Awesome: Our energy independence began today
The first natural gas began flowing today from the Tamar gas field, the smaller of the two gas fields discovered in our territorial waters (the Leviathan is aptly named and much, much bigger). The Tamar gas field alone will give us complete electrical energy independence until 2035. Hopefully it will also lower the cost of electricity for us consumers as well.
Our electrical bills shot up 25% following Egypt’s cancellation of the contract sending us gas via their pipeline. The terrorists kept blowing it up and the Muslim Brotherhood is not overly fond of us.
It is not going to be a massive economic boon the way the larger Leviathan field will be as no taxes will be paid on the Tamar field until the investors have doubled the profit beyond what they invested, so money won’t start filling state coffers until something like 2023. The deal made with the investors of the Leviathan field were not so pro-investor and so when it comes online in two years it will much more quickly boost the economy and make the state treasury flush with money. Still, the Tamar natural gas field will contribute NIS 12 billion to Israel’s economy in 2013 alone, experts are saying now, which is a lot more than the NIS 6 billion to NIS 8 billion estimated by the Bank of Israel and the Organization for Economic Cooperation and Development. The reason for this is that the Bank of Israel was looking only at the money directly brought in by the gas field and not including the savings the State will get from not importing the much more expensive petroleum.
It will have other indirect effects that will boost the economy in the next few years. Our debt is going to be able to be significantly reduced, the cheaper electrical cost will lower production costs for many of our industries and products, and once the cost of electricity comes down, people will have more in their pockets to spend on things like cottage cheese 🙂 Initially, however, our electric prices are going to go up (6% in April and possibly a further 3% in July) to cover the initial land-side production costs of the gas. By this time next year, however, electric cost should drop significantly.