricity if necessary by the end of July.
Sources inform ''Globes'' that Dorad recently filed an application with the Public Utilities Authority (Electricity) to join the arrangements for load shedding, which the Authority publishes ahead of the summer. This is a mechanism whereby large electricity consumers, especially factories, receive a discount on their electricity bills in exchange for allowing Israel Electric Corporation (IEC) (TASE: ELEC.B22) to disconnect them from the grid during peak hours. In this way, IEC avoids initiated power outages, which cause far greater damage. Payment to the enterprises can reach NIS 6 per kilowatt/hour.
The mechanism established with Dorad works in the opposite direction: Dorad can supply electricity to the grid according to the value of the electricity set in the load shedding mechanism. Applying the mechanism is subject to the consent of the parties to each power outage, or power supply, in Dorad's case.
Dorad will join independent power producer OPC Rotem Ltd., owned by Israel Corporation (TASE: ILCO), which came on line last week. Dorad, which will have Israel's largest independent power station, with a capacity of 850 megawatts, is owned by Eilat-Ashkelon Pipeline Company (EAPC), Turkey's Zorlu Industrial, Dori Group Ltd. (TASE: DORI), Ellomay Capital Ltd. (AMEX: ELLO), and Edelcom Ltd.
Dorad's power station is due to begin commercial operations by the end of 2013. It is being built on land owned by EAPC near Ashkelon at a cost of $1 billion. It is in the final stages of construction, after the installation of its 12 50-megawatt gas turbines.
Published by Globes [online], Israel business news - www.globes-online.com - on July 8, 2013
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