With the summer heat comes non-stop running of your air conditioning unit. As the price of electricity continues to move higher, many are faced with a question. Should we sit and swelter in our own home, or should we run the air conditioning even though we won’t be able to pay the bill? What if I told you that all people who pay for electricity are suckers! That’s what employees of the Israel Electric Corp. (IEC) think of you. You see, as a job perk they get free electricity. IEC employees get free electricity of 18,000 kilowatt hours, 3 times what the average Israeli family uses. And don’t think that they are careful with their usage. Average consumption by IEC employees is 14,000 kilowatt hours, twice the average rate of consumption. Boy am I glad that they use up most of their allotment.

Of course this perk is paid for by regular people, in the form of higher electricity rates. But that’s not all. Globes is reporting about some irregularities found in IEC books. “IEC has set aside more than NIS 1 billion ($300 million) in a special fund to cover the cost of free electricity to staff, The Public Utilities Authority (Electricity) believes. The regulator recently uncovered the fund during the course of an examination of the new basis for electricity tariffs, and after gaps were found between the sums IEC raised and its actual investments.”

The thought is that they created a fund with this money in the event that the free electricity perk is revoked, so that they will still be able to provide free electricity to their employees. This is just sick.

What can I say. I guess those of us paying electric bills really are suckers.

Aaron Katsman, IsraelNewsletter.com

Disclosure: Author’s fund has no positions in any stock mentioned as of 7/24/08.

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Aaron Katsman is Managing Editor of the Israel Opportunity Investor newsletter. He is lead portfolio manager for the Israel Growth Portfolio and Managing Director of America Israel Investment Associates, LLC. For more information, go to www.israelnewsletter.com or call 1-888-327-6179, or email aaron@profile-financial.com.

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