Environmental Protection Minister Gilad Erdan appealed to Finance Minister Yuval
Steinitz in hopes that he would slash the dramatic electricity price increase
that is expected to occur in response to the loss of a regular Egyptian gas
supply.
Due to the cease in reliable flow of this natural gas outlet, the
Electricity Authority recently announced it plans to raise the price of
electricity by 30 percent. In response, Erdan wrote a letter to Steinitz
suggesting he consider nixing the collection of excess taxes for 2012, as diesel
fuel consumption is expected to increase significantly this year, the
Environment Ministry said. Diesel fuel is one of the main alternative sources
currently used by the Israel Electric Corporation to power the country when the
natural gas supply is insufficient.
With an increased consumption of the
resource, excess tax collection – which would thereby cause a rise in tariff
rates – would not be necessary to satisfy budgetary needs, according to the
ministry.
“You could reduce the tariff increase by a substantial rate –
if the Finance Ministry would decide to limit the extent of tax collections on
diesel fuel from the production of electricity to the level that it was in
2010,” Erdan told Steinitz. “In this way, it will be possible to ease the
expected burden on electricity consumption, as well as the cash flow distress in
which the IEC finds itself.”