Hundreds of Thousands Switch to Private Electricity Suppliers in Israel

Hundreds of thousands of Israeli households have switched to private electricity suppliers over the past two years, seeking discounts on their bills. New data from September indicates an acceleration in this trend, with approximately 450,000 households having joined private suppliers since the market opened. In August alone, over 20,000 consumers made the switch, a new monthly record.

The adoption rate varies significantly by city. Modi'in Illit leads with about 33% of households switching, followed by Be'er Yaakov at nearly 29%. Other cities with high adoption rates include Bnei Brak (20.9%), Petah Tikva (20.7%), Rishon LeZion (20.1%), and Beit Shemesh (20.5%). While Tel Aviv has the highest absolute number of switches at over 31,000, this represents only about 11.8% of its households.

Private suppliers offer various plans with discounts typically ranging from a few percent up to 20% or even 21% during specific hours. It is crucial to understand that these discounts often apply only to the variable consumption component of the electricity bill, not the entire amount. Fixed charges and network fees remain subject to the Electricity Authority's tariffs. Higher discounts are usually tied to smart meters and specific off-peak hours.

Contrary to a common misconception, the reform is not limited to households with smart meters. Consumers with basic meters can also switch to private suppliers, provided they choose a suitable tariff and do not use a pre-paid meter. The primary difference lies in the available plans: smart meters allow for hourly consumption tracking, enabling time-of-use discounts, while basic meters typically offer a flat, round-the-clock discount.

Switching to a private supplier does not alter the responsibility for the electricity grid, infrastructure, or meters, which remain under the purview of the Israel Electric Corporation. Private suppliers handle electricity sales, pricing, and billing. Renters are also eligible to switch, as long as their electricity bills are in their name. The switching process is managed by the new supplier and does not involve any physical changes or power outages. Consumers can switch back to the Israel Electric Corporation or to another supplier later, subject to contract terms.