In Israel the electricity tariffs are set by the PUA-Electricity. The tariffs are updated either every six months or if there is a 3.5% change in IEC’s basket of expenses. The tariffs are composed of the approved cost of fuels, operational and maintenance services including consumer cost, capital services (depreciation, interest on debt in NIS linked to the CPI, interest on debt in foreign currencies linked to the Bank of Israel basket currencies, working capital financing, fair rate of return on equity, foreign currency risk exposure), compensation for the delays in updating the tariff, purchases from the IPP’s (Generation only), sectorial efficiency factor, pension surcharge, exogenous cost due to the past.