Every household saved more than $33,000 over the past decade thanks to the discoveries off the coast.
By JNS
Israel’s economy saved more than 316 billion shekels (~$86.7 billion) over the past decade thanks to its “natural gas revolution,” according to an in-depth study released on Tuesday.
That reflects a savings of more than NIS 120,000 (~$33,000) for every family in Israel over the past decade, according to the report by economic consulting firm BDO and the Israeli Natural Gas Trade Association.
The report also found that the price of electricity in Israel was nearly 50% lower than in Europe at the end of 2022 due to the country’s use of its offshore natural gas.
The NIS 316 billion savings, based on an analysis of public data published by Israel’s Ministry of Energy, Ministry of Environmental Protection and other entities, can be divided into two categories: savings of NIS 126 billion (~$34 billion) in energy costs derived from natural gas and environmental benefits amounting to NIS 190 billion ($52 billion) resulting from the use of natural gas over more polluting fuels.
During the past decade, more than NIS 19 billion ($5 billion) in gas revenue has been paid directly to the state treasury—14 times more than in the previous decade.
By 2030, an additional NIS 70 billion (~$19 billion) of natural gas funds are forecast to be paid into the state treasury, the report said. By 2050, that figure is expected to rise to more than NIS 300 billion (~$82 billion).
Gas production rose fivefold in the last decade compared to the previous one. Israel’s natural gas reserves have also grown.
In 2012, Israel’s reserves stood at some 780 billion cubic meters (BCM) of natural gas. In 2022, that figure reached 1.087 billion BCM as more natural gas discoveries were made in Israel’s economic waters and the assessed volumes of the fields were updated.
Israel is the leader in saving gas for the future among Organization for Economic Cooperation and Development (OECD) members, the study said. The rate of gas production is about half that of the largest producers in the OECD.
According to a 2015 report by the Ministry of Energy, there’s potential for discovering an additional 2,100 BCM of natural gas in Israel’s economic waters, which would triple the current reserves.
“Israel is ranked third among OECD countries in terms of reserves per capita and enjoys a relative advantage in the use of natural gas for domestic consumption and export,” said Chen Herzog, chief economist and partner at BDO Consulting Israel, who authored the report.
“Now is the time to enjoy this advantage through using natural gas in the domestic economy and expanding exports,” he added.
Amir Foster, executive director of the Israeli Natural Gas Association, said the Jewish state must continue to develop local production capabilities and export infrastructure so it can “break out beyond the regional arena and become an important international energy supplier.