Natural Gas and Israel's Energy Future

Israel's electric-power system needs new capacity to meet the demands of its growing economy. Israel must make major decisions on investing in new base-load generating capacity in the near future. Planners and policymakers need to consider likely future levels of demand, the costs and availability of sources of supply, security of supply, reliability, environmental effects, and land use. Decisions have to be made under conditions of deep uncertainty about what the future may have in store. This monograph discusses the opportunities and risks the government of Israel faces in shifting to a greater reliance on domestic and imported natural gas. The analysis seeks to help the Israeli government engage in managed change by choosing robust strategies that minimize potential consequences of relying more heavily on natural gas. It does so by applying to these assessments newly developed methods for strategic planning and decisionmaking under deep uncertainty. In particular, the study applies an innovative, quantitative robust decisionmaking (RDM) approach to the central question of how large a role natural gas should play in Israel's energy balance. Rather than relying on the typical planning method of trying to develop plans around a small number of “most likely” scenarios, RDM helps planners discover strategies that are robust — i.e., strategies that perform well across a large range of plausible futures. Given that we cannot predict the future, we use RDM to examine the available alternatives and ask which would be best to choose.

Please note: The printed version of this report includes the Hebrew translation.