BLOG: Good News – Israel and the PA Reach Agreement on Electric Debt

Benjy Cannon Image
Benjy Cannon
on September 14, 2016

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Israel and the Palestinian Authority signed a deal yesterday that resolves the longstanding debt issues between the PA and Israel Electric Corporation (IEC). It’s good news on a few different fronts.

In the last several years the PA has racked up close to $530 million in debt to the IEC. Because of the debt, the IEC instituted a series of blackouts in the West Bank over the summer, leaving Palestinians without electricity in some of the hottest months of the year. As Haaretz reports, this transformed what had once been a business dispute into a diplomatic and human rights issue.

The deal will end the power cuts and ensure that the debt is better managed going forward. It accomplishes this by simply erasing 500 million shekels that the PA currently owes, it mandates that they pay an additional 500 million shekels immediately and it sets up a plan to collect another billion shekels over an extended period. The plan includes mechanisms to collect unpaid electricity bills from Palestinians across the West Bank. As a result, in addition to ensuring that the IEC is paid for its services, West Bank Palestinians will now not have to worry about sudden power cuts.

It wasn’t a coincidence that this issue was addressed now. Since the summer power cuts, the international community has actively lobbied Israel to quickly address it, which spurred Netanyahu to put his special envoy for the peace process on the case. Because of the seriousness with which international actors and the Israeli government began to consider the issue, it was equitably resolved. Here’s to hoping all parties involved can learn from this deal’s quick resolution.