Ministry of National Infrastructures
Electricity Sector Law, 5756-1996
This version has been prepared for the reader’s convenience and it is
correct as of May 1st 2007
In any case of a discrepancy between this version and the version of the
Law as published in Reshumot,
the version published in Reshumot takes precedence
Chapter I.
Interpretation
1.
The purpose of this law is to regulate activity in the electricity sector for the benefit of
the public, while ensuring reliability, availability, quality, efficiency, and all while
creating the conditions for competition and minimizing costs.
2.
In this law:
“Israeli citizen” – within the meaning of the Citizenship Law, 5712-1951.
“Means of control” – any of the following:
(1) The right to vote at a general meeting of a company or equivalent body in
another corporation;
(2) The right to appoint directors or a general manager of a company, and in a
corporation that is not a company – equivalent office holders;
(3) The right to share in the profits of a corporation;
(4) The right to a share of the remaining assets of a corporation, after clearance
of its debts on liquidation;
“Stakeholder”, “family member”, “holding”, “subsidiary”, “control” – within the
meanings of these terms in the Securities Law, 5728-1968;
“Landowner” – including the occupant of the land;
“License holder” – whoever has received a license pursuant to this Law;
“the Manager” – the manager of the Electricity Administration in the Ministry of
Energy and Infrastructure, who has been appointed pursuant to clause 57 of the Law;
“the Authority” – the Public Services Authority – Electricity, established pursuant to
clause 21;
“Company” – a company registered in Israel according to the Companies Ordinance
(New Version), 5733-1983;
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Ministry of National Infrastructures
“Government company”, “government subsidiary” – as defined in the Government
Companies Law, 5735-1975.
“the Planning Law” – the Planning and Construction Law, 5725-1965;
“Chairman of the Authority” – the person appointed as chairman of the Authority
pursuant to clause 22(b);
“Electricity Producer” – the holder of a production license or licenses, concerning
whom the Minister has determined that he controls a significant portion of production
in the electricity sector, according to the provisions of clause 18(b);
“Private Electricity Producer” - the holder of a production license or licenses,
concerning whom the Minister has not so determined, according to the provisions of
clause 18(b).
“Planning institution” – within the meaning of the Planning Law;
“Holder of means of control” – (Deleted).
“Electrical facility” – a facility used for transmission, supply, distribution, sale,
delivery, accumulation, change or switching of electricity, including buildings,
machinery, instruments, accumulators, conductors, pillars, accessories and fixed or
mobile electrical equipment, linked to the facility, including a facility used for the
production of electricity with a capacity no greater than 5 megawatts;
“Electrical system” – the electricity grid and power stations;
“Public land” – Israel Land within the meaning of the Basic Law: Israel Land, or land
owned by a local authority or owned by a corporation legally established, and occupied
by one of them;
“Private land” – land that is not public;
“Officer” – as defined in Chapter d1 of the Companies Ordinance (New Version),
5743-1983;
“Activity” – any of these: production, system management, transmission, distribution,
supply or trade in electricity;
“Electricity Franchises Ordinance” – as instituted in the Additions to the Electricity
Franchises Law (Payments for connection to the electricity system), 5724-1963, the
Additions to the Electricity Franchises Law (Amendment of the franchise), 5730-1970,
the Amendment to the Electricity Franchises Ordinance Law (No. 3), 5754-1994, and
the Addendum to the Electricity Supply Law (Special Provisions), 5748-1987;
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Ministry of National Infrastructures
“Consumer” – anyone who purchases electricity or services from a license holder, or
who requests connection to the electrical grid, excluding anyone to whom the
provisions of the law regarding the holder of an essential service supplier license apply
only on account of a determination pursuant to clause 18(b);
“Other license” – a license pursuant to this Law that is not an essential service
provider’s license or a production license;
“Supply license” – a license to sell electricity to consumers in general or classes of
consumer;
“Distribution license” – a license to carry electricity from a sub station to a consumer,
over high and low voltage cables;
“Production license” – a license to produce electricity;
“An own production license” – a license to produce electricity for own use and not for
sale to another, excluding sale pursuant to the provisions of clause 20(c);
“System management license” - a license to manage an electricity system on segments
of production and transmission, including maintaining the balance between supply of
electricity and demand for it, ensuring survivability of the electricity production and
transmission setup, managing the transfer of energy from a power station over the
electricity grid to sub stations with the required reliability and quality, scheduling the
execution of maintenance work in the production units and the transmission system,
managing trade in electricity in competitive, equal and optimal conditions, including
making agreements to purchase available capacity and energy from electricity
producers and planning the development of the transmission and switching system;
“Essential service provider’s license” – license to manage the system, to transmit or
distribute electricity;
“Electricity grid” – installations and systems for the transmission, supply, switching,
distribution, sale and metering of electricity, at any voltage, including electrical pylons
and underground or overground conductors, pipes used for underground or overground
conducts, and any accessories and equipment installed on them or connected to them,
electrical wires, switching stations, electricity distribution boxes of all types, and all
connections to them, as well as overhead and underground connections to houses and
other facilities that consume electricity;
“Partnership” – a partnership registered according to the Partnerships Ordinance (New
Version), 5735-1975;
“Backup services” – an exchange arrangement for supply of electricity from the holder
of an essential service provider’s license to whoever receives electricity from another;
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Ministry of National Infrastructures
“Infrastructure services” – giving the license holder an option to use an electricity grid
in which he has no rights for the purpose of transmitting and distributing electricity to
another;
“Power station” – a facility used for production of electricity with a capacity greater
than 5 megawatts, including buildings, machinery, accumulators, conductors, switching
facilities, cooling facilities and the systems used for this purpose;
“Sub station” – a switching station that links various types of electricity grids, which
contains switches that reduce or raise voltage;
“tariffs” – all types of payments made by the consumer, private electricity producer, or
holder of an own production license to the holder of an essential service provider’s
license, including payments for the provision of infrastructure services and backup
services as well as all types of payments, excluding any payment determined in a
tender published by the State, and paid by the holder of a transmission license to a
license holder;
“the Minister” – the Minister of Energy and Infrastructure;
“the Ministers” – the Minister and the Minister of Finance.
Chapter II.
3.
Licensing
(a) A person shall do no activity except according to the license pursuant to this
Law.
(b) The provisions of sub clause (a) shall not apply to a person who produces
electricity with a capacity no greater than 5 megawatts and does not sell it to
another.
(c) When a license has been granted, the license holder shall act in accordance with
the terms of the license.
4.
(a) The Authority may grant a license for activity, stipulate terms in it and also limit
or not limit its term of validity.
(b) A license shall be granted for one activity, for a defined location or region, and
production licenses of various kinds may be given in respect of one power station.
(b1) A person shall not be given a license for more than one activity; however (1) It is possible to grant a person a production license together with a supply
license, taking note inter alia of the development of competition in the
electricity sector;
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(2) It is possible to grant the holder of a system manager license or to a
subsidiary of such, if so stipulated in his license and such grant is essential
for the reliability of the electricity supply, also production licenses, providing
that such licenses shall not be given for 5% or more of the production
capacity in the electricity sector, and if the Minister learns that there are
special circumstances – for 10% or more of the aforesaid capacity.
(b2) A license shall come into force after its approval by the Minister.
(b3) If the Minister considers such action necessary in order to promote the purposes
of the Law and the policy of the Government or its policy regarding the
electricity sector, he may, for reasons to be recorded and after hearing the
position of the Authority on this matter and giving notice to the Government,
instruct the Authority to grant a license, to change any of the terms of a license,
to add to the terms of the license or remove any of its terms, all as he instructs; if
the Minister has so instructed, the Authority will execute his instruction within
the period stipulated in the instruction; if 21 days have elapsed from the date
when the Minister submitted notice to the Government and no written demand
has been received from a member of the Government to debate the notice, the
Minister’s instruction pursuant to this sub clause shall be deemed valid.
(c) Notice of a grant of a license shall be published in Reshumot.
5.
(a) A license shall include, inter alia, the activities for which it is granted, the period
of validity if the period is limited, the location or region for which it is granted,
and the rules and obligations applying to the license holder under this Law.
(b) An essential service provider’s license shall include, in addition to the provisions
in sub clause (a), provisions regarding the obligation to purchase electricity from
a private electricity producer and provisions regarding the obligation to provide
infrastructure services and backup services, all as applicable.
(c) A system management license shall include, in addition to the provisions of sub
clauses (a) and (b), provisions on the following matters:
(1) Granting the license holder an option, in the framework of complying with
his obligations under the license, to give instructions to license holders under
this Law; on this matter the license may include terms for the provision of
such instructions;
(2) The obligation to prepare forecasts of demand for electricity in the economy
as a whole, and the method of publishing them;
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(3) The obligation to report to the Minister of an expected shortfall in the supply
of electricity;
(4) The responsibility of the license holder to plan and develop the transmission
system, according to the needs of the electricity sector.
6.
(a) A license pursuant to this Law, excluding an essential service provider’s license,
shall be granted to an individual who is an Israeli citizen, to a company or to a
partnership; an essential service provider’s license shall be granted to a company
only.
(b) A license pursuant to this Law shall not be granted –
(1) To an individual who has been declared bankrupt, unless discharged, or to a
corporation if a receiver or liquidator has been appointed for it, or that has
decided on voluntary liquidation;
(2) To an individual who has been convicted of an offense that in the opinion of
the Government’s legal counsel involves moral turpitude, to a company, also
if an officer or controlling owner of it has been so convicted, and to a
partnership, also if one of the partners has been so convicted.
(c) An essential service provider’s license shall not be granted except to a company
that has undertaken to supply only for activities according to the licenses given to
it pursuant to this Law and for associated activities.
(d) Notwithstanding the provisions of sub clause (c), the holder of an essential service
provider’s license may engage in other activities approved by the Ministers in
consultation with the Authority if such engagement does not affect its activities or
the supervision of its compliance with its obligations, all in accordance with the
provisions of this Law.
(d1) A license pursuant to this Law shall not be granted if, after receiving the license, a
person, excluding the State, shall be the holder of a license to manage the system
or shall own the means of control of such a license holder, and also the holder of a
distribution, production or supply license, or shall own the means of control of
such a license holder, excluding as stated in clause 4(b1)(2).
(e) A production license or distribution license shall not be granted to anyone who
owns the means of control of the holder of a transmission license.
(f) A transmission license shall not be granted to anyone who owns the means of
control of the holder of a production license or the holder of a distribution license.
(g) A production license shall not be granted in any of the following cases:
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(1) The applicant for the license owns the means of control of the holder of a
distribution license who controls 10% or more of distribution in the
electricity sector.
(2) The applicant for the license owns the means of control of the holder of a
distribution license, and after receiving the requested license, will control
10% or more of production capacity in the electricity sector;
(3) After receiving the requested license, a person will control 30% or more of
the production capacity in the electricity sector;
(4) The applicant for the license holds a transmission license.
(h) A distribution license shall not be granted in any of the following cases:
(1) The applicant for the license owns the means of control of the holder of a
production license who controls 10% or more of production capacity in the
electricity sector.
(2) The applicant for the license owns the means of control of the holder of a
production license, and after receiving the requested license, will control
10% or more of distribution in the electricity sector;
(3) After receiving the requested license, a person will control 25% or more of
distribution in the electricity sector;
(i)
7.
The Ministers, in consultation with the Authority and with the Government
Companies Authority within the meaning of the Government Companies Law
5735-1975 (in this Law – the Government Companies Authority), may determine
rates that differ from the rates stipulated in sub clauses (g) and (h), if they realize
that this is essential to promote the purpose of the Law as stated in clause 1, and
also determine additional restrictions to the restrictions stated in this clause on the
granting of licenses.
(a) The Minister, in consultation with the Authority, may determine –
(1) terms for granting a license;
(2) methods for selection between applicants for a license, for particular activity
in a particular location or region, if the numbers of all these have been
limited, in accordance with the Minister’s judgment pursuant to clause 8;
(3) procedures for submitting a license application;
(4) rules for activating the license, the duties applying to the license holder,
including the provision of guarantees and insurance;
(5) with respect to a transmission license – the responsibility of the transmission
license holder to develop the transmission system, in accordance with the
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development plan as stated in clause 19, and in accordance with the plan for
the transmission system made by the holder of a system management license;
(6) with respect to a system management license – instructions regarding the
license holder’s obligation to perform the actions stipulated by the Minister
in order to ensure the required level of development in the electricity
production system.
(b) Regulations according to sub clause (a) shall be drawn up, inter alia, also taking
into account the type of license, the activity, the period of validity, the location or
region, and with respect to production – also the output.
8.
When the Authority decides whether to grant a license pursuant to clause 4 or to
stipulate conditions in it, and also when the Minister decides whether to give approval
pursuant to clauses 11 to 13, they shall act in accordance with the policy of the
Government or of the Minister with respect to the electricity sector, and shall consider,
inter alia, the following:
(1) (Deleted);
(2) the contribution of granting the license to the standard of service to the
public;
(3) the good of the consumers;
(4) the contribution of granting the license to competition in the electricity
sector.
9.
(a) The Authority may at any time cancel the license or make it provisional and may
also with the approval of the Minister add conditions, rules or obligations or
change them, if it finds that any of the license terms have been breached, that any
of the reservations for obtaining the license exist, or that the fitness required under
this Law has ceased to exist.
(b) The Authority, with the approval of the Minister, may take such actions as stated
in sub clause (a) even without any of the grounds listed therein, for the
considerations specified in clause 8.
(c) The Authority shall not make use of its powers under sub clauses (a) and (b)
unless the license holder has been given an opportunity to present his arguments.
(d) The Ministers may set rules for granting compensation due to actions pursuant to
sub clause (b) and it is possible that under the said rules the rate of compensation
may be zero.
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10. (a) If the license holder fails to comply with any provision under this Law, or any
provision in the license, and the chairman of the Authority is convinced that such
failure to comply with the provision constitutes a real and present danger to
person or property, he may do whatever is required to prevent the said danger in
place of the license holder or appoint a person to take such action (hereinafter:
the appointee), and charge the license holder for all expenses incurred for this
purpose; the collection of such expenses shall be subject to the Taxes Ordinance
(Collection), as if they constitute tax expenses as defined in that Ordinance.
(b) The chairman of the Authority shall not act as stated in sub clause (a) until he has
asked the license holder in writing to do everything required to prevent the
danger, within the time specified in the notice, and the license holder has not done
what is required, and providing that in the circumstances there was time to give
the demand.
(c) In performing his role pursuant to this clause, the appointee shall act in
accordance with the instructions of the chairman of the Authority and he shall
have all the powers necessary for this purpose.
11. (a) A license or any part of it may not be transferred, encumbered or confiscated,
directly or indirectly, except with the Minister’s approval.
(b) The Minister may determine in the license that certain of the license holder’s
assets, that in the opinion of the Minister are necessary for performance of the
activity according to the provisions of the license may not be transferred,
encumbered or confiscated, directly or indirectly, except with the Minister’s
approval.
(c) Guarantees submitted by the license holder, and money received from their
exercise, may not be confiscated or encumbered.
(d) The Minister may determine in the license that any change or reorganization of
the license holder, including merger, split, compromise, arrangement or voluntary
liquidation, requires the Minister’s approval.
12. (a) A person may not transfer or purchase control of a license holder or rights in a
partnership that is a license holder, directly or indirectly, except with the
Minister’s approval.
(b) The Minister may approve transfer of control or transfer of rights in a partnership,
providing that the recipient of such transfer meets the requirements for the grant
of a license according to this Law.
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13. (a) A license holder or owner of means of control of a license holder may not
purchase or own the means of control of another license holder, except with the
Minister’s approval.
(b) In addition to the provisions of clause 12, no person shall own the means of
control of the holder of an essential service provider’s license except with the
approval of the Minister.
(c) If any person, excluding the State, holds means of control contrary to the
provisions of this Law or the licenses given to him, no voting rights to appoint
directors, rights to receive dividends or any other rights shall be exercised by
virtue of the aforesaid means of control.
14. (a) The Minister, in consultation with the Minister of Finance and with the approval
of the Government, may at any time stipulate in an Ordinance that the holder of a
license to provide a particular or any essential service shall be subject to all or
some of the following provisions:
(1) A determination to ensure control of it by an Israeli citizen and an Israeli
resident, including a determination of the maximum rate of means of control
that may be held, directly or indirectly, by someone who is not an Israeli
citizen or resident;
(2) A demand for reasons of national security that all or some of the officers and
certain functionaries of that license holder shall be citizens and residents of
Israel, and that all or some of them shall have the stipulated security
classification.
(3) The Minister shall not issue an Ordinance as aforesaid in sub clause (a)
except after giving the person to whom the Ordinance shall apply the
opportunity to state his arguments.
15. (a) Any action taken contrary to the provisions of clauses 11 to 14 or contrary to the
provisions stipulated pursuant to them – is void.
(b) Without derogating from the provisions of sub clause (a), a person may not
exercise his rights as a result of any action taken contrary to the provisions of
clauses 11 to 14, directly or indirectly, excluding the sale of the rights or
participation in the profits of a corporation.
(c) To secure enforcement of clauses 11 to 14 and this clause, and for the purpose of
supervision, the Minister may determine conditions, provisions, restrictions and
reporting duties, including provisions on the matter of managing and special
registration of the holders of securities of a license holder, directly or indirectly.
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16. The Ministers may determine, in general or for certain classes, with the approval of the
Knesset Finance Committee, fees that an applicant for a license or a license holder
must pay.
Chapter III.
Holder of an essential service provider’s license
17. (a) The holder of an essential service provider’s license –
(1) shall provide a service to the public in general without discrimination,
according to the criteria determined by the Authority, reliably and efficiently,
all according to the terms of his license and to any law;
(2) shall purchase electricity from a private electricity producer, and shall
provide infrastructure and backup services, all according to the terms of his
license and to any law;
(3) shall provide backup services to the holder of a license to produce his own
electricity, at his request, all according to the terms of his license and to any
law;
(4) shall act to ensure the provision of all services throughout the term of his
license, including provision of services under the development plan approved
pursuant to clause 19, while doing everything necessary to provide the said
services.
(b) The holder of an essential service provider’s license shall prepare financial
reports as stipulated by the Ministers, in consultation with the Minister of Justice
regarding the degree of detail required, the accounting principles for their
preparation, the declarations and the clarifications to be attached to them.
(c) The holder of an essential service provider’s license shall collect payments
according to the tariffs determined by the Authority.
(c1) The holder of a transmission license shall make payments to the license holder
according to the tariffs determined by the Authority.
(d) The Authority shall determine criteria by which the holder of an essential service
provider’s license shall be permitted not to provide the service or not to make the
purchase to which he is obliged by this Law, to stop, delay or limit such actions, if
the license holder has not received the payments due for them under any law or
the conditions for the legal provision of such service or making such purchase are
not met.
18. (a) The provisions of this Law, regarding the holder of an essential service provider’s
license, shall apply to him whether or not he holds a license for an additional
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activity pursuant to this Law, and they shall also apply to all such additional
activities for which he holds a license.
(b) The Minister may, according to the factual situation in the electricity sector,
determine from time to time that a holder of one or more production licenses
controls a significant portion of production in the electricity sector and when such
determination has been made, that license holder shall be subject to the provisions
of this Law regarding the holder of an essential service provider’s license.
(c) An electricity producer and a license holder who controls an electricity producer,
directly or indirectly, shall be subject to the provisions of this Law regarding the
holder of an essential service provider’s license, excluding the provisions of
clause 17(a)(2).
19. (a) The Minister in consultation with the Authority may demand from the holder of
an essential service provider’s license to submit for his approval, in the manner
and on the date specified, a full or partial development plan covering his activities
pursuant to the provisions of the license; if the Minister in consultation with the
Authority approves the plan, the holder of the essential service provider’s license
shall only act in accordance with the approved plan.
(b) If the holder of an essential service provider’s license fails to submit a
development plan pursuant to sub clause (a), the Minister may, in consultation
with the Authority, determine a development plan for him and the license holder
must act according to it.
20. (a) At the request of a private electricity producer, the Authority shall stipulate in his
license that he may sell electricity to the holder of an essential service provider’s
license or to another.
(b) Transactions with the holder of an essential service provider’s license as stated in
clause 17(a)(2) and (3) and in sub clause (a) shall be done according to the rules
stipulated by the Minister, in consultation with the Authority or at its suggestion,
including the principles for determining the quantities of electricity, dates of
purchase and dates of changes, as applicable. The aforesaid rules shall stipulate
the cases where the Authority shall be entitled to give other instructions on the
matter of a particular transaction.
(c) The holder of a license for own production may sell electricity, as agreed between
the parties, in any of the following cases:
(1) The sale is to the holder of an essential service provider’s license;
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(2) The sale is to a corporation that is a member of a concern of which the
license holder is a member and for that purpose there is no need to transmit
electricity through land over which anyone who is not a member of that
concern has rights;
On this matter – “concern” within the meaning in the Securities Law, 57281968.
Chapter IV.
The Public Services Authority – Electricity
Section A: The composition, powers and role of the Authority
21. A Public Services Authority – Electricity is hereby established, to act in accordance
with the purposes of this Law and the policy of the Government, the policy of the
Minister or the policy of the Ministers, in accordance with their powers under any law,
in the field of the electricity sector, and to supervise compliance with the provisions of
this Law and of the licenses, and to perform the functions determined for it in this Law
and imposed on it under any other law.
22. (a) The Authority shall be composed of five members appointed by the Government,
at the suggestion of the Ministers; members of the Authority shall be citizens and
residents of Israel.
(b) The Government, at the suggestion of the Ministers, shall appoint a chairman for
the authority, as stated in Item B of this chapter.
(c) The composition of the Authority shall be:
(1) The chairman;
(2) Two representatives of the Government, including a representative of the
Minister chosen from the staff of his Ministry, and a representative of the
Minister of Finance chosen from the staff of his Ministry;
(3) Two representatives of the public, who have a degree in one of the following
subjects: economics, accountancy, business management, engineering, or
another subject connected to the electricity sector, as well as cumulative
experience of at least five years in the aforesaid fields.
(d) Members of the Authority pursuant to sub clause (c)(2) and (3) shall be appointed
for a term of three years and may be re-appointed, providing that they shall not
serve for more than two consecutive terms of office.
(e) Notice of the appointment of members of the Authority shall be published in
Reshumot.
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23. (a) No person shall be appointed nor serve as a member of the Authority who may
directly or indirectly be placed in a situation of conflict of interest between his
role as a member of the Authority and any other interest of his or of a family
member of his, or of a corporation in which he or a family member has an interest.
(b) A member of the Authority who may have a direct or indirect interest in any
matter to be deliberated by the Authority, shall accordingly inform the chairman
of the Authority in writing as soon as he learns that the said matter is on the
agenda, and he shall be absent from the proceedings of the Authority on that
matter.
24. Meetings of the Authority shall take place at least once a month; the Authority shall
hold a special meeting if at least two of its members so demand; the meeting shall be
held within seven days of the demand, unless in the circumstances it must be held
within a shorter time; at this meeting the Authority shall discuss the matters specified
in the demand.
25. (a) The legal quorum for a meeting of the Authority shall be a majority of its
members.
(b) Resolutions of the Authority shall be passed by a majority of votes of those
members present and voting and that meeting, and in the event of a tie the
chairman shall have an additional vote.
(c) The authority shall determine its own methods of working and procedures, insofar
as the same have not been determined in this Law or according to it.
26. The existence of the Authority, its powers and the validity of its resolutions shall not be
affected if the place of a member of the Authority becomes vacant.
27. Members of the Authority from the general public shall receive payment and expenses
for their service on the Authority, in accordance with the Government Company
Regulations (Rules for Payment and Expenses of Directors from the Public in
Government Companies), 5744-1994, and for that purpose the Authority shall be
deemed a company with the highest classification.
28. Members of the Authority who are not Civil servants shall be deemed Civil servants
for the purpose of the following legislation:
(1) The Elections to the Knesset and for the Prime Minister Law (Combined
Version), 5729-1969;
(2) The Civil Service Law (Classification of Activity and Collection of Money
for a Political Party), 5719-1959;
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(3) The Public Service Law (Gifts), 5740-1979;
(4) The Penal Law, 5737-1977 – provisions applying to public employees;
(5) The Evidence Ordinance (New Version), 5731-1071;
(6) The Torts Ordinance (New Version);
(7) The Public Service Law (Restrictions after Retirement), 5729-1969.
29. (a) A member of the Authority shall cease to serve on it before the end of his term of
office in one of the following cases:
(1) he resigns by submitting a letter of resignation to the Government;
(2) he is permanently unable to perform his duties, and the Government, at the
suggestion of the Ministers, dismisses him from his position by written
notice;
(3) he is convicted of a crime that in the opinion of the Government’s legal
adviser is one of moral turpitude;
(4) if he was appointed from among the general public – he has been appointed
as a Civil servant, and if he was appointed as a Civil servant – he has ceased
to be a Civil servant;
(5) if the Government has determined, at the suggestion of the Ministers and on
behalf of the Authority, that he is not performing his duties in a fit manner.
(b)
If a member of the Authority is absent, without proper cause, from three
consecutive meetings of the Authority or five meetings in one year, the
Government may, at the suggestion of the Ministers, cancel his appointment.
(c) If an indictment is filed against a member of the Authority for a offense that in
the opinion of the Government’s legal adviser is one of moral turpitude, the
Government may, at the suggestion of the Ministers, suspend that member from
his office until the final verdict on the case is delivered.
(d) A member of the Authority shall not be suspended pursuant to sub clause (c)
unless he has been given the opportunity to present his case on the matter of the
suspension to the Ministers, within the period specified by the Ministers.
30. And these are the functions of the Authority:
(1) To set tariffs and method of updating them;
(2) To set criteria for the standard, nature and quality of the service provided by
the holder of an essential service provider’s license (hereinafter – the
criteria) and supervision of fulfillment of his duties according to the criteria;
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(3) To grant licenses and supervise compliance with the terms stipulated in those
licenses.
31. (a) The Authority shall determine the tariffs based on the principle of cost, taking into
account inter alia the type and standard of the services; every price shall reflect
the cost of that service, with no reduction in one price at the expense of raising
another price; if the State budget specifies support for the purpose of reducing the
price of a service, the amount of the support shall be deduced from the cost of that
service.
(b) For the purpose of determining tariffs, the Authority shall review the costs of the
holder of an essential service provider’s license; the Authority may when setting
tariffs ignore some or all of the costs that in its opinion are not necessary for the
holder of the essential service provider’s license to comply with his obligations.
(c) On the matter of costs as stated in sub clause (a), the Authority shall take into
account a fair rate of yield on capital, considering the rights and obligations of the
holder of an essential service provider’s license.
(d) Notwithstanding the foregoing in sub clause (a), when setting tariffs paid by
consumers in general the Authority shall take into account any costs not taken into
account as a result of the reduced payments according to clause 31a.
31a. (a) A consumer eligible for a benefit pursuant to clause 2(a)(4) of the Income Support
Law, 5741-1980 shall pay a reduced price that is 50% less than the domestic
tariff, for the first 400 kwh consumed each month for domestic use only; in this
clause, “domestic tariff” – the tariff for payment for electricity consumption in
residential buildings only.
(b) (1) The Minister, in consultation with the Minister of Welfare and with the
consent of the Minister of Finance, may stipulate other needy population
groups, whose members shall pay a reduced tariff, determined as a
proportion of the domestic tariff, for the quantity of electricity for which he
is entitled to a reduced tariff, and for that purpose he may take into account
the number of people living in the consumer’s home and the area of
residence, their income, age and medical status, and all in proportion to the
average consumption of electricity by consumers with the same number of
people living in the home.
(2) Eligibility for reduced payments according to this sub clause shall be
determined such that the total reduction in payments for electricity
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consumption under this clause shall be no greater than an amount equal to
1.5% of the total amount paid by all consumers for electricity.
(c) The Minister, in consultation with the Minister of Welfare, shall determine
provisions regarding the ways of proving eligibility for reduced payment in
accordance with the provisions of this clause, and he may also determine
provisions regarding the method of furnishing information to prove such
eligibility.
32. (a) The Authority shall determine the tariffs from time to time and they shall be
updated according to a formula determined by the Authority.
(b) The update formula as stated in sub clause (a) may take account of an improved
efficiency coefficient; on this matter, “improved efficiency coefficient” – the rate
of deduction from the update which the Authority, in consultation with the
Ministers, decides to take into account, for the greater efficiency of the holder of
an essential service provider’s license.
33. (a) The Authority shall determine criteria, subject to the development plan approved
by the Minister pursuant to clause 19; the criteria shall be available for
consultation by the public and shall be published in the manner determined by the
Minister.
(b) The Authority shall determine provisions regarding payments to be made by the
holder of an essential service provider’s license to consumers for any breach of
the criteria determined according to sub clause (a).
34. The Authority may determine obligations regarding accounting records and reporting
to the public that shall apply to the holder of an essential service provider’s license, in
addition to the obligations placed on him by any law; such obligations may include
provisions regarding details of the accounts to be published by the holder of an
essential service provider’s license and the dates of such publication.
35. For the purpose of executing its functions pursuant to this Law, the Authority may
require the holder of an essential service provider’s license to submit to it reports and
any other information, according to its demands.
36. The decisions of the Authority according to this Law, including explanations of the
manner of determining the tariffs and statistical data, shall be made public, unless the
Authority determines otherwise, for special reasons to be specified.
37. In order to perform its functions under this Law –
(1)
The Authority shall allow representatives of consumers’ organizations to
bring before it suggestions and views on the matter of determining the tariffs
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and the criteria, in the manner determined by the Minister, in consultation
with the Minister of Finance, at the Authority’s suggestion;
(2) The Authority shall investigate any complaints from consumers and decide
on them.
37a. (a) The Authority shall submit to the Minister, at the beginning of each year, a work
plan for that year, and at the end of the year – a report of its activities during that
year; the Authority shall also submit to the Minister, at his request, within a
reasonable time, other reports on its activity, and data and information regarding
its activities, whether in general or on a particular subject, all as specified in the
request.
(b) The Minister or the Minister of Finance may demand that the Authority formulate
a position on a particular matter, to be specified in the demand; if they so
demand, the Authority shall discuss that matter and decide its position within 60
days or within any other reasonable time stipulated in the demand; if the
Authority does not discuss that matter within the aforesaid period, excluding for
circumstances beyond its control, the Minister or the Minister of Finance, in the
framework of their powers under any law, may take action on that matter
otherwise than through the Authority.
37b. (a) If the Minister sees that the Authority is not operating properly in according to the
provisions of this Law, he shall inform the Authority, by detailed written notice
sent to the chairman of the Authority, that if within the stipulated reasonable time
the Authority fails to perform its duties as specified in his demand, he will order
its dissolution; if the Authority fails to perform its duties within the time specified
by the Minister in his notice, the Minister may, in consultation with the Minister
of Finance and with the approval of the Government, order the dissolution of the
Authority, and the provisions of clause 40 shall not apply in this matter.
(b) Within 30 days of dissolution of the Authority pursuant to sub clause (a), a new
Authority shall be appointed according to the provisions of clause 22; the
Minister may, with the consent of the Minister of Finance, extend the aforesaid
period by a further 30 days.
(c) Until the appointment of a new Authority as stated in sub clause (b), the Authority
shall continue to operate with its former composition.
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Section B: Chairman of the Authority
38. (a) The chairman of the Authority, appointed pursuant to clause 22(b) shall be in
charge of execution of the Authority’s functions under this Law.
(b) The chairman of the Authority shall be a Civil servant, and the term of his office –
five years, and he may be reappointed for a further term of four years.
39. The chairman of the Authority shall be an Israeli citizen and resident who meets two of
the following conditions:
(1) He has a degree in one of the following subjects: economics, business
management, accountancy, engineering or other subject related to the area of
the Authority’s function under this Law;
(2) He has cumulative experience of at least five years in a senior position in the
management of a corporation with a significant volume of business, or in a
senior position in the public service dealing with economic or engineering
matters.
40. The Government shall not terminate the term of office of the chairman of the Authority
pursuant to clause 29(a)(5) before giving him the opportunity to appeal its decision
before the Service Committee pursuant to clause 7 of the Civil Service Law
(Appointments) 5719-1959; the Service Committee shall discuss the appear after
receiving an opinion from the Civil Service Commissioner.
41. If the Government suspends the chairman of the Authority pursuant to clause 29(c), at
the suggestion of the Ministers it shall appoint a deputy who meets the conditions of
fitness according to clause 39; the deputy shall have all the powers of the chairman of
the Authority according to this Law.
Section C: Structure of the Authority
42. The budget of the Authority shall be determined in an annual budget law, in a separate
budget item; the person responsible for this budget item, on the matter of the Budget
Fundamentals Law, 5745-1985, will be the chairman of the Authority.
43. (a) The employees of the Authority shall be civil servants and the provisions of the
Civil Service Law (Appointments) 5719-1959 shall apply to them, providing that
the chairman of the Authority shall be authorized, with the approval of the
Ministers, together with the Authority’s accountant, to represent the State when
drawing up special contracts with employees.
(b) Employees of the Authority shall operate in accordance with the instructions of
the Authority chairman and under his supervision.
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(c) The service of an Authority employee shall not be terminated except with the
consent of the Authority chairman or in accordance with the instruction of a
competent court of law or tribunal.
44. For the purpose of executing the provisions of this Law, the Authority chairman,
together with the Authority accountant, is authorized to represent the Government
in transactions as stated in clauses 4 and 5 of the State Assets Law, 5711-1951,
excluding land transactions, and to sign documents relating to such transactions
on behalf of the State.
Chapter V.
Authority to enter land to carry out work
45. In addition to the provisions of any law, execution of works and erection of facilities as
stated in clause 145(f) of the Planning Law and its regulations, by a license holder,
must be authorized by the Manager.
46. (a) For the purpose of complying with the terms of his license, the license holder
may, with the consent of the owner of the land, enter land, whether public land or
private land, for the purpose of the following:
(1) to perform any necessary measurements and tests;
(2) to set up and transfer electricity grids through the land and set up electricity
pylons;
(3) to install, build or set up an electrical facility on the land;
(4) to dig, remove stone, earth and wood and carry out other associated actions
required for the exercise of the powers stated in paragraphs (2) and (3);
(5) to remove or cut back, in the vicinity of any electrical facility or electrical
grid either existing or planned, any plant that is interfering with the
construction, existence or proper operation of the said electrical facility or
electrical grid;
(6) to carry out any test, repair or removal of an electrical facility located on the
land, and to make any change in it that does not affect the scope of use of
that land;
(7) to dig overland and underground ditches, tunnels and passages;
(8) to lay cables and pipes in the land;
(9) (a) to open and prepare any road for the purpose of carrying out electrical
work on the land, providing that as soon as the work is complete, the road is
restored to its previous condition;
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in this paragraph, “road” – including a track, path, alley, street, roundabout, passageway,
bridge or open space where the public has right of way;
(10) to remove any installation that is illegally interfering with the proper activity
of the license holder in complying with the terms of the license and to
remove any obstacle that is interfering with such activity;
(11) to install and to build cells, trenches, switching stations, distribution boxes,
branches, connections and any additional or other electrical facility required
for the purpose of setting up, operating, improving, extending and repairing
the grid;
(12) subject to the provisions of any law, to set up communications networks on
the land;
(13) to use a vehicle to cross any land adjacent to a place where it is necessary to
carry out the actions specified in paragraphs (1) to (12).
(b) If the land owner does not give his consent for the actions enumerated in sub
clause (a), the license holder may enter the land for the purpose of complying with
the terms of his license and carry out the aforesaid actions, if he receives
authorization to do so from the manager as stated in clause 47.
(c) When considering whether to grant authorization pursuant to sub clause (a) to
enter private land in order to carry out work that is not needed by that land, the
manager shall consider, inter alia, the existence of alternatives to that work.
(d) Entry pursuant to this clause to a security facility must be approved in advance by
the body authorized to do so by law, for that facility.
47. (a) If a license holder has asked the manager for authorization pursuant to clause
46(b), the manager shall inform the owner of the land accordingly and give him an
opportunity to state his case.
(b) If the manager gives authorization according to clause 46(b), he shall inform the
land owner accordingly, with his reasons, and shall publish the notice in two
daily newspapers as stated in clause 1a of the Planning Law; the notice shall
specify the date when the license holder is authorized to enter the land.
(c) A license holder shall not enter any land until 25 days have elapsed from the day
on which notice of the authorization was delivered to the land owner, unless the
manager has stipulated a shorter period, for special reasons to be recorded.
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(d) A license holder who is planning to carry out work according to this chapter on
public land shall inform the owner of the land and the planning institution
responsible for the area where the land is located.
48. (a) A land owner who considers himself harmed by the provision of authorization
pursuant to this chapter, may lodge an appeal in the Magistrates Court with
jurisdiction over the land, within 21 days of receiving the aforesaid notice.
(b) The Court hearing the appeal may approve the aforesaid decision of the manager,
or cancel it, and it may grant any relief that a court hearing a civil matter is
empowered to grant.
(c) Lodging of an appeal in the Court shall not delay use of the land according to the
authorization of the license holder, unless the Court so decides, in a reasoned
decision based on special grounds that it perceives.
49. (a) The Minister of Justice may stipulate the rules of procedure for the appeal; in the
absence of such rules of procedure, the Court shall hear the case in the manner it
deems most effective for achieving a quick and just decision.
(b) The Court hearing the appeal shall not be bound by the rules of evidence,
excluding the laws of witness immunity and confidential evidence as stated in
chapter C of the Evidence Ordinance (New Version), 5731-1971.
(c) The Court hearing the appeal may appoint a professional consultant to assist it
with professional matters but he shall not take part in delivering the verdict.
(d) The professional consultant shall be entitled to remuneration and reimbursement
of costs from the license holder requesting authorization, in amounts to be
determined by the Court.
50. (a) A license holder who is carrying out work under this chapter, shall avoid as far as
possible causing any damage and shall restore the land, as far as possible, to the
condition it would have been in if no use had been made of it.
(b) If any direct damage is caused to the land holder as a result of the work, at the
demand of the affected party, the body executing the work shall pay compensation
for the said damage.
(c) If the license holder decides to reject a demand for compensation pursuant to sub
clause (b), he shall given the land owner written notice with reasons for the
rejection within sixty days of receiving the demand.
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51. Notwithstanding the provisions of clause 12 of the Land Law, 5729-1969, an electrical
facility or electrical grid connected to the land of another party shall be owned by the
party that installed them in accordance with the law.
Chapter VI.
Offenses and penalties
52. (a) Anyone who commits an offense against the provisions of clauses 17(b) or (c), 34
or 35 or a license holder who breaches any of the terms of the license, with
respect to the activity covered by the license, shall be liable for one year of
imprisonment or a fine that is three times the fine stipulated in clause 61(a)(2) of
the Penal Law, 5737-1977 (hereinafter: the Penal Law), and an additional fine for
every day in which the offense continues, three times the fine stipulated in clause
61(c) of the Penal Law.
(b) An offense under sub clause (a) does not require proof of criminal intent or
negligence.
(c) Anyone who carries out any of the actions enumerated in clause 3 without a
license, or who breaches any of the provisions of clause 17(a) shall be liable for
three years of imprisonment or a fine that is four times the fine stipulated in clause
61(a)(3) of the Penal Law, and an additional fine for every day in which the
offense continues, four times the fine stipulated in clause 61(c) of the Penal Law.
53. Anyone who spoils an electrical facility, excluding a facility for private use, or any part
of an electrical grid, causing it damage or removing it from its place or illegally
damages a power station, shall be liable for five years of imprisonment.
54. Anyone who does any of the following shall be liable for three years of imprisonment:
(1) Disturbs, prevents or hinders the transmission, distribution or supply of
electricity;
(2) Disturbs a license holder or his agents, himself or through his agents or
contractors, in the erection, operation, maintenance, alteration, testing or
repair of an electricity grid;
(3) Connects to the electricity grid of the holder of an essential service
provider’s license.
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55. (a) An officer and also a partner, excluding a limited partner, must supervise and do
everything possible to prevent offenses under this chapter by the corporation or
any of its employees; anyone who breaches the aforesaid obligation shall be
liable to one year of imprisonment and a fine as stated in clause 61(a)(3) of the
Penal Law.
(b) If any of the offenses under this chapter is committed by a corporation or any of
its employees, it shall be presumed that an officer as well as a partner, excluding a
limited partner, has breached his aforesaid obligation in this clause, unless he can
prove that he acted without criminal intent or negligence and did everything
possible to comply with his obligation.
56. (a) If suspicion arises of an offense against any of the provisions of this Law, the
chairman of the Authority, with the approval of the Minister or whoever he has
empowered for this purpose in writing, may demand from the license holder any
document relating to the matter, including reports, registers and certificates or any
other documents (hereinafter: documents) that could tend to ensure or ease the
performance of the provisions of the Law or the license, or to prove the offense.
(b) The documents shall be returned to their source, no later than the end of six
months from the day when they were taken, unless an indictment is filed in a case
for which the documents may serve as evidence; a judge in a Magistrate’s Court
may, at the request of the Authority chairman or counsel for the Government’s
legal adviser, and after giving anyone from whom documents were taken a proper
opportunity to present his arguments, extend this period under terms to be stated.
(c) The chairman of the Authority shall furnish the license holder with photocopies of
any documents taken from him within seven days of their being taken, unless the
license holder waives this requirement.
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Chapter VII. Miscellaneous provisions
57. The Government shall appoint, at the suggestion of the Minister, a manager for the
purpose of this Law; the manager shall be a civil servant, directly subordinate to the
Minister.
58. (a) The Minister may announce, with Government approval, an emergency in the
electricity sector, for a limited period; on this matter, “emergency” – including a
deliberate stoppage of compliance with his obligations by the holder of an
essential service provider’s license pursuant to this Law or his inability to comply
with such obligations.
(b) The Minister, in consultation with the Minister of Finance and with the approval
of the Government, may stipulate provisions that shall apply to the activity of the
electricity sector during an emergency, in general or for certain categories.
Chapter VIII.
Preserving laws and other provisions
59. (a) The Electricity Franchises Ordinance is repealed.
(b) The Electricity Franchises Ordinance (Jerusalem) is repealed.
(c) The Electricity Supply Law (Special Provisions), 5748-1987 is repealed.
(d) The Electricity Law, 5714-1954 –
(1) Clause 2 is repealed.
(2) The following shall be added at the end of clause 4(d): “and providing that it
was installed before the commencement of the Electricity Sector Law, 57561996”.
(3) To the extent that its provisions do not contradict the provisions of this Law,
those provisions are in force.
(e) Regulations, Orders or Rules instituted by virtue of the Electricity Franchises
Ordinance shall be in force unless they are explicitly repealed in this Law or have
expired, until two years have elapsed from the commencement date of this Law.
(f) The tariffs in existence at the time of commencement of this Law, including their
updates, shall remain in force until changed pursuant to the provisions of this
Law.
60. (a) The Israel Electric Corporation Ltd. (hereinafter: Electric Corporation) shall
continue its activities and the provision of the services it provided before the
expiry of the electricity franchises, according to the Electricity Franchises
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Ordinance and the provisions of the Electricity Supply Law (Special Provisions),
5748-1987, and the Orders deriving from it, until licenses shall have been
awarded pursuant to this Law and no later than the 2nd of Ellul 5757 (4th
September 1997); for that purpose it shall have all the rights, powers and
obligations that it had before the commencement of this Law, excluding the rights
and powers pursuant to clauses 3 and 25 of the Addendum to the Electricity
Franchises Ordinance.
(b) The Electric Corporation of East Jerusalem Ltd. shall continue its activities and
the provision of the services it provided before the expiry of the electricity
franchises, according to the provisions of the Electricity Supply Law (Special
Provisions), 5748-1987, and the Orders deriving from it, until licenses shall have
been awarded pursuant to this Law and no later than the 2nd of Ellul 5757 (4th
September 1997); for that purpose it shall have all the rights, powers and
obligations that it had before the commencement of this Law.
(c) Whosoever was prior to the commencement of this Law the holder of a license to
carry out an activity, shall be authorized to continue that activity until the 2 nd of
Ellul 5757 (4th September 1997), and whosoever had a production license shall
also be authorized to sell electricity to whomever was linked to him in a contract
for the sale of electricity that was in force on the commencement date, in
accordance with the terms of that contract.
(d) Notwithstanding the provisions of clauses 4(b) and 9(b), a first license for the
transmission, distribution, supply, sale and trade in electricity shall be granted to
the Electric Corporation for a period of ten years from the commencement date of
this Law (hereinafter: the transitional period).
(d1) Repealed.
(d2) Repealed
(d3) Repealed.
(d4) (1) In this sub clause, “the licenses” – the licenses granted pursuant to this Law to
the Electric Corporation, that were in force before the end of the transitional
period..
(2) Notwithstanding the provisions of this Law and the provisions of the licenses,
the licenses shall remain in force for all activities carried out under the licenses,
until 15th Tammuz 5767 (1st July 2007), providing that the Electric Corporation
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shall act in accordance with their provisions, the provisions of this Law and the
provisions of any other law.
(3) The provisions under this Law shall apply to the licenses during the period of
extension of the licenses pursuant to this sub clause.
(d5) The Authority, with the approval of the Minister, may grant production licenses
even if the provisions of clauses 4 and 6 or any provisions stipulated in the
regulations deriving from this Law are not met, for the purpose of power stations
included in the development plan approved pursuant to clause 19 and whose
construction began before the 14th Adar 5767 (4th March 2007), for the period
during which the licenses within the meaning of sub clause (d4) are in force,
under the provisions of this clause.
(d6) The Authority, with the approval of the Minister, may grant production licenses
and distribution licenses to a Government company or a Government subsidiary,
for the purpose of the electric system operating in accordance with the licenses
within the meaning of sub clause (d4) and in accordance with the licenses granted
in accordance with sub clause (d5), even if the provisions of clause 6(f)(3) and
(g)(3) are not met, providing that all the following conditions are met:
(1) Production licenses shall only be granted if after receiving the license the
license holder shall control power stations operating on a mixture of various kinds
of fuel, including diesel, natural gas and coal, but on the matter of coal, the
applicant for a license is permitted not to produce electricity using coal himself,
but shall have the rights to receive electricity produced in coal fired power
stations; a license holder under this paragraph shall refer to anyone who controls
a significant portion of production in the electricity sector, as stated in clause
18(b), and he shall be subject to the provisions of this Law on the matter of the
holder of an essential service provider’s license, as long as the Minister has not
determined otherwise; the Minister’s determination as aforesaid before the 12th of
Shevat 5775 (1st January 2015) requires the consent of the Minister of Finance.
(2) Distribution licenses shall be granted in such a way that the costs of the
license holders with respect to the electrical facilities used for their activity, at the
time of granting the licenses, shall be similar as far as possible; however the
Ministers may, in consultation with the Authority and with the Government
Companies Authority, determine otherwise if they believe that this is essential in
order to promote the aims of this Law.
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(3) After receiving the license, the license holder shall not control, through one
corporation, 30% or more of production capacity in the electricity sector or 25%
or more of distribution capacity in the electricity sector.
(4) The validity of the license shall be conditional on the fact that from the 23 rd
of Tammuz 5773 (1st July 2013) onwards, no Government company or
Government subsidiary, jointly or severally, shall hold more than 51% of the
means of control of the holder of a distribution or production license, granted
pursuant to this clause.
(d7) (1) In this sub clause –
“The determining date” – the date specified below, according to the type of
license:
(1) On the matter of a system management license – 1st Ellul 5768 (1st
September 2008);
(2) On the matter of a production license – 5th Tevet 5769 (1st January 2009);
(3) On the matter of a distribution license and a supply license – 15th Tevet
5770 (1st January 2010);
(4) On the matter of a transmission license – 24th Tevet 5771 (31st December
2010).
(2) The Ministers, in consultation with the Authority and with the Government
Companies Authority, may extend, by Orders, the validity of the licenses
within the meaning of sub clause (d4) and of the licenses granted pursuant to
sub clause (d5), as specified below:
(a) An extension for the period from 16th Tammuz 5767 (2nd July 2007)
until 20th Heshvan 5768 (1st November 2007) – if they find that this is
essential to promote the aims of this Law;
(b) An extension for the period from 21st Heshvan 5768 (2nd November
2007) until the date as specified below, as applicable, and providing that
such extension shall be made in the framework of an Order determining
the manner of implementing the structural change in the electricity
sector, and by which it shall be possible, starting on the determining
date, to grant licenses in accordance with the provisions under this Law
including according to sub clause (d6), for all activities carried out in
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accordance with the licenses whose term is extended (in this sub clause
– the Implementation Order) –
(1) on the matter of production licenses and transmission licenses –
until 23rd Tevet 5768 (1st January 2008);
(2) on the matter of distribution licenses and supply licenses – until 5th
Tevet 5769 (1st January 2009).
(c) Extension of the term of licenses for production, distribution and supply
for the period following the end of the period as stated in sub paragraph
(b)(1) or (2), as applicable, until the determining date, as applicable, and
providing that corporations have been established according to the
Implementation Order, in a manner that shall permit, starting from the
determining date, granting of production and distribution licenses to
those corporations pursuant to the provisions of this Law, including sub
clause (d6).
(d) Extending the validity of a transmission license beyond the term stated
in sub paragraph (b)(1) as specified below:
(1) from the end of the aforesaid period in sub paragraph (b)(1) to the
1st Ellul 5768 (1st September 2008) – if a corporation has been
established in accordance with the Implementation Order, in a manner
that shall permit, starting from the determining date, granting of a
system management license to that corporation pursuant to the
provisions of this Law;
(2) from 2nd Ellul 5768 (2nd September 2008) until 14th Tevet 5770 (31st
December 2009) – if a system management license has been granted
pursuant to the provisions of this Law;
(3) from 15th Tevet 5770 (1st January 2010) until 24th Tevet 5771 (31st
December 2010) - if a corporation has been established in accordance
with the Implementation Order, in a manner that shall permit, starting
from the determining date, granting of a transmission license to that
corporation pursuant to the provisions of this Law
(3) The provisions of the Implementation Order shall be deemed for the
purposes of this Law to be one of the conditions of the licenses extended
pursuant to this sub clause, on the matter of the activity covered by the
licenses.
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(4) The licenses extended pursuant to this sub clause shall remain in force
for the extension period providing that the Electric Corporation shall act
in accordance with their provisions and the provisions of this Law and
the provisions of any other law.
(5) The provisions of this Law shall apply to the licenses extended pursuant
to this sub clause, during the extension period.
(d8) (1) The Ministers shall determine, in an Order. In consultation with the
Authority and with the Government Companies Authority, by 25th Tevet
5771 (1st January 2011), whether a Government company or a
Government subsidiary that holds the means of control of the holder of a
production or distribution licenses may also hold the means of control of
the holder of a transmission license.
(2) If the Ministers have determined, in an Order pursuant to paragraph (1),
that a Government company or Government subsidiary may not hold the
means of control of the holder of a transmission license, they shall also
determine the date and the manner for implementation of their decision,
providing that the said date shall be no later than 19th Tevet 5773 (1st
January 2013), and the validity of the transmission license shall be
conditional on compliance with the provision of the aforesaid Order.
(3) If the Ministers have determined, in an Order pursuant to paragraph (1),
that a Government company or Government subsidiary may hold the
means of control of the holder of a transmission license, they may
determine in that Order the terms, restrictions and provisions that shall
apply to such a holding, for the purpose of promoting the aims of this
Law, and the validity of the transmission license shall be conditional on
compliance with the provisions of the aforesaid Order and the provisions
of sub clause (d6)(4).
(d9) Starting on 5th Tevet 5769 (1st January 2009), a Government company or a
Government subsidiary which holds the means of control of a license holder
according to this clause, shall not engage in activity relating to the
engineering design of power stations, the construction of power stations, the
logistics, information technologies and purchase of all types of fuel, and a
Government company or Government subsidiary that holds a license
according to this clause shall not engage in such activities for another
corporation with a license pursuant to this Law; however, if corporations
have been established that are authorized to engage in the aforesaid
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activities, the Ministers shall determine, in an Order, that such company may
continue to engage in the said activities until 15th Tevet 5770 (1st January
2010), and the Ministers may determine in an Order that notwithstanding the
provisions of the Obligation for Tenders Law, 5752-1992, a Government
company or Government subsidiary that holds a license according to this
clause shall give priority to these corporations and all during the period and
on the terms to be determined.
(d10) Notwithstanding the foregoing in clause 4(b1), a supply license may be
granted to a Government company or Government subsidiary that holds a
distribution license according to this Law, until 6th Tevet 5772 (1st January
2012), and the Ministers may, in consultation with the Authority and with the
Government Companies Authority, determine, in an Order, that it is possible
to grant such a company a supply license up to 19th Tevet 5773 (1st January
2013).
(d11) The Ministers, in consultation with the Authority and with the Government
Companies Authority, if they consider such action to be essential to promote
the aims of this Law, may, in an Order, postpone all or some of the dates
stated in sub clause (d6) to (d10), excluding the date specified in sub clause
(d7)(2)(a), for a period that shall not exceed six months.
(e) Nothing in the provisions of this Law affects the actions of the manager
according to clauses 6 and 15 of the Electricity Franchises Ordinance, that
commenced before the commencement of this Law.
(f) The first appointment of members of the Authority, pursuant to clause 22,
shall be done within 60 days of the commencement of this Law.
61. Nothing in the provisions of this Law affects the obligations and rights of the Electric
Corporation under any contract, unless explicitly cancelled or amended in this Law.
62. (a) Notwithstanding the provisions of clause 46 of the addendum to the Electricity
Franchises Ordinance, the undertakings of the Electric Corporation and the rights
and assets that it held when the franchise expired and for which it is entitled to
compensation from the State according to the aforesaid clause, shall remain in the
possession of the Electric Corporation and no compensation shall be paid
therefor.
(b) The rights and assets for which the Electric Corporation is not entitled to
compensation, as stated in sub clause (a) and which are used or intended for use,
either directly or indirectly, in its activity pursuant to this law, shall be purchased
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by the Company at their value on the day the rights and assets are granted, in
accordance with an arrangement to be signed between the State and the Electric
Corporation; in this clause, “used”, “intended for use” – as determined by the
Ministers.
(c) Until the signing of the arrangement as stated in sub clause (b), the rights and
assets that the arrangement is intended to resolve shall remain in the possession of
the Electric Corporation, as they were at the time the franchise expired; if the
parties are unable to reach an arrangement as aforesaid within one year from date
of expiry of the franchise, the Ministers shall determine provisions regarding the
purchase of the said rights and assets.
(d) If the State is required to make any payment because of any of the undertakings of
the Electric Corporation that were in force when the franchise expired, due to its
expiry or as a result of compliance with the provisions of sub clauses (a) or (b),
the Electric Corporation shall compensate it for the said payment.
(e) For the purpose of determining tariffs, full account shall be taken of the costs
applying to the Electric Corporation, according to the arrangement determined by
the Ministers in connection with the agreement signed between the State and the
Electric Corporation on 20th Tishri 5735 (25th September 1975).
63. The Minister is responsible for implementation of this Law and he may institute
regulations and rules for its performance.
64. In the Government Companies Law, 5735-1975 –
(1) In clause 60a(b) the following shall be added after paragraph (4):
“(4a) On the matter of fitness for office for the Public Services Authority –
Electricity, pursuant to the Electricity Sector Law, 5756-1996, the provisions
of clause 16a shall be replaced by the provisions of clauses 22(c)(3) and 39
of the aforesaid Law.”
(2) The following shall be added at the end of the Addendum:
“7. The Public Services Authority – Electricity, pursuant to the Electricity
Sector Law, 5756-1996.”
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65. In the Administrative Offenses Law, 5746-1985, in the Addendum, after “the Land
Betterment Tax Law, 5723-1963, the words “The Electricity Sector Law, 5756-1996”
shall be added.
66. In the Civil Service Law (Appointments), 5719-1959, in the Addendum the following
shall be added at the end:
“The chairman of the Public Services Authority – Electricity;
The manager of the Electricity Administration in the Ministry of Energy and
Infrastructure”.
67. (a) This Law shall commence, excluding clauses 52 to 55, on 13th Adar 5756 (4th
March 1996).
(b) Clauses 52 to 55 shall commence on the date of publication of this Law.
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