Reducing World Reducing World Dependence on Oil in Dependence on Oil in

TransportationTransportation

The Israeli “OIL-FREE” Initiative The Israeli “OIL-FREE” Initiative

Sagi Dagan, Interim ManagerSagi Dagan, Interim Manager

30.10.201130.10.2011

The National Economic The National Economic CouncilCouncilPrime Minister’s OfficePrime Minister’s Office

Increasing Global Oil Dependence

Global oil dependence is due to transportation Around 1 billion new cars will be sold by 2020

Increasing dependence of China and India on oil from the

Persian Gulf

2

Asian oil demand VS. Middle East surplus

ME exports

Asia imports

2015

Source: lloyds 6/10

Consequences of Oil Dependence

3

Lack of long term vision

Investment in alternatives to oil depends on oil

price

Source: IEA, Israeli institute for economic planning4

Oil Alternatives in Transportation Main Fields of Technologies:

Main principles:

Focus & Consistency: a 10 year targeted plan

Partnerships with Leading Companies, Governments & NGOs

Private Initiatives & Innovation: Let Developers and Industry choose technological paths

Method of Impact:

The Israeli “Oil-Free” Initiative

7

The Israeli “Oil-Free” Initiative

To become a global leader in energy R&D, and a catalyst for worldwide implementation of “Oil Alternatives”:

Increase global demand for innovation

Create local supply of innovation

8

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How to create local innovation ?

1. Understand the need determination

Needs are determined globally (information barrier)

2. Support innovation of solutions

The global need is for “innovative solution” of problems

Israeli R&D has a “technology bias”

3. Create local demand for innovation

Local demand is small (local scale-up is small)

Innovative technologies are less bankable (scale-up is

“biased”)

“Initial markets” for Israeli companies (learning by doing)

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The Israeli “Oil-Free” Initiative

Research Centers & Grants

Venture Capital Co-Investment

Supporting Regulation for Pilots

Local Regulation & Incentives

Management Under the Prime Minister’s Office

International Cooperation & Activities

Government Budget of over $ 400 Mln on R&D for 10

years

Tax Incentives of over $ 5 Bln for Electric and Hybrid

Vehicles *

*Assessment with full usage

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International Cooperation

The Goals:

1.Understanding of global needs

2.Promote innovation of solutions

3.Become part of the global network

The Method:

1.Bring problems to Israel

2.Support joint development and demonstration of

solutions

3.Promote (and brand) Israel as a source of solutions

Local Market Policies and Demand

Oil-based fuels & vehicles taxes:

90% tax on gasoline, 90% tax on gasoline-based cars

Electric Vehicles:

About 30,000$ for Electric Vehicle and 15,000$ for Hybrid

Vehicle

Experiments with new technologies:

Breakthrough pilots & beta-sites of innovative solutions

Full scale solutions for adaptation of oil alternatives

Taking advantage of natural gas:

Methanol

CNG, LNG

Gas-to-Gasoline Fuels12

Thank you