Elsevier

Desalination

Volume 190, Issues 1–3, 15 April 2006, Pages 104-116
Desalination

Ashkelon seawater desalination project — off-taker’s self costs, supplied water costs, total costs and benefits

https://doi.org/10.1016/j.desal.2005.08.006Get rights and content

Abstract

Total desalinated water costs to the Israeli Government, the “off-taker”, from the Ashkelon seawater desalination plant consist of the contracted water costs at the plant’s battery limits plus the government’s own expenditures: a) its initial investments (tender administration, out-of-plant infrastructure required to integrate the product within the national and regional water supply systems, etc.), b) its annual infrastructure O&M, supervisory and administrative costs, and c) the projected additional costs associated with certain project risks assumed by it throughout the life of the project. The paper presents and reviews these risks and quantifies the Government’s anticipated direct and indirect, fixed and variable costs, including several cost escalation scenarios anticipated due to the linkage of the contracted water price to various indices (using an item by item and index by index cost sensitivity analysis). The escalated desalinated water costs are then compared to the similarly anticipated but differently escalating costs of other water sources in Israel, to project, long-term, the resultant gap. The benefits foreseen from the project, and particularly those related to its specific site location, and its mandated daily, monthly and annual water supply schedules and product quality, are presented against: a) the background of Israel’s current water supply system’s water sources’ sustainable capacity, reliability, quality and costs, b) the anticipated growth in demand by various consumer sectors and c) the continuous deterioration of groundwater quality. The resulting risk and cost-benefit analyses are relevant not only to the Ashkelon project, which, as the first large scale government sponsored seawater desalination project in Israel, is a pioneering case study, but also to all pending and future seawater desalination projects in Israel. Some of these are not and will not be BOT, as the Ashkelon project was, but BOO and turnkey contracts, but, though government’s participation and the division of project risks may vary, the key cost-benefit issues, from the government’s point of view, will remain the same. In this context, Israel’s overall seawater desalination program, which is currently fixed at 315 million m3/y by 2010, and its role within the Israeli Water Commission’s long-range planning are briefly reviewed.

References (1)

  • G. Kronenberg, Askelon 100 MCM/year BOT project, presented at the Desalination Cost Modeling Workshop, Limasol, Cyprus,...

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