Knesset Balks at Renewing Electric Corp License

MK Shama-Hacohen fumes at utility's inability to reform itself, says won't give it more time next time.

The Knesset Economics Committee balked Tuesday at renewing the Israel Electric Corporation's operating license for the eighth time, to protest the utility's unending foot-dragging over implementing reforms.

Given that without a license, the utility - a monopoly over electricity generation in Israel - can't operate, the committee ultimately bent and approved another extension, but only for four months.

Committee chairman, MK Carmel Shama-Hacohen rejected the boilerplate request by the Energy and Water Ministry, formerly known as the Infrastructure Ministry. "You've reached the deadline and you have nothing to say," said Shama-Hacohen.

The IEC's license expires at year-end. The reason for the endless extensions, rather than a routine process of renewal, is that the company had been given until its license's expiration to implement a reform passed in 1996. It never did execute the reform and the IEC has ever since been wriggling through the loophole, requesting that its license be extended.

In November the IEC had asked the ministry for a one-year extension, until January 2013, and the ministry had passed the request on to the Knesset committee.

In the company's defense, just two months the government unveiled the current incarnation of the reform, which calls for the dismissal of 2,000 employees over five years, and reducing union involvement in management.

Despite his umbrage, Shama-Hacohen said his committee would extend the IEC's licenses until April 15. "You have until then to draft an orderly law, because we won't be the ministry's rubber stamp," he said. "As far as we're concerned, the government can give you permanent approval to extend the IEC's licenses, but I find it unacceptable that we're asked to rubber-stamp this extension at the end of every year," he said.

Ministry officials said they may not be able to get a law through during the four-month window given by the committee. They said they fear they will have to ask for another extension.

Shama-Hacohen disagreed, noting that all they need is a two-sentence law that sets a clear government stance on the matter. "Don't count on another extension beyond April 15," he said.