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Arab-owned Electric Company Loses Clients in Jerusalem

December 8, 1987
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Thirteen Jewish neighborhoods in Jerusalem that have received their electric power from the Arab owned Jerusalem District Electric Co. for the past 20 years, have been linked to the Israel Electric Corporation’s national power grid.

The switch, which began at 11 p.m. Sunday and was to be completed by Monday evening, went smoothly despite the Arab utility’s refusal to cooperate. More than 300 IEC employees carried out the carefully planned operation, watched by some 1,000 border police who were mobilized for the occasion.

The Jewish neighborhoods were built since the 1967 Six-Day War. They received their power from the Arab company under a 60-year-old concession dating from the British Mandate.

The concession, which permits the Arab company to serve other communities, expires at the end of this month. The Knesset just voted to extend the concession for 12 years on condition that the Arab company reduce its number of clients to overcome its $25 million debt. The money is owed mainly to the IEC, from which it buys 95 percent of its power.

The Arab-owned company will continue to supply some 70,000 households in Jerusalem’s Arab suburbs. Power to West Bank settlements, military bases in the territory and Jewish neighborhoods in the Old City, will be switched to the IEC grid at a later date.

The Arab electric company is the largest public institution in the West Bank. It had been receiving generous financial assistance from the joint development fund operated by Jordan and the Palestine Liberation Organization until two years ago, when a rift developed between the two partners.

The financial assistance enabled the company to expand beyond its needs. Its financial difficulties are attributed to poor management and obsolete equipment.

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