Carbon Tax Adaptation Track (Directive 4.79)

Carbon Tax Adaptation Track (Directive 4.79)

Funds emissions-reduction investments by industrial actors in Israel adapting operations to climate and carbon policy signals.

Directive 4.79 — Carbon Tax Adaptation Track — is a multi-year grant programme operated jointly by Israel's Ministry of Economy and Industry (Authority for Investments and Development), the Ministry of Energy and Infrastructure, the Ministry of Environmental Protection, and the Ministry of Finance. Effective from 7 November 2024 and published 9 December 2024, it provides rolling financial assistance to Israeli industrial plants that consume fuel and carry a carbon-tax (Balo tax) liability. The programme accepts applications from 19 December 2024 through 1 January 2030. Its explicit purpose is to give industry a structured adaptation period as Israel phases in carbon pricing, while preserving the underlying incentive for efficiency and emission reduction embedded in that pricing framework.

Eligibility is limited to for-profit industrial entities registered and operating in Israel whose facilities consume fuel and pay the Balo (carbon) excise tax. No minimum company age or team-size threshold is specified. The grant amount is not fixed — it is calculated as a proportion of the Balo tax actually paid by each facility, and each eligible plant may receive support for up to six years, subject to eligibility and threshold conditions detailed in the directive. Conversion coefficients used in the grant calculation were updated at an allocation committee decision on 29 June 2025 to align with Gas Authority 2021 publication standards; applications submitted before that date are recalculated using the updated coefficients. An example calculation appears in Appendix 5 of the directive.

Applications are submitted on a rolling basis via the Investment Authority online portal (govextra.gov.il/economy/4-79). Supporting documents include a managers' declaration (Appendix 2), a beneficiary opening/updating form (Appendix 3), and documentation of fuel consumption and Balo tax payments. Strong applications will clearly document fuel consumption volumes per economy branch (Appendix 4), track the six-year eligibility window per facility from the first approved grant year, and use the updated Appendix 1 coefficients. The programme is one of several green-economy tracks at the Investment Authority, sitting alongside Directive 4.80 (GHG capture) and Directive 4.82 (energy efficiency).