IEC workers (file)
IEC workers (file) Flash 90

The Israel Electric Corporation (IEC) has restored full power supply to the Palestinian Authority (PA) city of Jericho in Judea to the east of Jerusalem after reducing it over an enormous outstanding debt, officials said Sunday.

The cut last Thursday led to blackouts, but full supply was restored later the same day, according to Mansour Nassar of the Palestinian Jerusalem District Electricity Company (JDECO).

IEC had reduced supply to Jericho over a debt of 1.7 billion shekels ($450 million, 397 million euros) owed by the private JDECO and the PA. While that massive debt has yet to be paid, Israel nevertheless decided to return full power.

An Israeli official said supply was reduced by half, while JDECO said it had been cut by two-thirds.

The Israeli official said the IEC could at any point renew the cut. It was not clear why Israel decided to restore power after the brief cut.

Thursday's cut had affected up to 30,000 people of a total population of around 50,000 in the city and surrounding area, according to Jericho governor Majed al-Fityani.

The PA is struggling financially amid widespread corruption, and depends largely on foreign aid to prop it up. It relies heavily on Israel for electricity supplies, which also provides electricity to Hamas-controlled Gaza.

Ongoing talks with the IEC and PA have so far not resolved the debt problem.

In January 2015, the IEC cut power to PA cities for a number of hours every day over a similar debt, only to renew it a few weeks later after the US State Department criticized the move.

Some Israeli leaders have suggested using tax money collected by Israel for the PA to pay off the massive debt.

Under an economic agreement signed with the PA in 1994 amid the Oslo Accords, Israel collects around 600-700 million shekels each month in customs duties levied on goods destined for Palestinian markets that transit through Israeli ports.

It transfers the money after deducting approximately 100 million shekels for expenses such as Palestinian hospitalizations in Israel, sewage treatment and covering part of the electricity debt.

AFP contributed to this report.