81 For US investors assessing where to deploy capital in 2026, Israel presents a rare alignment of national policy priorities and private sector opportunity. The market is defined by a state-supported pipeline of projects requiring international capital, engineering expertise, and sophisticated operators to modernize core infrastructure and ensure energy security. Structural Drivers of Demand Israel combines one of the highest population growth rates in the OECD with a rapidly expanding technology sector. This drives sustained increases in electricity consumption for data centers, transport electrification, and energy-intensive desalination. Since Israel operates as an “electricity island” with no physical interconnection to neighboring grids, it must maintain total self-sufficiency through redundancy and grid resilience – a structural condition that shapes every investment opportunity. Key Investment Sectors Transportation: The Tel Aviv Metro Israel’s planned Tel Aviv metro is the largest infrastructure procurement anywhere in the world right now, a USD 50 billion, 150km, three-line heavy rail network serving the country’s economic core from 109 stations. The government has committed half the funding from its own budget, with the remainder to be raised through private and international capital. That sovereign backing, combined with a refined PPP concession structure, makes this a longduration, investment-grade opportunity rather than a speculative bet. The largest infrastructure project in Israel’s history, the Metro is a defining test of the country’s nextgeneration project delivery capability. NTA has launched pre-qualification proceedings for substantial works packages, with procurement documentation in English to encourage international participation. For investors, the significance of the Metro lies not only in size but in what it signals: Israel is now delivering transport projects large and structured enough to attract global infrastructure capital and multinational consortiums. The Opportunity: The project entered active procurement in early 2026, with pre-qualification tenders for Stage 1 civil works. Eleven standalone work packages allow international consortiums, including US firms, to participate without assuming the full program. Beyond civil works, the Metro offers a multidecade pipeline of BOT and PPP opportunities across tunnelling, systems integration, and rolling stock, with operations targeted for 2037 and decades of inflationlinked, demand-backed revenue thereafter. Power Generation: IEC Privatization A second major theme is the transformation of Israel’s power generation landscape through the privatization of Israel Electric Corporation assets. The long-running reform of the electricity sector has not been cosmetic. It has fundamentally altered ownership patterns in power generation and accelerated the shift from a vertically dominant public utility model to a more competitive structure in which private ownership and operational optimization play a much larger role. Major gas-fired stations, including Alon Tavor, Ramat Hovav and Hagit East, have already been sold, and IEC’s own public reporting recorded the expected completion path for the sale of Eshkol as part of that broader reform trajectory. For investors familiar with brownfield power transactions in the United States and Europe, this should immediately resonate. Privatization in Israel is not just about acquiring operating assets. It is about entering a market where asset management, fuel strategy, dispatch economics, refinancing, and integration with storage and renewables are becoming increasingly sophisticated. The Opportunity: For US investors, the attraction is straightforward: cash-generating assets in an advanced OECD market, backed by stable electricity demand and long-term offtake arrangements, without greenfield construction risk. With installed capacity expected to grow 67% by 2030, further privatization and privatebuild opportunities remain large and policy-driven. The next power plant to be privatized is the 1.3 GW Gezer powerplant, near Modi’in in central Israel. ISRAEL — FINANCING
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