2032

The energy sector of Israel has long been one of its greatest strategic vulnerabilities. Up until the discovery of the Leviathan Gas Field in the 2000s, Israel was largely at the mercy of global energy markets to power its growing economy. With little to speak of in the way of hydrocarbon resources, Israel was reliant on coal and oil imports to make ends meet--both of which could potentially be interrupted in the event of war.

The Tamar and Leviathan Gas Field finds alleviated these issues somewhat. With reserves great enough to meet growing Israeli demand for at least the next forty years, these two fields have become the predominant source of Israeli energy, with coal phasing out of the country's energy mix over the course of the 2010s and 2020s in favor of cheaper, cleaner, and more importantly, domestically produced natural gas.

However, there are still some glaring issues in the Israeli energy sector. First and foremost, natural gas is still a fossil fuel, the consumption of which continues to contribute to climate change, thereby putting stress on Israel's limited water resources and dramatically increasing energy consumption in the country (as more and more energy has to be spent keeping buildings cool). Second, and more unique to Israel's situation, the country's natural gas infrastructure is highly centralized. Almost all of Israel's electricity comes from just ten power plants. With the growing proliferation of precision weapons in the Middle East, including among non-state actors like Hamas and Hezbollah, this has created considerable security concerns in Israel, with Israeli defense policymakers growing increasingly worried that a few lucky strikes might be able to slip past the country's missile defense systems and disable large swathes of the country's electrical grid. If this were to occur in the middle of summer, this could put the millions of Israelis in danger, as well as grind the economy to a halt. To help address these concerns, Israel has maintained some of its older power plants, including the coal-fired plants of Orot Rabin, even though they are no longer in active use, with the intention of maintaining reserve capacity in the event of attacks on its power grid.

Still, with the major missile attacks from Hezbollah and Hamas in 2032, and with the threat of increased tensions with a nuclear Iran, Israel is looking for new ways to make its power grid robust while also improving its air quality and reducing its carbon footprint. This has led the Israeli government, despite its hardline right-wing views, to begin assessing renewable energy production as a potential alternative.

The Mediterranean-Dead Sea Canal

First proposed in 1855 as an alternative to the Suez Canal, the Mediterranean-Dead Sea Canal (MDSC), the MDSC enjoyed renewed interest in the 1980s as a potential source of power generation for Israel following the 1973 Oil Crisis. The proposed canal takes advantage of the fact that the Dead Sea sits roughly 400 meters below sea level (being one of the lowest points on the surface of the Earth) to generate electricity by moving water from the Mediterranean (sitting at sea level) through a series of surface canals, underground pipes, and water reservoirs across Israel to the Dead Sea. After commissioning a series of studies on the project in the 1990s, the Israeli government shelved the idea due to economic uncertainties and political concerns.

A combination of factors have led Prime Minister Sa'ar's government to revisit, and ultimately, approve the proposal. In addition to making the country's electricity generation sector more robust, the project is viewed as a way to breathe life back into the shrinking Dead Sea, thereby reinvigorating the region's tourist economy--and more importantly, preventing an ecological catastrophe akin to the the collapse of the Aral Sea in Central Asia. Moreover, the plan would require the construction of a desalination plant somewhere along the course of the canal, as the salinity of the water has to be increased prior to entering the Dead Sea (meaning that, somewhere along the way, some water has to be desalinated and removed). Current plans put this desalination plant in the vicinity of Beersheba, increasing the water supply of the water-starved Negev region.

The How

Several paths were considered for the MDSC. Some, located in the north of the country, took advantage of the naturally low terrain surrounding the Kishon River to build the project at a lower cost. However, this path was eliminated from consideration by the Sa'ar government, both because it would require infrastructure to be built in Judea and Samaria (which would make them an object of contention in any future potential peace settlement), and because it would reduce the power generation of the final project. Concerns over final settlement in Judea and Samaria also eliminated the central most route, which would have entered the West Bank around Jerusalem on its path to the Dead Sea, and the southernmost route, which would have passed through the Gaza Strip.

With these options eliminated, the only remaining option was the so-called central route. With a sea intake on the Mediterranean at Ziqim or Ashqelon, this route sees the water chlorinated near the coast (to prevent biological buildup along the route) before traveling through a 92.5 kilometer long tunnel through the south of the country. Once reaching Beersheba, a desalination plant would ensure that the salinity of the incoming water would match that of the Dead Sea (with the resulting freshwater being provided to Negev communities like Beersheba) before sending the water further through the tunnel towards the Dead Sea. At the Dead Sea, the water will enter a regulating reservoir, which, in combination with a power station and storage system near the Dead Sea, will regulate the rate of flow into the Dead Sea. Estimates put the total annual electricity generation at ~3.5 terrawatt hours annually, with the whole system taking in roughly 6.3 cubic kilometers of water per year (though less than that will reach the Dead Sea owing to the desalination process). All in all, the MDSC is set to cost roughly 5b USD to build, which will pay itself back through electricity sales after some 15 years of operation. Construction will last five years, with the project opening in 2037.

Additional Concerns

The government has also been considering the construction of a thermal power plant of some variety co-located with the desalination plants in the vicinity of Beersheba. According to older studies, the water used in the project should be capable of cooling a thermal power plant with a generating capacity of ~1000MWe. While initial plans proposed that this attached power plant use natural gas, newer proposals have considered the installation of a nuclear power plant--Israel's first (not counting the heavy water reactor at Dimona)--at the site. Indeed, the location seems like the best possible location in Israel for one--its location in the south of the country places it far away from the Gaza Strip and south Lebanon and close to some of Israel's largest military bases (including its largest air base at Nevatim), making it some of the most heavily defended territory in the country.

Of course, such a project had the same difficulties as Israel's past attempts to develop nuclear energy. Israel, along with North Korea, South Sudan, Pakistan, India, and, as of 2031/2032, Iran, is not a member of the Nuclear Non-Proliferation Treaty, meaning that other countries are banned from exporting nuclear technology to Israel (it was this hang-up that prevented the Carter Administration from upholding an Israeli-American nuclear deal initialed by the Ford Administration in 1976). Fortunately for Israel, countries seem to have gotten more lax about this issue in recent years: Pakistan and India, both nuclear weapons states that are not party to the NPT, have enjoyed civilian nuclear cooperation with China and the United States (respectively), despite this technically being in violation of the NPT. We are hoping to mirror these developments and strike a deal with one of these countries to begin our civilian nuclear program.

While our preferred partner would be the United States, owing to our long-standing commercial and security ties, there are several issues that prevent us from making a nuclear deal with the United States. If this deal were to follow the framework established in the Indian-American nuclear deal of the 2000s, Israel would have to either join or be granted a full waiver by the Nuclear Suppliers Group (the multilateral export control regime responsible for controlling nuclear material, equipment, and technology exports). Israel has previously attempted to join the NSG, or at least to gain such a waiver, but its attempts have stalled--largely due to its refusal to sign the NPT, which is viewed as a core component of membership. This makes a civilian nuclear partnership with the United States untenable.

Thus, we look to China for our nuclear cooperation. Despite it technically being in violation of the NPT and the NSG, China engages in extensive civilian nuclear cooperation with Pakistan, having sold and assisted in the construction of several nuclear reactors in the country. As part of growing economic relations with China, we are hoping to develop a similar understanding.

Specifically, we are interested in the construction of two single-core Hualong One reactors--one at a site near Beersheba, with the other on the Mediterranean coast near Nitzanim. Once completed in 2037, these reactors will be powered by uranium extracted from the Negev using Israel's proprietary method for extracting uranium from phosphate deposits. We are looking to spend roughly 2.5b USD for the construction of each power plant (for a total price of ~5b USD), and are interested in securing Chinese loans for roughly 50 percent of the project's sticker price. We propose a fixed 20-year term loan with 2 percent interest.