In deal with Israel, PA takes ‘historic’ step toward energy independence

AL-JALAMEH, West Bank — High-ranking Palestinian and Israeli officials gathered in a field outside the West Bank city of Jenin on Monday to turn on the first-ever piece of Palestinian-owned electricity infrastructure and ink a new electricity agreement between the two sides.

The deal, hailed as “historic” by signatories, will for the first time set parameters for the supply of power between Israel and the Palestinian Authority, which for years has seen the PA default on billions of shekels of debt and Israel subsequently withhold electricity.

After the signing of the agreement, Palestinian Authority Prime Minister Rami Hamdallah, Israel’s Minister of National Infrastructure, Energy and Water Resources Yuval Steinitz, Israel Electric Corporation Chairman Yiftah Ron-Tal and Coordinator of Government Activities in the Territories Major General Yoav Mordechai together turned on the Al-Jalameh Substation.

Al-Jalameh is the Jenin-region village nearest to the station, in the northern West Bank.

The station will allow Israel to send up to 135 more megawatts to the northern West Bank area, though the agreement currently calls for just 60 more. The energy will provide a much-needed boost to the Jenin area, which has suffered power outages more than any other Palestinian West Bank region.

Power company workers seen at the new power plant near Jenin, July 10, 2017. (Dov Lieber for the Times of Israel)

The station also represents the first time the Palestinians will be able to control the distribution of the electricity to their own towns and cities.

The PA will still have to buy its power from the Israel Electric Corporation. But apart from that, once the power is handed off to the PA, it’s in Palestinian hands.

When infrastructure breaks down — which once necessitated Israeli teams escorted by the army to perform repairs, which inevitably caused delays — Palestinian teams will be responsible for dealing with any problems.

The station was built by the Israel Electric Corporation, by both Israeli and Palestinian workers, but it is owned by the Palestinian Electric Authority (PEA) and the PA. The IEC also trained Palestinians to work, maintain and fix the site.

Steinitz described the deal as a “win-win project” for Israel and the Palestinians.

“It’s good for Palestinians because they will get more electricity, which will be more stable and of higher quality. It’s good for Israel because…the responsibility [for Palestinian electricity] won’t fall on the shoulders of the Israeli Electric Corporation,” he said.

The coordinator of government activities in the West Bank Yoav (Poli) Mordechai (second from left) and Minister of National Infrastructure, Energy and Water Resources Yuval Steinitz sit with Palestinian Authority Prime Minister Rami Hamdallah (far right) and Yiftah Ron-Tal, head of the Israel Electric Corporation (far left), at a ceremony to mark the first-ever signing of a commercial agreement between the two authorities to increase electricity in the West Bank area of Jenin, July 10, 2017. (Dov Lieber for the Times of Israel)

Steinitz added that the project showed that “If we speak together and work together, we can make advancements in the field.”

Steinitz also said the deal will “be a model” for how Israel can work together with the PA to advance the Palestinians’ water supply and water treatment infrastructure.

Jenin is the first region to receive a substation, but three more are on the way — in the Hebron region in the south, in the Ramallah region in the center and in Nablus in the mid-northern West Bank. With all four stations, the Palestinian Authority will control the power flow across all the territory it controls.

Hamdallah, the PA prime minister, described the project as “pivotal to enhance our independence so we can meet the growing needs of our people in the electricity sector.”

He thanked Israel for “its cooperation to facilitate” the completion of the project.

These substations are only the first phase in a plan to make the Palestinians more energy independent.

The Palestinians — both governmental and private investment firms — are currently building their own power producing plant in Jenin, slated to be finished by the end of 2019 or 2020. It will cost an estimated $620 million to build.

When it’s operational, it will produce 400-450 megawatts, which is 50% of the PA’s current electricity needs in the West Bank. The plant will run on natural gas, which Palestinians can purchase from Israel. The hope, however, is that the PA will be able to tap into the Palestinians’ own natural gas field off the shores of Gaza, and become self-sufficient.

The document signed on Monday only pertains to the Jenin area. It is a smaller agreement that is meant to pave the way for a contract that will deal with the entirety of electricity cooperation between Israel and the PA.

The Al-Jalameh station, built in three years, was bought from the IEC for 12 million euros.

The project was partially subsidized by Italy, Norway, the European Union, USAID, and the European Investment Bank.

In September 2016, the PA and Israel signed an agreement that transferred control of West Bank electrical infrastructure to the PA. Under that deal, the PA also began paying off its outstanding power bill of NIS 2 billion ($560 million).

Three quarters of that is still owed, and is meant to be paid off in 48 installments.

The contract signed on Monday allows the IEC to increase electricity supply to the Jenin region without fearing the piling up of more debt from the Palestinians.

Yael Nevo of the Israel Electric Company poses with her Palestinian counterpart Jihad Barri at a ceremony to mark the first-ever signing of a commercial agreement between the two authorities to increase electricity in the West Bank area of Jenin, July 10, 2017. (Dov Lieber for the Times of Israel)

Yael Nevo, the lawyer for the IEC who led the negotiations with the Palestinian Electric Authority, told The Times of Israel that the agreement allows the IEC to legally cut off the power after one missed bill. However, she added, an understanding was reached that will allow the Palestinians to miss three months of bills before the power is cut.

Nevo said it was a “great experience” working with the Palestinian side.

“The negotiations were in very good spirits. Each side defended its interests while understanding the other side’s concerns, and finding creative contractual solutions,” she said.

Steinitz said such “win-win” projects would continue “regardless of the political situation.”

Hamdallah said that while promoting economic development was important, “the political track remains the most important.”

With the Israeli minister and COGAT chief Mordechai sitting beside him, the PA premier called on the “international community to exert its influence and intensify its intervention in order to save the two-state solution, and end the military occupation of our land.”

Hamdallah did not reference the current electricity crisis in Gaza, which has seen the residents of the Strip receive only between 2-6 hours of power daily since April. The crisis was caused after the PA decided to reduce its funding of Israeli-supplied electricity to the Strip by 35%, in a bid to force the rival Hamas terror group to cede control of the enclave.

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