In 2002, the Ministerial Committee for Social and Economic Affairs decided to encourage the construction and operation of electricity installations and power stations powered by renewable energy sources by private electricity producers and by the Israel Electric Corporation (Resolution 2264). The resolution set a target of 2% of electricity generation for consumers coming from renewable energy sources as of 2007, increasing by one percent every three years up to a level of 5% of total electricity generation in 2016 and 10% by 2020. Accordingly, the Public Utility Authority – Electricity published premiums for the generation of electricity from renewable energy sources, the level of which will be commensurate with the benefit gained by the economy from the reduced pollution.
In 2007, the Israeli Government passed Resolution 2718 to remove barriers in the energy sector and to encourage electricity generation by private developers, construction of power stations based on renewable energy sources and a transition to the use of natural gas for generating electricity. It did so by examining tariffs for electricity generation based on solar energy and by encouraging the construction of power stations based on renewables by offering tax incentives.
In 2009, the Government passed Resolution 4450, setting a guideline target and formulating measures to promote the use of renewable energy sources, especially in the Negev and Arava regions. The resolution sets an electricity generation target from renewable energy sources of 10% of the country's energy needs in 2020, and calls for the building of power stations based on renewable energy sources in the Negev and Arava regions, of at least 250 megawatts each year. An interim target of 5% of electricity consumption coming from renewable energy sources by 2014 was also set.
In 2010, the Ministry of Energy and Water Resources accordingly published a policy document for the integration of renewable energy sources in generation of electricity in Israel.
In July 2011, the Israeli Government accepted the recommendations of the document (Resolution 3484), reaffirmed the targets set in 2009, and established quotas for the generation of electricity from solar energy, wind energy and energy based on biogas, biomass and solid waste sources. The resolution requires the Ministry of Energy and Water Resources to formulate a revised policy to achieve the Government targets for the year 2020, and to promote the implementation and integration of effective and innovative Israeli technologies for the generation of electricity from renewable energy sources. To this end, the Ministry received an allocation of NIS 10 million to incentivize specific projects such as commercial demonstration installations.