Position Paper on Aggravation of Electricity Crisis in the Gaza Strip

PCHR Palestinian Centre for Human Rights

Position Paper on Aggravation of Electricity Crisis in the Gaza Strip

At midnight on Friday, 25 June 2010, the operation of Gaza Power Plant stopped as the industrial fuel necessary for its operation to produce 65 megawatts of electricity ran out. The stoppage of the operation of the plant coincided with a wave of hot weather in the Gaza Strip and seriously impacted basic services provided to 1.7 million Palestinians, including drinking water and health and sanitation services. The stoppage also caused extreme suffering to at least 36,860 students who have been attending final exams of the Genera Certificate of Education (Tawjihi) since 12 June 2010. Electricity outages increased from 8-12 hours to 10-16 hours daily in most areas in the Gaza Strip. The Palestinian Center for Human Rights (PCHR) calls upon both governments in Ramallah and Gaza to prioritize the interests of the population, including the transfer of parts of the funds collected by the Electricity Distribution Company in Gaza to the Energy Authority in Ramllah, to ensure enough supplies of industrial fuel to operate Gaza Power Plant, in accordance with the April 2010 agreement between the two sides.

According to PCHR's field observations of the electricity crisis in Gaza, the operation of Gaza Power Plant stopped on Friday midnight, 25 June 2010, as the supplies of industrial fuel needed for its operation ran out. Eng. Cana'an 'Obaid, Deputy Head of the Energy Authority in Gaza, stated the authorities in Ramallah were responsible for repeated stoppages of Gaza Power Plant through not fully paying the costs of industrial fuel to the supplying Israeli fuel company.

On the other hand, Dr. 'Omar Kittana, Head of the Energy Authority in Ramallah, stated to a PCHR researcher that coping with the current crisis requires that the Electricity Distribution Company in Gaza be committed to transfering the funds it is required to pay as its contribution to the costs of industrial fuel needed for the operation of one generator in the plant. He also demanded that the company enhance the efficiency of collecting fees for electricity, explaining that the Palestinian National Authority (PNA) pays the costs of electricity supplies imported from the Israeli side and from Egypt and a part of the cost of the industrial fuel and maintenance, which means that the PNA covers 85% of the costs of electricity in Gaza. He further called for implementing the April 2010 agreement, which obligates the Electricity Distribution Company in Gaza to pay approximately US$ 4 million in contribution to the costs of the industrial fuel needed for the operation one generator in Gaza Power Plant. He stressed that no money transfers have been made this month.

PCHR has made contacts with all concerned parties in Gaza and Ramallah and followed up their positions expressed in the media. PCHR has been able to obtain information and data that can serve as a basis for a crucial solution for the crisis of electricity outages and the stoppage of Gaza Power Plant:

· Mr. Jamal al-Dirdissawi, Public Relations Officer in the Electricity Distribution Company in the Gaza Strip, stated that the current electricity crisis has been the most extreme, as electricity is cut off for 12 hours a day after 6 hours of availability.

· Mr. al-Dirdissawi stated that the cost of electricity supplies for the Gaza Strip is estimated at 50 million NIS: 35-40 million NIS electricity supplies imported from Israel; 3.2-3.5 million NIS for electricity supplies imported from Egypt; 10 million NIS for industrial fuel designed for the operation of Gaza Power Plant.

· Mr. Hani Salman, Financial Officer of the Electricity Distribution Company, stated that fees collected by the company each month are estimated at 15-20 million NIS, while the expenditures of the company are estimated at 3.5-4 million NIS. He added that 22 million NIS has been transferred to the Energy Authority in Ramallah since the beginning of 2010; the last transfer was 2 million NIS this month.

· Dr. Ghassan al-Khatib, Spokesman of the Government in Ramallah, stated that the current crisis of the industrial fuel for Gaza Power Plant is fabricated for political purposes related to making use of the suffering of people to gain support and incite against the PNA. He confirmed that the PNA "covers 95-97% of the costs of energy consumed in Gaza, both that imported from Israel and Egypt and that produced in the Gaza Strip, where 1.5 million people live." He added that the Gaza population's contribution to the total cost of electricity supplies "does not exceed 3-5%."

· Eng. Suhail Skaik, Director-General of the Electricity Distribution Company in Gaza, stated the electricity outage crisis, which the people in Gaza have been suffering from for approximately 6 months, has peaked as the daily outage will increase to 16 hours daily because of the stopped operation of Gaza Power Plant. He called for keeping the energy sector separate from ongoing factional differences. He further called on alls parties to make efforts to put an end for the suffering of the Gaza Strip under the siege and the electricity crisis, which impacts all aspects of life, as the deficit in electricity supplies has amounted to 60%.

· Eng. Skaik emphasized that the Ministry of Finance in Ramllah has been paying the costs of electricity supplies for the Gaza Strip from the three sources. He added that his company was supposed to transfer US$ 4 million to the PNA this month, but it transferred only US$ 2 million.

· It is worth noting that an agreement was concluded between the Electricity Distribution Company in Gaza and the Palestinian Energy Authority in Ramallah on 11 April 2010, under the auspices of representatives of Palestinian factions and independent figures. Under the agreement, the Energy Authority in Ramallah would pay 36 million NIS for the cost of the industrial fuel purchased to operate Gaza Power Plant; on the other hand, the Electricity Distribution Company would transfer the fees it collects from the population in Gaza after discounting operational expenditures.

· The Electricity Distribution Company suffers from an increasing deficit as at least 60% of the beneficiaries in the Gaza Strip do not pay their accumulating debts owed to the company. These debts have amounted to 3 billion NIS, which has made the company unable to pay the costs of electricity produced by Gaza Power Plant. On the other hand, thousands of beneficiaries, including public figures, politicians, businesspeople, traders and employees in governmental and non-governmental organizations, do not pay accumulated debts owed to the company although they can pay. They believe that the European Union provides Gaza Power Plant with industrial fuel for its operations, which has encouraged them to abstain from paying electricity bills.

The suffering of the Gaza Strip population has aggravated due to the deterioration of electricity services, which coincided with a wave of extreme hot weather. Many people expressed their dismay for being pushed into the political conflict between the Gaza and Ramallah governments, especially as the current crisis coincides with the final exams of the General Certificate of Education (Tawjihi). Due to the electricity outages, many areas suffered from extreme disruption in water supplies. There are also concerns that access of people to basic services, such as health, education and sanitation, may be impacted.

PCHR is gravely concerned over the catastrophic consequences of that may result from the suspension of basic services in the Gaza Strip due to electricity outages, especially health, water and sanitation services. PCHR has concluded the following:

· The total money transfers from the Electricity Distribution Company in Gaza to the Energy Authority in Ramallah since the beginning of 2010, according to sources of the company itself, have been 22 million NIS, which constitutes 40% of the cost of industrial fuel for one month.

· According to the financial officer of the company, the Electricity Distribution Company collects 15-20 million NIS from beneficiaries in the Gaza Strip each month, average of 87.5 million NIS in the first five months of 2010. On the other hand, the company operational expenditures are estimated at 3.5-4 million NIS, which means that the company expended an average of 18.75 million NIS in the first five months of 2010.

· Accordingly, the company has a surplus of 68.75 million NIS after discounting operational expenditures. The question here is: Does the company have the surplus in its accounts? If yes, why does not it transfer such money, or at least the US$4 million monthly pay according to the April agreement?

· PCHR reiterates that the government in Gaza has a duty to coordinate and cooperate with the Electricity Distribution Company in Gaza to collect accumulated debts from beneficiaries who are able to pay, including politicians, business people, traders, employees and governmental and non-governmental organizations, who have high accumulated debts, as a first step towards pressuring other beneficiaries to pay. This measure will constitute a part of a strategic solution for the chronic electricity crisis, regardless of the availability of external funding.

· PCHR calls upon the electricity distribution company to upheld the beneficiaries' right to obtain information on the electricity crisis, including the publication of names of people who do not pay highly accumulated fees, even though they are able to.

PCHR believes that people who pay electricity fees regularly should not endure the result of the failure of concerned parties of the electricity crisis, as these parties must provide them with electricity supplies in all circumstances. PCHR is fully aware that the ongoing siege that has been imposed by Israeli occupation authorities for three years has created catastrophic economic situations for thousands of families, making them unable to pay the costs of electricity supplies; thus there is a need to reconsider mechanisms of assistance to such families, in which costs of electricity supplies should be taken into consideration in order for the electricity fees be paid to the Electricity Distribution Company.