Keystone and Edeltech request to immediately accelerate the conversion of the loan into shares at the Sorek power plant

The Keystone fund is changing course and is requesting to immediately accelerate the conversion of the loan it provided to Edeltech into shares at the Sorek power plant. The partners in the project — Edeltech, Keystone, and Menora — have approached the Electricity Authority with a request to accelerate the loan conversion now, even though according to the agreement, such a conversion is possible only after the plant enters commercial operation, planned for 2029. Edeltech does not object, claiming that from their perspective, this is a positive move that would have happened eventually.

In December 2024, Edeltech, owned by Uri Adelsburg, together with the insurance company Menora, won the tender to build the Sorek power plant. The deal involved the Keystone fund, owned by Gil Deutsche, Roni Biram, and Navot Bar, which provided financing estimated at 300–400 million shekels. According to the terms, the company is entitled to convert part of the loans into 40% of equity rights and 49% of voting rights, subject to approvals from the Electricity Authority and the Competition Authority.

The Electricity Authority previously allowed Keystone only to provide a loan for the project, fearing that it and Edeltech would cross the 20% production threshold in the private electricity market. Keystone’s holdings in the IPM power plant (450 MW) and the Etgal station (200 MW) hindered approval. Market analysts believe this request signals that Keystone has abandoned its intention to acquire Shikun & Binui Energy. Shikun & Binui recently signed an agreement to sell its energy division to the infrastructure fund Generation for 4.45 billion shekels, preferring it over Keystone’s 4.35 billion shekel offer.

At the time of the original deal, 20% of the private electricity market stood at 1,650 MW. Since then, the market has expanded, and the quota now stands at about 4,000 MW, which theoretically allows for Keystone's entry. However, it remains unclear if the Electricity Authority will permit the conversion, as the Competition Authority must also examine the potential impact on electricity prices.

Under current regulations, for any shareholder holding over 5% of a power plant, the entire production capacity is calculated as part of the producer's market share. Edeltech and Keystone jointly hold two power plants privatized from the Israel Electric Corporation: Hagit East and Ramat Hovav. Additionally, Keystone holds stakes in the IPM power plant, and Edeltech holds 18.75% of the Dorad power plant.

The Sorek power plant, with a capacity of 630–900 MW, will be built near the Shafdan facilities. Edeltech will operate the plant for 25 years before it reverts to state ownership. The group offered an availability tariff of 3.18 agorot per kWh in the tender. This tariff provides stable income and ensures financial security for the project. Edeltech remains the largest energy company in the private sector but may lose this title to the Generation fund if it receives approval to acquire Shikun & Binui Energy.