05.07.2009

Concept of setting up a power station to run on the methane gas extracted from a landfill. Methane gas is produced over a process of years from a landfill and enables to profit from available energy whilst preserving the environment

Israel Electric Corp. is the sole integrated electric utility in the State of Israel and generates, transmits and distributes substantially all the electricity used in the State of Israel. The State of Israel owns approximately 99.85%of the Company.

As of December 31, 2009, IEC maintains and operates 17 power station sites (including five sites for steam driven power stations) with installed generating capacity of 11,664 megawatts. Each Company power station site has one or more separate units to generate electricity, leading to a total of 59 generating units, of which 20 are steam powered and 39 gas turbines (of which 14 industrial gas turbines, 16 jet gas turbines, 8 combined cycle gas turbines and 1 industrial gas turbine for future operation in the combined cycle format).

IEC’s steam driven generating units produce electricity with steam turbines and include carbonic units powered by coal and/or fuel oil, steam units driven by fuel oil and/or natural gas, jet gas turbines driven by diesel only and industrial gas turbines driven by diesel and/or natural gas.

Integrated resource planning (IRP) is a planning process for electric utilities that evaluates many different options for meeting future electricity demands and selects the optimal mix of resources that minimizes the cost of electricity supply while meeting reliability needs and other objectives. With traditional utility planning, planners take into consideration the demand to be met, the reliability to be achieved, and applicable government policies and regulations. The planner then selects the types of fuels, power plants, distribution systems and patterns, and power purchases that will meet these objectives with minimum revenue requirement (the revenue the utility must collect to finance and operate the power system). Options are selected only from the supply side (options to supply more power) as opposed to the demand side (options to reduce electricity demand) of the electricity system. IRP however, attempts to take the traditional planning approach several steps further. It strives to: (1) Evaluate all options, from both the supply and demand sides, in a fair and consistent manner; (2) Minimize costs to all stakeholders (and not just costs to the utility); (3) Create a flexible plan that allows for uncertainty and permits adjustment in response to changed circumstances. The traditional goals of utility planning are reliable service, economic efficiency, environmental protection, and equity. Reliable service necessitates the balancing of customer and investor interests (i.e., balancing the quality of service against cost). Equity necessitates the additional balancing of the interests of the various customer classes as well as the interests of present and future generations. IRP makes it easier to strike a balance among these traditional goals by considering all supply and demand options as potential contributors and by integrating them into a common framework. The result is an opportunity to achieve lower overall costs than might result from considering only supply-side options. Furthermore, the inclusion of demand-side options presents more possibilities for saving fuel and reducing negative environmental impacts than might be possible if only supply-side options were considered. However, while DSM programs are one important aspect of an IRP, an IRP is much more than DSM programs. An IRP will also usually include many supply-side measures, ranging from traditional power plants to more innovative sources of electricity supply such as power purchases, independent power plants, cogeneration, and renewable energy sources. >

An alternative to achieving efficiency improvements in conventional pulverized coal-fired power stations is through the use of gasification technology. IGCC plants use a gasifier to convert coal or other hydrocarbon feedstock into gaseous components by applying heat under pressure in the presence of steam. In Integrated Gasification Combined-Cycle systems, the syngas is cleaned of its hydrogen sulfide, ammonia and particulate matter and is burned as fuel in a combustion turbine (much like natural gas is burned in a turbine).

The IGCC process uses a combined cycle format with a gas turbine driven by the combusted “syngas,” while the exhaust gases are heat exchanged with water/steam to generate superheated steam to drive a steam turbine. Using IGCC, more of the power comes from the gas turbine. The process, which is used in countries like the UK, supposedly creates less sulfur gas due to it being “cleaned” by burning the gasses with either oxygen or air. While the process is said to be better for the environment than ordinary coal or fuel oil plants, it still results in creating gasses that contribute to global warming.

The installed capacity of a power plant is either its nameplate capacity or its actual capacity. The total electricity installed capacity of a country is all the electricity capacity in place when all the plants are available for operation. The installed capacity of an electricity utility is required to meet all the electricity demands of the country. De facto, there is a gap between the installed capacity and the available capacity, since stations needs to be shut down at times for both planned maintenance work and non anticipated problems.

Electricity capacity that is totally or partially out of service during peak hours due to either maintenance outages or planned outages or for other reasons such as environmental restrictions, extensive modifications or repairs