Powering injustice

‘Powering Injustice’ examines how foreign trade and investment in Israel’s energy sector may contribute to grave violations of international law being perpetrated by Israel in the Occupied Palestinian Territory, including in Gaza. It considers the obligations of states and the responsibilities of companies involved in the supply of energy to Israel.

The report is framed in light of two important determinations made by the International Court of Justice (ICJ) in 2024.

• On 26 January 2024(opens in new window) , the ICJ concluded that there was a plausible risk of Israel committing acts of genocide in Gaza. The Genocide Convention obliges states to take action to prevent genocide. The ICJ has clarified that this obligation arises from the moment states are aware of a serious risk that acts of genocide are being committed. States were made aware of the risk of genocide in Gaza by the ICJ’s 26 January order.
• On 19 July 2024(opens in new window) , the ICJ determined that Israel’s occupation of the Gaza Strip and the West Bank, including East Jerusalem, is unlawful, along with the associated settlement regime and the annexation and use of Palestine’s natural resources. The Court made clear that third states must “abstain from entering into economic or trade dealings with Israel […] which may entrench its unlawful presence in the territory”. Furthermore, third states must “take steps to prevent trade or investment relations that assist in the maintenance of the illegal situation created by Israeli in the Occupied Palestinian Territory”.

The ICJ’s findings have direct relevance for foreign investors and companies. Under widely accepted international standards on business and human rights, including the UN Guiding Principles (UNGPs), companies must respect all human rights. The UNGPs, by their nature, must be read in light of international human rights and humanitarian law, and the authoritative interpretation of these laws. In addition to compliance with international standards, depending on the context, companies involved in the supply of energy to Israel may also face risks of legal liability if their contribution to unlawful acts reaches the threshold of complicity.

Energy, or fuel to produce energy, plays a significant role in Israel’s military operations and unlawful presence in the Occupied Palestinian Territory. Israeli military vehicles, including jets and tanks, which have been used in the commission of crimes under international law in Gaza, require substantial amounts of fuel to operate. Israel has considerable dependency on imports of fuel, particularly military jet fuel and crude oil, which is refined in Israel and supplied to the military, amongst other end users. SOMO identified deliveries of crude oil, and liquid fuel, such as gasoline, diesel, and jet fuel, to Israel involving the United States (U.S.), Brazil, and Azerbaijan amongst the largest suppliers. Data also shows deliveries from Greece, Albania, and Kazakhstan, amongst others, with military jet fuel coming from the U.S.

Israeli settlements are one component of what the ICJ has declared as Israel’s illegal occupation of Palestinian territory. Israel’s electricity grid directly incorporates illegal Israeli settlements located in the West Bank, including East Jerusalem and the occupied Syrian Golan. Nearly all of Israel’s electricity comes from gas, coal or renewable energy. Gas is the main fuel, accounting for more than 70% of electricity generated. Most gas comes from Israel’s offshore gas fields, several of which are operated by foreign oil and gas companies. Israel imports coal, with Russia and South Africa being major source countries. Coal contributed 17.5% to the grid in 2023. Wind and solar power contributed just over 10% in the same year. Multiple renewable energy projects in Israel involve foreign companies and investment.

As a matter of policy, Israel’s electricity grid does not differentiate between civilian infrastructure within its 1948 borders and illegal settlements. The fact that the provision of electricity services to settlements is done through the national grid reinforces the view expressed by some Israeli policymakers that the settlements are part of Israel. SOMO’s analysis makes the case that foreign investments in the generation of electricity for Israel’s grid, and specifically trade in coal and investment in gas extraction and renewable energy projects that supply the grid, constitute trade and investment relations that “assist in the maintenance of the illegal situation created by Israeli in the Occupied Palestinian Territory.” 

In relation to the ICJ’s finding that there is a plausible risk of genocide in Gaza, third states and business actors have been put on notice. The gravity of the situation was underscored when, in:

• November 2024(opens in new window) , the International Criminal Court issued arrest warrants for Prime Minister Benjamin Netanyahu and former Defence Minister Yoav Gallant for suspected crimes against humanity. In 
• December 2024(opens in new window) , Amnesty International unambiguously concluded that Israel is committing genocide in Gaza.
• Companies involved in coal exports or gas extraction and renewable energy projects in Israel are also, following the July 2024(opens in new window)  ICJ advisory opinion, on notice and must act. While the ICJ’s determination places obligations on States, the Court’s opinion is critical information in terms of corporate human rights due diligence and establishing knowledge of the potential for a company or its executives to be involved in violations of, or crimes under, international law.

In the report, we conclude that foreign governments have an obligation to end the supply of fuel to Israel unless they can guarantee it will only be used for non-military purposes. This includes both a ban on the export of crude oil, military jet fuel, and other fuels, as well as a prohibition on the transport of these commodities through their territory. 

We also argue that states should end the supply of coal to Israel where there is no means of ensuring it does not end up supplying electricity to settlements, on the basis that this constitutes trade dealings with Israel which may entrench its unlawful presence in the Occupied Palestinian Territory.

In respect of foreign investment in gas exploitation and renewable energy projects in Israel, the home states of foreign multinationals which are invested in these enterprises should take steps to prevent such investment relations insofar as they assist in the maintenance of the illegal settlements. This may include advisory, regulatory and legal action to support companies to implement effective due diligence measures and, where necessary, divest from Israel.

The corporate responsibility to respect human rights requires companies to act, even if states do not. Companies investing in Israel’s energy sector or involved in the trade supply chain of fuels, including jet fuel, crude oil, refined oils and coal, should urgently review their engagement and conduct enhanced due diligence assessments which examine the risk that they are contributing to violations of international law. Where companies cannot identify measures to prevent their involvement, or risk of involvement, they should divest.

Given the need to balance divestment from the energy sector with protection of the rights of Palestinians and Israelis to access energy necessary for heat, cooking, health and wellbeing, companies should give clear notification and timeframes for their divestment. They should also seek the support of their home states in ensuring civilian access to energy, making clear access must cease to be discriminatory. The report outlines several measures which can be brought to bear to allow responsible divestment while respecting human rights.