BDI

Israel Electric Corporation Ltd.

Electricity Generation, Transmission, Distribution, and Supply

Profile

Founding Year 1923
Address P.O.B. 10, Haifa 3100001 - View Map
Phone 04-8182222
Fax 04-8186100
Social Networks
Company Website www.iec.co.il
   
   

About Israel Electric Corporation Ltd.


The Israel Electric Company ("IEC") is a government-public conglomerate that generates and supplies electricity to all economic sectors in Israel. The Government holds approximately 99.85% of its shares. Its activities include electricity generation, transmission, distribution, supply, and the sale of electricity to consumers. IEC owns and operates 15 power plant sites, of which 50 generation units, which include steam units, combined cycle, open gas turbines, and jets. IEC's installed generation as of December 31, 2022 was 10,955 MW. IEC works to provide available, reliable, and high-quality electricity while maintaining a state-of-the-art service level and commercial and environmental principles. As of the end of 2022, IEC had 10,121 employees and provided service to 3.016 million consumers.

Operations Development

Over the last decade, IEC has invested $10 billion in developing Israel’s electricity sector. The capital required to finance its investments is drawn from IEC’s internal sources and capital issuances in Israel and abroad, all the while being a State-owned company. The transmission of the overhead lines at a voltage of 161 kW has been expanded and several line reinforcement projects have been completed. The length of the active overhead lines at an upper voltage of 161 kW amounts to 4,789 km; the length of the active underground cables with a high voltage of 161 kW amounts to 157 km; the length of lines at a voltage of 115 kW amounts to 41.5 km; and the length of lines at an upper voltage of 400 kW amounts to 777 km. The transformer system includes 11 switching stations and 148 substations owned by IEC, besides, 57 sub-stations privately owned but under its operational/maintenance responsibility.

At the end of 2022, the installed transformer capacity was 19,486 MVA. The distribution system included at the end of 2022, high voltage grid lines with a total length of 30,113 km; 53,920 distribution transformers with a total capacity of 27,425 MVA and low voltage grid lines with a total distance of 40,955 km.

Entering the Era of “Smart Grid” and “Smart Meters”

“Smart Grid” is an advanced concept of an electrical system based on the integration of an advanced electrical network with two-way communication, control, monitoring, and advanced information systems. This network integrates sensors and advanced means of control (LOT) as well as a computer system (which includes data collection and processing), communication, and automation in electrical system components.

The smart grid will enable the integration of electricity generation alongside demand management, reducing or diverting them, and will contribute to energy efficiency and a reduction in greenhouse gas emissions, along with improving the safety, reliability, and flexibility of the network as well as contributing to improving the consumer experience. The “smart meters” project uses smart electricity meter technology so that a regional electrical situation picture of what is happening in two operational layers is obtained: that of the grid and that of the consumer’s meter. Management is carried out by a central control system that operates from IEC’s national meter unit and enables the management of the consumption of the largest consumers in the electricity sector and of the household consumers. The smart meter has many advantages for the power industry in Israel and for the smart grid. The goal of the project is to assist the energy sector in dealing with challenges such as the use of electric vehicles and regulation vis-à-vis private producers (mainly renewable energies), competition in the supply sector, etc. Smart meter installation is a vital part of the smart grid revolution for which IEC is preparing. All meters in Israel will be smart meters.

In 2022. IEC continued its nationwide deployment of smart meters, so that a smart meter is installed in every new installation. Later on, older meters will be replaced with smart meters and within a few years, all meters in Israel will be smart meters.

Integration of Renewable Energies

IEC is planning a long-term development plan for the electricity grid for 2030, under the government’s objectives: increasing targets for electricity generation using renewable energies to 30% by 2030, including the addition of technological measures intended to manage and control the operation of renewable energy generation facilities and to maintain the stability of the electricity grid in an era of distributed generation in order to ensure reliability and quality of electricity supply to all consumers. IEC is working to promote energy storage projects in order to support the ability to integrate renewable energy sources into large-scale electricity generation–increasing the volume of generation using renewable energies increases the need and feasibility of integrating the storage facilities. The dynamism of entering and exiting the grid of renewable energies generated by distributed producers presents IEC with challenges in maintaining frequency stability in the system (frequency stability is essential for the reliability of the power supply). Storage facilities will assist in stabilizing and mitigating the impact of energy facilities.

Revenue, Capital Issuances, and Ratings

In 2022, IEC revenue totaled NIS 23,105 million. IEC ended the year with a profit of NIS 1,774 million.

Foreign Credit Ratings (as of December 31, 2022):

Moody’s: Baa1, with a stable outlook (without change compared to 2021).

S&P Global Ratings: BBB, with a stable outlook (an improvement over the previous year).

IEC Domestic Credit Ratings (as of December 31, 2022):

S&P Ma’alot: ilAAA +, with a stable outlook.

Midroog: Aa1.il (without change when compared to 2021).

Demand For Electricity and Peak Load

The peak demand in the economy in 2022 was recorded on January 26, 2022, totaling 11,615 megawatts. At the peak of demand, IEC supplied 9,216 megawatts.

In 2022, IEC generated 42.6% of the total electricity generation using coal, 42.6% using natural and liquid gas, 0.6% using diesel, and 0.2% using fuel oil.

Natural Gas in the Electricity Economy

As of the end of 2022, IEC has three sources of natural gas supply: the “Tamar,” Leviathan,” and the “Karish” reservoirs. As of the end of 2022, 56% of the IEC’s total installed generation capacity is through units that can be operated with natural gas.

Service in Terms of Smart Electricity Usage and Energy Efficiency

The IEC starts and maintains long-term dialogue and collaborations with a variety of community factors in areas consistent with its core business, including safety and the intelligent use of electricity, science and technology, sustainability, and energy efficiency. These collaborations are characterized by constantly listening to the needs that arise from the community and continuing with ongoing dialogue and social responsibility. IEC strives to move forward to a culture of correct electricity consumption within the framework of educational programs, responsible advertising, and within the framework of lectures delivered and provides information on the safety of electricity use, recommendations for saving and intelligent use of electricity, and energy efficiency in the home. IEC’s educational activity focuses on core areas of its business, particularly electricity safety and energy efficiency.

One goal of IEC in these areas is to lead a change of consciousness and behavior in the community, with the students participating in the programs being used as ambassadors who help expand the circles of influence.

In addition, IEC continues its activities to encourage its consumers to “smart electricity consumption” through advertising in the media, attachments to monthly electricity bills, and on the IEC’s website, as well as transmitting information on energy efficiency to various target audiences.

Energy Efficiency at IEC Sites – Reducing Energy Consumption at IEC Sites

IEC contributes to the government’s energy efficiency goals and reducing greenhouse gas emissions.

In this context, various energy efficiency measures have been carried out in recent years at IEC’s sites, including:

  • Improving energy efficiency at existing generation units.
  • Replacement of old air conditioners with modern air conditioners with a high energy rating.
  • Replacement of lighting fixtures with modern and energy-efficient lighting.

From a systemic approach and to bring about maximum cooperation, removing barriers, raising the awareness of employees and managers to the importance of the issue, and enable a unified report to IEC management, an administrative unit has been established to promote energy efficiency projects which brings it under all units that are engaged in the field.

Structural Change, Organizational Change Plan and Efficiency Plan

For many years, discussions were held between government, regulatory bodies and the IEC, to regulate economic activity in favor of the public, based on the Electricity Economy Act. On May 10, 2018, the relevant government officials and the IEC, after consultations with the workers’ representatives and the Histadrut, reached an understanding regarding an outline of the principles of a structural change for eight years. The IEC’s Board of Directors approved this outline, subject to a government decision and anchoring of the arrangements. On June 3, 2018, the outline of the reform was also approved by the Government of Israel and on July 19, 2018, the Knesset of Israel approved the amendment to the Electricity Economy Law. Structural change includes: an outline for structural change; a Government decision on reform; an amendment to the Electricity Economy Law; principles of the Minister of Energy’s policy and the decision of its Board of Directors.

Service
Quality and service are one of the IEC’s core values. Understanding the needs of its diverse consumer base, and providing a professional and quick response, are at the heart of its activities. This value has horizontal implications for all aspects of IEC work. IEC strives to provide value to its consumers, combining personal, responsible and humane service with technological innovation.
Along with the ongoing dialogue that takes place in a variety of channels available to consumers, the IEC is implementing innovative measures in order to improve the consumer experience and their satisfaction with the service provided. In this framework, the IEC makes use of digital tools and artificial intelligence capabilities – both in the interface between the consumers and its service centers, and in providing tools for consumers to perform operations and receive information independently. With regard to the supply of electricity, the IEC is an essential service provider and provides electricity in accordance with the applicable legal provisions and regulations.
In 2020, a comprehensive organizational change was made in the field of service at the IEC, in support of meeting the goals of the reform in the electricity market. The customer service division, which includes the “103” centers and the national accounting center as well as the service centers, has moved from the consumer division (the name of which was changed to the Network Services Division) to the “Shirah” Division – Service, Marketing and Regulation. The IEC has a new service department manager, the purpose of these moves, as well as additional steps, is to help specialize in consumer – oriented service, as an organizational value, with an emphasis on understanding consumer needs, along with the integration of advanced technologies and IT systems adapted to this concept.

Business Development
The Business Development Unit works to locate and realize business activities in addition to and separate from the IEC’s activities as an essential service provider, in Israel and abroad. The unit’s goals are to expand the IEC’s fields of operation, to maximize the utilization of its professional knowledge and resources, to improve professional capabilities and to increase IEC revenue and profits. Business development activities are mainly in the fields of planning services and engineering consulting; services in cyber defense; intelligent utilization of infrastructure and resources; selling knowledge, consulting, and engineering services in Israel and abroad; selling cyber defense services to critical systems abroad and in Israel; asset-based services: antennas, fuel discharge, product discharge, utilization of infrastructure balances; commercialization of the byproducts created in electricity generation – such as coal ash, gypsum, etc.; professional laboratories, training, storage, logistics; the communications field and the establishment of the communications company; business activity in innovation and the development of new service packages on a business basis.

The Communications Venture
Since August 1, 2019, the IEC has been a partner in Israel Broadband Company (IBC) since its establishment in July 2013. IEC holds 30% of its share capital and 70% is held by Cellcom and HOT, equally. Under the agreements, IEC manages the design and deployment of optical cables on the electricity infrastructure and grants IBC the exclusive right to use the infrastructure and allocate wavelengths on the IEC’s optical network backbone. IEC designs, deploys an optical network, and connects to buildings based on the existing overhead and underground electricity infrastructures in many cities. IBC provides home and business consumers with broadband communications services, starting at 100 mega symmetric. In addition, IEC provides IBC with infrastructure for hosting communications rooms, storage and logistics services related to the deployment of the communications network.

Innovation
IEC’s innovation unit was established in 2020, along with a budget for research and development. Innovation under the unit is divided into two main areas: open innovation, that is – joint work with start-ups in technological pilots, with IEC providing the program envelope, expertise and platform (that is – the electric grid and the unique infrastructures for the electricity and energy market to test new technologies), while the start-up brings its own technology. The second area is intra-organizational entrepreneurship through various platforms, starting with a social platform, continuing with workshops and courses, and ending with an intra-organizational entrepreneurship incubator whose first cycle has ended, and products designed within its framework are expected to undergo commercialization processes in the coming years. In research and development, collaborations with leading universities, such as joining up with the National Energy Center at Bar-Ilan University, publishing a “call for proposals” for academia, and signing initial agreements with research and development suppliers to build solutions to the challenges facing electricity companies.

The Environment
IEC considers itself responsible and committed to taking measures to protect the environment and reduce hazards along the electricity chain. The Company operates according to an environmental vision with a sustainable, long-term, and forward-looking vision and minimizes as much as possible the environmental consequences arising from its activities, with the aim of preventing hazards. The Company works to adopt advanced environmental standards, to use raw materials wisely, and to reduce emissions of pollutants at the source. In addition, the Company operates according to international environmental treaties, such as the “Barcelona Convention” for the prevention of pollution of the Mediterranean Sea from terrestrial sources, strengthens cooperation with environmental factors, and promotes dialogue with relevant stakeholders. The Company operates in accordance with policy principles for the protection of the environment that were first approved in 1997 and updated from time to time. The total investment in environmental quality facilities in 2022 was NIS 467 million, of which NIS 435 million is the scope of the investment in environmental aspects in the generation segment, and in addition, a total of NIS 32 million in the transmission, distribution, and particular projects sectors. The Company works to reduce environmental impacts and is a partner in the fight against the climate crisis. To this end, it formulated long-term ESG goals that include measurable quantitative goals in the main environmental impact areas of the IEC, releasing for preservation the coal-fired generation units 1-4 at the Orot Rabin power plant site; establishing efficient generation units; converting generation units from coal to gas; environmental investments; promotion of the “Smart Meter” project; development for the integration of renewable energies into the grid; storage; electric transportation; dialogue between owners’ interest and more.

Community Involvement
Being a national infrastructure company, activities started by IEC are strategic tools for creating a “shared value”: social and/or environmental value for stakeholders alongside business value while reflecting its core values and commitment to act with corporate responsibility. IEC starts and maintains long-term dialogue and collaborations with a variety of community entities in areas that are consistent with its core business, including the safe and intelligent use of electricity, science and technology, sustainability, and energy efficiency. These collaborations are characterized by constant listening to the needs of the community and take place with caring, ongoing dialogue, and social responsibility. IEC’s educational activities focus on the core areas of its activity, particularly electricity safety and energy efficiency. One of the IEC’s goals in these areas of activity is to lead a change in consciousness and behavior in the community, with students taking part in the programs serving as ambassadors to help expand the circles of influence.

Risk Management and Business Continuity
In this area, the IEC operates in accordance with the guidelines of the Government Companies Authority. The activity is carried out in accordance with the primary policy for risk management, which defines methods of action, control, and reporting in the field, including the obligation to use a computerized information system. Risk management is also carried out at the levels of the divisions, districts, power plants, and projects and is a work tool for making managerial and operational decisions.
As part of risk management, the IEC continues to promote the preparation, updating, and practice of response plans for extreme scenarios as part of ensuring business/functional continuity. Once a quarter, the Company reports to its Board of Directors on its state of risk management, including material events that have materialized, breaches in the “risk appetite” statements, and additional information as needed.

Preparing for an Emergency/Crisis
During 2022, the IEC acted on a variety of other main issues as part of its emergency preparedness: a project to protect critical installations in the electricity sector, increasing the fuel stock for use by the electricity sector in times of emergency, carried out rescue and rescue team training from among the Company’s employees, development of emergency response systems to improve emergency preparedness and incident management emergency and more.

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