Egypt declared Monday that it would continue to supply electricity to the Gaza Strip. The announcement followed a European Union decision to suspend fuel payments to the Gaza power plant out of suspicion that some electricity revenues could be going to Hamas. "No one has the right to deny the Palestinians their basic needs and Egypt is obligated to provide them," read a statement by the Egyptian Foreign Ministry. On Monday, thousands of Palestinians in Gaza spent their fourth sweltering day without electricity, as the EU refused to resume the fuel payments. "The European Commission received information indicating that steps were being taken by Hamas to divert part of the revenues deriving from the production of electricity in Gaza," the EU said in a press statement. "We are extremely concerned about this and are carefully verifying the situation," it said.
Hamas and Fatah trade accusations over fuel crisis
The EU had stopped payments on Sunday to the Israeli company Dor Alon Energy, which supplies fuel to the Gaza Generating Company based on orders placed by the Palestinian Authority in Ramallah.
Dor Alon on Sunday refused to send out fuel without a gurantee of payment from a responsible party.
The EU has paid Dor Alon for all past shipments, but balked at financing further supplies on Sunday and Monday on suspicion that such funding violated the rules of the EU's Temporary International Mechanism (TIM), which is designed to bypass the Hamas government.
"Once we feel the funds are being used for the benefit of the Gaza residents [financial] support could resume within hours," said Mario Mariani, who heads the TIM.
The EU spends 6.5 million euros a month, through the TIM, to send fuel to a power plant that produces 25 percent of the electricity in Gaza. Israel provides 70 percent of the Gaza's electricity and Egypt contributes five percent. But, some 600,000 of the 1.4 million Palestinians in Gaza receive electricity from the Gaza Generating Company.
The plant ran out of fuel on Friday because it lacked reserve supplies and had not been able to sustain Israel's closure on Thursday of the Nahal Oz crossing for security reasons. Israel had been prepared both on Sunday and Monday to open the crossing for fuel, but did not do so because the EU had suspended payment.
"We had received some unconfirmed reports" that revenues from the electricity distribution company connected to the plant could go to Hamas when they should have been reinvested into the plant, Mariani told The Jerusaelm Post. "This an extremely sensitive program, so it is important to have confidence in the financing", he added.
His fear is shared by the Fatah-led government in Ramallah, which has accused Hamas of siphoning off electricity revenues. "Hamas is collecting all the electricity fees and never pays the costs of the electricity," said Jawwad Hirzallah, deputy minister of economy. "The Europeans were paying $10 million that Hamas collects from the people and doesn't pay the costs. So the European Union found itself paying the electricity company, while Hamas was pocketing the revenues." Last month, Hamas arrested the electric company's Fatah-affiliated executive director on corruption charges. Its officials have denied putting its hands on the utility's money. And, they accused the government in Ramallah of trying to discredit it through the electricity crisis.
"The government in Gaza is not involved in the operations of the (electric) company," said Hamas adviser Ala Araj.
"In the next few days, the government will announce the investigations of the former director of the company, who stole money the EU donated." In recent weeks, Hamas has been going door to door in Gaza ordering residents to pay long overdue electricity bills. While Hamas denies that it controls the electricity company, Fatah insists it does - citing the director's arrest as evidence.
Jehad Hamad, a political analyst based in Gaza, said electricity is one of many battlegrounds the two sides are using to try to gain the upper hand. The Ramallah government, Hamad added, might be worried that Hamas has uncovered proof that Fatah officials skimmed off money from the electrical company in the past. "Electricity is a 'hot-button' issue," he said.
Power outages are nothing new in Gaza, where electricity reserves are in short supply. But in the last four days during which some 600,000 Palestnians have lived mostly in darkness, residents have scrambled to improvise.
People were going from neighborhood to neighborhood to charge mobile phones and laptop computers in anticipation of outages, and generators have become a precious commodity.
Tamer al-Bagga, manager of a beachside cafe, said his two generators have caused his business to flourish, as people flock in to watch TV, eat hot meals and escape the heat of their homes. "No one is sharing their generators," he said, saying the price of generators has gone up 70 percent since he bought his last year. "They are more expensive now and fuel is scarce. It's every man for himself."
AP contributed to this report.