The Israeli government has decided to break up the monopoly of the state-owned power utility Israel Electric Corporation (IEC) and the sector will be opened to competition for private electricity producers. The agreement has been signed by IEC, the Histadrut trade union and the Ministry of Finance and still requires approval from the Knesset.
IEC has been managing the domestic power supply chain for decades but has agreed to sell five of its power plants over the next five years and will set up a new subsidiary for the development of two new power stations projects, which are yet to be built. IEC's system management and planning unit will be sold to another government-owned company, but the state power utility will retain its power distribution monopoly. However supply will be gradually opened to competition.
In recent years, the power generation market has been open to competition and independent power producers (IPPs), such as Edeltech, IC Power or Dalia Power Energies, operate more than 3 GW, i.e. more than 20% of the total installed capacity.