Political risk insurance from the Overseas Private Investment Corporation (Opic) will enable a US company to help operate a power plant in the Gaza Strip, the first such plant under the regulatory control of the Palestinian Energy Authority (PEA).
Because Israel, the West Bank and Gaza Strip are connected to a single electricity grid, the additional power capacity generated by the project will also benefit Israel, by freeing up generation capacity to meet growing demand in that country.
Opic will provide US$48mn in insurance to a subsidiary of Morganti Group, a Connecticut-based construction company, to help operate a 140MW power plant in the Gaza Strip, the output of which will be sold to the PEA, the authorised utility in the West Bank and Gaza Strip. The plant began generating power in single cycle in June 2002, and reached full commercial operation in March 2004.
The project is also an important component in the development of water infrastructure in Gaza; the capacity generated by the project will help meet a critical need to develop new water resources to replace limited groundwater supplies.