Palestine
With a cumulative score of 1.16, the Palestine ranks number 85 among emerging markets and number 114 in the global ranking.
- Emerging markets
- Middle East & Africa
1.40 / 5
Power score
0.59 / 5
Transport score
Buildings score
Only 56 markets (28 emerging markets) are scored on the Buildings sector. See the full list on the methodology page.
Low-carbon strategy
Net-zero goal and strategy
Palestine does not have a net-zero goal or strategy.
Nationally Determined Contributions (NDC)
Palestine submitted an updated ‘nationally determined contribution’ (NDC) – a non-binding plan to achieve the goals set out in the Paris Agreement – in October 2021. If it remains occupied by Israel, it aims to lower its emissions by 17.5% by 2040 versus a business-as-usual (BAU) scenario from 2011 levels. If it achieves independence, Palestine will look to cut its emissions by 26.6% by 2040 relative to a BAU scenario. This is conditional upon international support.
The country’s NDC targets agriculture, coastal and marine, energy, food, gender, health, industry, terrestrial ecosystems, tourism, urban infrastructure, waste and wastewater, and water. Palestine has yet to submit a long-term strategy under the Paris Agreement.
Fossil fuel phase-out policy
Palestine does not have a fossil fuel phase-out policy.
Power
Power policy
In 2021 Palestine launched its first tender for 20 megawatts (MW) of solar. It already has 55MW of solar capacity installed. Palestine aims to generate 10% of total electricity from renewable sources by 2030, targeting around 130MW of installed renewables capacity by then. The 2030 goal has two scenarios covering different extents of Palestinian territory: either 300MW or 500MW. Capacity additions in Palestine are primarily done through the feed-in tariff policy, which applies to solar, wind, biomass, and biogas projects of 5 kilowatts per household. Palestine also has a net metering policy for projects smaller than 1MW, which allows consumers to have 75% of their excess energy credited for the following month. Utility-scale renewable projects are eligible for exemptions of VAT, import, and customs duties.
Power policies
Power prices and costs
Palestine has tariffs set by the Palestinian Electricity Regulator based on a cost-plus approach. In 2021, tariffs increased 4% across all sectors.
Power market
Palestine only has one power plant, the Gaza Power Plant, which is fueled by oil. It does not have standardized power purchase agreements (PPAs). The electricity market is privatized with the Palestinian Electricity Transmission Company as both transmission operator and buyer for the Palestinian energy sector.
Palestine relies on fossil fuels and subsidizes them for the Gaza Power Plant while taxing other fossil fuel users. The Gaza Power Plant needs to be modernized and plans have been announced both to extend its capacity and convert it to use natural gas.
Palestine’s electrification rate is 100%, but the quality and supply of power varies. For example, in the Gaza strip there are sometimes just a few hours of power a day supplied through the grid. Rooftop solar is supported by the government through a feed-in tariff policy, and there are retail licenses available for consumers to sell their power back to the grid. Even with rooftop solar, the share of renewables in Palestine is extremely low.
Installed Capacity (in MW)
Electricity Generation (in GWh)
Utility privatisation
Which segments of the power sector are open to private participation?
Wholesale power market
Does the country have a wholesale power market?
Doing business and barriers
There are some barriers to development in Palestine. The Palestinian government reserves the right to renegotiate PPAs when there is an increase in capacity of a power plant, although this has not happened to date. There are no specified concession areas for mini grids.
And, Gaza receives subsidies for fossil fuel because there is only one power plant and it runs on diesel. Subsidies have recently been drastically cut.
Currency of PPAs
Are PPAs (eg. corporate PPAs and all other types) signed in or indexed to U.S. Dollars or Euro?
Bilateral power contracts
Can a C&I (Commercial and Industrial) customer sign a long-term contract (PPA) for clean energy?
Fossil fuel price distortions - Subsidies
Does the government influence the wholesale price of fossil fuel (used by thermal power plants) down through subsidies?
Fossil fuel price distortions - Taxes
Does the government influence the wholesale price of fossil fuel (used by thermal power plants) up through taxes or carbon prices?
Transport
EV market
There are no fiscal incentives or other policy instruments for electric vehicles.
EV policy
There are no specific laws.
Transport policies
Fuel economy standards
Does the country have a fuel economy standard in place?
Buildings
Buildings market
Palestine has developed an Energy Efficiency Plan in 2016 in partnership with the World Bank.
Energy efficiency policy
Does the country have a national energy efficiency plan?
Energy efficiency policy
Are there minimum energy performance standards for buildings?
Energy efficiency incentives
Is there access to loans or grants for energy efficiency measures (i.e. Wall or loft insulation or double glazing)?
Buildings policy
There are no specific laws.
Buildings policies
Additional insights
from BNEF
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