The Electricity Revolution – the Competition in the Electricity Sector is Reaching Every House in Israel
For the first time since the State's foundation, the electricity sector will be opened for competition in the summer. All residents of Israel will be able to choose their power provider and their electricity prices will decline, saving each family hundreds or even thousands of Shekels each year.
Good news for consumers: Minister of Energy and Infrastructure Eli Cohen decided today (Tuesday 13.2.2024) to launch a historic reform which will change the Israeli electricity sector forever.
As part of the consumer reform, the electricity sector will be opened to full competition, within which a variety of companies will be able to sell electricity to all households in the country. The move, which will create competition in power supply for the first time since the State's foundation, is expected to lower electricity prices for all families in Israel by an estimated 5-20 percent, and will save each household hundreds or even thousands of Shekels every year depending on the profile of use of electricity and the hours in which the power is consumed.
Minister of Energy and Infrastructure, Eli Cohen: "The electricity revolution which we have launched by opening the electricity sector to competition is enormous news for all residents of Israel and it will lead to savings of hundreds or even thousands of Shekels each year in electric bills. I believe electricity is a basic and critical consumer product in the life of every Israeli household. For this reason, it was important to me to remove all obstruction to allowing full competition. In the coming summer, we will allow all families in Israel to choose their electricity provider, and we will give all consumers an equal opportunity to take part in the reform and to lower the electric bill".
Chairman of the Electricity Authority, Mr. Amir Shavit: The authority is acting to promote competition and remove obstructions to competition – like the issue of the mandatory smart-meters. The reform is good news both for the consumer public and to the private companies providing power. The Electricity Authority will continue to promote competition on the production and storage sides as well, within a market model with a comprehensive view for an efficient, reliable and clean electricity sector".
Shaul Goldstein, C.E.O. of Noga: "The Minister of Energy's announcement on the opening of the electricity market to competition, quickly and independently of changing the basic meters to smart ones, will greatly advance competition in the electricity sector. This competition may lead to savings for consumers as well as a sector-wide improvement in efficiency. The State of Israel is at an economic crossroads and such a move may contribute to strengthening the economy and lowering the cost of living. There are currently approximately 3 million meters, of them about 700 thousand are smart and the rest are basic. If all consumers receive a discount of only 5%, it will collectively save the consumers approximately 750 million N.I.S. annually. We at Noga believe that this is very good news, after which we will be able to continue and develop, together with all partners, the competition which will drive the growth we need so much at this time".
C.E.O. of the Israel Electric Corporation, Meir Spiegler: "the state wide distribution of smart-meters constitutes the basis for opening the power supply sector to competition. The Israel Power Corporation's directorate made a courageous decision in 2017 to begin the distribution of smart-meters. In early 2023, the corporation's board decided to accelerate the rate of smart-meter installation to double what it was in the work-plans for that year. As part of a policy which believes in free competition and the advantages derived from managing home and business power consumption using the smart-meters, we have shortened the original schedule according to which all meters will be installed by 2036, and have moved it forward to 2028. This is good news for consumers as well as producers which, through the use of advanced technology, allows each consumer to choose their electricity provider for the lowest price and also gives the Israel Electric Corporation the tools to recognizably improve the standard and quality of service, including automatic malfunction detection without the need to contact the call center. During 2023 alone, 427 thousand smart-meters were installed. The Israel Electric Corporation will continue to work to simplify processes, shorten schedules, enhance competition and commit fully to the right to serve the public".
Director General of the Ministry of Energy and Infrastructure, Yossi Dayan: "the move lead by the Minister of Energy and Infrastructure will promote Israel's electricity sector, open it to competition and lower the cost of living. This is only one milestone in a broad process of innovation which we are leading at the Ministry, and we aim to continue to promote meaningful reforms in years to come, while encouraging competition in all energy sectors. These steps, like the one we launched today, will lead to significant savings for consumers, contribute to economic growth and make the energy sector more efficient, economical and green".
With the launch of the reform, competition will open for the power supply segment, and as early as this summer every Israeli citizen will be able to call one of the private electricity providers and choose a package suited to their needs.
Until now, such transition between providers was only possible for consumers with smart-meters. Since smart-meters have not yet been installed in the vast majority of households, the Minister has ordered the Electricity Authority to allow the attribution of consumers even without a smart-meter.
This decision was made after, this January, private providers were allowed to purchase power directly from the power producers. Along with the reform which the Minister of Energy and Infrastructure has announced today, power providers will also be able to increase the efficiency of their energy sources. Thus, competition will increase and consumer prices will decline. Each family will be able to enjoy economical, flexible and smart power consumption.
