The real reason why our electricity bills are going up

And on the first day, the Voice in the Sky said: Let there be light.

So the Israel Electric Corporation sent ’round a team of ten: one light engineer, one electrician, a retired switch operator, his mate, the tea boy, the trainee, the PA, a union official to check that all was OK, and two extras, as ordained by clause 4.5(1)a of the Israel Electric “How to Employ Anyone Manual.” And they looked and they hummed and they hawed. Or even haha-ed. But mostly they hummed.

Eventually the engineer wrote a detailed report and had it sent to the New Lights Division, which read it, proofed it, photocopied it, analyzed it, sat on it, chewed it, and then put it into practice.

So finally, on the 245th day, there was light.

Of course that was just my little joke. I mean, who ever heard of an IEC engineer writing a report and having a new light installed — all within 246 days?

Off the grid. The Israel Electric Corporation has been very quiet recently. (Yaakov Naumi/Flash90)

The Israel Electric Corporation — now there’s a sly one. They’ve been very quiet recently. Why make a fuss when they seem to be getting their way without much of a struggle, and the bolshie workers at the Israel Railways are hogging all the limelight?

But I do believe our electricity utility needs a closer examination, just for the fun of it.

Your electricity bill, my Israeli friends, is about to leap. Yes, we’ve managed to get the cost of cottage cheese down, and even cartons of milk are facing competition. But electricity? Not bloody likely. We’ll have to wait for the next revolution for that one.

Come next Sunday, you will see your electricity bill leap by almost 9%. Yes, 9%. Halevai we should all be enjoying 9% pay rises. Inflation is running at just over 2% (thanks, Stanley) on an annual basis; so what gives the IEC, a monopoly, the right to up our prices by more than four times the inflation rate?

It’s the NINCOMPOOP, stupid!

Blame the price of oil, moans the IEC. That’s the problem. Higher oil prices, and a supply of gas from Egypt that keeps stopping every time revolutionary bandita Mustafa Leak has a tantrum.

Electricity does not grow on trees; it needs to be generated from some other form of energy: wind, sun, coal, oil, gas. The IEC has a supply of gas from Egypt, but apparently that’s not to be relied on. And when the gas gets turned off, the IEC has to turn to coal (expensive and very dirty, and not found naturally in Israel) or oil (also expensive, terribly difficult to remove if you get it on your overalls, and also not found naturally in bulk in Israel).

But the IEC can’t just up prices, like so. Any change in its tariff first has to be approved by the Nameless Inefficient Committee of Mostly Politicians or Other Obsolete Penpushers, or NINCOMPOOP for short. So, the IEC, grumbling about high costs, unreliable gas supplies etc., goes running to NINCOMPOOP (OK, so its real name is Public Utility Authority: Electricity), claiming it needs to raise prices by 37% just to keep solvent. Well 37% is over the top, even for a statutory monopoly, so after a chop here, a back-scratch there, a fuel-tax jiggle somewhere else, approval is given for an 8.9% rise this year, followed by another rise in 2013 and another in 2014.

A comfortable perch. Israel Electric Corporation employees (photo credit: Roni Schutzer/Flash 90)

But where’s the incentive for the IEC to trim its fat? Why doesn’t the state set a price rise for electricity at, say, 3% (or the rate of inflation), and tell the corporation to plan ahead and think of ways to become more efficient, less wasteful? It can be done.

When I was working on a building site in Jerusalem many years ago, we had to call in the IEC to move an electricity pylon. Five people turned up, and while two did the job, the others sat on the side and counted their pensions, or pointed at someone who actually did something for a living and laughed.

There is talk of changes in the electricity monopoly, but you’ll find that the IEC can dig its heels in fairly firmly when it likes.

It took them years to agree to what’s known as net metering. In some countries, anyone can generate their own power, typically using solar panels. Usually you end up generating more than you need (or at least, more than you need at the time, because electricity cannot be stored). So the sensible thing is… wait for it, you’ll like this… you sell your surplus electricity back to the electric company! Your electricity meter goes the other way! This is known as net metering, and only several years after it became common practice in Germany (where they don’t even get enough sun for the solar panels), did the IEC allow the same thing here. Reluctantly.

The IEC had also set up a secret fund to finance all its happy perks: the holiday gifts for workers, free electricity for employees (current and retired) — that sort of thing. But this was an illegal hoard, and last week the state ordered the corporation to take 90% of the funds from this kitty, and put it in with all the rest of its cash. Ninety percent of what? How much do you think the IEC — barely able to scrape by, what with the high cost of oil and gas etc, etc — had stashed away in this fund? TWO BILLION SHEKELS.

Think of that when you get your bigger bill next month.