The first cracks are appearing in the gas companies’ united front against the government’s planned reform in the household gas market. Alon Israel Oil Company Ltd. subsidiary Dorgas Ltd. today announced that it supports the reform. The Ministries of Finance and National Infrastructures included the reform in the 2008 economic arrangements bill.
Dorgas CEO Eli Misgav said, “The pending reform is a needed measure in the gas market. The reform has been planned for years, but never carried out. The reform will make it easier for consumers to switch companies and it will strengthen competition for the benefit of consumers.”
Israel’s cooking gas market has an annual turnover of NIS 2.5 billion. Four companies - Pazgas Ltd., Supergas Ltd., Amisragas Ltd. and Dorgas - control 90% of the market. Dorgas entered the market in 1989 following the previous reform. Industry sources noted that Dorgas has a market share of 5-10%, which is why it has an interest in supporting the reform, which could help it expand its market share.
The other gas companies are still waging a legal battle against the new regulations. Some of the companies are planning to petition the High Court of Justice in the matter.
The reform measures include a six-month ban on companies to negotiate with consumers who have decided to switch companies, the provision of equal services in all operating areas within a 15-kilometer radius, a complete separation between the installation of gas lines to homes and signing contracts with a gas supplier, and allowing the immediate change in suppliers.
Published by Globes [online], Israel business news - www.globes.co.il - on August 15, 2007
© Copyright of Globes Publisher Itonut (1983) Ltd. 2007