1.	Executive Summary0F1

*

EBITDA, EBITDA after proportionate consolidation, adjusted net income and FFO are not recognized in accordance with IFRS – for definitions and the manner of their calculation – see Sections 4B and 4G below.

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1

The Executive Summary below is presented solely for convenience and it is not a substitute for reading the full detail (including with reference to the matters referred to in the Summary) as stated in this report with all its parts (including warnings relating to “forward‑looking” information as it is defined in the Securities Law, 1968 (“the Securities Law”), definitions or explanations with respect to the indices for measurement of the results and including the information included by means of reference, as applicable). This Summary includes estimates, plans and assessment of the Company, which constitute “forward‑looking” information regarding which there is no certainty they will materialize and the readers are directed to the detail presented in this report below.

1.	Executive Summary (Cont.)

(1)

Renewable energy projects are presented in accordance with the relative share of the CPV Group in this area of activities (about 66.7%).

(2)

Natural gas projects are presented in accordance with the relative share of the CPV Group in each project.

1.	Executive Summary (Cont.)

(1)

The above chart does not include the Hadera 2 project, with a capacity of 850 megawatts, in light of the Government’s decision to reject the plan. As at the approval date of the report, a petition is underway in the Supreme Court sitting as the High Court of Justice regarding cancellation of the said Government decision. For details – see Section 5A(2) below and Section 7.3.13.4 of Part A to the Periodic Report for 2024.

2.	Brief description of the areas of activity

3.	Main Developments in the Business Environment

3.1

General

A.

Macro‑economic environment (particularly inflation and interest) – for details regarding the business and macro‑economic environment in which the Group companies operate, significant changes that occurred in 2024 and the impact thereof on the Group’s activities – see Section 3.1A to the Report of the Board of Directors for 2024.

*

The dollar/shekel exchange rate shortly before the approval date of the report (on May 16, 2025) is 3.549.

3.	Main Developments in the Business Environment (Cont.)

3.1

General (Cont.)

B.

Domestic and geopolitical instability in the defense (security) situation in Israel – further to that stated in Section 6.1.1 of Part A of the Periodic Report for 2024, as of the approval date of the report, the ceasefire had ended in some of the combat areas along with increased security instability and a rekindling of the fighting, including calling up of military reserves and air strikes by Yemenite terrorist organizations, as well as significant uncertainty regarding the defense situation in Israel. Also, there is considerable uncertainty with respect to the impacts of the war on macro‑economic and financial factors in Israel, including the Israeli capital market.

As a group operating in Israel, the said rekindling of the fighting, expansion of the scope of the combat and/or a worsening of the defense situation in Israel could unfavorably affect its activities, operating results and liquidity, including due to impacts, as stated, on the Group’s significant suppliers and customers and/or macro‑economic factors and the capital market. Regarding the possible impacts of the war – see Sections 6.1.1 of Part A of the Periodic Report for 2024.

C.

Change of the government in the U.S. – further to that stated in Section 3.1C of the Report of the Board of Directors for 2024, the policy changes against the background of entry into office of the Trump administration has created uncertainty along with opportunities in the energy sector in the U.S. Since his entry into the position in January 2025, President Trump has issued executive orders promoting the production of fossil fuels, including with respect to natural gas and LNG and reduction of government support in the area of renewable energies relating to, among other things, off‑shore wind. In addition, the Trump administration has suspended plans for Federal funding of clean energy and Federal licensing processes for wind projects. In the estimation of the CPV Group, as at the approval date of the report, the said executive orders do not have a significant impact on the activities of the CPV Group in the renewable energy area, and they may have a favorable impact on the business environment and the overall sentiment in the area of natural gas. Furthermore, as at the date of the report, President Trump has imposed tariffs (some of which have been stayed) on import of equipment and raw materials (such as, steel and solar panels) into the U.S., in such a manner that at the present time there is uncertainty regarding the full extent of the impacts of the said orders on the cost of the equipment for the projects. It is noted that the said update of the Customs’ duty could affect the equipment costs (both in the areas of renewable‑energy projects and natural‑gas projects) and trigger disruptions in the supply chain and, ultimately, lead to an increase in the construction costs of projects1F2.

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2

That stated in this Section above constitutes “forward‑looking” information, as it is defined in the Securities Law, which is based solely on the Company’s estimates as at the approval date of the report, which are subject to uncertainty and changes that are not under the Company’s control. Ultimately, the policy changes made by the Trump administration (present or additional) could have a negative impact on advancement and/or benefits with respect to renewable energy projects and the costs of equipment, services and shipping for the projects and power plants in the U.S. In addition, such changes could have macro impacts on the Company’s activity markets.

3.	Main Developments in the Business Environment (Cont.)

3.1

General (Cont.)

C.

(Cont.)

3.2

Activities in Israel

D.

Update of the electricity tariffs – in January 2025, a decision of the Electricity Authority entered into effect regarding update of the tariff for 2025 for consumers of electricity from the Electric Company. Pursuant to the decision, the weighted‑average generation component was updated to 29.39 agurot per kilowatt hour – a decline of about 2.2% in the weighted‑average generation component with reference to the generation component in effect at the end of 2024, this being mainly as a result of a decrease in the Electric Company’s generation cost due to a reduction in the use of coal and a forecasted decline in the Electric Company’s natural‑gas price. In addition, there was a non‑recurring recognition of surplus receipts from sale of the Eshkol power plant, which led to a reduction in the generation component.

E.

Update off the decision regarding regulation of conventional generation units – further to that stated in Section 7.3.4 of Part A of the Periodic Report for 2024, on March 26, 2025, the Electricity Authority published a decision – “Update of the Decision regarding Regulation of Conventional Generation Units” (“the Decision”). As part of the Decision, the Electricity Authority increased the quota to four additional generation units and extended the validity of the decision up to the end of June 2027. The availability tariff determined runs from 3.05 agurot to 3.31 agurot based on the date of the financial closing. In addition, an incentive of 0.5 agurot was provided for the first unit that reaches a financial closing – this being only for units located in the northern part of Gush Dan (central Israel), as well as an incentive of 0.75% of the availability tariff for every month of acceleration of the commercial operation prior to December 31, 2029. For details regarding the developments relating to the Hadera 2 projects – see Section 5 below.

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3

That stated regarding the impact of changes in the generation component on the Company’s results, is subject to changes, among other things, as a result of determination of the periodic generation component and/or the manner of its application between the hourly demand hours’ brackets, operational factors and/or existence of one or more of the risk factors to which the Company is exposed, as stated in Section 19.2 of Part A of the Periodic Report for 2024. For additional details – see section 7.2.3 of Part A of the Periodic Report for 2024.

3.3

Activities in the U.S.

F.

Electricity and natural gas prices

*

Based on Day‑Ahead prices as published by the relevant ISO.

3.	Main Developments in the Business Environment (Cont.)

3.3

Activities in the U.S. (Cont.)

F.

Electricity and natural gas prices (Cont.)

3.	Main Developments in the Business Environment (Cont.)

3.3

Activities in the U.S. (Cont.)

F.

Electricity and natural gas prices (Cont.)

Set forth below are the average Spark Spread margins for each of the main markets in which the power plants of the CPV Group are operating (the prices are denominated in dollars per megawatt/hour)*:

*

Based on electricity prices as shown in the above table, with assuming a thermal conversion ratio (heat rate) of 6.9 MMBtu/MWh for Maryland, Shore and Valley, and a thermal conversion ratio of 6.5 MMBtu/MWh for Three Rivers, Towantic and Fairview. It is clarified that the actual energy margins of the power plants of the CPV Group could be significantly different due to, among other things, the existence of Power Basis and a different breakdown in the scope of the electricity sold in the peak and off‑peak hours in CPV’s power plants and that shown above (which was calculated in the above table based on the assumption of generation in all the hours of the 24‑hour period).

3.3

Activities in the U.S. (Cont.)

G.

Tax on carbon emissions (RGGI)

*

The prices of the carbon emissions tax are presented under the assumption that the price of the tender that is held prior to a certain quarter represents the price of the carbon emissions tax. For example, the tender held in December 2024 will represent the price for the first quarter of 2025. It is noted that the actual price of the carbon emissions tax could be different than the tender prices as a result of transactions made in the secondary market.

**

The cost of the carbon emissions tax (in terms of gas cost) is calculated under the assumption of emissions of carbon dioxide with a reference (ratio) of 119 lbs./MMBtu. It is noted that the actual carbon dioxide emissions ratio varies between the different power plants, and in the estimation of the CPV Group a ratio of 119 lbs./MMBtu is a representative ratio for power plants running on natural gas.

3.3

Activities in the U.S. (Cont.)

H.

Capacity revenues

3.	Main Developments in the Business Environment (Cont.)

3.3

Activities in the U.S. (Cont.)

H.

Capacity revenues (Cont.)

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6

That stated in this Section regarding the estimation of the CPV Group constitutes “forward‑looking” information as it is defined in the Securities Law, with respect to which there is no certainty it will materialize. Ultimately, the revenues of the CPV Group from availability could be different (even significantly) as a result of, among other things, regulatory changes (including appeal or other processes in the PJM market or relating to other authorities), operating factors, changes in the business environment and/or existence of one or more of the risk factors the CPV Group is exposed to.

3.	Main Developments in the Business Environment (Cont.)

3.3

Activities in the U.S. (Cont.)

H.

Capacity revenues (Cont.)

3.3

Activities in the U.S. (Cont.)

H.

Capacity revenues (Cont.)

4.	Analysis of the results of operations for the three months ended March 31, 2025 (in millions of NIS)

A.

Statement of income

*

Commencing from November 2024, as a result of loss of control of CPV Renewable and transition to the equity method of accounting, the Company has discontinued consolidation in the consolidated financial statements of the results of the renewable energy segment in the U.S.

**

For an analysis of the change in the net income and a definition and analysis of the change in the adjusted net income – see Section 4G below.

4.	Analysis of the results of operations for the three months ended March 31, 2025 (in millions of NIS) (Cont.)

A.

Statement of income (Cont.)

Revenues		For the							Board’s Explanations
		Three Months
		Ended
		March 31
		2025				2024
Revenues in Israel
Revenues from sale of energy to private customers			282				300		Stems mainly from a decrease in the tariff for the generation component compared with the corresponding period last year.
Revenues from sale of energy to the System Operator and to other suppliers			50				46
Revenues in respect of capacity payments			33				42
Revenues from sale of energy at cogeneration tariff			18				19
Revenues from sale of steam			15				17
Other revenues			–				7
Total revenues from sale of energy and others in Israel (without infrastructure services)			398				431
Revenues from private customers in respect of infrastructure services			128				101
Total revenues in Israel			526				532
Revenues in the U.S.
Revenues from sale of electricity from renewable energy			–				56		The decrease derives mainly from discontinuance of consolidation of the renewable energies segment in November 2024, and transition to the equity method of accounting. For additional details – see Note 23E to the annual financial statements.
Revenues from sale of electricity (retail) activities and others			134				50		The increase stems mainly from an increase in the scope of the retail activities.
Total revenues in the U.S.			134				106
Total revenues			660				638

4.	Analysis of the results of operations for the three months ended March 31, 2025 (in millions of NIS) (Cont.)

A.

Statement of income (Cont.)

(2)

Changes in the cost of sales and provision of services (not including depreciation and amortization):

Cost of Sales and Services		For the Three Months							Board’s Explanations
		Ended
		March 31
		2025				2024
Cost of sales in Israel
Natural gas and diesel oil			174				154		Most of the increase stems from an increase in the gas consumption against the background of the maintenance work performed at the Rotem power plant in the corresponding quarter last year.
Expenses in respect of acquisition of energy			26				59		Most of the decrease stems from maintenance work performed at the Rotem power plant in the corresponding quarter last year.
Cost of transmission of gas			13				14
Salaries and related expenses			9				10
Operating expenses			28				28
Other expenses			–				5
Total cost of sales in Israel without infrastructure services			250				270
Expenses in respect of infrastructure services			128				101
Total cost of sales in Israel			378				371

Cost of sales and services in the U.S.
Cost of sales in respect of sale of electricity from renewable energy			–				16		The decrease stems from discontinuance of consolidation of the renewable energies segment in November 2024 and transition to the equity method of accounting. For additional details – see Note 23E to the annual financial statements.
Cost of sales in respect of sale of electricity (Retail) and others			123				43		The increase stems mainly from an increase in the scope of the retail activities.
Total cost of sales and provision of services in the U.S.			123				59
Total cost of sales and provision of services			501				430

4.	Analysis of the results of operations for the three months ended March 31, 2025 (in millions of NIS) (Cont.)

B.

EBITDA, FFO and net cash flows after debt service

1.

EBITDA indices

2.

“FFO” (funds from operations) – with respect to active projects – cash flows from current operating activities for the period (including changes in working capital) and less investments in property, plant and equipment and periodic maintenance costs that are not included in the operating activities and less net interest payments. With respect to the rest of the Group’s activities – cash flows from current operating activities for the period (including changes in working capital) and less net interest payments (to the extent they do not relate to projects under construction). It is clarified that investments in property, plant and equipment (under construction and/or in development) including the net interest payments in respect thereof, are not included in FFO.

3.

“Net cash flows after service of project debt” – the “FFO” less/plus payment of principal in respect of financial debt and/or taking out of project debt and non‑project debt (loans and/or debentures), and after adjustments for a change in other credit from banks and a change in cash, including cash restricted for debt service and deposits (including to secure transactions hedging electricity margins).

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7	It is clarified that the compensation for loss of income is included in EBITDA in the consolidated statements.

4.	Analysis of the results of operations for the three months ended March 31, 2025 (in millions of NIS) (Cont.)

B.

EBITDA, FFO and net cash flows after debt service (Cont.)

*

Due to completion of an investment transaction in the area of renewable energies in the U.S. in November 2024, starting from this date the data of this segment is calculated on the basis of a proportionate consolidation where the share of the CPV Group is about 66.7%.

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8	It is noted that other companies might define EBITDA and FFO indices differently.

4.	Analysis of the results of operations for the three months ended March 31, 2025 (in millions of NIS) (Cont.)

B.

EBITDA, FFO and net cash flows after debt service (Cont.)

(1)

Calculation of the Group’s share in the EBITDA after proportionate consolidation, FFO and net cash flows after service of project debt of associated companies in the Energy Transition segment (in millions of NIS):

For the three months ended March 31, 2025		Fairview				Towantic				Maryland				(1)(2) Shore				Valley				Three Rivers				Total
Rate of holdings of the CPV Group		25%				26%				*75%				*69%				50%				10%
Revenues from sales of energy			93				137				196				116				227				25				794
Cost of natural gas			52				104				126				94				99				16				491
Carbon emissions tax (RGGI)			–				12				32				13				23				–				80
Cost of sales – other expenses (without
depreciation and amortization)			–				1				5				2				2				–				10
Gain (loss) on realization of transactions
hedging the electricity margins			4				(2	)			22				24				(17	)			6				37
Net energy margin			45				18				55				31				86				15				250
Revenues from capacity payments			4				32				9				9				12				1				67
Other income			2				5				7				4				1				1				20
Gross profit			51				55				71				44				99				17				337
Fixed costs (without depreciation and
amortization)			3				3				10				10				16				4				46
Administrative and general expenses
(without depreciation and amortization)			1				1				3				3				2				–				10
Loss from revaluation of unrealized
hedging transactions			(3	)			–				–				–				–				(1	)			(4	)
Group’s share in EBITDA after
proportionate consolidation in the
Energy Transition segment			44				51				58				31				81				12				277
Group’s share in FFO			34				38				36				1				70				9				188
Group’s share in net cash flows after flows
service of project debt (3)			16				28				8				(201	)			14				4				(131	)

(1)

At the Shore power plant – gas transmission costs (totaling in the first quarter of 2025 about NIS 10 million) are classified in accordance with IFRS 16 as depreciation expenses and, accordingly, are not included in the EBITDA.

(2)

The net cash flows after service of the project debt in Shore includes partial repayment of debt that was made as part of the refinancing made in February 2025. For additional details – see Section 8A(6) below.

(3)

It is pointed out that the financing agreements of the CPV Group include arrangements for mechanisms of the “cash sweep” type, in the framework of which all or part of the free cash flows of the projects is designated for repayment of loan principal on a current basis along with a predetermined minimum repayment schedule relating to every long‑term loan. Accordingly, there could be an acceleration of execution of repayments upon occurrence of certain events and there are also restrictions on distributions to shareholders.

*

For details regarding transactions for acquisition of additional holdings in the Shore and Maryland power plants in the fourth quarter of 2024 – see Note 24C to the annual financial statements.

4.	Analysis of the results of operations for the three months ended March 31, 2025 (in millions of NIS) (Cont.)

B.

EBITDA, FFO and net cash flows after debt service (Cont.)

(1)

Calculation of the Group’s share in the EBITDA after proportionate consolidation, FFO and net cash flows after service of project debt of associated companies in the Energy Transition segment (in millions of NIS): (Cont.)

For the three months ended March 31, 2024		Fairview				Towantic				Maryland				(1) Shore				Valley				Three Rivers				Total
Rate of holdings of the CPV Group		25%				26%				25%				38%				50%				10%
Revenues from sales of energy			58				61				31				43				102				14				309
Cost of natural gas			29				36				23				30				45				12				175
Carbon emissions tax (RGGI)			–				8				5				10				17				–				40
Cost of sales – other expenses (without
depreciation and amortization)			1				1				1				1				2				–				6
Gain on realization of transactions hedging
the electricity margins			11				4				7				7				35				9				73
Net energy margin			39				20				9				9				73				11				161
Revenues from capacity payments			4				28				3				4				14				1				54
Other income			1				3				1				1				1				–				7
Gross profit			44				51				13				14				88				12				222
Fixed costs (without depreciation and
amortization)			3				4				3				5				16				4				35
Administrative and general expenses
(without depreciation and amortization)			1				1				1				1				2				–				6
Gain (loss) from revaluation of unrealized
hedging transactions			1				(10	)			–				(4	)			–				–				(13	)
Group’s share in EBITDA after
proportionate consolidation in the
Energy Transition segment			41				36				9				4				70				8				168
Group’s share in FFO			37				40				(5	)			(5	)			55				4				126
Group’s share in net cash flows after service
of project debt			20				(1	)			–				(5	)			17				9				40

(1)

At the Shore power plant – gas transport costs (totaling in the first quarter of 2024 about NIS 6 million) are classified in accordance with IFRS 16 as depreciation expenses and, accordingly, are not included in the EBITDA.

4.	Analysis of the results of operations for the three months ended March 31, 2025 (in millions of NIS) (Cont.)

B.

EBITDA, FFO and net cash flows after debt service (Cont.)

(2)

Calculation of the Group’s share in EBITDA after proportionate consolidation of the renewable energies segment (in NIS millions):

4.	Analysis of the results of operations for the three months ended March 31, 2025 (in millions of NIS) (Cont.)

B.

EBITDA, FFO and net cash flows after debt service (Cont.)

(3)

Set forth below is a breakdown of the EBITDA after proportionate consolidation data broken down by subsidiaries (on a consolidated basis) and the associated companies (on a proportionate basis, based on the rate of the holdings of the CPV Group therein) as well as FFO and cash flows after service of project debt data (in NIS millions):

				For the three months ended												For the three months ended
Main projects in operation		Basis of		March 31, 2025												March 31, 2024
		presentation										Net cash												Net cash
		in the		EBITDA								flows				EBITDA								flows
		Company’s		after								after				after								after
		financial		proportionate								debt				proportionate								debt
		statements		consolidation				FFO				service				consolidation				FFO				service
Total operating projects in Israel and
accompanying business activities (1)		Consolidated			139				222				209				(2)180				(3)239				(3)201
Business development costs,
headquarters in Israel and other costs		Consolidated			(2	)			(3)(29	)			(3)113				(10	)			(10	)			(10	)
Total Israel (4)					137				193				322				170				229				191
Total operating projects (5)		Associated			277				188				(131	)			168				126				40
Other costs		Consolidated			–				(4	)			(4	)			(2	)			(2	)			(2	)
Total energy transition in the U.S.					277				184				(135	)			166				124				38
Total operating projects (5) (6)		Associated			33				22				1				37				25				(1	)
Business development and other costs		Associated			(6	)			(4	)			(4	)			(9	)			(10	)			(10	)
Total renewable energy in the U.S.					27				18				(3	)			28				15				(11	)
Total activities as part of the “others”
segment (7)		Consolidated			(8	)			(8	)			(8	)			(9	)			(9	)			(9	)
Headquarters in the United States (8)		Consolidated			(17	)			(41	)			(41	)			(20	)			(40	)			(40	)
Total United States					279				153				(187	)			165				90				(22	)
Company headquarters (not allocated
to the segments) (4) (8)		Consolidated			(6	)			(21	)			(127	)			(3	)			(30	)			72
Total consolidated (9)					410				325				8				332				289				241

(1)

The accompanying business activities in Israel include mainly virtual supply activities through OPC Israel, and sale/purchase of natural gas, including with third parties through OPC Natural Gas.

(2)

In the first quarter of 2024, the EBITDA of the active projects in Israel included compensation of about NIS 26 million in respect of lost revenues caused by a delay in the commercial operation of the Zomet power plant.

(3)

In the period of the report, the financial data of the headquarters in Israel includes payments of interest and principal (if any) of the company credit in OPC Israel (which was used partly for early repayment of project financing in Zomet and Gat) and taking out of company credit in OPC Israel, as described in Note 6A(1) to the Interim Statements. In the corresponding period last year, the financial data of the active projects in Israel includes payments of interest and principal of project credit in Zomet and Gat, which were repaid early, as stated, in the third quarter of 2024 (for additional details see – Note 14B(1) to the annual financial statements).

(4)

Not including intercompany activities between the Company, on the one hand, and the headquarters and the subsidiaries in Israel, on the other hand.

(5)

For details regarding active projects in the Energy Transition segment in the U.S. – see Section 1 above and regarding calculation of the Group’s share in the EBITDA after proportionate consolidation of the Renewable Energies segment – see Section 2 above.

(6)

Due to completion of the transaction for investment in the area of renewable energies in the U.S. in November 2024, the data of this segment in the U.S. is calculated from this date on the basis of proportionate consolidation where the share of the CPV Group is 66.7%.

(7)

Includes mainly business development and other costs in the area of initiation and development of high‑efficiency power plants running on natural gas, with future carbon capture potential, and the results of the retail activities in the U.S.

(8)

After elimination of management fees between the CPV Group and the Company, in the amounts of about NIS 8 million and about NIS 7 million for the three months ended March 31, 2025 and 2024, respectively.

4.	Analysis of the results of operations for the three months ended March 31, 2025 (in millions of NIS) (Cont.)

C.

Analysis of the change in EBITDA – Israel segment

1.

Availability (operational) – further to that stated in Section 7.11.1 of Part A of the Periodic Report for 2024, for purposes of reducing the risk of an operating failure at the Zomet power plant due to a technical defect discovered and in coordination with the contractor, as part of the process of clarifying and repairing the defect, in the period of the report the availability of the power plant was partially limited (for details – see Section H. below), which starting from March 2025 the capacity of the power plant is limited about 80% – 85%, which had a negative impact on the availability of the power plant and, in turn, on the results for the period of the report. In the Company’s estimation, as at the approval date of the report, the process of clarification and repair of the defect is expected to be completed at the latest within about 10 months.9 For details – see Section 7.11.1 of Part A of the Periodic Report for 2024.

2.

One‑time events – in the corresponding period last year, an amendment to the agreement was signed with Zomet’s construction contractor, in the framework of which, among other things, the construction contractor paid Zomet compensation, in the amount of about NIS 26 million (about $7 million) in respect of a loss of revenues caused to Zomet due to delay in the commercial operation date of the power plant. For additional details – see Note 26A(3) to the annual financial statements.

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9

That stated constitutes “forward‑looking” information as it is defined in the Securities Law. Ultimately, there could be delays in completion of the required clarification and repairs and/or other operation limitations, among other things, as a result of technical and/or operational factors and/or factors relating to the construction contractor.

4.	Analysis of the results of operations for the three months ended March 31, 2025 (in millions of NIS) (Cont.)

D.

Analysis of the change in EBITDA after proportionate consolidation – energy transition segment in the U.S.

(*)

Reflects the impact of the increase in the holdings (which was completed in the fourth quarter of 2024) in the Maryland and Short power plants on the EBITDA after proportionate consolidation in the period of the report. For details – see Note 24C to the annual financial statements.

4.	Analysis of the results of operations for the three months ended March 31, 2025 (in millions of NIS) (Cont.)

E.

Renewable energies segment in the U.S.

4.	Analysis of the results of operations for the three months ended March 31, 2025 (in millions of NIS) (Cont.)

F.

Additional details regarding energy hedges and guaranteed capacity payments in the Energy Transition segment in the U.S.

(*)

Pursuant to the policy for hedging electricity margins as at the date of the report, in general the CPV Group seeks to hedge up to 50% of the scope of the expected generation. The actual hedge rate could ultimately be different.

(**)

The net energy margin is the energy margin (Spark Spread) plus/minus Power Basis less carbon tax (RGGI) and other variable costs. For details regarding the manner of calculation of the electricity margin (Spark Spread) – see Section 3.3G above. The market prices of the net energy margin are based on future contracts for electricity and natural gas.

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4.	Analysis of the results of operations for the three months ended March 31, 2025 (in millions of NIS) (Cont.)

F.

Additional details regarding energy hedges and guaranteed capacity payments in the Energy Transition segment in the U.S. (Cont.)

G.

Net income and adjusted net income (in millions of NIS)

1.

Definitions

4.	Analysis of the results of operations for the three months ended March 31, 2025 (in millions of NIS) (Cont.)

G.

Net income and adjusted net income (in millions of NIS) (Cont.)

2.

Analysis of the change in net income and adjusted net income (in millions of NIS)

(1)

A loss from impairment in value of the investment in Gnrgy in 2024, in the amount of about NIS 19 million. For additional details – see Note 11C to the annual financial statements. In addition, in 2024 there was an impairment loss in Hadera 2, in the amount of about NIS 31 million, in light of the government’s decision to reject the plan, for additional details, see Note 10B(4) to the annual financial statements.

(2)

Most of the increase stems from additional depreciation and financing expenses, in the amount of about NIS 29 million in the period of the report, relating to transition to presenting the investment in the renewable energies segment in the U.S. based on the equity method of accounting, commencing from November 2024, and additional depreciation and financing expenses, in the amount of about NIS 35 million, due to increase in the rate of holdings in the Shore and Maryland power plants in the fourth quarter of 2024.

(3)

Most of the decrease in the depreciation and amortization and financing expenses, net, stems from discontinuance of the consolidation of the renewable energies in the U.S. segment from November 2024 and transition to the equity method of accounting (for additional details – see Note 23E to the annual financial statements).

4.	Analysis of the results of operations for the three months ended March 31, 2025 (in millions of NIS) (Cont.)

H.

Detail of generation

						For the three months ended March 31, 2025																For the three months ended March 31, 2024
																		Actual																Actual
						Potential				Net				Actual				calculated				Potential				Net				Actual				calculated
						electricity				electricity				generation				availability				electricity				electricity				generation				availability
		Capacity				generation				generation				percentage				percentage				generation				generation				percentage				percentage
		(MW)				(GWh)(1)				(GWh)(2)				(%)(3)				(%)				(GWh)				(GWh)				(%)				(%)
Rotem			466				961				926				96.4	%			99.3	%			964				685				71.1	%			82.0	%
Hadera			144				257				233				90.7	%			90.8	%			268				258				96.3	%			96.4	%
Gat			75				154				143				92.9	%			100.0	%			159				141				88.7	%			88.0	%
Zomet*			396				782				73				9.3	%			67.5	%			818				136				16.6	%			83.5	%

(1)

The generation potential is the net generation capability adjusted for temperature and humidity.

(2)

The actual net generation in the period.

(3)

The actual generation percentage is the net electricity generated divided by the generation potential.

						For the three months ended March 31, 2025																For the three months ended March 31, 2024
						Potential				Net				Actual				Actual				Potential				Net				Actual				Actual
						electricity				electricity				generation				availability				electricity				electricity				generation				availability
		Capacity				generation				generation				percentage				percentage				generation				generation				percentage				percentage
		(MW)				(GWh)(1)				(GWh)(2)				(%)(3)				(%)				(GWh)				(GWh)				(%)				(%)
		Energy transition projects (natural gas)
Shore			725				1,476				778				49.1	%			92.6	%			1,600				1,011				63.0	%			98.9	%
Maryland			745				1,620				1,066				65.8	%			98.9	%			1,483				832				50.7	%			90.5	%
Valley			720				1,555				1,438				92.6	%			99.6	%			1,572				1,411				89.8	%			97.4	%
Towantic*			805				1,741				1,459				80.0	%			99.9	%			1,759				1,477				80.1	%			99.1	%
Fairview			1,050				2,324				2,127				93.2	%			100.0	%			2,349				2,139				92.7	%			99.9	%
Three Rivers			1,258				2,717				1,615				61.0	%			97.9	%			2,746				1,677				62.7	%			75.8	%

(1)

The potential generation is the gross generation capability during the period after planned maintenance and less the electricity used for the power plant’s internal purposes.

(2)

The net generation of electricity is the gross generation during the period less the electricity used for the power plant’s internal purposes.

(3)

The actual generation percentage is the quantity of the net electricity generated in the facilities compared with the maximum quantity that can be generated in the period.

A.

Projects under construction and in development in Israel (held at 100% ownership by OPC Israel, which is 80% held by the Company)12:

1.

Main details with reference to construction projects in Israel (the data presented in the table below is in respect of 100% for each project):

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12

That stated in connection with projects that have not yet reached operation, including with reference to the expected operation date, the technologies and/or the anticipated cost of the investment, is “forward‑looking” information, as it is defined in the Securities Law, which is based on, among other things, the Company’s estimates as at the approval date of the report and regarding which there is no certainty it will be realized (in whole or in part). Completion of the said projects (or any one of them) may not occur or may occur in a manner different than that stated above, among other things due to dependency on various factors, including those that are not under the Company’s control, including assurance of connection to the network and output of electricity from the project sites and/or connection to the infrastructures (including gas infrastructures), receipt of permits, completion of planning processes and licensing, completion of construction work, final costs in respect of development, construction, equipment and acquisition of rights in land, the proper functioning of the equipment and/or the terms of undertakings with main suppliers (including lenders), and there is no certainty they will be fulfilled, the manner of their fulfillment, the extent of their impact or what their final terms will be. Ultimately technical, operational or other delays and/or breakdowns and/or an increase in expenses and/or other changes could be caused, this being as a result of, among other things, factors as stated above or as a result of occurrence of one or more of the risk factors the Company is exposed to, including construction risks (including force majeure events and the War and its impacts), regulatory, licensing or planning risks, macro‑economic changes, delays in receipt of permits or assurance of connection to the networks and infrastructures, delays and increased costs due relating to the supply chain and changes in raw‑material prices and etc. For additional details regarding risk factors – see Section 19 of Section A of the Periodic Report for 2024. It is further clarified that delays in completion of the above‑mentioned projects beyond the date originally planned for this could impact the ability of the Company and the Group companies to comply with their obligations to third parties (including under guarantees provided), including authorities, conditions of permits, lenders, yard consumers, customers and others, in connection with the projects, and cause a charge for additional costs, payment of compensation or starting of proceedings (including under guarantees provided).

A.

Projects under construction and in development in Israel (held at 100% ownership by OPC Israel, which is 80% held by the Company)12: (Cont.)

Power

Date/

Total

plants/

expectation

Total

construction

facilities

of the start

expected

cost as at

for

of the

Main

construction

March 31,

generation

Capacity

commercial

customer/

cost

2025

of energy

Status

(megawatts)

Location

Technology

operation

consumer

(NIS millions)

(NIS millions)

OPC Sorek 2 Ltd. (“Sorek 2”)

Under construction

≈ 87

On the premises of the Sorek B seawater desalination facility

Powered by natural gas, cogeneration

Second half of 202513

Yard consumers and the System Operator

14≈ 220

≈ 196

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A.

Projects under construction and in development in Israel (held at 100% ownership by OPC Israel, which is 80% held by the Company)12: (Cont.)

2.

For additional details regarding projects in the advanced and initial development stages in Israel, particularly facilities for generation of energy on the customer’s premises in various stages of construction and development and solar and storage projects in kibbutzim/communities – see Section 6A(2) to the Report of the Board of Directors for 202415.

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B.

Construction and development projects in the U.S. (including projects in the renewable energy area held by CPV Renewable which is held at the rate of 66.7% by the CPV Group (the CPV Group is held at the rate of 70.53% by the Company)16:

1.

Main details regarding construction projects in the area of renewable energy using solar and wind technologies in the U.S. (the data presented in the table below is in respect of 100% for each project):

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5.	Initiation and Construction Projects (Cont.)

B.

Construction and development projects in the U.S. (including projects in the renewable energy area held by CPV Renewable which is held at the rate of 66.7% by the CPV Group (the CPV Group is held at the rate of 70.53% by the Company)16: (Cont.)

1.

Main details regarding construction projects in the area of renewable energy using solar and wind technologies in the U.S. The data presented in the table below is in respect of 100% for each project (Cont.)

Total expected construction cost net for 100%

Total construction cost as at

Expectation for a first full calendar year

in the period of the PPA agreements

Regulated

Cash flows

Expected

market

of the

Tax

March 31,

after tax

commercial

after

project

equity

2025

Revenues

EBITDA

partner

Capacity

operation

Commercial

the PPA

(NIS

(NIS

(NIS

(NIS

(NIS

(NIS

Project

(megawatts)

Location

date

structure

period

millions)

millions)

millions)

millions)

millions)

millions)

CPV Backbone Solar, LLC (“Backbone”)

179 MWdc

Maryland

Second half of 2025

Long-term PPA17 (including green certificates)

PJM + MD SRECs

≈ 1,212 (≈ $326 million)

≈ 445 (≈ $120 million)18

≈ 959 (≈ $258 million)

≈ 70 (≈ $19 million)

≈ 47 (≈ $13 million)

≈ 39 (≈ $11 million)

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5.	Initiation and Construction Projects (Cont.)

B.

Construction and development projects in the U.S. (including projects in the renewable energy area held by CPV Renewable which is held at the rate of 66.7% by the CPV Group (the CPV Group is held at the rate of 70.53% by the Company)16: (Cont.)

1.

Main details regarding construction projects in the area of renewable energy using solar and wind technologies in the U.S. The data presented in the table below is in respect of 100% for each project (Cont.)

Total expected construction cost net for 100%

Total construction cost as at

Expectation for a first full calendar year

in the period of the PPA agreements

Regulated market

Cash flows

Expected

of the

Tax

March 31,

after tax

commercial

after

project

equity

2025

Revenues

EBITDA

partner

Capacity

operation

Commercial

the PPA

(NIS

(NIS

(NIS

(NIS

(NIS

(NIS

Project

(megawatts)

Location

date

structure

period

millions)

millions)

millions)

millions)

millions)

millions)

CPV Rogue’s Wind, LLC (“Rogues”)

114

Pennsylvania

First half of 2026

Long-term PPA19 (including green certificates)

PJM MAAC

≈ 1,357 (≈ $365 million)

≈ 596 (≈ $160 million)20

≈ 438 (≈ $118 million)

≈ 89 (≈ $25 million)

≈ 70 (≈ $19 million)

≈ 57 (≈ $16 million)

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5.	Initiation and Construction Projects (Cont.)

B.

Construction and development projects in the U.S. (including projects in the renewable energy area held by CPV Renewable which is held at the rate of 66.7% by the CPV Group (the CPV Group is held at the rate of 70.53% by the Company)16: (Cont.)

2.

Main details regarding development projects in the U.S.

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5.	Initiation and Construction Projects (Cont.)

B.

Construction and development projects in the U.S. (including projects in the renewable energy area held by CPV Renewable which is held at the rate of 66.7% by the CPV Group (the CPV Group is held at the rate of 70.53% by the Company)16: (Cont.)

2.

Main details regarding development projects in the U.S.

(1)

For details regarding the process with respect to requests for connection to the network and the interim results regarding some of the connection studies in the PJM market, which in the estimation of the CPV Group triggered a delay in the development of certain projects, taking into account, among other things, the required costs for upgrading the network and their position in the connection process – see Section 6B(2) to the Report of the Board of Directors for 2024.23

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5.	Initiation and Construction Projects (Cont.)

B.

Construction and development projects in the U.S. (including projects in the renewable energy area held by CPV Renewable which is held at the rate of 66.7% by the CPV Group (the CPV Group is held at the rate of 70.53% by the Company)16: (Cont.)

2.

Main details regarding development projects in the U.S. (Cont.)

(2)

Further to that stated in Section 8.13.2 of Part A of the Periodic Report for 2024, with respect to a framework agreement for acquisition of solar panels, in April 2025 CPV Renewable (which as at the date of the report is held by the CPV Group at the rate of 66.7%) signed an amendment to the agreement, to increase the total number of the solar panels as part of the agreement to about 140 MWdc, for an aggregate consideration of about $23 million, among other things, while reducing the price per unit, adjustment of the timetables for supply of the panels to the timetables of the development projects, update of the deposit provided by CPV Renewable and reduction of the scope of the compensation that will apply to CPV Renewable in a case of early conclusion of the agreement.

The said equipment agreement includes, among other things, the supply and payment dates and terms, warranty of the manufacturer and specifications of the equipment, and it permits cancellation of the agreement up to the end of December 2025 with no additional compensation beyond the amounts paid up to the cancellation date, which in the estimation of the CPV Group up to the end of August 2025 are not expected to be significant. Subject to completion of the said processes and agreements, signing of the loan agreement with TEF, as stated, and raising the capital needed for construction of the project, a decision to invest in the project and start of the project’s construction are expected to take place in the second half of 2025. It is noted that as at the approval date of the report, taking into account the project’s timetables and the market conditions, the Company and the CPV Group are examining various alternatives for raising the capital required for construction of the project (including through an integration of financing in addition to the TEF financing), while at the same time it is examining raising private capital in the CPV Group. It is further noted that as at the approval date of the report, there is no certainty regarding the structure, manner or amount of the said fundraising, or the terms or the results of any fundraising that might be executed, which have not yet been finally determined, and the matter is subject to, among other things, the market conditions, advancement of the project’s development and the discretion of the Company’s competent organs. In addition, there is no certainty regarding completion of the project’s development processes, signing of all the detailed agreements referred to above, receipt of the TEF loan and the other conditions necessary for purposes execution or construction of the project, which had not yet been fulfilled as at the approval date of the report and there is no certainty regarding their fulfillment or the timing thereof24. It is clarified that construction of the project and the operation thereof are exposed to various risk factors that characterize projects in the Energy Transition area (including construction risk and exposure to market risks, operating risks (including breakdowns or extreme weather/environmental conditions), commercial and/or regulatory events (including by force of legislation, regulation and/or ERCOT requirements)). For additional details see Section 8.21 of the Periodic Report for 2024.

Category		3/31/2025				12/31/2024			Board’s Explanations
Current Assets
Cash and cash equivalents			837				962		For details – see the Company’s consolidated statements of cash flows in the interim statements and Part 7 below.
Trade receivables			286				293
Receivables and debit balances			83				90
Total current assets			1,206				1,345

Non-Current Assets
Long-term deposits and restricted cash			61				60
Long-term receivables and debit balances			160				162
Investments in associated companies			5,715				5,320		Most of the increase stems from an investment in Shore, in the amount of about NIS 257 million, for purposes of refinancing the project debt (for additional details – see Note 10 to the Interim Statements), equity income of the CPV Group, in the amount of about NIS 63 million, and an increase in the shekel/dollar exchange rate, in the amount of about NIS 114 million. This increase was partly offset by distribution of dividends to the CPV Group by associated companies, in the amount of about NIS 59 million. For additional details regarding investments in associated companies – see Sections 4D and 4E above.
Long-term derivative financial instruments			41				44
Property, plant and equipment			4,198				4,238		Most of the decrease stems from depreciation expenses on property, plant and equipment.
Right-of use assets and long-term deferred expenses			648				637
Intangible assets			264				261
Total non-current assets			11,087				10,722
Total assets			12,293				12,067

6.	Financial Position as at March 31, 2025 (in millions of NIS) (Cont.)

Category		3/31/2025				12/31/2024			Board’s Explanations
Current Liabilities
Loans and credit from banks and financial institutions (including current maturities)			85				82
Current maturities of debt of holders of non‑controlling interests			13				14
Current maturities of debentures			235				212
Trade payables			276				213		Most of the increase stems from timing differences.
Other payables and credit balances			203				123		Most of the increase, in the amount of about NIS 105 million, stems from reclassification of current maturities of liabilities in respect of a profit participation plan for employees of the CPV Group.
Total current liabilities			812				644

Non-Current Liabilities
Long-term loans from banks and financial institutions			2,274				2,150		Most of the increase derives from a financing agreement signed by OPC Israel in the period of the report, under which a loan in the amount of NIS 150 million was drawn (for additional details – see Note 7A(1) to the Interim Statements).
Long-term debt from holders of non-controlling interests			495				500
Debentures			1,537				1,663		Most of the decrease, in the amount of about NIS 106 million, derives from repayment of debentures.
Long-term lease liabilities			29				31
Other long-term liabilities			11				115		See explanation in the “other payables and credit balances” section.
Liabilities for deferred taxes			564				543
Total non-current liabilities			4,910				5,002
Total liabilities			5,722				5,646
Total equity			6,571				6,421		Most of the increase stems from the net income, in the amount of about NIS 93 million and other comprehensive income, in the amount of about NIS 39 million.

(1)

Most of the decrease in cash provided by operating activities stems from a decrease in income on a cash basis, in the amount of about NIS 65 million. On the other hand, there was an increase of about NIS 41 million in dividends from associated companies in the U.S.

(2)

Most of the decrease stems from exit from the consolidation of CPV Renewable in the fourth quarter of 2024 and, as a result, transition to the equity method of accounting – see Note 23E to the annual financial statements.

(3)

Most of the increase stems from an additional investment in the Shore power plant as part of a refinancing executed in February 2025. For additional details – see Note 10 to the Interim Statements.

(4)

For additional details – see Notes 14 and 15 to the annual financial statements and Note 6 to the Interim Statements.

8.	Adjusted financial debt, net

A.

Composition of the adjusted financial debt, net

(2)

For details – see Section 9A of the Report of the Board of Directors for 2024.

8.	Adjusted financial debt, net (Cont.)

A.

Compositions of the adjusted financial debt, net (Cont.)

---

A.

Compositions of the adjusted financial debt, net (Cont.)

(7)	The rate (%) of the Cash Sweep mechanism is in accordance with the estimate of the CPV Group and it could change based on the provisions of the financing agreements of the projects.

(8)

As part of some of the financing agreements, financial covenants were determined for the projects. As at the date of the report, the associated companies are in compliance with the financial covenants. As part of Maryland’s financing agreement, a financial covenant was provided requiring a historical debt service coverage ratio of 1:1 during the last four quarters. As at the date of the financial statements, Maryland is in compliance with this financial covenant (2.26).

(9)	Includes balances of debt and cash in the Company and cash in ICG Energy Inc. (available for use for all the Group’s needs).

B.

Interest and linkage bases

---

8.	Adjusted financial debt, net (Cont.)

9.	Debentures (Series B, Series C and Series D)

10.	Impacts of changes in the macro‑economic environment on the Group’s activities and its results

Yair Caspi	Giora Almogy
Chairman of the Board of Directors	CEO

–	In the peak hours, electricity is sold in the maximum scope;

–	Sale of the balance of the electricity is made in the off‑peak hours.

–	The scope of the generation of each power plant was estimated separately on the basis of the historical generation data while taking into generation forecasts.

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		For the
		nine months
		April –				For the				For the
		December				year				year
Power Plant		2025				2026				2027
Fairview
Gas price (Texas Eastern M2, as of 2026: M3)			3.43				4.26				3.84
Electricity price (AEP Dayton (AD))			52.02				53.45				49.72
Electricity margin			29.73				25.75				24.76
Towantic
Gas price (Algonquin City Gate)			4.91				6.41				5.62
Electricity price (Mass Hub)			60.73				68.55				60.59
Electricity margin			28.85				26.90				24.06
Maryland
Gas price (Transco Zone 5)			4.70				5.16				4.41
Electricity price (PJM West Hub)			59.66				61.44				58.05
Electricity margin			27.21				25.85				27.64
Shore
Gas price (Texas Eastern M3)			3.77				4.26				3.84
Electricity price (PJM West Hub)			59.66				61.44				58.05
Electricity margin			33.64				32.03				31.56
Valley
Gas price (Texas Eastern M3 – 70%, Dominion South Pt – 30%)			3.67				4.01				3.57
Electricity price (New York Zone G)			57.00				62.77				57.46
Electricity margin			31.68				35.10				32.86
Three Rivers
Gas price (Chicago City Gate)			3.99				4.23				3.69
Electricity price (PJM ComEd)			46.60				47.16				43.56
Electricity margin			20.67				19.64				19.54