Sources inform ''Globes'' that Israel Electric Corporation (IEC) (TASE: ELEC.B22) is in negotiations with the Palestinian Authority to jointly build five substations in its territory. The new substations will improve the reliability of electricity supplies. The turn key project will cost several hundred million shekels, based on an agreed upon fee for IEC.
Last Thursday, an IEC delegation visited Egypt to meet representatives of the World Bank, which may partly finance the project. Former IEC VP customer relations, Yigal Ben-Arie, who used to be responsible for IEC relations with the Palestinian Authority, headed the delegation.
The Palestinian Authority is almost totally dependent on Israel for its electricity supply, except for a single 110-megawatt power station in the Gaza Strip, which supplies about half of the area's electricity.
The Palestinian Authority is one of IEC's largest customers, accounting for 6-7% of the company's power supply. IEC sales to the Palestinian Authority are estimated at NIS 1.5 billion a year. Despite the escalation in the security situation, Palestinian electricity consumption is rising steadily, rising 11.6% in 2007 and 8.2% in 2006.
IEC said in response, "IEC supplies electricity to Palestinian customers in the territory of the Palestinian Authority. Demand is high, and the company is seeking technical solutions to meet demand."
In a separate development, sources inform ''Globes'' that IEC plans to hire 1,000 new workers as part of implementation of the company's emergency plan. IEC's board has authorized management to hire 400 temporary workers for the first part of the plan, in order to build new production units at the Ramat Hovav power plant in the Negev.
Later, subject to approval of the board, IEC will hire hundreds of engineers, technicians, welders, and other employees. They will be defined as temporary employees, employed by IEC's projects division.
IEC says that this hiring does not contradict the company's streamlining plan, which includes 2,000-2,500 layoffs within three years. IEC said in response, "The company is pleased that in these hard times it is able to hire hundreds of employees."
Published by Globes [online], Israel business news - www.globes-online.com - on December 1, 2008
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