State-owned utility Israel Electric Corp's consumption of coal in the first half was 19% lower year on year at 4.3 million mt, the company said.
The drop followed a directive in December from Israel's energy and water ministry and environmental protection ministry to reduce coal consumption at the country's four coal plants by 15% in 2016.
The ministries also mandated a further 5% reduction in use in 2017.
Coal accounted for 52% of electricity production by the company in the first half, compared with just over 60% in the 2015 period.
The drop in coal use was offset by use of natural gas which accounted for 48% compared with 39% in the same period in 2015.
More than 60% of Israel's total electricity production is from natural gas with the remainder coming from private power plants that came on line in recent years.
Meanwhile, the environmental protection and health ministries have been calling for the total shutdown of the four coal units at the Hadera power plant, which have a combined capacity of 2,500 MW, because of the pollution they cause.
The environmental protection ministry issued a report early this month saying the Hadera plant should be shut and used as a strategic back-up.
The report said building new natural gas power plants and shutting Hadera could save the economy over $3 billion.
The government has yet to decide on the fate of the Hadera plant, but the finance and energy and water ministries have ruled out switching the units to natural gas from coal, an option considered in the past.
The finance ministry said sufficient domestic gas would not be available until 2020 at the earliest. Israel Electric is currently investing $2 billion in flue-gas desulfurization systems at Hadera. The first system went into service this summer.
