31
from an infrastructural, institutional and framework-related
perspectives.
Enabling Conditions – Infrastructure
Any discussion of enabling conditions for state building must
begin with the creation of an Israeli-Palestinian understanding
for the development of a sustainable, modern infrastructure
of the emerging State of Palestine, necessary to create and
facilitate economic growth. The current situation is that both
parties have moved into a gridlock, which causes a mutual
lose-lose effect. Under existing agreements, in the most basic
elements of roads, water and energy the Palestinians remain
heavily dependent on Israel. In a political climate, where
Israeli-Palestinian negotiations are ruled by the principle
"nothing is agreed upon until everything is agreed upon"
any constructive approach toward the development of
an independent, although interdependent, construction
of Palestinian transport, energy, water, communication
infrastructure is being blocked.
In this situation, infrastructure development is left for the
agenda of the international community. In 2012, the Palestinian
Partnership for Infrastructure Development Multi-Donor Trust
Fund (PID fund) was established. Administered by the World
Bank, the Fund’s objective is to improve the coverage, quality,
and sustainability of infrastructure in the Palestinian territories
through financial and technical support in the water, urban
development, and energy sectors and by 2015, it contributed
over $100 million towards these aims.
5
Nevertheless, in its
recent report to the donor conference (AHLC – Ad Hoc Liaison
Committee), the Office of the Quartet (OQ) describes how
there was virtually no public infrastructure development in
2015. What is needed is to oblige both parties to accept the
principle of separation of physical infrastructure in order to
promote the full independence and sovereignty of the State
of Palestine, while creating regional coordination between
Israel, Palestine and their neighbors.
In order to build a solid foundation for a future Palestinian
state, independent infrastructure development and gradual
separation in the management of existing facilitates must
begin, with Israeli and international assistance and expertise.
These issues cannot wait until a peace agreement is
concluded, since in many cases it requires preparation for
re-organization, either of separation or, if and where needed,
of joint infrastructure management and maintenance.
The following sections describe specific key elements in
infrastructure development that need to be accompanied
by a complete strategic plan and outlook; from immediate
to medium and long-term measures.
Energy
The Israeli electric grid, which also provides electricity to
the West Bank and Gaza, is a national system, i.e., one that
5
infrastructure-trust-fund
operates a closed system regulating overall electric supply
to Israel, West Bank and Gaza. Therefore, the Palestinian
energy sector remains heavily dependent on external energy
sources except for a small percentage of electrical energy that
is being produced through the partially operated electricity
plant, which covers part of Gaza’s electricity needs
6
.
In total, more than 95% of electricity in the Palestinian Territory
is imported from Israel
7
and while the huge financial debt to
Israel Electric Company (IEC)
8
needs to be resolved for the
benefit of both parties, independent energy production –
primarily through renewable sources such as solar power - is
critical to reduce dependence on Israel and energy costs
to consumers. It should be stressed that in the immediate
term, according to the Bank of Israel, this issue is one of
the most important economic problems between Israel and
the PA and requires finding a solution in the near future:
The continuation of the debt hinders possible development
projects in the PA which require additional electric capacity.
According to recent Quartet estimates (April 2016), the
immediate development of solar energy in the West Bank
can save up to 25% of the total cost of electricity imported
from Israel, by 2025. Solar energy projects are already being
promoted by both private entrepreneurs and by international
agencies, but in order to ensure their successful and timely
implementation Israeli authorities need to streamline approval
of such projects.
9
In the Gaza Strip, which has long suffered from an acute
energy crisis whereby electricity is only available on a
sporadic basis, the internationally backed “Gas for Gaza”
initiative is gaining pace. Since linking Gaza to a reliable
and cost-efficient natural gas supply has been identified
as the only viable long-term solution to its energy crisis,
the OQ launched in August 2015 the G4G Task Force.
In coordination with the Palestinian Energy and Natural
Resources Association (PENRA), the Task Force aims to
facilitate the agreement and construction of a natural gas
pipeline connecting Gaza to the Israeli natural gas network.
Shortly after at the September 2015 AHLC meeting, the
Israeli Government announced its approval in principal for
the G4G project.
Therefore, in addition to measures already underway of
Israel constructing additional sub-stations to uphold rising
demands,
10
diversification of energy sources, including
regional interconnection with neighboring countries, such
as Jordan and Egypt, must be promoted.
In the longer-term the overdue development of independent
gas fields is necessary. Permission should be given to
Shell (owner of BG Group) to develop the Gaza Marine gas
field opposite Gaza’s coastline, in full coordination with the
6 2011 Annual Report by the Palestinian Electricity Regulatory Council.
7 Ibid.
8 Amounting to NIS 1.7 billion according to the Bank of Israel.
9 Interview with Arab-Israeli business entrepreneur, June 2016.
10 Four new sub-stations underway in Tapuach junction, Tarqumiya
area, Ramallah and Jenin.
