(photo credit: Rennett Stowe)
Electricity rates will rise by nearly nine percent in February, if an agreement
struck between representatives of the Israel Electric Corporation and the
Finance Ministry on Tuesday is approved by the Public Utilities
The IEC announced last month that electricity prices would
rise by 30% in 2012 on the back of financial troubles caused by the suspension
of natural gas deliveries from Egypt. Tuesday’s agreement was reached after the
Finance Ministry proposed staggering the rate hike over three stages to avoid a
large one-time rate hike.
Finance Minister Yuval Steinitz has instructed
his personnel to find a solution that will prevent the dramatic rate hike. The
IEC’s financial situation is being examined, the Finance Ministry said on
But opposition members of Knesset blasted the government over
the increase, saying prices had risen 25% since Prime Minister Binyamin
Netanyahu made a commitment last summer to ease the cost of living.
Netanyahu government is the government of taxes,” MK Shlomo Molla (Kadima)
“Netanyahu said he understood the socioeconomic protest, but in the
same breath his government raises taxes that harm the lower and middle classes.
The government is showing contempt for its citizens, the public is collapsing
and the government is laughing.”
Also on Tuesday, Energy and Water
Ministry director-general Shaul Tzemach told the National Planning and Building
Commission the IEC was buying unprecedented quantities of diesel to offset the
loss of Egyptian gas, Globes reported.
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“We will pay an extra NIS 10
billion in 2012 for fuel for electricity, compared with last year,” Tzemach
said. “Natural gas costs a fifth of diesel, before the excise, and a ninth of
the price of diesel, including the excise.”
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