GWI Newsletter -- Israeli Government to Blame for Water Crisis (Part 3)

Israel would rather be known for its technical innovations, but recently, it has been getting in the news for all the wrong reasons.  International relations aside, the state now lacks 15.2bil m3 of water in its reservoirs due to over extraction of water. This is more than five times Israel's annual water demand! A government-appointed committee puts the blame squarely on several government agencies:

• Water Authority -- lacked public transparency, failed to coordinate with other government agencies, did not warn of the crisis in time, took no action to prevent overproduction, and did not adequately explain the consequences of a delay in implementing desalination on the necessary scale
• Finance Ministry -- delayed the desalination plan asking that conservation and water reuse be done first, but provided insufficient resources to do so

Cliched as it maybe, every cloud has its silver lining, and companies can now look forward to the rolling out of a large number of projects, ranging from large desalination plants and major network expansions, to groundwater protection measures.

Bank-rolling these projects, though, may be more of a challenge. Tariff hikes of just over 40% have already been scheduled for this year, but it is estimated that tariff rates will have to rise by at least 60% to cover the full cost of these projects. The Finance Ministry is, obviously, facing difficulties in raising tariffs any further, and are likely to have to allocate funds from the state budget. Honestly, can they afford not to?

Main source:
Report Reveals Israel's Crisis of Confidence