Equibles

6-K

Kenon Holdings Ltd. (KEN)

6-K 2026-03-12 For: 2026-03-11
View Original
Added on April 10, 2026

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16

OF THE SECURITIES EXCHANGE ACT OF 1934

March 12, 2026

Commission File Number 001-36761

Kenon Holdings Ltd.

1 Temasek Avenue #37-02B

Millenia Tower

Singapore 039192

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F ☒         Form 40-F ☐

EXHIBITS 99.1 AND 99.2 TO THIS REPORT ON FORM 6-K ARE INCORPORATED BY REFERENCE IN THE REGISTRATION STATEMENT ON FORM S-8 (FILE NO. 333-201716) OF KENON HOLDINGS LTD. AND IN THE PROSPECTUSES RELATING TO SUCH REGISTRATION STATEMENT.

CONTENTS

Annual Report of OPC Energy Ltd. for the Year Ended December 31, 2025

On March 12, 2026, Kenon Holdings Ltd.’s subsidiary OPC Energy Ltd. (“OPC”) filed with the Israeli Securities Authority and the Tel Aviv Stock Exchange its annual report (in Hebrew) for the year ended December 31, 2025 (“OPC’s Annual Report”). English convenience translations of the (i) Report of the Board of Directors for the Year Ended December 31, 2025 and (ii) Consolidated Financial Statements as at December 31, 2025, each as published in OPC’s Annual Report, are furnished as Exhibits 99.1 and 99.2, respectively, to this Report on Form 6-K. In the event of a discrepancy between the Hebrew and English versions, the Hebrew version shall prevail.

Forward Looking Statements

This Report on Form 6-K, including the exhibits hereto, includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. You can generally identify these statements by the use of words like “may”, “will”, “could”, “should”, “believe”, “expect”, “plan”, “estimate”, “forecast”, “potential”, “intend”, “target”, “future”, and variations of these words or comparable words. These statements include statements regarding OPC’s (including CPV Group LP and its investees (“CPV Group”)) plans, expectations and strategy, including statements on OPC’s planned financings, OPC’s construction and development projects and development pipeline, including their portfolios of projects in various stages of development and construction, including the development of the Hadera 2 and Ramat Bekka projects, expected start of construction and completion dates of projects and estimated cost of and investment in projects, agreements to acquire or dispose of projects, expected financing of projects, and decisions to proceed or to not proceed with projects in various stages of development, and the stage of development and expectations of such projects, including expected commercial operation date, and the total volume (in MW), grid connection, carbon capture potential (if any), and other statements regarding other expectations about these projects, statements regarding the electricity tariff in Israel and statements regarding virtual suppliers, statements regarding characteristics of projects including timelines, contracting, expected maintenance work and expected timing and impact of plant shutdowns, availability of plants, including the reduction of operations to identify potential defects, and commercial operation of plants, statements regarding agreements and expected agreements with tax equity partners, expected tax benefits, the capacity prices published by the PJM and expected revenues including statements regarding secured capacity revenues, statements regarding the NYISO and ISO-NE markets capacity payments and availability prices, pricing methodology, and expectations with respect to interest rates, statements regarding the war in the Middle East and other related military actions, including the expected impact on OPC, on market demand and on the availability of natural gas, statements regarding forecasted electricity and natural gas prices for 2026, 2027 and 2028 and underlying assumptions, excise tax on fuel, expected electricity margin, the scope of energy hedges, plans for hedging electricity margins and expected generation and net hedged energy margin, and the impact of weather events and conditions, statements on the negotiations for increasing and/or exchanging holdings in some of CPV Group’s power plants, and the status and/or payment terms of the acquisition or disposal of stakes in the existing portfolio projects, including expected completion date and expected accounting impact, carbon emissions regulation and the expected impact on CPV Group, gas supply agreements, plans and agreements for supply of electricity, statements regarding the industry and market and potential and proposed regulatory and political developments and expected impact on OPC, statements regarding the impact of seasonality, statements regarding additional bank financing to be used for bond repayments, statements regarding the expected value of profit sharing compensation plans for employees, statements regarding the expected impact of changes in laws, rules, policies and orders including tariffs and customs duty, and other legislative changes with respect to renewable activities and projects, on CPV Group’s business, and statements regarding recently published regulations in Israel and potential impact on OPC and potential investments and investment opportunities in the renewable energy sector in Israel and other non-historical statements. These statements are not historical facts, but rather are based on OPC management’s current expectations or beliefs, and are subject to uncertainty and changes in circumstances. These forward-looking statements are subject to a number of risks and uncertainties which could cause the actual results to differ materially from those indicated in such forward-looking statements. Such risks include risks relating to potential failure to obtain regulatory or other approvals for projects or to meet the required conditions and milestones for development of projects, risks as to the feasibility of carbon capture potential, the risk that OPC (including CPV Group) may fail to develop or complete projects or any other planned transactions as planned (including as to the actual cost and characteristics of projects and other transactions) or at all, the risk that tenders are not successful and that development projects do not proceed to construction, risks relating to grid connection, risks relating to financing of construction and development projects, risks relating to new and existing regulations and proposed changes to regulations including tariff structure and methodology and risks relating the proposed excise tax on fuel in Israel, risks relating to license requirements and regulatory decisions, risks relating to tariffs and gas prices and hedging and the impact on OPC’s results, risks relating to electricity prices and natural gas prices in the U.S. and Israel including the risk that prices may differ from the forecasts included in OPC’s report and the impact of hedging arrangements of CPV Group, risks relating to changes in laws, rules, policies and orders including tariffs and customs duty and other legislative changes, risks relating to the war in the Middle East and other related military actions and its impact on OPC and other risks and factors, including those risks set forth under the heading “Risk Factors” in Kenon’s most recent Annual Report on Form 20-F filed with the U.S. Securities and Exchange Commission and other filings. Except as required by law, Kenon undertakes no obligation to update these forward-looking statements, whether as a result of new information, future events, or otherwise. Capitalized terms used but not defined herein shall have the meanings given to them in OPC’s Periodic Report.

* * *

OPC’s Periodic Report has been prepared and published by OPC and Kenon makes no representation or warranty as to such report or the information contained. Statements of intent, goals, plans and similar expressions included in OPC’s Periodic Report are those of OPC and/or CPV Group and not of Kenon.

Exhibits

99.1 OPC Energy Ltd. - Report of the Board of Directors for the Year Ended December 31, 2025, as published by<br> OPC Energy Ltd. on March 12, 2026 with the Israeli Securities Authority and Tel Aviv Stock Exchange*
99.2 OPC Energy Ltd. - Consolidated Financial Statements as at December 31, 2025, as published by OPC Energy<br> Ltd. on March 12, 2026 with the Israeli Securities Authority and Tel Aviv Stock Exchange*

*English convenience translation from Hebrew original document.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

KENON HOLDINGS LTD.
Date: March 12, 2026 By: /s/ Robert L. Rosen
Name: Robert L. Rosen
Title: Chief Executive Officer

Exhibit 99.1

---Unofficial translation for convenience purposes---

Unofficial English translation of certain sections of the Company’s 2025 Annual Report, for convenience purposes only.<br><br> <br>The complete and binding report is the official Hebrew Annual Report published by the Company on the Tel Aviv Stock Exchange website.<br><br> <br>In case of any discrepancy, the official and full Hebrew report shall prevail.<br><br> <br>This unofficial translation does not constitute an offer, advice or invitation to make any transaction in the Company’s securities.

OPC ENERGY LTD.

Report of the Board of Directors on the State of the Company’s Affairs

for the year ended December 31, 2025

The Board of Directors of OPC Energy Ltd. (hereinafter – “the Company”) is pleased to present herein the Report of the Board of Directors regarding the activities of the Company and its investee companies (hereinafter together – “the Group”), as at December 31, 2025 and for the year then ended (“the Period of the Report” or “the Year of the Report”).

Except for the data audited in the Company’s consolidated financial statements as at December 31, 2025 (hereinafter – “the Financial Statements”) that is included in this report below, the data appearing in the Report of the Board of Directors has not been audited (or reviewed) by the Company’s auditing CPAs.

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OPC Energy Ltd.

Report of the Board of Directors

1. Executive Summary^1^
A. Brief description of the areas of activity
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The Company is a public company the securities of which are listed for trading on the Tel‑Aviv Stock Exchange Ltd. (hereinafter – “the Stock Exchange”). As at the date of the report, the Group is engaged in the generation and supply of electricity and energy in three main activity areas (that constitute reportable segments in the financial statements), as briefly described below:

(1) Israel (by means of OPC Power Israel Ltd.^2^) (OPC Israel) – as part of this area of activities, the Group is engaged in the generation and supply of electricity and energy, mainly to private customers and<br> to Noga Electricity System Management Ltd. (“the System Operator”), as well as in initiation, development, construction and operation of natural‑gas fired power plants and renewable generation facilities in Israel;
(2) Energy transition in the U.S. (by means of the CPV Group^3^) – as part of this area of activities^4^, the Group is engaged in the operation of natural gas-fired power plants in the U.S., which<br> efficiently and reliably supply electricity to the grid.
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(3) Renewable Energy in the U.S. (by means of the CPV Group) – as part of this area of activities^5^, the Group is engaged in initiation, development, construction and operation of renewable generation facilities in the U.S.<br> (mainly solar and wind) and supply of electricity from renewable sources to customers.
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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<br> 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<br> 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<br> they will materialize and the readers are directed to the detail presented in the relevant sections.
^2^ As at the date of the report, the Company holds directly 80% of the shares of OPC Israel while the other 20% is held by Veridis Power Plants Ltd. (“Veridis”).
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^3^ As at the date of the report, the Company holds indirectly about 70.69% of the shares of CPV and as at the approval date of the report the Company holds, indirectly, about 71.09% (after the investment commitment in the first quarter of<br> 2026 and acquisition by the Company of an immaterial amount). The remaining interest is held, indirectly, by three institutional financial investors from Israel.
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^4^ As at the date of the report, all the power plants operating in this area are held by associated companies at various holding rates (which are not consolidated in the<br> CPV Group’s financial statements and, in turn, are also not consolidated in the Company’s financial statements). Subsequent to the date of the report, a transaction was completed for acquisition of the remaining 11% in the Shore power<br> plant, and starting from this date the project is 100% held by the CPV Group and is consolidated in the Company’s financial statements. As at the approval date of the report, an agreement was signed for acquisition of the remaining interest<br> in the Maryland power plant, which subject to the completion thereof, which is expected in the second quarter of 2026, will also be consolidated in the Company’s financial statements.
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^5^ Which is consolidated by a company held by the CPV Group at the rate of about 66.7% (starting from November 2024) and that constitutes an associated company (which is not consolidated in the CPV Group’s financial statements and, in turn,<br> is also not consolidated in the Company’s financial statements).
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OPC Energy Ltd.

Report of the Board of Directors

1. Executive Summary^1^ (Cont.)
A. Brief description of the areas of activity (Cont.)
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In addition, through the CPV Group, the Group is involved in additional activities in the U.S. which, as of the date of the report, in accordance with IFRS, do not constitute reportable segments in the financial statements):

(1) Initiation, development and construction of highly‑efficient natural gas-fired projects with integration of future carbon‑capture potential^6^^7^;
(2) Retail activities, which are intended to supplement the generation activities of the CPV Group.
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B. Main financial parameters (in millions of shekels)
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For the For the
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Year Ended Three Months Ended
December 31 December 31
2025 2024 % 2025 2024 %
Consolidated EBITDA after proportionate consolidation 1,591 1,208 32 % 336 228 47 %
Net income 457 197 132 % 124 123 1 %
Adjusted net income (loss) 373 115 225 % 62 (47 ) 234 %
FFO (Funds From Operations) 1,295 718 80 % 468 154 204 %
Israel EBITDA 611 639 (4 )% 89 98 (9 )%
FFO (Funds From Operations) 494 420 18 % 100 45 122 %
U.S. EBITDA after proportionate consolidation 1,005 589 71 % 255 137 86 %
FFO (Funds From Operations) 855 339 152 % 373 111 236 %
EBITDA after proportionate consolidation – Energy Transition 1,099 588 87 % 252 141 79 %
EBITDA after proportionate consolidation – Renewable Energies 105 112 (6 )% 25 28 (11 )%
* EBITDA, EBITDA after proportionate consolidation, adjusted net income and FFO (Funds From Operations) are non‑IFRS financial measures – for definitions and the manner of their calculation – see Sections 4A(3) and 4B below.
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^6^ Some of the projects in this area are being developed by associated companies. Regarding the Basin Ranch power plant, which is presently under construction, as at the date of the report the project is held by an associated company.<br> Subsequent to the date of the report, a transaction was completed for acquisition of the remaining 30% in the project, and starting from this date it is 100% held by the CPV Group and is consolidated in the Company’s financial statements.
^7^ It is noted that the carbon capture process constitutes an additional separate component of the natural gas projects under development/construction, which are subject to separate uncertainty and risks and is expected to be developed or<br> executed (if ultimately executed) according to a different timetable.
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OPC Energy Ltd.

Report of the Board of Directors

1. Executive Summary^1^ (Cont.)

As detailed in the above table, 2025 was characterized by an improvement of the financial parameters compared with 2024.

The consolidated EBITDA after proportionate consolidation increased by about 32%, mainly as a result of a sharp increase of about 71% in the EBITDA after proportionate consolidation in the United States, primarily due to an increase in the energy margins and the capacity prices in the PJM market, as well as due to an increase in the holding rates in the Maryland and Shore power plants. In Israel the EBITDA was relatively stable declining by about 4%, mainly due to planned maintenance work and upgrades at the Rotem power plant and restriction of operational availability at the Zomet power plant.

The adjusted net income in 2025 also rose sharply by about 225% over 2024, driven primarily by the increase in EBITDA after proportionate consolidation due to an increase in the holding rates in the Maryland and Shore power plants offset by higher depreciation and financing expenses.

In 2025, the FFO (Funds From Operations) climbed by about 80% mostly due to the sharp rise in the consolidated EBITDA after proportionate consolidation, primarily in the U.S., as stated above.

Main developments in 2025 and thereafter

Israel Hadera 2 project in advanced development (combined cycle) with a capacity of 850 megawatts – on August 10, 2025, the government of Israel approved National<br> Infrastructures Plan 20B (NIP 20B) regarding construction of an additional power plant in Hadera. The Company is taking action to sign the project agreements (construction, equipment and financing) and to obtain the required approvals and<br> permits. For details – see Section 6A(2) below.
Ramat Beka project in advanced development (solar with a capacity of 550 megawatts with integrated storage of 3,850 megawatts/hr.) – in January 2026, the plan<br> was approved by the National Infrastructures Committee and it is awaiting final approval. The Company is taking action to sign the project agreements (construction, equipment and financing) and to obtain the required approvals and<br> permits. For details – see Section 6A(2) below.
Intel project in initial development (combined cycle with a capacity of 600 megawatts) – in March 2025, government consent was received for advancement of the<br> plan on the National Infrastructures Committee. The Company is taking action to obtain the necessary approvals and permits for advancement of the project and is carrying on negotiations with respect to signing of a binding PPA agreement<br> with Intel. For details see Section 6A(3) below.
Continuing increase in the pipeline of projects under development in the area of renewable energy – in addition to the Ramat Beka project, as at the approval<br> date of the report the portfolio of the pipeline projects in the renewable energy area with integrated storage is estimated at about 0.5 gigawatts and 2.5 gigawatt-hours. For details see Section 6A(3) below.

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OPC Energy Ltd.

Report of the Board of Directors

1. Executive Summary^1^ (Cont.)

Main developments in 2025 and thereafter (Cont.)

Israel (Cont.) Corporate financing in Israel – in 2025, OPC Israel signed bank financing agreements, in the aggregate amount of NIS 700 million, on terms similar to those of<br> the agreements it signed in 2024. The loans were used for refinancing long‑term debt in OPC Israel and the Company’s share is mainly for repayment of its debentures. For details see Section 7A(2) below.
Update of the structure of the electricity tariff for consumers of Israel Electric Company – in December 2025, the Electricity Authority published a decision<br> regarding update of the structure of the electricity tariff, which provides, among other things, that assuming a shekel/dollar exchange rate of 3.3 in 2026 the tariff will be 28.90 agurot and it will be for three‑years (2026–2028) subject<br> to updates and after being linked to the relevant indices. For details – see Section 2A below.
Performance of upgrading and planned maintenance work at the Rotem power plant and limitation of the availability at the Zomet power plant – in the fourth<br> quarter of 2025, the Rotem power plant was shut down for planned upgrades and maintenance work. In addition, in 2025 the operating availability of the Zomet power plant was limited, and from this date the power plant is operating partially.<br> For details – see Section 4C(1) below.
Natural gas activities with carbon capture potential in the U.S. Financial close and start of construction of the Basin Ranch power plant in Texas (a combined cycle power plant with a capacity of 1.35 gigawatts) – in October<br> 2025, the financial close was completed for the project with an estimated aggregate construction cost of about $1.8 – $2.0 billion, wherein the project was granted a subsidized loan from the Texas Energy Fund, in the amount of about $1.1<br> billion, and the CPV Group received a corporate loan from Bank Leumi, in the amount of about $300 million, for financing part of the shareholders’ equity. For details – see Section 6B(1) below.
Acquisition of the remaining rights (30%) in the Basin Ranch power plant for an aggregate consideration of about $371 million – further to the signing of the<br> agreement from October 2025, in February 2026 the acquisition was completed and starting from this date the project will be consolidated in the CPV Group’s and the Company’s financial statements. In this regard, after the date of the report<br> the corporate loan from Bank Leumi was increased by about $130 million. For details – see Section 6B(1) below.
The CPV Group is taking action with respect to accelerated advancement of the Shay flagship project in the PJM market (combined cycle with a capacity of 2.1<br> gigawatts in West Virginia – share of CPV 70%). For details – see Section 6B(2) below.

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OPC Energy Ltd.

Report of the Board of Directors

1.        Executive Summary^1^ (Cont.)

Main developments in 2025 and thereafter (Cont.)

Energy Transition in the U.S. Execution of the strategy to increase the holdings and obtain control over natural gas‑fired power plants: (1) acquisition of the remaining rights (11%) in the<br> Shore power plant (a combined cycle power plant with a capacity of 725 megawatts in PJM) in January 2026, in exchange for an immaterial amount; and (2) signing of an agreement, which as at the approval date of the report had not yet been<br> completed, for acquisition of the remaining interest (25%) in the Maryland power plant (combined cycle with a capacity of 745 megawatts in PJM) in exchange for sale of the rights (10%) in the Three Rivers power plant (combined cycle with a<br> capacity of 1,258 megawatts in PJM) and payment of an immaterial amount. In addition, a non‑binding memorandum of understanding for examination of a potential transaction to increase the holdings in additional active power plants in<br> exchange for certain rights in the CPV Group, as will be discussed by the parties.
Refinancing of the Shore power plant – in February 2025, the refinancing transaction for the Shore power plant was completed, such that the margin was updated to<br> 3.75% and $80 million were invested in Shore by the partners (the CPV Group’s share – about $72 million). For details – see Section 7A(5) below.
Refinancing of the Fairview power plant (combined cycle with a capacity of 1,050 megawatts in PJM) – in October 2025, a transaction was completed for revision of<br> the financing terms such that the margin was reduced to 2.5% and a dividend was distributed to the partners, in the aggregate amount of about $217 million (the CPV Group’s share – about $54 million).
Refinancing of the Valley power plant (combined cycle with a capacity of 720 megawatts in New York) – in February 2026, a refinancing transaction was completed<br> whereby the margin was reduced to 2.75%, the cash sweep rate was reduced from 100% to a leverage‑based mechanism as is customary in the TLB market, and a dividend was distributed to the partners / shareholders’ loans were repaid, in the<br> amount of about $100 million (the CPV Group’s share – about $50 million). For additional details – see Section 7A(6) below.
Capacity auctions and regulatory processes in PJM – two capacity auctions for the period from June 1, 2026 through May 31, 2028 were published at a price of<br> about $330 for megawatts/day, which reflects the ceiling for the price range that was approved by the FERC. In February 2026, PJM submitted a request to FERC for approval of extension of the maximum and minimum limits (collar) for two<br> additional capacity auctions from June 1, 2028 through May 31, 2030, which as at the approval date of the report had not yet been approved. At the same time, in the PJM regulatory processes are being considered with the goal of assuring a<br> balance between supply and demand and maintaining reliability of the electricity grid, in light of the new significant additional energy demand expected to enter the market, particularly existence of emergency capacity auctions (Reliability<br> Backstop Auctions) up to September 2026 that will include capacity prices for a period of up to 15 years. For details – see Section 3C below.

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OPC Energy Ltd.

Report of the Board of Directors

1.        Executive Summary^1^ (Cont.)

Main developments in 2025 and thereafter (Cont.)

Renewable Energies in the U.S. Commercial operation of the Backbone project (a solar project with a capacity of 179 megawatts) – in December 2025, construction of the Backbone project was<br> completed and the amount of about $120 million was received from the project’s tax partner. For details – see Section 5E below.
Investment agreement with the tax partner in the Rogues Wind project (a wind project under construction with a capacity of 114 megawatts) – in August 2025, a<br> binding investment agreement was signed with a tax partner for investment in the Rogues Wind project, the aggregate amount of about $163 million.
Legislation of the “One Big Beautiful Bill” and change of the tax benefit arrangements in the energy area, including reduction of the benefits for renewable<br> energies, and update of the U.S. income tax guidelines regarding the Safe Harbor rules for purposes of entitlement to tax benefits for the renewables – for details – see Section 3D below. As at the approval date of the report, the CPV<br> Group assured compliance with the Safe Harbor rules for the projects in the scope of 1.9 gigawatts.
Group headquarters Raising of capital – in 2025, the Company completed a capital raise with gross proceeds of about NIS 2,090 million. The proceeds of the issuances was earmarked<br> mainly for provision of part of the share of the CPV Group in the shareholders’ equity required for construction of the Basin Ranch power plant and the continued growth and development of the Company’s business.
Increase of the investment commitment in the CPV Group – in March 2026, a process was completed of increase of the investment commitment of the Company and the<br> other partners in the CPV Group in connection with the financial close of the Basin Ranch power plant and transactions for increasing the holdings in the natural gas‑fired power plants, in the aggregate amount of about $502 million. For<br> details – see Note 23A(2) to the financial statements.
Credit rating for the Company of A1.il with a stable rating outlook – in May 2025, Midroog determined an initial rating of A1.il with a stable rating outlook for<br> the Company and its debentures. In addition, in May 2025 S&P Maalot raised the Company’s credit rating to ilA with a stable rating outlook and the credit rating of its debentures to ilA+. For details – see Section 7B below.
Issuance of debentures by means of expansion of the debentures (Series D) – in November 2025, the Company made an additional issuance of debentures (Series D) by<br> way of an expansion of an existing series, in the amount of NIS 500 million (gross) in order to refinance existing debts and for use in current ongoing business activities. For details – see Section 7A(13) below.
Early partial redemption (prepayment) of the debentures (Series B) – on September 30, 2025, the Company made an early partial prepayment of the debentures<br> (Series B), in the total amount of about NIS 302 million.

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OPC Energy Ltd.

Report of the Board of Directors

1.           Executive Summary^1^ (Cont.)

Portfolio of about 15.1 GW and about 6.4 GWh of storage (for details – see Section 6 below)

United States (1)

(1) The projects are presented according to the CPV’s Group relative ownership interest in each project.
(2) The Basin Ranch (under construction) and Shore (active) power plants are presented at 100%, which is the rate of ownership of the CPV Group as at the approval date of the report.
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OPC Energy Ltd.

Report of the Board of Directors

1. Executive Summary^1^ (Cont.)

Portfolio of about 15.1 GW and about 6.4 GWh of storage (for details – see Section 6 below) (Cont.)

Israel

That stated with respect to the development stages, capacities and/or expectations regarding construction of the development (pipeline) projects in Israel and in the U.S. constitutes “forward‑looking” information as it is defined in the Securities Law, 1968 (“the Securities Law”), which is based on the Company’s estimates at the approval date of the report and regarding which there is no certainty they will be realized. Ultimately, there could be changes in the characteristics of the projects and/or delays or changes due to regulatory, operating, commercial factors and/or realization of one or more of the risk factors to which the Company is exposed, as stated in Part A of the Periodic Report. Advancement of the pipeline projects (or any one of them) is subject to the discretion of the Company’s competent organs and existence (fulfillment) of additional conditions, as stated in Part A of the Periodic Report.

For definitions of the development stages – see Section 6 below.

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OPC Energy Ltd.

Report of the Board of Directors

2. Main Developments in the Business and Regulatory Environment in Israel
A. Electricity tariff for consumers of Israel Electric Company
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1. Structure of the tariff of the generation component
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The Electricity Authority determines, among other things, the tariffs including the electricity generation component tariff that is collected by Israel Electric Company (“the generation component”) in the year of the report, based on the cost principle and the other factors provided in the Electricity Sector Law. In this regard, the generation component is based on, among other things, the Electric Company’s fuel costs, which for 2025 are composed mainly of the natural‑gas costs (and coal at a diminishing rate), the costs involved with acquiring electricity from private generators, the Electric Company’s capital costs, operating costs and the policies of the Electric Company with respect to classification of costs between the generation component and system costs^8^.

As at the date of the report, most of the Company’s revenues in Israel derives from agreements covering sale of electricity, primarily to industrial and commercial consumers, as well as to household consumers via agreements with marketing entities, where the balance of the weighted‑average period^9^ of the agreements with the industrial and commercial consumers is about 8 years and with the entities that market to household consumers it is about 6 years. In general, in the undertakings with the private customers, as stated, the Company collects the TAOZ tariff^10^ from the consumer (which is impacted primarily by the generation component tariff) less a discount relating to the generation component. The price of the electricity changes based on the season (summer, winter and transition) and the charge hour – the hourly demand brackets (peak and low). In general, the electricity tariffs in Israel in the summer and the winter are higher than those in the transition seasons and, accordingly, the Company’s revenues are impacted by seasonality.

Therefore, the results of the Group’s activities in Israel are materially impacted by changes in the generation component tariff in such a manner that an increase in the generation component has a positive impact on the Group’s results, and vice‑versa^11^.

^8^ System costs are costs collected from all the consumers in the economy. These costs include services for balancing the system, collection services, accompanying arrangements in the electricity sector and administrative costs (“the system<br> costs”). It is noted that the electricity tariff that is published by the Electricity Authority includes a number of components, including, transmission infrastructure, distribution infrastructure, a system component and a generation<br> component. To the best of the Company’s knowledge, except for the generation component (which is usually collected with a certain discount and which remains with the private electricity generators or suppliers), all the rest of the<br> components are collected at the same rate that is published by the Electricity Authority and are transferred directly to Israel Electric Company.
^9^ The average balance of the period does not include agreements for short periods that are signed from time to time, for a period of up to about 3 months. The agreements include the possibility of early termination and “exit” points that<br> are customary in agreements of this type.
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^10^ A burden and time‑of‑use tariff, which is determined by the Electricity Authority and which is based on various electricity prices in accordance with the season of the year and different time brackets during the 24‑hour period.
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^11^ 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<br> 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.
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OPC Energy Ltd.

Report of the Board of Directors

2. Main Developments in the Business and Regulatory Environment in Israel (Cont.)
A. Electricity tariff for consumers of Israel Electric Company (Cont.)
--- ---
1. Structure of the tariff of the generation component (Cont.)
--- ---

Decision of the Electricity Authority regarding the structure of the generation component tariff

In December 2025, the Electricity Authority published a decision regarding the matter of “Update of the Tariff Structure for Electricity for Consumers of Israel Electric Company”, in the framework of which it was determined, among other things, that update of the tariff will be made automatically every six months and the structure of the generation component will change such that starting from January 1, 2026 the generation component will be split into a fixed component and a variable component based on the tariff costs for 2025 less non‑recurring adjustments. Regarding the tariffs for the starting point of each of the two components, a linkage and advancement mechanism was provided that conforms to the costs that compose it and their characteristics. The variable component is linked to the exchange rate of the dollar, the CPI, the carbon emissions tax cost and the price of coal and the fixed component is linked to the CPI and the risk‑free inflation‑adjusted interest rate. The tariff will be a three‑year tariff (2026–2028), where during the period the tariff will be linked to relevant indices and prices, as stated. It is noted that in the Company’s estimation, in general, in the present format for the generation component, a change of 1 agura per kilowatt hour in the generation component has an impact of about NIS 30 million on the EBITDA in Israel. It is further noted that in the Company’s estimation, based on past experience and assuming the said update mechanism in the next three years, the generation component tariff is relatively stable over the long run with respect to the relative volatility that characterizes the electricity prices in the U.S.^12^

2. Update of the tariff of the generation component for 2025–2026

In January 2025, a decision of the Electricity Authority entered into effect regarding update of the generation tariff for 2025, whereby the weighted‑average generation component was updated to 29.39 agurot per kilowatt hour – a decline of about 2.4% in the generation component with reference to the average that prevailed in 2024 and about 2.2% compared with 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.

In December 2025, the generation component for 2026 was set (subject to a periodic update as stated above) at 28.90 agurot per kilowatt hour (assuming a shekel/dollar exchange rate of U.S.$1 = NIS 3.3), a decline of 1.66% compared with the average generation component for 2025.

^12^ The Company’s estimates regarding the impact of changes in the generation component on the EBITDA and the relative stability of the generation component are “forward‑looking” information as it is defined<br> in the Securities Law, regarding which there is no certainty it will materialize. Ultimately, the impact might be different due to, among other things. the market conditions, changes impacting the components of the tariff, regulatory<br> changes/factors that impact the electricity market and/or the final arrangements that will be determined if they enter into effect, which are not dependent on the Company.

11

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OPC Energy Ltd.

Report of the Board of Directors

2. Main Developments in the Business and Regulatory Environment in Israel (Cont.)
A. Electricity tariff for consumers of Israel Electric Company (Cont.)
--- ---
2. Update of the tariff of the generation component for 2025–2026
--- ---

Set forth below is data regarding the annual weighted‑average generation component (the prices are denominated in agurot per kilowatt hour):

Period 2025 2024 Change
January–December average 29.39 30.10 (2.4 %)
October–December average 29.39 30.07 (2.2 %)

In the Company’s estimation, a significant impact on its results due to the above‑mentioned Hearing is not expected^13^.

3. The natural gas price and carbon emissions tax

Natural gas serves as the main raw material for generation of electricity in the area of activities (usually, with diesel oil as a backup). For purposes of its activities, the Group has signed long‑term agreements^14^ for acquisition of natural gas for the active power plants, where most of the gas purchased from the Karish Tanin reserve (which is held by Energean) and from the Tamar Group.

The price of the natural gas determined as part of the said agreements is denominated in or linked to the dollar (subject to a minimum graduated dollar price), as applicable in accordance with each agreement, and is also linked to the weighted‑average generation component (subject to a minimum price) in such a manner that if the natural‑gas price pursuant to the agreements stands at the minimum price, a decline in the generation component will not trigger a decrease in the cost of the natural gas. It is noted that the purchase price of the natural gas is not impacted by the seasonality of the TAOZ tariff or the hourly demand brackets. In light of that stated, in the Company’s estimation, the Group’s natural gas cost in Israel is (relatively) stable over time, compared with the relative volatility characterizing the natural‑gas prices in the U.S.

^13^ The Company’s estimates with respect to the impact of the Decision is “forward‑looking” information as it is defined in the Securities Law, for which there is no certainty of their realization.<br> Ultimately, the impacts could be different due to, among other things, the market conditions, changes impacting the components of the tariffs, regulator changes/factors that impact the electricity market and/or final arrangements that<br> will be determined, should they enter into effect, which do not depend on the Company.
^14^ The Energean agreements are in effect up to 2033 and 2038 for the Rotem and Hadera power plants, respectively, and the Tamar agreements are in effect up to 2028 for<br> the Rotem and Gat power plants and 2029 for the Hadera power plant. There is an option to extend the said agreements for a period of up to two years on the terms provided in the agreements.
--- ---

12

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OPC Energy Ltd.

Report of the Board of Directors

2. Main Developments in the Business and Regulatory Environment in Israel (Cont.)
A. Electricity tariff for consumers of Israel Electric Company (Cont.)
--- ---
3. The natural gas price and carbon emissions tax (Cont.)
--- ---

In September 2024, the amendment to the Excise Tax on Fuel Order (“the Amended Order”) took effect, such that starting from January 1, 2025 the excise tax rate imposed on natural gas will increase in a graduated manner from 2025 and up to 2030 (in 2025 increased from NIS 19 per ton to NIS 33 per ton, in 2026 will increase to NIS 54 per ton and gradually up to a maximum excise tax of NIS 192 in 2030, CPI linked). The said increase is expected to raise the Group’s natural‑gas cost in Israel, where in the Company’s estimation part of this impact could decline due to, among other things, an increase in the Group’s revenues in Israel, if and to the extent there is an increase in the generation component and subject to the expected impact of such an increase on the natural‑gas price, which is linked to the generation component. As at the approval date of the report, the Company is unable to estimate the full impact of the Amended Order on its results over time due to the uncertainty embedded in the manner of determination of the tariff, in general, and the generation component, in particular, over the long run and on the manner of the further application of the decision, as well as in light of the possible impacts of conclusion of significant natural gas agreements in the economy. Regarding 2026, the Company estimates that the Amended Order is not expected to have a significant impact on its results^15^.

4. Capacity revenues

In addition to the revenues from sale of energy, some of the active power plants in Israel, mainly the Zomet power plant, are entitled to capacity revenues that are paid by the System Operator. The capacity tariff in the Zomet and Gat power plants is fixed (based on tariff approvals for each power plant, and broken down by the hourly‑demand brackets as determined by the System Operator) and is linked to the CPI (and with respect to Gat – also including an annual ceiling).

^15^ That stated above with respect to the Company’s estimates regarding the relative stability of the gas price in the area of activities in Israel and/or regarding the Company’s estimate with respect to the impact of the amended Excise Tax Order and the possibility of the reduction of its scope, constitutes “forward‑looking” information as it is defined in the Securities Law, which is based on the Company’s estimates as at the date of the report. Ultimately, the gas price could be impacted by various factors, and the impacts of the amended Excise Tax Order might not have a positive impact on the generation component that will be reflected in the Company’s revenues – this being due to, among other things (and as applicable), certain operative factors, the terms of the gas agreements, factors relating to the gas suppliers with which the Company has contracted (particularly Energean), disruptions in the supply of natural gas, regulatory changes, items impacting the generation component and the Company’s revenues, including, macro‑economic factors, or the occurrence of one or more of the risk fact to which the Company is exposed, as stated in Section 19 of the Part A of the Periodic Report.

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OPC Energy Ltd.

Report of the Board of Directors

2. Main Developments in the Business and Regulatory Environment in Israel (Cont.)
A. Electricity tariff for consumers of Israel Electric Company (Cont.)
--- ---
5. Supply to customers
--- ---

As part of implementation of the reform in the electricity sector in Israel, in recent years the Electricity Authority has taken action to advance the competition in the supply market by means of entry and integration of private suppliers and acceleration of the transition of consumers to receipt of services from those suppliers. Based on the Report of the Israeli Economic Sector for 2025, the market share of the private suppliers reached about 35% of the economy’s entire consumption, where most of the undertakings are mainly with customers having significant electricity consumption (mostly industrial and commercial consumers with high‑ and medium‑voltage connections). Regarding consumers with low‑voltage connections, including, among others, most of the household consumers, as at June 2025, only 9% are serviced by private suppliers. It is noted that in order to increase the ability to transfer household consumers to private electricity suppliers, starting from January 2024 household consumers that do not have a “smart” meter are permitted to contract with a private supplier. At the present time, the Company supplies private electricity consumers (indirectly through PPA agreements with two marketers), while in the Company’s estimation, up to the end of 2026 the scope of the sales to household consumers through the said marketers is expected to continue to rise.

In addition, as part of the continuing optimization and diversity of the mix of the Company’s customers in Israel, including from the standpoint of the future projects being developed by the Company, as detailed in Section 6A below, during the past year the Company contracted with a number of server farms, including examination of significant expansion of the undertakings with these consumers and/or with additional server farms^16^.

B. Security, Political and Geopolitical Developments in Israel

Commencing from 2023, Israel has been characterized by significant geopolitical and defense instability, along with considerable regional escalation – due to both internal political events and the events occurring on October 7, 2023, as well as the defense/security issues arising from the outbreak of the “Iron Swords” war in the Gaza Strip. During 2024–2025, the combat and tensions increased in certain areas, particularly in the northern part of the State as well as with the Houthis group in Yemen and with the country of Iran, where on June 12, 2025 a broad‑scoped military confrontation started between Israel and Iran (the “Rising Lion” military operation). On June 24, 2025, a ceasefire was declared with Iran and in October 2025 an agreement was signed for a ceasefire in the Gaza Strip.

^16^ The Company’s estimates with respect to the developments in the electricity market, including regarding the scope of the Company’s sales  and its customer portfolio, constitutes “forward‑looking” information as it is defined in the Securities Law, and there is no certainty regarding its realization in the short run or in the long run, and which depends on, among other things, the scope of the activities of the marketers through which the Company operates, the extent of the transition of household consumers to private suppliers, changes in the market conditions or the competition therein, the composition of the consumption of the Company’s customers, PPA agreement execution and/or or the occurrence of one or more of the risk fact to which the Company is exposed.

14

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OPC Energy Ltd.

Report of the Board of Directors

2. Main Developments in the Business and Regulatory Environment in Israel (Cont.)
B. Security, Political and Geopolitical Developments in Israel (Cont.)
--- ---

The fighting that started in 2026, following the combat that took place in the period of the report, had varying external impacts that included, among other things, disruptions in the shipping routes due to attacks on commercial and transport vessels and contraction (sometimes even significant) of the activities of the foreign airline companies in Israel. From time to time, these events impacted (and may continue to impact, as stated below) the arrival of equipment and foreign work teams in Israel (including those needed for purposes of maintenance and construction at the Group’s activity sites in Israel). The said fighting and the “Rising Lion” military operation did not have a material impact on the activities in Israel in the period of the report.

Subsequent to the date of the report, on February 28, 2026, there was a significant escalation in the regional geopolitical situation upon the outbreak of an additional serious military confrontation between Israel and the United States versus Iran, which according to the reporting also includes attacks by Iran on additional Middle‑Eastern countries (the “Lion’s Roar” Operation). As a consequence of the “Lion’s Roar” military operation, among other things, Israeli airspace was closed and a general emergency situation was announced for the Israeli home front in such a manner that significantly limits the activities (traffic/movement) in public areas – this being together with a large mobilization of military reserves.

The above‑mentioned events involve significant uncertainty and could impact the macro‑economic environment, including an adverse impact on the strength of the Israeli economy. The said military/defense situation and/or a worsening thereof could negatively affect the Company’s activities in Israel as well as the activities of its customers and suppliers in Israel, and could also have an unfavorable effect on the results of the Company’s operations, its generation capacity and the cost of the capital and financing sources required for the Group’s activities. During the “Lion’s Roar” Operation, all the natural gas rigs (platforms) were shut down (including the Karish reservoir) for varying periods of time (as at the date of the report – only for several days), while at the approval date of the report the Tamar reservoir is operating whereas the Karish and Leviathan reservoirs have not yet resumed their operations. As at the approval date of the report, the operation of the Tamar reservoir has supplied all the Company’s natural‑gas needs. Nonetheless, some of the gas was purchased at a price higher than the alternative price from the Karish reservoir with only an immaterial impact as at the approval date of the report. The Company is preparing for a possible continuation of the impact of the military operation on the natural gas platforms, including temporary use of diesel oil at the Company’s power plants, as necessary. In addition, in light of the emergency situation announced in the Israeli economy there has been a certain decline in demand, however the full extent of the impacts on the Company’s customers (if any) has not yet been ascertained. Furthermore, force majeure notifications have been received from suppliers and contractors along with limited availability of foreign work teams and experts at the activity sites in Israel, including at the Sorek 2 site (which is undergoing acceptance tests) and the Hadera site (which is performing unplanned maintenance).

As at the approval date of the report, taking into account the close succession of the “Lion’s Roar” Operation following the preceding events, there is no complete certainty regarding the full impacts and consequences of the said Operation on the Group’s activities, if any, and at this point the Group is not able to assess them.

For additional details – see Section 6.1.1 of Part A of the Periodic Report.

15

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OPC Energy Ltd.

Report of the Board of Directors

3. Main Developments in the Business and Regulatory Environment in the U.S.
A. Electricity and natural gas prices
--- ---

The results of the activities of the CPV Group are impacted to a significant extent by the electricity prices in effect in the areas in which the Group’s power plants operate. The main factors impacting the electricity prices are demand for electricity, available generation (supply) and the natural gas price in the area in which the power plant operates.

Electricity supply and demand trends

The electricity prices in the U.S. are continuing to be impacted by supply and demand trends in the activity markets of the CPV Group’s power plants, particularly the PJM and ERCOT markets (the location of the Basin Ranch power plant which is under construction).

In the year of the report, electricity demand continued to rise, with an expectation of significant further growth. This trend is driven primarily by ongoing electrification in transportation, real estate and industry sectors, expansion of industrial activities – particularly due to increased energy requirements in the data center sector following the transition to cloud computing and the growth in artificial intelligence (AI) applications, as well as an increase in the demand for electricity in energy‑intensive industries, such as, cryptocurrency mining. In the United States, available generation capacity is expanding as new natural gas, solar, and wind installations more than offset the retirement of older, less efficient, and more polluting conventional power plants, particularly coal-fired facilities^17^. Nevertheless, according to the U.S. Energy Information Administration’s Annual Energy Outlook 2025 projections of electricity demand and generation capacity through 2035, long-term energy trends indicate a rising power demand and shifts in the generation sources that will entail significant additional investments in new generation and infrastructures in order to meet the future needs^18^.

It is noted that in June 2025, the PJM region recorded a record demand for electricity, which reached about 160 gigawatts – the highest level recorded in the last decade. The exceptional increase in the demand stemmed from a combination of weather conditions (extreme heat wave and high humidity) that triggered an increase in electricity consumption for air conditioning, along with structural trends as detailed above. Per PJM’s most recent load forecast, the summer peak is projected to reach 222 GW in 2036, an increase of over 60 GW in 10 years, driven in large part by the rising energy demand from data centers^19^.

^17^ Americas Generation Capacity 2025 Update from April 2025:

(https://www.publicpower.org/system/files/documents/Americas-Electricity-Generation-Capacity-2025- Update.pdf)

^18^ U.S. Energy Information Administration’s Annual Energy Outlook 2025 from April 2025

(https://www.eia.gov/outlooks/aeo)

^19^ Source: “PJM Load Forecast Report 2026” dated January 14, 2026.

16

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OPC Energy Ltd.

Report of the Board of Directors

3. Main Developments in the Business and Regulatory Environment in the U.S. (Cont.)
A. Electricity and natural gas prices (Cont.)
--- ---

Electricity supply and demand trends (Cont.)

In the estimation of the CPV Group, this record demand, together with the unusual winter demand recorded in January 2025 along with the demand forecasted for the winter of 2026^19^, emphasize PJM’s need to system‑wide preparations in order to, among other things, cope with extreme weather conditions, additional investments in generation and storage capability along with a re‑examination of the availability and reliability resources at times of record‑high demand.

It is further noted that the peak summer demand for electricity in the ERCOT system reached over 83 GW in 2025^20^. Based on the forecasts published by ERCOT as at the approval date of the report, the summer peak is projected to reach 126 GW by 2031, reflecting an average annual growth rate of 13.6%) in the demand for energy from 2026 to 2030^21^.

Fluctuations

In general, in the United States, the electricity prices are impacted by the demand for electricity and the prices of natural gas, which are generally high in periods in which the weather is cold or hot compared with the annual average and depending on the weather (usually in the summer and winter seasons).

In connection with renewable energy projects, in wind projects the wind speeds tend to be higher in the winter and lower in the summer, whereas in solar projects the radiation from the sun tends to be higher in the spring and summer months and lower in the fall and winter months.

Natural gas prices

With respect to the “energy transition” activities, in general, the price of natural gas is significant in determination of the price of the electricity, as gas-fired generation is frequently the marginal (price-setting) resource in most of the competitive wholesale markets in which the CPV Group operates. Accordingly, in the existing production mix, over time, to the extent the natural‑gas prices are higher in a continuing manner, the marginal energy prices will also be higher, and would be expected to have a positive impact on the energy margins of the CPV Group due to the high efficiency of the power plants it owns compared with other power plants operating in the relevant activity markets (the impact could be different between the projects taking into account their characteristics and the area (region) in which they are located or in cases of sharp fluctuations in the natural gas prices, for example, upon the occurrence of extreme weather events)^22^.

^20^ Source: “ERCOT Monthly Operational Overview for August 2025, dated September 22, 2025.

^21^ Source: Report “Capacity, Demand and Reserves (CDR) in ERCOT Region, 2026-2030”, dated December 19, 2025.

It should be noted that the foregoing regarding trends in the electricity market, growth in demand, or consumption forecasts constitutes forward-looking information based on the assessments of the CPV Group in accordance with publicly available data, which may change due to factors that are not under its control.

^22^ That stated constitutes merely a general estimate that could be subject to changes due to projects characteristics or factors and events that are not under the control of the CPV Group.

17

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OPC Energy Ltd.

Report of the Board of Directors

3. Main Developments in the Business and Regulatory Environment in the U.S. (Cont.)
A. Electricity and natural gas prices (Cont.)
--- ---

Natural gas prices (Cont.)

Set forth below are the average natural gas prices in each of the main markets in which the power plants of the CPV Group operate (the prices are denominated in dollars per MMBtu)*:

For the Year Ended For the Three Months Ended
Region December 31 December 31
(Power Plant) 2025 2024 Change 2025 2024 Change
Texas Eastern M‑3 (Shore, Valley – 70%) 3.69 2.07 78 % 3.66 2.37 54 %
Transco Zone 5 North (Maryland) 3.70 2.51 47 % 3.76 2.38 58 %
Dominion South Pt (Valley – 30%) 2.78 1.67 66 % 2.96 1.97 50 %
Algonquin City Gate (Towantic) 6.23 3.03 106 % 7.37 4.42 67 %
Texas Eastern M‑3 and Texas
Eastern M‑2 (Fairview)** 3.03 1.71 77 % 3.66 1.99 84 %
Chicago City Gate (Three Rivers) 3.25 2.12 53 % 3.36 2.21 52 %
Waha (Basin Ranch)*** 0.58 0.05 1,060 % (0.94 ) 0.65 (245 )%
* Source: The Day‑Ahead prices at gas Midpoints as reported in Platt’s Gas Daily. It is clarified that the actual gas prices of the power plants of the CPV Group could be significantly different.
--- ---
** Commencing from the third quarter of 2025, Fairview has started acquiring natural gas that is priced based on the Texas Eastern M‑3 transmission region. The above table presents Fairview’s combined gas price, which constitutes the gas<br> price up to June 2025 based on the Texas Eastern M‑2 transmission region, and starting from July 2025 the gas price based on the Texas Eastern M‑3 transmission region. For additional details – see Appendix A below.
--- ---
*** The Basin Ranch project is under construction. For details – see Section 6B(1) below.
--- ---

In the estimation of the CPV Group, the significant increase in the natural gas prices in the period of the report and in the fourth quarter of 2025, compared with the corresponding periods last year, is mainly due to the weather conditions described above, which led to a significant rise in demand for natural gas and an increase in the prices in the regions in which the CPV Group’s power plants operate.

Regarding the distribution region for natural gas in Waha Texas, which is expected to serve as the supply source for the Basin Ranch power plant, which as noted in under construction, is characterized by variable levels of production of natural gas as a function of the desired levels of production of the crude oil by the producers, which are impacted by the competitive environment in the fuel market (the natural gas constitutes a by‑product), and transmission and transport limitations of natural gas from the region. The corresponding periods last year were characterized by a significant surplus supply of natural gas against the background of the scope of the fuel production and transport limitations as stated (which were resolved in part in the period of the report due to operation of a new natural gas pipeline in the region) and, in turn, low price‑levels compared with the other power plants of the CPV Group. Therefore, the rate of increase of the natural gas prices in the period of the report compared with the corresponding period last year, when measured against the other power plants of the CPV Group, is unusually high. In the fourth quarter of 2025, against the background of the significant supply surpluses of natural gas, negative gas prices were recorded, which led to a sizable decrease in the natural‑gas prices compared with the corresponding period last year. It is noted that the Basin Ranch project has signed Netback gas agreements and fixed‑price agreements for sale of electricity. These arrangements hedge the electricity margins for a substantial portion of the Basin Ranch power plant’s capacity thereby limiting the project’s exposure to gas price volatility. For details – see Section 6B(1), below.

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OPC Energy Ltd.

Report of the Board of Directors

3. Main Developments in the Business and Regulatory Environment in the U.S. (Cont.)
A. Electricity and natural gas prices (Cont.)
--- ---

Electricity prices

The following table summarizes the average electricity prices in each of the regions in which the power plants in the area of energy transition activities of the CPV Group are active (the prices are denominated in dollars per megawatt hour)*:

For the For the
Year Ended Three Months Ended
Region December 31 December 31
(Power Plant) 2025 2024 Change 2025 2024 Change
PJM West (Shore, Maryland) 50.24 33.83 49 % 57.89 34.71 67 %
New York Zone G (Valley) 62.37 37.64 66 % 68.18 46.26 47 %
Mass Hub (Towantic) 67.98 41.47 64 % 78.80 54.49 45 %
PJM AEP Dayton (Fairview) 45.13 30.73 47 % 48.52 32.48 49 %
PJM ComEd (Three Rivers) 36.64 25.55 43 % 37.36 24.58 52 %
ERCOT West Hub (Basin Ranch)** 33.73 28.94 17 % 34.34 25.18 36 %
* Based on Day‑Ahead prices as published by the relevant ISO.
--- ---
** The Basin Ranch power plant, the construction of which commenced in October 2025. For details – see Section 6B(1) below.
--- ---

It is noted that the actual electricity prices of the power plants of the CPV Group could be higher or lower than the regional price shown in the above table due to the existence of a Power Basis (the difference between the power plant’s specific electricity price and the regional price). The Power Basis is a function of transmission constraints, local cost of electricity generation, local demand for electricity, loss of electricity in the transmission lines and additional factors.

The following table presents the average Power Basis data for each power plant (the prices are denominated in dollars for megawatts per hour):

Power Plant For the Year Ended December 31
2025 2024
Shore (8.47 ) (6.25 )
Maryland 4.90 3.59
Fairview (3.11 ) (2.18 )
Valley (1.33 ) (1.00 )
Towantic (4.44 ) (2.77 )
Three Rivers (2.00 ) (1.01 )

In the period of the report and in the fourth quarter of 2025, there was a significant increase in the electricity prices compared with the corresponding periods last year, which in the estimation of the CPV Group derives mainly from an increase in the natural‑gas prices due to lower‑than‑average temperatures in the first and fourth quarters of 2025 along with higher‑than‑average temperatures in the second and third quarters of 2025 in the areas in which the power plants of the CPV Group are located. In addition, as detailed above the demand for electricity continued to rise in the activity areas of the CPV Group’s power plants.

19

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OPC Energy Ltd.

Report of the Board of Directors

3. Main Developments in the Business and Regulatory Environment in the U.S. (Cont.)
A. Electricity and natural gas prices (Cont.)
--- ---

Electricity margin in the operating markets of the CPV Group (Spark Spread)

Spark Spread is the difference between the price of the electricity in the relevant area (zone) and the price of the natural gas used for generation of the electricity in the relevant area (zone) (it is clarified that RGGI is not included in calculation of the Spark Spread but rather in the energy margin as detailed in Section 4D(3) below).

The Spark Spread is calculated based on the following formula:

Spark Spread ($/MWh) = price of the electricity ($/MWh) – [the gas price ($/MMBtu) x thermal conversion ratio (heat rate) (MMBtu/MWh)]

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)*:

For the For the
Year Ended Three Months Ended
December 31 December 31
Power Plant^23^ 2025 2024 Change 2025 2024 Change
Shore 24.78 19.55 27 % 32.64 18.36 78 %
Maryland 24.71 16.51 50 % 31.95 18.29 75 %
Valley 38.79 24.19 60 % 44.38 30.74 44 %
Towantic 27.49 21.78 26 % 30.90 25.76 20 %
Fairview 25.45 19.62 30 % 24.73 19.55 27 %
Three Rivers 15.52 11.77 32 % 15.52 10.22 52 %
Basin Ranch** 29.96 28.62 5 % 40.45 20.96 93 %
* 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, Fairview,<br> Towantic and Basin Ranch. 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<br> 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).
--- ---
** The Basin Ranch power plant is under construction. For details – see Section 6B(1) below.
--- ---

In the period of the report and in the fourth quarter of 2025, there was a significant increase in the electricity margins (Spark Spread) in all the active power plants of the CPV Group, compared with the corresponding periods last year, stemming from a combination of unusual weather conditions – temperatures lower than the average in the first and fourth quarters of 2025, along with temperatures higher than the average in the second and third quarters of 2025, plus a continuing increase in the demand for electricity in the areas in which the power plants of the CPV Group are located.

^23^For additional details regarding the energy margin of the CPV Group – see Section 4D(3) below.

20

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OPC Energy Ltd.

Report of the Board of Directors

3. Main Developments in the Business and Regulatory Environment in the U.S. (Cont.)
A. Electricity and natural gas prices (Cont.)
--- ---

Electricity margin in the operating markets of the CPV Group (Spark Spread) (Cont.)

The electricity margins in the ERCOT market were impacted, to a moderate degree, by natural‑gas price trends. This is primarily because electricity pricing in the ERCOT West Hub region is not directly linked to natural gas prices in the WAHA region, which experienced significant impacts, as stated above, from surplus supply and transmission constraints in the corresponding periods last year.

CPV Group uses hedging strategies for its natural gas-fired power plants that are intended to reduce the fluctuations of the CPV Group’s electricity margin resulting from changes in the natural gas and electricity prices in the energy market. For details regarding hedging agreements related to the electricity margin at CPV Group’s active power plants – see Section 4D(3) below. Regarding the Netback gas agreements and fixed-price electricity sales, which hedge a significant portion of the Basin Ranch power plant’s capacity – see Section 6B(1), below).

For the EOX Company’s 2026-2028 electricity and natural gas price forecast details – see Appendix A below.

B. Carbon Emissions Tax – Regional Greenhouse Gas Initiative (RGGI)

The RGGI regulation applies to 4 of the 6 power plants of the CPV Group in the Energy Transition segment: Maryland, Shore, Valley and Towantic. For additional details regarding the RGGI regulation – see Section 8.1.4B of Part A of the Periodic Report.

Set forth below is a summary of the prices of the gas‑emission quotas (carbon emission tax) from the RGGI auctions. In general, the auctions take place four times a year, in March, June, September and December.

Average for
the three months ended
December 31
2024 Change 2025 2024 Change
Price of carbon emission tax in the RGGI auctions ( per short ton / 2,000 pounds)* 20.42 19.42 5 % 22.25 25.75 (14 )%
Cost of the carbon emission tax (in terms of gas cost) ( per MMBtu)** 1.22 1.16 5 % 1.32 1.53 (14 )%

All values are in US Dollars.

* The prices of the carbon emissions tax are presented under the assumption that the price of the auction that is held prior to a certain quarter represents the price of the carbon emissions tax for the subsequent quarter. For example, the<br> auction held in December 2025 will represent the price for the first quarter of 2026. It is noted that the actual price of the carbon emissions tax could be different than the auction prices as a result of transactions made in the secondary<br> 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<br> between the different power plants, and in the estimation of the CPV Group a ratio of 119 lbs./MMBtu is a representative ratio for natural gas-fired power plants.
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OPC Energy Ltd.

Report of the Board of Directors

3. Main Developments in the Business and Regulatory Environment in the U.S. (Cont.)
B. Carbon Emissions Tax – Regional Greenhouse Gas Initiative (RGGI) (Cont.)
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During the reporting period, the RGGI prices remained relatively stable, with only a moderate increase compared to the corresponding period last year. It is noted that from time to time, usually for short periods, the RGGI market could experience price volatility stemming mainly from regulatory factors and supply and demand with respect to emissions’ permits.

C. Capacity revenues

Capacity is an additional significant income component of the CPV Group’s active power plants that operate in the PJM, NYISO and ISO‑NE markets, wherein  an increase in the capacity prices has a favorable impact on CPV’s results, and vice‑versa. The extent of the impact on the overall results changes as a function of the energy margins, which is the most significant component of the gross profit (margin for generation of the electricity and the sale thereof), this taking into account the fact that the weight of the capacity component is usually lower than the weight of the energy margin component.

PJM market

In the PJM market, the capacity payments vary between the market’s sub‑regions, as a function of local supply and demand and transmission capabilities. In general, the capacity auctions are made once a year for an annual supply period (June – May) in a format of three years in advance. Due to regulatory delays, the current schedule includes an auction once every six months, with the goal of returning to annual auctions in 2027 – subject to regulatory changes. Set forth below are the capacity tariffs in the sub‑regions that are relevant to the CPV Group’s power plants and in the general market (the prices are denominated in dollars per megawatt per day).

Sub-region CPV Power Plants ^(3)^2027/2028 ^(2)^2026/2027 ^(1)^2025/2026 2024/2025 2023/2024
PJM RTO 333.44 329.17 269.92 28.92 34.13
PJM COMED Three Rivers 333.44 329.17 269.92 28.92 34.13
PJM MAAC Fairview, Maryland, Maple Hill 333.44 329.17 269.92 49.49 49.49
PJM EMAAC Shore 333.44 329.17 269.92 54.95 49.49

Source: PJM

^(1)^ Estimated additional revenues for the CPV Group for the period of the auction compared with the corresponding period last year of about $98 million^24^.
^(2)^ Estimated additional revenues for the CPV Group for the period of the auction compared with the corresponding period last year of about $18 million^24^.
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^(3)^ Estimated additional revenues for the CPV Group for the period of the auction compared with the corresponding period last year of about $2 million^24^.
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^24^ That stated in this section with respect to the estimate of the CPV Group constitutes “forward‑looking” information as it is defined in the Securities Law, regarding which there is no certainty it will be<br> realized. Ultimately, the revenues of the CPV Group from capacity could change (even significantly) as a result of, among other things, regulatory changes, operational factors, regulatory arrangements applicable to capacity regarding<br> fines or bonuses, changes in the business environment and/or the occurrence of one or more of the risk factors the CPV Group is exposed to.

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OPC Energy Ltd.

Report of the Board of Directors

3.          Main Developments in the Business and Regulatory Environment in the U.S. (Cont.)

C. Capacity revenues (Cont.)

It is noted that the capacity prices set in the 2026/2027 and 2027/2028 auctions, as shown above, were determined in accordance with the ceiling prices approved by PJM and confirmed by the FERC or for these two capacity auctions (with the necessary adjustments). In addition, the capacity coefficients for combined cycle gas plants were updated which led to a decrease in the availability capacity that is provided for sale by the CPV Group’s natural‑gas power plants of this type from about 96% to about 79% (in the 2025/2026 auction) and from about 79% to about 74% (in the 2026/2027 auction and thereafter). It is further noted that based on PJM publications, the theoretical prices derived from the results of the auctions, had it not been for the said ceiling, would have been about $389 and about $530 per megawatt/day, respectively.

Subject to additional changes in the timetables, if any, as at the approval date of the report, the next PJM capacity auction for the 2028/2029 capacity year is planned for June 2026.

The significant increase in the capacity tariffs in the latest auctions, as shown in the table above, relates to, among other things, a continuing increase in electricity demand, anticipated growth in future demand, higher reserve requirements, and a decline in the aggregate supply due to a change in the methods used to calculate capacities and demand capability of PJM’s generation sources.

Critical Issue Fast-Track Process (CIFP) – in January 2026, the PJM Council published a letter whereby it determined that the results of the latest capacity auctions reflect a continually increasing disparity between supply and demand, which requires taking corrective measures in order to maintain the reliability of the system, against the background of a quick increase in energy demand, including new large load connections. Accordingly, in January 2026, PJM’s management was directed to advance an accelerated process (CIFP) and to examine a series of interim steps, subject to regulatory approvals, including improvement of the demand forecasts, advancements of avenues for accelerated connection of new generation (including a “Bring Your Own Generation” model), expansion of demand‑related response mechanisms, operation of an RBP emergency mechanism for procurement of additional capacity as a reliability back‑up for the 2027/2028 period, examination of extension of maximum ceilings and minimum floors (collar) for two additional auctions, and broad examination of investment incentives and market design. For additional details – see Section 1.2.1.8A of Part A of the Periodic Report.

At the end of February 2026, PJM filed a request at FERC to extend the administrative price collars for the 2028/2029 and 2029/2030 capacity auctions. The tariff revisions will require FERC approval to be implemented, which as at the date of the report had not yet been received.

Separately, in the “Statement of Principles regarding PJM” document published by authorities in the Federal government and by a number state governors, PJM was called on to comply with the Reliability Backstop Auction (an emergency capacity auction for purposes of backing up the system’s reliability) no later than September 2026 for new resources, including long‑term reliability contracts covering a period of up to about 15 years. Pursuant to the results of the latest auction, the minimum requirement for additional available capacity in the PJM market, in order to ensure the system’s reliability, is estimated at about 6.5 gigawatts. Nonetheless, in light of the continuing rise in the demand for electricity, the scope of the new capacity in the PJM market in the upcoming years could well be considerably higher.

At this stage, these measures are under review, and there is no certainty regarding the manner of their implementation, their scope, or their timetable. Therefore, their long-term impact on the availability market and on the results of future tenders cannot be fully assessed.

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OPC Energy Ltd.

Report of the Board of Directors

3. Main Developments in the Business and Regulatory Environment in the U.S. (Cont.)
C. Capacity revenues (Cont.)
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NYISO market

Similar to the PJM market, in the NYISO market capacity payments are made in the framework of a central mechanism for acquisition of capacity. In the NYISO market, there are a number of submarkets, wherein there could be various capacity demands as a function of local supply and demand and transmission capability. NYISO makes seasonal auctions every spring for the upcoming summer (the months of May through October) and in the fall for the upcoming winter (the months of November through April). In addition, there are supplemental monthly auctions for the balance of the capacity not sold in the seasonal auctions. The power plants are permitted to assure the capacity tariffs in the seasonal auction, the monthly auction or through bilateral sales.

Set forth below are the capacity prices determined in the seasonal auctions in the NYISO market (the prices are denominated in dollars per megawatt per day):

Sub-Area CPV<br><br> <br>Power<br><br> <br>Plants Winter<br><br> <br>2025/2026 Summer<br><br> <br>2025 Winter 2024/2025 Summer<br><br> <br>2024
NYISO<br><br> <br>Rest of the Market – 89.83 153.26 66.30 168.91
Lower Hudson Valley Valley 89.83 153.26 66.30 168.91

Source: NYISO – Converted from dollars for kilowatt per month to dollars for megawatt per day.

It is noted that the Valley power plant is located in Area G (Lower Hudson Valley) and the actual capacity prices for the Valley power plants are impacted by the seasonal auctions, the monthly auctions and the SPOT prices, with variable capacity prices every month, as well as bilateral agreements with energy suppliers in the market.

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OPC Energy Ltd.

Report of the Board of Directors

3. Main Developments in the Business and Regulatory Environment in the U.S. (Cont.)
C. Capacity revenues (Cont.)
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ISO‑NE market

The Towantic power plant, which operates in this market, participated for the first time in a capacity auction for 2018–2019 at a price of $313.97 MW/day and determination of the tariff for seven years in respect of 725 megawatts linked to the Handy-Whitman Price Index, which applied up to May 2025.

In general, ISO‑NE executes forward auctions for a period of one year, commencing from June 1, three years from the year of the auction. In addition, there are supplementary monthly and annual auctions for the balance of the capacity not sold in the forward auctions. The power plants are permitted to guarantee the capacity payments in the forward auctions, the supplementary auctions or through bilateral sales. For details regarding the planned reform in the capacity market – see Section 8.1.2.1C of Part A of the Periodic Report.

Set forth below are the capacity payments determined in the sub‑regions that are relevant to the Towantic power plant (the prices are denominated in dollars per megawatt per day):

Sub-Region CPV Power Plants 2027/2028 2026/2027 2025/2026
ISO-NE<br><br> <br>Rest of the Market Towantic 117.70 85.15 85.15

Source: NE‑ISO – the Company’s processing in order to convert from dollars for kilowatt per month to dollars for megawatt per day.

It is noted that the actual capacity prices for the Towantic power plant are impacted by forward auctions, supplementary annual auctions, monthly auctions with capacity prices that change every month and bilateral agreements with energy suppliers in the market.

D. Changes in the government’s policies (including with respect to Customs duty (tariffs)) and legislation of the One Big Beautiful Bill in the U.S. – the commencement of the new Trump administration has introduced recent policy<br> changes that have created uncertainty along with significant opportunities in the U.S. energy sector. Since January 2025, orders and directives have been issued and legislation has been enacted supporting reduction of the government’s<br> support in the area of renewable energy, including matters related to eligibility for tax incentives (ITC and PTC), among other things, as detailed below and in Section 8.1.3.1 of Part A of the Periodic Report.

Furthermore, President Trump has imposed tariffs (some of which have been updated and are expected to continue to be updated later on) on imported equipment and raw materials (including, steel and solar panels) into the U.S., and is carrying on negotiations with respect to new trade agreements with foreign countries, in such a manner that there is uncertainty regarding the full extent of the impacts of the said orders or new trade agreements on the costs of the equipment for the projects. It is noted that the said update of the tariffs leads to an increase in the equipment costs (both in the areas of renewable‑energy and natural‑gas) and to disruptions in the supply chain and could, ultimately, lead to an increase in the construction or maintenance costs of projects^25^.

^25^ 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<br> report, which are subject to uncertainty and changes that are not under the Company’s control. The policies (present or additional) of the U.S. government could have a negative impact (even a significant one) on advancement and/or<br> 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.

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OPC Energy Ltd.

Report of the Board of Directors

3. Main Developments in the Business and Regulatory Environment in the U.S. (Cont.)
D. Changes in the government’s policies (including with respect to Customs duty (tariffs)) and legislation of the One Big Beautiful Bill in the U.S (Cont.)
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On February 20, 2026, the U.S. Supreme Court ruled that the President does not have general authority to impose the said tariffs and, therefore, their future validity and scope are not certain at this stage. Along with that stated, various sectorial tariffs are continuing to apply, including tariffs at a rate of up to 50% on certain categories of steel, aluminum and their products.

On July 4, 2025, a comprehensive federal law known as the “One Big Beautiful Bill” (hereinafter in this Section – “the Law”) was passed into law, which includes, among other things, legislative changes in all that relating to the set of federal tax benefits, which are mainly relevant to the renewable energy activities of the CPV Group in the U.S. regarding the entitlement to ITC and PTC. For details regarding the Law, the “safe harbor” rules and U.S. income tax (IRS) provisions regarding the term “start of the construction” in the framework of these items – see Section 8.1.3.1 of Part A of the Periodic Report.

In the estimation of the CPV Group, as at the approval date of the report: (A) regarding the activities of the CPV Group in the natural gas area, including future potential for addition of carbon capture, the said directives should have a positive impact on the general sentiment, the business environment and the feasibility of the investments; and (B) regarding the activities of the CPV Group in the renewable energies area, the Law and the said directives are not expected to have a negative impact on its active projects, its projects under construction, projects in the advanced development stage and some of the projects in the initial development stage, which in the estimation of the CPV Group should be entitled to tax benefits under the new legislation. Concerning projects in the initial development stage that will not be entitled to tax benefits under the new legislation, in the estimation of the CPV Group as at the approval date of the report, continuing demand for electricity from renewable energy should support an increase in the electricity prices along with a possible decline in the equipment prices and possible changes in government policies, could fully or partly compensate for the impact of cancellation of the tax benefits and, thus, reduce the impact of the Law on the economic worthwhileness of the said projects. Nonetheless, there could be delays in the development of projects in such a manner that the Law could have an unfavorable impact on the projected start dates of the construction^26^. For additional details – see Section 6C(2) below.

The CPV Group is continuing to monitor the changes being advanced by the Trump Administration and to examine their impacts. For additional details – see Sections 8.1.3.1 and 8.1.4O of Part A of the Periodic Report.

^26^ That stated above regarding the absence of a negative impact of the new legislation on the list of projects in the advanced development stage, and relating to the demand for renewable energies and an<br> increase in prices (and scope), a decline in the equipment prices and/or reduction of the impacts of the Law on renewable energy projects, constitutes “forward‑looking” information as it is defined in the Securities Law, which is based<br> on the estimates of the CPV Group as at the approval date of the report and on an assumption regarding high demand for renewable energies on the part ofsignificant consumers, and regarding which there is no certainty they will be<br> realized or the manner of their realization. As part of the process of internalizing the legislation (including updates, if any, or changes in other regulations) there could be changes in the sector the results of which will be<br> different than the said estimates, including changes that could have a significant negative impact, including on projects of the CPV Group in the area. As at the approval date of the report, the said estimates are subject to changes<br> (including due to specific circumstances of the projects on the list of the awaiting projects of the CPV Group).

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OPC Energy Ltd.

Report of the Board of Directors

4. Analysis of the results of operations for the Year Ended December 31, 2025 (in millions of NIS)
A. Consolidated statement of income
--- ---
For the Year Ended
--- --- --- --- --- ---
Section December 31
*2025 2024
Revenues from sales and provision of services (1) 3,002 2,779
Cost of sales and provision of services (without depreciation and amortization) (2) (2,263 ) (1,931 )
Depreciation and amortization (232 ) (317 )
Gross profit 507 531
Share in earnings of associated companies 523 166
Compensation for lost revenues 16 44
Administrative and general expenses (365 ) (263 )
Business development expenses (14 ) (45 )
Gain on loss of control in the renewable energies segment in the U.S. – 259
Other income (expenses), net 95 (56 )
Operating income 762 636
Financing expenses, net (218 ) (252 )
Loss from extinguishment of financial liabilities – (49 )
Income before taxes on income 544 335
Taxes on income expenses (87 ) (138 )
Net income for the year (3) 457 197
Attributable to:
The Company’s shareholders 346 111
Holders of non‑controlling interests 111 86
* Commencing from November 2024, as a result of deconsolidation 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<br> renewable energy segment in the U.S.
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OPC Energy Ltd.

Report of the Board of Directors

4. Analysis of the results of operations for the Year Ended December 31, 2025 (in millions of NIS) (Cont.)
A. Consolidated statement of income (Cont.)
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(1) Changes in revenues:

Revenues For the Board’s Explanations
Year Ended
December 31
2025 2024
Revenues in Israel
Revenues from sale of energy to private customers 1,271 1,368 A decrease, in the amount of about NIS 68 million, stemming from a decline in the consumption of customers compared with last year, among other<br> things in light of the “Rising Lion” operation and an additional decline, of about NIS 47 million, stemming 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 181 165
Revenues in respect of capacity payments 143 171 Most of the decrease compared with last year stems from a decline in the availability of the Zomet power plant. For additional details – see<br> Section 4C(1) below.
Revenues from sale of energy at cogeneration tariff 76 83
Revenues from sale of steam 57 57
Other revenues 2 23 Most of the decrease derives from discontinuance of the consolidation of Gnrgy at the end of second quarter of 2024.
Total revenues from sale of energy and others in Israel (without infrastructure services) 1,730 1,867
Revenues from private customers in respect of infrastructure services 591 445 The increase stems mainly from an average increase in the tariffs at the rate of 40%.
Total revenues in Israel 2,321 2,312
Revenues in the U.S.
Revenues from sale of electricity from renewable energy – 195 The decrease derives mainly from discontinuance of consolidation of the renewable energies segment in November 2024, and transition to the<br> equity method of accounting.
Revenues from sale of electricity (Retail) activities 470 145 The increase stems mainly from an increase in the scope of the retail activities.
Revenues from provision of services and others 211 127 Most of the increase stems from a transition to the equity method of accounting in the renewable energies area and an increase in revenues from<br> provision of asset‑management services (which were previously eliminated in the consolidation).
Total revenues in the U.S. 681 467
Total revenues 3,002 2,779

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OPC Energy Ltd.

Report of the Board of Directors

4. Analysis of the results of operations for the Year Ended December 31, 2025 (in millions of NIS) (Cont.)
A. Consolidated statement of income (Cont.)
--- ---
(2) Changes in the consolidated cost of sales and provision of services (not including depreciation and amortization):
--- ---
Cost of Sales and<br><br> <br>Provision of Services For the<br><br> <br>Year Ended Board’s Explanations
--- --- --- --- --- ---
December 31
2025 2024
Cost of sales in Israel
Natural gas and diesel oil 596 645 Most of the decrease is against the background of planned upgrading and maintenance work at the Rotem power plant in the fourth quarter of 2025.
Expenses in respect of acquisition of energy 274 320 Most of the decrease stems from a decline in customer consumption compared with the corresponding period last year due to, among other things,<br> the “Rising Lion” operation and the impact of planned and unplanned maintenance at the power plants in the period of the report and in the corresponding period last year.
Cost of transmission of gas 52 55
Salaries and related expenses 43 46
Operating expenses 117 120
Other expenses – 18 Most of the decrease stems from discontinuance of the consolidation of Gnrgy at the end of the second quarter of 2024.
Total cost of sales in Israel without infrastructure services 1,082 1,204
Expenses in respect of infrastructure services 591 445 For details – see the explanation of the change in the revenues in respect of infrastructure services.
Total cost of sales in Israel 1,673 1,649
Cost of sales and services in the U.S.
Cost of sales in respect of sale of electricity from renewable energy – 60 The decrease stems from discontinuance of consolidation of the renewable energies segment in November 2024 and transition to the equity method<br> of accounting.
Cost of sales in respect of sale of electricity (Retail) and others 436 130 The increase stems mainly from an increase in the scope of the retail activities.
Cost of sales in respect of provision of services and others 154 92 Most of the increase stems from a transition to the equity method of accounting in the renewable energies area and an increase in costs related<br> to the provision of asset‑management services (which were previously eliminated in the consolidation).
Total cost of sales and provision of services in the U.S. 590 282
Total cost of sales and provision of services 2,263 1,931

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OPC Energy Ltd.

Report of the Board of Directors

4. Analysis of the results of operations for the Year Ended December 31, 2025 (in millions of NIS) (Cont.)
A. Consolidated statement of income (Cont.)
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(3) Consolidated net income and consolidated adjusted net income
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1. Definitions
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Adjusted net income or loss – net income or loss in accordance with IFRS plus or minus other expenses and income, events of a non‑recurring nature, such as, impairment losses and reversals and transactions that are not in the ordinary course of business.

It is emphasized that the said adjusted net income or loss item in this report is not an item that is recognized under IFRS or other generally accepted accounting standards as an index for measuring financial performances and should not be considered as a substitute for income or loss or other terms provided pursuant to IFRS. It is possible that the Company’s definitions of adjusted income or loss are different than those used by other companies. Nonetheless, the Company believes that the adjusted income or loss provides useful information to management and investors by eliminating certain sections that management believes do not constitute an indication of the Company’s regular and ongoing business activities.

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OPC Energy Ltd.

Report of the Board of Directors

4. Analysis of the results of operations for the Year Ended December 31, 2025 (in millions of NIS) (Cont.)
A. Consolidated statement of income (Cont.)
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(3) Consolidated net income and consolidated adjusted net income (Cont.)
--- ---
2. Analysis of the change (in millions of New Israeli Shekels)
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(1) Mainly, a loss from impairment in value of the investment in Gnrgy in the corresponding period last year, in the amount of about NIS 21 million, of which there was an impairment loss in Hadera 2, in the amount of about NIS 31 million,<br> in light of the government’s original decision to reject the plan.
(2) Including non‑recurring financing expenses in respect of repayment of the project credit in Zomet and Gat, in the amount of about NIS 49 million (about NIS 38 million, net of tax).
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(3) For an analysis of the change in the EBITDA after proportionate consolidation in the various segments in the period of the report compared with the corresponding period last year, see Sections B - E below.
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(4) Most of the increase stems from additional depreciation and financing expenses, in the amount of about NIS 172 million, due to increase in the rate of holdings in the Shore and Maryland power plants in the fourth quarter of 2024 and in<br> the beginning of the second quarter of 2025. This increase was partly offset, in the amount of about NIS 30 million, as a result of translation of the results of the associated companies from dollars into shekels (the Company’s functional<br> currency), due to a decline in the average shekel/dollar exchange rate in the period of the report compared with the corresponding period last year.
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(5) Most of the increase stems from an increase in the financing expenses as a result of the impact of the changes in the shekel/dollar exchange rate, in the amount of about NIS 83 million: (A) an increase in the financing expenses in the<br> period of the report, in the amount of about NIS 39 million; and (B) a decrease in the financing income, in the amount of about NIS 44 million, recognized in the corresponding period last year. On the other hand, there was an increase in<br> the financing income of about NIS 36 million due to an increase in interest on bank deposits and a decrease in financing expenses of about NIS 15 million mainly due to a decline in the expenses stemming from linkage differences in respect<br> of the debentures (Series B).
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(6) The increase in the tax expenses derives mainly from higher taxable income compared with the corresponding period last year.
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(7) (A) Cancellation of an impairment loss recognized by Hadera 2 in the third quarter of 2025, in the amount of about NIS 31 million, in light of plan approval by the government and (B) income, in the amount of about $15 million<br> (about NIS 51 million), in respect of development fees for the Basin Ranch power plant.
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OPC Energy Ltd.

Report of the Board of Directors

4. Analysis of the results of operations for the Year Ended December 31, 2025 (in millions of NIS) (Cont.)
B. EBITDA, FFO (Funds From Operations) and net cash flows after debt service
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1. Definitions
--- ---
– EBITDA indices
--- ---

“EBITDA in the consolidated financial statements”^27^: net income (loss) for the period before depreciation and amortization, financing expenses or income, net, taxes on income and other income (expenses), net.

“EBITDA after proportionate consolidation”: – “EBITDA in the consolidated financial statements” less the share of the income (loss) of associated companies and plus a proportionate consolidation of the EBITDA of the associated companies based on the rate of the holdings of the CPV Group therein.

– “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<br> 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<br> 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)<br> including the net interest payments in respect thereof, are not included in FFO.
– “Net cash flows after service of debt” – the “FFO” less/plus payment of principal in respect of financial debt or taking out of project debt and non‑project debt (loans and/or debentures), and after adjustments for a change in<br> other credit from banks and a change in cash, including cash restricted for debt service and deposits.
--- ---

The said non‑IFRS measures are not recognized as indices for measurement of financial performances and are not intended to be considered a replacement for gross profit or loss and operating income, cash flows from operation activities or other terms relating to operating performances or liquidity indices in accordance with IFRS.

It is noted that the EBITDA indices are not intended to present an approximate of the free cash flows from the Group’s operating activities or to present cash available for distribution of dividends or other uses (particularly in light of provisions of the project financing agreements for some of the Group’s power plants), since such cash may be used for debt service, capital investments, working capital and other liabilities. Moreover, the EBITDA indices are characterized by restrictions that limit the use thereof as indices for analyzing the Company’s profitability, since they do not take into account certain income and expenses deriving from the Company’s business that could have a material impact on its net income or loss, such as depreciation expenses, financing expenses or income and taxes on income.

^27^ It is clarified that income in respect of lost profits is included in EBITDA in the consolidated statements.

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OPC Energy Ltd.

Report of the Board of Directors

4. Analysis of the results of operations for the Year Ended December 31, 2025 (in millions of NIS) (Cont.)
B. EBITDA, FFO (Funds From Operations) and net cash flows after debt service (Cont.)
--- ---
1. Definitions (Cont.)
--- ---

The Company believes that the data items “EBITDA after proportionate consolidation” and “FFO”^28^ provide useful and transparent information to investors when reviewing the Company’s operating performances and current cash flows and when comparing such performances to performances of other companies in the same sector or in other industries (having different capital structures, different levels of debt and/or different income tax rates) as well as when comparing performances between periods. It is noted that the “EBITDA after proportionate consolidation” data item also serves the Company’s management when analyzing the Company’s performances.

The data item “net cash flows after debt service” provides additional information regarding the Group’s net cash flows that are available for its use for purposes of growth and making of new investments, along with distribution of dividends to the shareholders (subject to compliance with the provisions of law, the trust certificates and non‑project financing agreements and in accordance with the Company’s dividend distribution policy^29^).

^28^ It is noted that other companies might define EBITDA and FFO indices differently.

^29^ Pursuant to the Company’s dividend distribution policy, which was adopted by a decision of the Company’s Board of Directors in July 2017, it was determined that the Company will distribute, subject to the provisions of law and the discretion of the Board of Directors, an annual dividend at the rate of at least 50% of the net after‑tax income. In 2024, the Company’s Board of Directors decided to suspend implementation of the dividend distribution policy for a period of two years, in light of the Company’s growth strategy and the targets for expansion of its activities, while taking into account its business needs and preservation of its financial strength. In the decision of the Company’s Board of Directors in March 2026, the suspension of the dividend distribution policy was extended for an additional at least two years, that is, up to March 2028, where at the end of this period the Board of Directors will consider restarting of the said policy and the conformance thereof to the circumstances as they will be.

33

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OPC Energy Ltd.

Report of the Board of Directors

4. Analysis of the results of operations for the Year Ended December 31, 2025 (in millions of NIS) (Cont.)
B. EBITDA, FFO (Funds From Operations) and net cash flows after debt service (Cont.)
--- ---
2. Calculation of EBITDA
--- ---

EBITDA calculations in the consolidated statement, including EBITDA after proportionate consolidation (in millions of NIS):

For the Year Ended
December 31
2025 2024
Revenues from sales and provision of services 3,002 2,779
Cost of sales (without depreciation and amortization) (2,263 ) (1,931 )
Share in income of associated companies 523 166
Compensation for lost revenues 16 44
Administrative and general expenses (without depreciation and
amortization) (348 ) (247 )
Business development expenses (14 ) (45 )
Consolidated EBITDA 916 766
Elimination of the share in income of associated companies (523 ) (166 )
Plus – Group’s share of the proportionate EBITDA of associated
companies in the Energy Transition segment 1,093 592
Plus – Group’s share of the proportionate EBITDA of activities
in the renewable energies segment in the U.S.* 105 16
EBITDA after proportionate consolidation 1,591 1,208
* 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 (instead of a<br> full consolidation up to that time) where the CPV Group’s share is about 66.7%.
--- ---

34

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OPC Energy Ltd.

Report of the Board of Directors

4. Analysis of the results of operations for the Year Ended December 31, 2025 (in millions of NIS) (Cont.)
B. EBITDA, FFO (Funds From Operations) and net cash flows after debt service (Cont.)
--- ---

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 debt data (in NIS millions):

For the year ended For the year ended
Main projects in operation Basis of December 31, 2025 December 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) (2)^ Consolidated 622 629 581 670 557 485
Business development costs, headquarters in Israel and other costs ^(3)^ Consolidated (11 ) (135 ) (98 ) (31 ) (137 ) (73 )
Total Israel ^(4)^ 611 494 483 639 420 412
Total operating projects ^(5)^ Associated 1,098 819 334 592 385 388
Other expenses Consolidated 1 (10 ) (12 ) (4 ) (14 ) (14 )
Total energy transition in the U.S. 1,099 809 322 588 371 374
Total operating projects ^(6)^ Associated 125 69 11 142 74 14
Business development and other costs Associated (20 ) (24 ) (24 ) (30 ) (23 ) (23 )
Total renewable energy in the U.S. 105 45 (13 ) 112 51 (9 )
Total activities as part of the “others” segment ^(7)^ Consolidated (18 ) (26 ) (9 ) (22 ) (22 ) (22 )
Headquarters in the United States ^(8) (9) (10)^ Consolidated (181 ) 27 27 (89 ) (61 ) (61 )
Total United States 1,005 855 327 589 339 282
Company headquarters (not allocated to the segments) ^(4) (8)^ Consolidated (25 ) (54 ) (76 ) (20 ) (41 ) (37 )
Total consolidated ^(11)^ 1,591 1,295 734 1,208 718 657
(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 period of the report and in the corresponding period last year, the EBITDA of the active projects in Israel included non‑recurring events. For additional details – see Section 4C(1) below.
--- ---
(3) For purposes of comparison, the FFO and cash‑flow data after debt service for the activities in Israel were updated in the comparative data, such that the financial data for the headquarters in Israel includes payments of interest and<br> principal of the project credit in Zomet and Gat up to the early repayment date and refinancing of corporate credit in Israel during the third quarter of 2024.
--- ---
(4) Not including intercompany activities between the headquarters and the subsidiaries in Israel.
--- ---
(5) For details regarding active projects in the Energy Transition segment in the U.S. – see Section 4D(2) below.
--- ---
(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<br> 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 natural gas-fired power plants, with future carbon capture potential, and the results of the retail activities in the<br> U.S.
--- ---
(8) After elimination of management fees between the CPV Group and the Company, in the amounts of about NIS 35 million and about NIS 32 million for the years ended December 31, 2025 and 2024, respectively.
--- ---
(9) Most of the change in the EBITDA in 2025 compared with 2024, in the amount of about NIS 115 million, relates to changes in the fair value of a profit participation plan for employees of the CPV Group, which fully vested in January 2026<br> (at the end of five years from the acquisition date of the CPV Group), and is expected to be completed at the end of the first quarter of 2026, in the amount of about $70 million (about NIS 223 million). In addition, the CPV Group intends<br> to adopt a new remuneration plan with terms substantially similar to those of the prior plan (with certain adjustments). For additional details – see Note 16C to the financial statements.
--- ---
(10) Most of the change in the FFO stems from development fees in the Basin Ranch power plant that were received in the fourth quarter of 2025.
--- ---
(11) In the year of the report, the consolidated FFO without adjustments for changes in the working capital was about NIS 1,171 million (last year – about NIS 682 million).
--- ---

35

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OPC Energy Ltd.

Report of the Board of Directors

4. Analysis of the results of operations for the Year Ended December 31, 2025 (in millions of NIS) (Cont.)
C. Analysis of the change in EBITDA and the generation data – Israel segment (Cont.)
--- ---
(1) Set forth below is an analysis of the change in EBITDA in the Israel segment in the period of the report compared with the corresponding period last year (in NIS millions):
--- ---

Energy margin – the increase stems mainly from optimization of the trade receivables, in the amount of about NIS 31 million, and a decline in the natural‑gas price, in the amount of about NIS 21 million, mainly due to the weakening of the dollar against the shekel. On the other hand, there was a decrease of about NIS 31 million as a result of a decline in the generation component tariff.

Availability (operational) – (A) Zomet power plant – for purposes of reducing the risk of an operating failure due to a technical defect discovered and in coordination with the contractor, as part of the process of clarifying and repairing the defect in 2025, the availability of the power plant was partially limited and maintenance work was performed along with gradual replacement of the generation units (for details – see Section 4C(2) below). These factors had a negative impact on the power plant’s availability and, in turn, on its financial results. As at the approval date of the report, the Company estimates that the process of clarification and repair of the defect, including replacement of the generation units, is expected to be mostly completed by the end of 2026, and it also estimates that the said partial capacity, which is expected to be 65%–70% of the power plant’s capacity (similar to the capacity in 2025), will negatively affect the EBITDA in 2026^30^. (B) Rotem power plant - During the fourth quarter of 2025, the Rotem power plant was shut down for planned upgrading and maintenance work, at an estimate cost of about NIS 133 million. As a result, Rotem’s operating results were negatively impacted. (C) In the corresponding period last year the Rotem, Hadera and Gat power plants were shut down for various periods of time for purposes of planned and unplanned maintenance work that had a negative impact on their results in the corresponding period last year.

^30^ The aforesaid regarding rectification of the defect (including the duration thereof) and/or the estimate of the scope of the partial capacity and its impact constitutes “forward-looking” information as defined in the Securities Law. In practice, delays or difficulties may occur in completing the examination and/or the required rectifications beyond the aforementioned timelines and/or additional operational limitations/shutdowns (full or partial) may occur, inter alia, as a result of technical factors, operational failures, factors related to the contractor, the transportation of equipment and/or the performance of work, and accordingly may affect the availability (capacity) of the station in such a manner that could increase the scope of the partial capacity limitation, the removal of capacity limitations and the completion of the rectification, the duration of the rectification and/or the impact of the availability limitation on the Company’s EBITDA. For further details regarding the implications of the availability limitation, see Section 7.13 of Part A of the Periodic Report

36

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OPC Energy Ltd.

Report of the Board of Directors

4. Analysis of the results of operations for the Year Ended December 31, 2025 (in millions of NIS) (Cont.)
C. Analysis of the change in EBITDA and the generation data – Israel segment (Cont.)
--- ---
(1) Set forth below is an analysis of the change in EBITDA in the Israel segment in the period of the report compared with the corresponding period last year (in NIS millions): (Cont.)
--- ---

Non‑recurring events – (A) In 2025, mainly insurance compensation for lost profits at the Gat and Hadera power plants in prior years, in the aggregate amount of about NIS 16 million; (B) in 2024, mainly in respect of compensation from the construction contractor of the Zomet power plant, in the amount of about NIS 26 million (about $7 million); in respect of lost profits caused by a delay in the date of the commercial operation and non‑recurring compensation from the insurers of Hadera power plant, in the amount of about NIS 18 million (about $5 million) in connection with lost profits preceding the commercial operation.

(2) Set forth below is detail regarding the generation at the power plants in the Israel segment:
For the Year Ended December 31, 2025 For the Year Ended December 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) (GWh) (%) (%) (GWh) (GWh) (%) (%)
Rotem (A) 466 3,736 3,073 82.3 % 83.7 % 3,736 3,332 89.2 % 95.1 %
Hadera (B) 144 1,019 970 95.2 % 96.1 % 1,048 943 90.0 % 92.6 %
Gat (C) 75 620 503 81.1 % 91.6 % 616 397 64.4 % 64.4 %
Zomet (C) 396 3,171 291 9.2 % 67.1 % 3,268 428 13.1 % 83.6 %

Definitions:

– The generation potential is the net generation capability adjusted for temperature and humidity.
– The actual net generation in the period.
--- ---
– The actual generation percentage is the net electricity generated divided by the generation potential.
--- ---

Significant operating events^31^:

A. During the fourth quarter of 2025, the Rotem power plant was shut down for planned upgrading and maintenance work.
B. In 2026, a planned shutdown is anticipated for part of the power plant for purposes of upgrading and maintenance work that is expected to last for about a month. In addition, Hadera is taking action to repair the technical defect found<br> in the power plant proximate to the approval date of the report, where at this stage and up to completion of the repair, generation of the electricity at the power plant is continuing while utilizing most of the generation capability.<br> Hadera is taking action to repair the defect in the upcoming months, where the said event is not expected to have a significant long‑term impact on Hadera’s results, taking into account the insurance coverage under the power plant’s<br> policy.
--- ---
C. In 2026, a planned shutdown is anticipated for the power plant for purposes of upgrading and maintenance work that is expected to last for about a month.
--- ---
D. The generation potential presented in the above table does not include the temporary generation limitation that applied in the period of the report to each of the generation units. In addition, in the period of the report some of the<br> generation units were replaced due to the maintenance work. For details – see Section 4C(1) above.
--- ---

^31^That stated regarding expected maintenance. completion thereof (including repair of the defect at Hadera, its impact and/or the insurance coverage) and/or the period of time required for the completion thereof constitutes “forward‑looking” information as it is defined in the Securities Law, regarding which there is no certainty it will materialize. Ultimately, maintenance, as stated (and unplanned maintenance that could be caused), could continue beyond the expected date, this being as a result of, among other things, operating factors, technical breakdowns, constraints relating to maintenance and equipment contractors and the timetables for receipt (arrival) of the relevant equipment. Delays and/or failures in completion of the maintenance have a negative impact on the power plant’s operating results.

37

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OPC Energy Ltd.

Report of the Board of Directors

4. Analysis of the results of operations for the Year Ended December 31, 2025 (in millions of NIS) (Cont.)
D. Analysis of the change in EBITDA, the generation data, energy hedges and capacity – Energy Transition segment in the U.S.
--- ---
(1) Set forth below is an analysis of the change in the EBITDA after proportionate consolidation in the Energy Transition segment in the period of the report compared with the corresponding period last year (in millions of NIS):
--- ---

Energy and hedging margins – as detailed in Section 3A above, in the period of the report there was a significant increase in the electricity margins compared with the corresponding period last year and, accordingly, there was an increase in the energy margins of the CPV Group (without the impact of the increase in the holdings in the Maryland and Shore power plants), which was partly offset by hedges realized at a lower margin in the period of the report compared with the corresponding period last year.

Capacity revenues – most of the increase stems from an increase in the capacity tariff in the PJM market starting from June 2025. This increase was partly offset by a decrease in the capacity tariff of the Towantic power plant starting from June 2025 – this being as a result of conclusion of the fixed-rate (of seven years) wherein the capacity tariff was fixed in advance from Towantic’s operation date. For details – see Section 3C above.

Operating and capacity expenses (operational) – most of the increase stems from planned maintenance work at the Valley power plant in the fourth quarter of 2025.

Increase in the rate of holdings – reflects the impact of the increase in the holdings in the fourth quarter of 2024 in the Maryland and Shore power plants and in the beginning of the second quarter of 2025 in the Shore power plant. It is noted that subsequent to the date of the report, a transaction was completed for acquisition of the remaining 11% of the Shore power plant, and after its completion the CPV Group holds 100% of the ownership rights in Shore.

38

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OPC Energy Ltd.

Report of the Board of Directors

4. Analysis of the results of operations for the Year Ended December 31, 2025 (in millions of NIS) (Cont.)
D. Analysis of the change in EBITDA, the generation data, energy hedges and capacity – Energy Transition segment in the U.S. (Cont.)
--- ---
(2) Analysis of the Group’s share in the proportionate EBITDA, FFO and net cash flows after service of project debt of associated companies by project in the Energy Transition segment (in millions of NIS):
--- ---
For the year ended December 31, 2025 Fairview Towantic Maryland^*^ Shore^*^<br><br> <br>(1) Valley Three<br><br> <br>Rivers Total
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Rate of holdings of the CPV Group 25% 26% 75% 89% 50% 10%
Revenues from sales of energy 275 310 766 520 528 91 2,490
Cost of natural gas 127 199 321 275 198 49 1,169
Carbon emissions tax (RGGI) – 36 117 86 70 – 309
Cost of sales – other expenses (without depreciation and amortization) 2 4 17 14 9 1 47
Gain (loss) on realization of transactions hedging the electricity margins 3 (14 ) (37 ) 19 (24 ) 9 (44 )
Net energy margin 149 57 274 164 227 50 921
Revenues from capacity payments 40 63 100 118 58 19 398
Other income 3 24 24 17 3 3 74
Gross profit 192 144 398 299 288 72 1,393
Fixed costs (without depreciation and amortization) 15 22 51 67 79 14 248
Administrative and general expenses (without depreciation and amortization) 5 5 10 12 8 2 42
Loss from revaluation of unrealized hedging transactions (1 ) – (1 ) – – (3 ) (5 )
Group’s share in EBITDA after proportionate consolidation in the Energy Transition segment 171 117 336 220 201 53 1,098
Group’s share in FFO 140 99 293 78 167 42 819
Group’s share in net cash flows after service of project debt ^(3)^271 105 135 ^(2)^(223) 16 30 334
(1) At the Shore power plant – gas transmission costs (totaling in the period of the report of about NIS 46 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 7A(5) below.
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(3) The net cash flows after debt service in Fairview include additional project financing as part of the financing agreement amendment in the fourth quarter of 2025, as detailed in Section 7A(3) below, which was distributed as a dividend<br> to the partners in the project. The CPV Group’s share amounted to about $54 million (about NIS 179 million).
--- ---
(4) The financing agreements for the CPV Group include “cash sweep” mechanisms, in 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<br> repayment schedule for each long‑term loan. This mechanism allows for faster repayments if certain events occur and also places restrictions on distributions to shareholders.
--- ---
(*) In line with the Company’s strategy to gain control over some of the active power plants of the CPV Group, transactions were completed in the fourth quarter of 2024 and in the second quarter of 2025 that led to an increase in the rates<br> of holdings in the Maryland power plant (from 25% to 75%) and the Shore power plant (from 38% to 89%) as at the date of the report and to 100% after the date of the report.
--- ---

39

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OPC Energy Ltd.

Report of the Board of Directors

4. Analysis of the results of operations for the Year Ended December 31, 2025 (in millions of NIS) (Cont.)
D. Analysis of the change in EBITDA, the generation data, energy hedges and capacity – Energy Transition segment in the U.S. (Cont.)
--- ---
(2) Analysis of the Group’s share in the proportionate EBITDA, FFO and net cash flows after service of project debt of associated companies by project in the Energy Transition segment (in millions of NIS): (Cont.)
--- ---
For the year ended December 31, 2024 Fairview Towantic Maryland Shore<br><br> <br>(1) Valley Rivers Total
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Rate of holdings of the CPV Group 25% 26% 75% 68 50% 10%
Revenues from sales of energy 206 217 185 155 352 61 1,176
Cost of natural gas 91 98 73 73 127 36 498
Carbon emissions tax (RGGI) – 41 33 47 80 – 201
Cost of sales – other expenses (without depreciation and amortization) 2 4 8 6 7 2 29
Gain (loss) on realization of transactions hedging the electricity margins 21 (12 ) (3 ) 14 47 17 84
Net energy margin 134 62 68 43 185 40 532
Revenues from capacity payments 18 122 16 19 58 4 237
Other income 4 6 9 6 3 2 30
Gross profit 156 190 93 68 246 46 799
Fixed costs (without depreciation and amortization) 14 21 28 28 76 13 180
Administrative and general expenses (without depreciation and amortization) 5 4 5 5 8 2 29
Gain (loss) from revaluation of unrealized hedging transactions 10 (1 ) (1 ) (6 ) – – 2
Group’s share in proportionate EBITDA in the Energy Transition segment 147 164 59 29 162 31 592
Group’s share in FFO 106 157 21 18 68 15 385
Net cash flows after service of project debt ^(2)^289 65 8 17 (1 ) 10 388
(1) At the Shore power plant – gas transmission costs (totaling in the corresponding period last year about NIS 22 million) are classified in accordance with IFRS 16 as depreciation expenses and, accordingly, are not included in the<br> EBITDA.
--- ---
(2) The net cash flows after debt service in Fairview include additional project financing as part of a refinancing made in the third quarter of 2024 which was distributed as a dividend to the partners in the project. The CPV Group’s share<br> amounted to about NIS 246 million.
--- ---
(3) It is noted that the increase in the rates of holdings in the Shore power plant (from about 37.5% to about 68.8%) and in the Maryland power plant (from about 25% to about 75%) in the fourth quarter of 2024, did not have a significant<br> impact on the results of the Energy Transition segment in the U.S. in 2024.
--- ---

40

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Report of the Board of Directors

4. Analysis of the results of operations for the Year Ended December 31, 2025 (in millions of NIS) (Cont.)
D. Analysis of the change in EBITDA, the generation data, energy hedges and capacity – Energy Transition segment in the U.S. (Cont.)
--- ---
(3) Additional details regarding energy hedges and guaranteed capacity payments in the Energy Transition segment in the U.S.
--- ---

As part of its policy for management of the exposures, the CPV Group is in the practice, from time to time, of entering into hedging agreements, which are designed to reduce the fluctuations in the electricity margins. In addition, the capacity revenues for the nominal capacity of the natural gas-fired power plants are determined for certain future periods, as detailed in Section 3A above.

Set forth below is the scope of the hedging for 2026 as at the date of the report^32^:

2026
Expected generation (MWh) * 12,126,000
Net scope of the hedged energy margin (% of the expected generation of the power plants) ** 73%
Net hedged energy margin (millions of $) ≈ 165<br><br> <br>(≈ NIS 570 million)
Net hedged energy margin ($/MWh) 18.6
Net market prices of energy margin ($/MWh) *** 19.4
* The expectation for the generation including adjustments in respect of planned and unplanned maintenance work, including the Fairview power plant. Loss of the said generation is expected to be mostly covered by insurance. For<br> additional details – see Section 4 below.
--- ---
** Pursuant to the policy for hedging electricity margins as at the date of the report, in general the CPV Group seeks to hedge about 50% of the scope of the expected generation. The actual hedge rate could ultimately be different,<br> depending on the market factors.
--- ---
*** 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 3A<br> above. The market prices of the net energy margin are based on future contracts for electricity and natural gas.
--- ---

^32^ The estimated percentages and the actual hedged energy margins could change due to the execution of new hedges, capacity sales, changes in market conditions, or modifications to the CPV Group’s hedging policy. That stated in this Section with respect to the energy margin and availability receipts constitutes “forward‑looking” information as it is defined in the Securities Law, which may change due to, among other things, operating factors and availability of the power plant, market conditions, regulatory changes and/or occurrence of one or more of the risk factors as stated in Section 19 of Part A of the Periodic Report.

41

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OPC Energy Ltd.

Report of the Board of Directors

4. Analysis of the results of operations for the Year Ended December 31, 2025 (in millions of NIS) (Cont.)
D. Analysis of the change in EBITDA, the generation data, energy hedges and capacity – Energy Transition segment in the U.S. (Cont.)
--- ---
(3) Additional details regarding energy hedges and guaranteed capacity payments in the Energy Transition segment in the U.S. (Cont.)
--- ---

Set forth below is the scope of the secured capacity revenues for 2026 as at the date of the report:

2026
Scope of the secured capacity revenues (% of the power plant’s capacity) 88%
Capacity receipts (millions of $) ≈ 151<br><br> <br>(≈ NIS 521 million)
(*) Most of the non‑guaranteed capacity receipts relates to the Valley power plant that operates in the NYISO market. For details regarding the capacity auctions in this market – see Section 3C above.
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It is noted that the data detailed in the above tables includes the increase in the holdings in the Shore power plant, at the rate of about 11%, which was completed in January 2026, as well as the increase in the holdings in the Maryland power plant, at the rate of about 25%, and sale of the rights in the Three Rivers power plant, which as at the date of the report is held at the rate of 10%. Completion of the exchange transaction is expected to take place in the second quarter of 2026 and is subject to conditions that have not yet been fulfilled and there is no certainty regarding their fulfillment.

42

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OPC Energy Ltd.

Report of the Board of Directors

4. Analysis of the results of operations for the Year Ended December 31, 2025 (in millions of NIS) (Cont.)
D. Analysis of the change in EBITDA, the generation data, energy hedges and capacity – Energy Transition segment in the U.S. (Cont.)
--- ---
(4) Set forth below is detail regarding the generation of the power plants in the Energy Transition segment in the U.S.
--- ---
For the Year Ended December 31, 2025 For the Year Ended December 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) (GWh) (%) (%) (GWh) (GWh) (%) (%)
Energy transition projects (natural gas)
Shore 725 6,115 3,828 60.6 % 87.7 % 6,130 3,612 56.9 % 92.4 %
Maryland 745 6,439 4,718 73.3 % 95.9 % 5,958 3,628 56.3 % 90.3 %
Valley (A) 720 5,302 4,725 77.7 % 83.5 % 5,838 5,002 82.1 % 89.1 %
Towantic (B) 805 5,700 4,812 67.1 % 78.5 % 6,521 5,593 77.7 % 89.9 %
Fairview (C) 1,050 8,758 7,513 81.5 % 87.1 % 8,601 7,610 82.1 % 88.5 %
Three Rivers 1,258 9,911 6,456 60.1 % 85.2 % 9,792 6,366 59.9 % 76.9 %

Definitions

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

Significant operating events

A. A decrease in the power plant’s capacity stemming mainly from performance of planned maintenance work in the fourth quarter of 2025.
B. In the second quarter of 2025, planned maintenance was performed at the power plant, as part of which a significant item of equipment was replaced. The said item is insured under the insurance policy covering the power plant, and as at<br> the date of the report, a cash compensation was received that covers most of the costs required for its replacement and installation.
--- ---
C. In December 2025, as part of planned maintenance work, a malfunction occurred in one of the generation units, as a result of which the power plant’s generation capacity was temporarily limited to about 50% of its full capacity. In the<br> estimation of the CPV Group, as at the approval date of the report, the power plant is expected to return to full operation in 2027^33^. As at the approval date of the report, Fairview has submitted a claim under the power<br> plant’s insurance policy, both in respect of the direct costs to repair the damage and for loss of the expected profits.
--- ---
^33^ That said regarding the expectation of return to the power plant’s full activities and/or the results of the claim under the insurance policy constitutes “forward‑looking” information regarding which there is<br> no certainty it will be realized. Ultimately, there could be delays or breakdowns due to operational factors, delays or breakdowns in the course of performance of the work and/or delays in arrival of conforming equipment. It is noted that<br> in the usual course of things, extended maintenance (planned or unplanned) has a negative impact on the power plant’s results. In addition, as at the approval date of the report there is no certainty regarding the insurance compensation<br> in accordance with the claim and the timing date thereof.

43

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OPC Energy Ltd.

Report of the Board of Directors

4. Analysis of the results of operations for the Year Ended December 31, 2025 (in millions of NIS) (Cont.)
E. Analysis of the change in EBITDA after proportionate consolidation – Renewable Energies segment in the U.S.
--- ---

Set forth below is an analysis of the change in the EBITDA after proportionate consolidation in the renewable energies segment in the period of the report compared with the corresponding period last year (in millions of NIS):

Entry of a partner in CPV Renewable – as a result of completion of the investment transaction in the area of renewable energies in the U.S. in November 2024, starting from this date this segment’s data is calculated on the basis of a proportionate consolidation, where the share of the CPV Group is 66.7%.

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OPC Energy Ltd.

Report of the Board of Directors

5. Analysis of the results of operations for the Three Months Ended December 31, 2025 (in millions of NIS)
A. Consolidated statement of income
--- ---
For the Three Months Ended
--- --- --- --- --- ---
Section December 31
*2025 2024
Revenues from sales and provision of services (1) 746 589
Cost of sales and provision of services (without depreciation and amortization) (2) (620 ) (438 )
Depreciation and amortization (52 ) (72 )
Gross profit 74 79
Share in earnings of associated companies 100 16
Compensation for lost revenues 16 –
Administrative and general expenses (70 ) (72 )
Business development expenses (4 ) (12 )
Gain on loss of control in the renewable energies segment in the U.S. – 259
Other income (expenses), net 76 (6 )
Operating income 192 264
Financing expenses, net (55 ) (52 )
Income before taxes on income 137 212
Taxes on income (13 ) (89 )
Net income for the period (3) 124 123
Attributable to:
The Company’s shareholders 92 28
Holders of non‑controlling interests 32 95
* Commencing from November 2024, as a result of exit from the consolidation of CPV Renewable and transition to the equity method of accounting, the Company has discontinued consolidation in the consolidated financial statements of the<br> results of the renewable energy segment in the U.S.
--- ---

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OPC Energy Ltd.

Report of the Board of Directors

5. Analysis of the results of operations for the Three Months Ended December 31, 2025 (in millions of NIS) (Cont.)
A. Consolidated statement of income (Cont.)
--- ---

(1) Changes in revenues:

Revenues For the Three Board’s Explanations
Months Ended
December 31
2025 2024
Revenues in Israel
Revenues from sale of energy to private customers 285 247 An increase, in the amount of about NIS 25 million, stemming mainly from an increase in the consumption of customers, compared with the<br> corresponding quarter last year.
Revenues from sale of energy to the System Operator and to other suppliers 23 19
Revenues in respect of capacity payments 33 44 Most of the decrease compared with the corresponding quarter last year stems from a decline in the availability of the Zomet power plant. For<br> additional details – see Section 4C(1) above.
Revenues from sale of energy at cogeneration tariff 20 41 The decrease is due to optimization in light of maintenance at the Rotem power plant in the fourth quarter of 2025
Revenues from sale of steam 13 13
Total revenues from sale of energy and others in Israel (without infrastructure services) 374 364
Revenues from private customers in respect of infrastructure services 158 113 The increase derives mainly from the increase in the average tariffs at a rate of about 40%.
Total revenues in Israel 532 477
Revenues in the U.S.
Revenues from sale of electricity from renewable energy – 31 The decrease stems from discontinuance of the consolidation of the renewable energies segment in November 2024 and transition to the equity method<br> of accounting.
Revenues from sale of electricity from (Retail) 139 63 The increase stems mainly from an increase in the scope of the retail activities.
Revenues from provision of services and others 75 18 Most of the increase stems from a transition to the equity method of accounting in the renewable energies area and an increase in revenues from<br> provision of asset‑management services (which were previously eliminated in the consolidation).
Total revenues in the U.S. 214 112
Total revenues 746 589

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OPC Energy Ltd.

Report of the Board of Directors

5. Analysis of the results of operations for the Three Months Ended December 31, 2025 (in millions of NIS) (Cont.)
A. Consolidated statement of income (Cont.)
--- ---
(2) Changes in the cost of sales and provision of services (not including depreciation and amortization):
--- ---
Cost of Sales and<br><br> <br>Provision of Services For the Three<br><br> <br>Months Ended Board’s Explanations
--- --- --- --- --- ---
December 31
2025 2024
Cost of sales in Israel
Natural gas and diesel oil 94 150 Most of the decrease is against the background of planned upgrading and maintenance work at the Rotem power plant in the fourth quarter of 2025.
Expenses in respect of acquisition of energy 138 40 Most of the stems from planned upgrading and maintenance work performed at the Rotem power plant in the fourth quarter of 2025.
Cost of transmission of gas 14 14
Salaries and related expenses 10 13
Operating expenses 29 33
Total cost of sales in Israel without infrastructure services 285 250
Expenses in respect of infrastructure services 158 113 For details – see the explanation of the change in the revenues in respect of infrastructure services.
Total cost of sales in Israel 443 363
Cost of sales and services in the U.S.
Cost of sales in respect of sale of electricity from renewable energy – 7
Cost of sales in respect of sale of electricity (Retail) 127 46 The increase stems mainly from an increase in the scope of the retail activities.
Cost of sales in respect of provision of services and others 50 22 Most of the increase stems from a transition to the equity method of accounting in the renewable energies area and an increase in costs related to<br> the provision of asset‑management services (which were previously eliminated in the consolidation).
Total cost of sales and provision of services in the U.S. 177 75
Total cost of sales and provision of services 620 438

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OPC Energy Ltd.

Report of the Board of Directors

5. Analysis of the results of operations for the Three Months Ended December 31, 2025 (in millions of NIS) (Cont.)
A. Consolidated statement of income (Cont.)
--- ---
(3) Consolidated net income and consolidated adjusted net income
--- ---

Analysis of the change (in millions of NIS)

(1) For an analysis of the change in the EBITDA after proportionate consolidation in the various segments in the fourth quarter of 2025 compared with the corresponding quarter last year – see Sections B – E below.
(2) Most of the increase stems from additional depreciation and financing expenses, in the amount of about NIS 29 million, due to increase in the rate of holdings in the Shore and Maryland power plants in the fourth quarter of 2024 and in<br> the beginning of the second quarter of 2025. This increase was partly offset, in the amount of about NIS 14 million, due to the impact of translation of the results of the associated companies included from dollars into shekels (the<br> Company’s functional currency), against the background of a decline in the average shekel/dollar exchange rate in the period of the report compared with the corresponding period last year.
--- ---
(3) Most of the increase derives from an increase in the financing expenses as a result of changes in the shekel/dollar exchange rate, in the amount of about NIS 19 million.
--- ---
(4) Mainly in respect of revenues from development fees and development of the Basin Ranch power plant.
--- ---

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OPC Energy Ltd.

Report of the Board of Directors

5. Analysis of the results of operations for the Three Months Ended December 31, 2025 (in millions of NIS) (Cont.)
B. EBITDA, FFO (Funds From Operations) and net cash flows after debt service
--- ---
1. Calculation of EBITDA
--- ---

EBITDA in the consolidated statement and EBITDA after proportionate consolidation (in millions of NIS)

For the
Three Months Ended
December 31
2025 2024
Revenues from sales and provision of services 746 589
Cost of sales and provision of services (without depreciation and amortization) (620 ) (438 )
Share in income of associated companies 100 16
Compensation for lost revenues 16 -
Administrative and general expenses (without depreciation and amortization) (66 ) (68 )
Business development expenses (4 ) (12 )
Consolidated EBITDA 172 87
Elimination of the share in income of associated companies (100 ) (16 )
Plus – Group’s share of the proportionate EBITDA of associated companies in the Energy Transition segment 239 141
Plus – Group’s share of the EBITDA after proportionate consolidation of activities of the Renewable Energies segment in the U.S.* 25 16
EBITDA after proportionate consolidation 336 228
* 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 (instead<br> of a full consolidation) where the share of the CPV Group is 66.7%.
--- ---

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OPC Energy Ltd.

Report of the Board of Directors

5. Analysis of the results of operations for the Three Months Ended December 31, 2025 (in millions of NIS) (Cont.)
B. EBITDA, FFO (Funds From Operations) and net cash flows after debt service
--- ---
2. Breakdown of EBITDA after proportionate consolidation, FFO and cash flows after debt service by segments (in millions of NIS)
--- ---

Set forth below is a breakdown of the EBITDA after proportionate consolidation data broken down by the 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 data and cash flow after project debt service (in millions of NIS):

For the For the
three months ended three months ended
Main projects in operation Basis of December 31, 2025 December 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) (2)^ Consolidated 91 128 116 106 72 61
Business development costs, headquarters in Israel and other costs Consolidated (2 ) (28 ) 39 (8 ) (27 ) (28 )
Total Israel ^(3)^ 89 100 155 98 45 33
Total operating projects ^(4)^ Associated 244 294 362 141 114 63
Other costs Consolidated 8 11 9 – (12 ) (12 )
Total energy transition in the U.S. 252 305 371 141 102 51
Total operating projects ^(^^5^^)^ Associated 29 5 – 38 15 8
Business development and other costs Associated (4 ) 3 3 (10 ) 10 10
Total renewable energy in the U.S. 25 8 3 28 25 18
Total activities as part of the “others” segment ^(6)^ Consolidated (6 ) (7 ) (2 ) (4 ) (4 ) (4 )
Headquarters in the United States ^(7) (8) (9)^ Consolidated (16 ) 67 67 (28 ) (12 ) (12 )
Total United States 255 373 439 137 111 53
Company headquarters (not allocated to the segments) ^(7)^ Consolidated (8 ) (5 ) 91 (7 ) (2 ) (2 )
Total consolidated ^(10)^ 336 468 685 228 154 84
(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 current quarter, the EBITDA of the active projects in Israel includes non‑recurring events. For details – see Section 5C(1) below.
--- ---
(3) Not including intercompany activities between the Company, the headquarters in Israel and the subsidiaries in Israel.
--- ---
(4) For details regarding active projects in the Energy Transition segment in the U.S. – see Section 5D(2) below.
--- ---
(5) 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 (instead<br> of a full consolidation) where the share of the CPV Group is 66.7%.
--- ---
(6) Includes mainly business development and other costs in the area of initiation and development of high‑efficiency natural gas-fired power plants, with future carbon capture potential, and the results of the retail activities in the<br> U.S.
--- ---
(7) After elimination of management fees between the CPV Group and the Company, in the amounts of about NIS 9 million and about NIS 8 million for the fourth quarter 2025 and 2024, respectively.
--- ---
(8) Most of the change in the EBITDA in the fourth quarter of 2025 compared with the corresponding quarter last year, in the amount of about NIS 12 million relates to changes in the fair value of a profit participation plan for employees<br> of the CPV Group. For additional details – see Section 4B(2) above.
--- ---
(9) Most of the change in the FFO stems from development fees in the Basin Ranch power plant that were received in the fourth quarter of 2025.
--- ---
(10) In the fourth quarter of 2025, the consolidated FFO without adjustments for changes in the working capital was about NIS 321 million (in the corresponding period last year – about NIS 94 million).
--- ---

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OPC Energy Ltd.

Report of the Board of Directors

5. Analysis of the results of operations for the Three Months Ended December 31, 2025 (in millions of NIS) (Cont.)
C. Analysis of the change in EBITDA – Israel segment
--- ---

Set forth below is an analysis of the change in the EBITDA in the Israel segment in the fourth quarter of 2025 compared with the corresponding quarter last year (in NIS millions):

Availability (operational) – mainly in light of performance of planned upgrading and maintenance work at the Rotem power plant in the fourth quarter of 2025 and limitation of the capacity and continued performance of maintenance work at Zomet, as detailed in Section 4C(1) above.

One‑time events – in the fourth quarter of 2025, mainly in respect of insurance compensation in respect of lost profits at the Gat and Hadera power plants in respect of prior years.

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OPC Energy Ltd.

Report of the Board of Directors

5. Analysis of the results of operations for the Three Months Ended December 31, 2025 (in millions of NIS) (Cont.)
D. Analysis of the change in EBITDA after proportionate consolidation – Energy Transition segment in the U.S.
--- ---
(1) Set forth below is an analysis of the change in the EBITDA after proportionate consolidation in the Energy Transition segment in the fourth quarter of 2025 compared with the corresponding quarter last year (in millions of NIS):
--- ---

For details – see Section 4D(1) above.

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OPC Energy Ltd.

Report of the Board of Directors

5. Analysis of the results of operations for the Three Months Ended December 31, 2025 (in millions of NIS) (Cont.)
D. Analysis of the change in EBITDA after proportionate consolidation – Energy Transition segment in the U.S. (Cont.)
--- ---
(2) Analysis of the Group’s share in the proportionate EBITDA, FFO (Funds From Operations) 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 December 31, 2025 Fairview Towantic Maryland^*^ Shore^*^aa(1) Valley Three Rivers Total
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Rate of holdings of the CPV Group 25% 26% 75% 89% 50% 10%
Revenues from sales of energy 44 80 213 150 97 20 604
Cost of natural gas 21 59 81 80 29 11 281
Carbon emissions tax (RGGI) – 7 28 29 10 – 74
Cost of sales – other expenses (without depreciation and amortization) 1 1 5 4 2 – 13
Gain (loss) on realization of transactions hedging the electricity margins (2 ) (5 ) (27 ) (1 ) (8 ) 2 (41 )
Net energy margin 20 8 72 36 48 11 195
Revenues from capacity payments 9 5 35 42 13 7 111
Other income – 12 6 6 1 1 26
Gross profit 29 25 113 84 62 19 322
Fixed costs (without depreciation and amortization) 6 8 11 18 31 3 77
Administrative and general expenses (without depreciation and amortization) 1 1 2 3 2 1 10
Income (loss) from revaluation of unrealized hedging transactions – 1 (1 ) – – (1 ) (1 )
Group’s share in EBITDA after proportionate consolidation in the Energy Transition segment 22 17 99 63 29 14 244
Group’s share in FFO 28 52 112 42 42 18 294
Group’s share in free cash flows after service of project debt ^(2)^207 54 61 20 (1 ) 21 362
(1) At the Shore power plant – gas transmission costs (totaling in the fourth quarter of 2025 about NIS 12 million) are classified in accordance with IFRS 16 as depreciation expenses and, accordingly, are not included in the EBITDA.
--- ---
(2) The free cash flows after debt service in Fairview include additional project financing, as part of the financing agreement amendment in the fourth quarter of 2025, as detailed in Section 7A(3) below, which was distributed as a<br> dividend to the project’s partners, where the share of the CPV Group amounted to about $54 million (about NIS 179 million).
--- ---
(3) The CPV Group’s financing agreements include “cash sweep” mechanisms, in 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<br> repayment schedule for each long‑term loan. This mechanism allows for faster repayments if certain events occur and also places restrictions on distributions to shareholders.
--- ---
* In line with the Company’s strategy to gain control over some of the active power plants of the CPV Group, transactions were completed in the fourth quarter of 2024 and in the second quarter of 2025 that led to an increase in the rates<br> of holdings in the Maryland power plant (from 25% to 75%) and the Shore power plant (from 38% to 89%) as at the date of the report and to 100% after the date of the report.
--- ---

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OPC Energy Ltd.

Report of the Board of Directors

5. Analysis of the results of operations for the Three Months Ended December 31, 2025 (in millions of NIS) (Cont.)
D. Analysis of the change in EBITDA after proportionate consolidation – Energy Transition segment in the U.S. (Cont.)
--- ---
(2) Analysis of the Group’s share in the proportionate EBITDA, FFO (Funds From Operations) 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 December 31, 2024 Fairview Towantic Maryland (1)Shore Valley Three Rivers Total
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Rate of holdings of the CPV Group 25% 26% 75% 68% 50% 10%
Revenues from sales of energy 51 72 65 33 93 13 327
Cost of natural gas 25 39 25 16 32 8 145
Carbon emissions tax (RGGI) – 11 12 15 15 – 53
Cost of sales – other expenses (without depreciation and amortization) – 1 3 1 2 – 7
Gain (loss) on realization of transactions hedging the electricity margins 3 (7 ) (2 ) 7 2 5 8
Net energy margin 29 14 23 8 46 10 130
Revenues from capacity payments 5 33 7 5 13 1 64
Other income 1 2 4 2 1 1 11
Gross profit 35 49 34 15 60 12 205
Fixed costs (without depreciation and amortization) 4 6 15 8 25 4 62
Administrative and general expenses (without depreciation and amortization) 1 1 2 1 2 1 8
Gain (loss) from revaluation of unrealized hedging transactions 3 4 (1 ) – – – 6
Group’s share in EBITDA after proportionate consolidation in the Energy Transition segment 33 46 16 6 33 7 141
Group’s share in FFO 16 49 17 14 13 5 114
Group’s share in free cash flows after service of project debt 19 27 6 13 (2 ) – 63
(1) At the Shore power plant – gas transmission costs (totaling in the fourth quarter of 2024 about NIS 6 million) that are classified in accordance with IFRS 16 as depreciation expenses and, accordingly, are not included in the EBITDA.
--- ---
(2) It is noted that the increase in the rates of holdings in the Shore power plant (from about 37.5% to about 68.8%) and in the Maryland power plant (from about 25% to about 75%) in the fourth quarter of 2024, did not have a significant<br> impact on the results of the Energy Transition segment in the U.S. in 2024.
--- ---

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OPC Energy Ltd.

Report of the Board of Directors

5. Analysis of the results of operations for the Three Months Ended December 31, 2025 (in millions of NIS) (Cont.)
E. Renewable energies segment in the U.S.
--- ---
(1) Set forth below is an analysis of the change in the EBITDA after proportionate consolidation in the activities in the renewable energies segment in the U.S. in the fourth quarter of 2025 compared with the corresponding quarter last<br> year (in millions of NIS):
--- ---

Entry of a partner in CPV Renewable – as a result of completion of the investment transaction in the area of renewable energies in the U.S. in November 2024, starting from this date this segment’s data is calculated on the basis of a proportionate consolidation, where the share of the CPV Group is 66.7%.

Commercial operation of Backbone – in December 2025, construction of the Backbone solar power plant located in the state of Maryland was completed (the PJM market), with an installed capacity of about 179 megawatts and a construction cost that totaled about $328 million and its commercial operation commenced. The project has an investment agreement with a tax partner, in the amount of about $120 million, which had been provided in full as at the date of the report. Also, the project has a commercial agreement for sale of about 81% of the energy generated and the renewable energy certificates for 10 years from the commercial operation date. The EBITDA expected in the first full year of the project’s operation is estimated at about $16 million (about NIS 55 million)^34^.

In addition, in the fourth quarter of 2025 work commenced to expand the project in a scope of an additional 36 megawatts, at an anticipated construction cost of about $56 million. Completion of the expansion work is expected to take place in 2026. With respect to expansion of the project, there is a binding investment agreement with a tax partner on terms similar to the project’s agreement. The EBITDA expect ed in the first full year of operation of the expansion of the project is estimated at about $4 million (a NIS 14 million)^34^.

^34^ That stated above in connection with the expected commercial operation of the expansion of the Backbone project constitutes “forward‑looking” information as it is defined in the Securities Law, regarding which there is no certainty it will materialize. Ultimately, there could be delays and/or breakdowns with respect to completion of the project’s construction and operation deriving from, among other things, operating factors, completion of the construction and connection work, technical breakdowns and/or the occurrence of one or more of the risk factors the CPV Group is exposed to. It is noted that a delay in the commercial operation beyond the expected date, as stated above, could have an unfavorable impact on liabilities to third parties and its entitlement to benefits.

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OPC Energy Ltd.

Report of the Board of Directors

6.          Initiation and Construction Projects

A. Israel segment – projects under construction and pipeline projects (held at 100% ownership by OPC Israel^35^:
1. Main details with reference to construction projects (the data presented in the table below is in respect of 100% for each project):
--- ---
^35^ That stated in connection with projects that have not yet reached operation, including with reference to the development stages, expected operation/construction date, the anticipated technologies,<br> regulation, quota or commercial format,  capacity and project characteristics, undertakings in the project agreements (financing, equipment, construction), receipt of relevant approvals and/or the costs involved in the projects,<br> including the anticipated cost of the investment and costs of agreements, 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<br> 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<br> things due to dependency on various factors, including those that are not under the Company’s control, including completion of the construction and connection work, assurance of connection to the network and output of electricity from<br> the project sites and/or connection to the infrastructures (including the electricity grid and gas infrastructures), receipt of permits, completion of planning processes and licensing, application of relevant regulation, obtaining a<br> quota and/or formulation of a commercial format, completion of construction work, final costs in respect of development, construction, equipment and acquisition of rights in land, the proper functioning of the equipment, force majeure events and/or the terms of undertakings with main suppliers (including lenders), and there is no certainty they will be fulfilled, the<br> 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<br> 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, the War and its impacts), regulatory, licensing or planning risks, environmental factors, macro‑economic changes, delays in receipt of permits,<br> delays/problems regarding performance of acceptance tests or assurance of connection to the networks and infrastructures, delays and increased costs due relating to the supply chain, factors relating to main suppliers and financing<br> costs, changes in raw‑material prices and etc. For additional details regarding risk factors – see Section 19 of Section A of the Periodic Report. Accordingly, there is no certainty regarding actual execution of development and<br> construction projects (or any of them). It is further clarified that delays in completion of the projects beyond the date originally planned for this or a failure to enter them into operation for whatever reason, involve an increase in<br> costs or loss of expenses and payments (including by force of agreements the projects have signed) and/or impact the ability of the Company and the Group companies to comply with their obligations to third parties (including under<br> guarantees provided), including authorities, conditions of permits, lenders, consumers, suppliers and others, in connection with the projects, and/or cause a charge for additional costs, payment of compensation (including foreclosure of<br> guarantees or deposits) or starting of proceedings (including under guarantees provided).

56

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OPC Energy Ltd.

Report of the Board of Directors

6.          Initiation and Construction Projects (Cont.)

A. Israel segment – projects under construction and pipeline projects (held at 100% ownership by OPC Israel^35^: (Cont.)
1. Main details with reference to construction projects (the data presented in the table below is in respect of 100% for each project): (Cont.)
--- ---
Power Date/ Total
--- --- --- --- --- --- --- --- ---
plants/ expectation Total construction
facilities of the start expected cost as at
for of the Main construction December 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”) Acceptance tests after completion of the construction ≈ 87 On the premises of the Sorek B seawater desalination facility Powered by natural gas, cogeneration 2026 Yard consumers and the System Operator ^36^≈ 230 ≈ 222

The timetables and construction costs of Sorek 2 were negatively impacted by the defense situation and the war in Israel, as detailed in Section 2B above. For additional details – see Section 7.15.1.2 of Part A of the Periodic Report.

Regarding development and construction activities with respect to facilities for generation of electricity located on the yards (premises) of the consumers, as at the approval date of the report, facilities have been operated with an aggregate capacity of about 45 megawatts (of which about 10 megawatts are in various test‑run and operation stage) and additional facilities with an aggregate capacity of about 10 megawatts are in various stages of construction with an expectation of commercial operation in 2026. As at the date of the report, the total construction costs of the said capacity (about 55 megawatts) are estimated at about NIS 175^37^ million. For additional details– see Section 7.3.10 of Part A of the Periodic Report. It is noted that as at the approval date of the report, the Company is carrying on a process wherein it is examining possibilities for sale of the said activities, however a decision has not yet been formulated by the Company regarding this matter, including in connection with the terms of the sale, and there is no certainty regarding the results of this examination, the timing thereof or its conditions.

^36^ Not including a charge for headquarters costs and financing for the Company and the headquarters in Israel.

^37^ Not including a charge for headquarters costs and financing.

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OPC Energy Ltd.

Report of the Board of Directors

6.          Initiation and Construction Projects (Cont.)

A. Israel segment – projects under construction and pipeline projects (held at 100% ownership by OPC Israel^35^: (Cont.)
2. Main details with reference to projects in the advanced development stage^38^ in Israel^39^:
--- ---
Total Additional
--- --- --- --- --- --- ---
Expected expected developments
Capacity construction construction Expected in the
Project (megawatts) Location date cost regulation project
Ramat Beka (photovoltaic with integrated storage) About 550 megawatts plus storage capacity estimated at up to about 3,850 megawatt-hours^40^. Local Industrial Council Naot Hovav (the land will be leased from Israel Lands Administration for a period of 24 years and 11 months). Up to the end of 2026 About NIS 4.3 billion. Decision No. 71101 – Bilateral Market Regulation for Generation and Storage Facilities Connected to or Integrated in the Transmission Grid<br><br> <br><br><br> <br>Content: From January 1, 2026, renewable energy generation facilities with integrated storage (which are required to comply<br> with a storage capacity to installed generation capacity ratio that does not exceed 7) that will receive tariff approval up to June 1, 2027 or up a total quota of 2,000 megawatts.<br><br> <br>Main conditions: Signing of capacity transactions with virtual suppliers, which will give the supplier a right to purchase<br> energy at the half‑hour market price “SMP” in every hour up to a ceiling of the capacity certificate the supplier acquired from the generator. The capacity stated in the capacity certificate for a renewable energy facility with integrated<br> storage of 4 and 5 hours of unloading, will receive tariff approval as part of the first quota of the regulation, at the rates of 60% and 67%, respectively, up to 2036. The Company is taking action to sign project agreements (construction, equipment and financing) and to obtain all the required approvals and permits: (1) in March<br> 2025, after receipt of government consent for advancement of a plan for construction of the project by the National Infrastructures Committee, the plan was deposited. In January 2026, the plan was approved by the National Infrastructures<br> Committee and is awaiting final approval which is expected to be received in the upcoming weeks; (2) in December 2024, the Group signed an agreement for supply of solar panels for the project with an international supplier; (3) in January<br> 2026, the Group signed an EPC agreement for a substation and a switching station which were intended to conform the electricity that will be generated in the project to the grid. In addition, the Company is taking action to sign<br> additional project agreements, including an agreement with the construction contractor of the photovoltaic facilities, in an estimated scope of about NIS 500 million; (4) the Group is negotiating with Bank Hapoalim regarding provision of<br> financing for construction of the project; (5) as at the date of the report, the Group paid Israel Lands Authority about NIS 275 million (20% of the total consideration in respect of the main areas), the balance (80%), in the amount of<br> about NIS 1.2 billion is expected to be paid within 90 days from the final approval of the project which, as noted, is expected to be received in the upcoming weeks.
^38^ Natural gas projects which, in the Company’s estimation, are in a period of up to about two years or up to about three years before the start of construction (taking into account the<br> projects’ characteristics, such as relevant regulation, required regulatory approvals, commercial arrangements for sale of energy from the facility, etc.) are considered projects in advanced development. Renewable energy projects which,<br> in the Company’s estimation, are expected to reach construction within about two years, taking into account, among other things, the relevant regulation, connection to the electricity grid, statutory plans and required regulatory<br> approvals, are considered projects in advanced development.
^39^ “Forward‑looking” information – for details see footnote 35 above.
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^40^ As at the approval date of the report, the Company is making a technical feasibility examination along with economic optimization based on the possibility of increasing the solar<br> capacity up to 600 megawatts plus storage capacity estimated at up to 4,200 megawatts per hour. If the said increase is made, the expected cost of the project is about NIS 4.6 billion. That stated in<br> this table regarding the Ramat Beka project is forward‑looking” information – see footnote 35 above.
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OPC Energy Ltd.

Report of the Board of Directors

6.          Initiation and Construction Projects (Cont.)

A. Israel segment – projects under construction and pipeline projects (held at 100% ownership by OPC Israel^35^: (Cont.)
2. Main details with reference to projects in the advanced development stage in Israel^33^:
--- ---
Total Additional
--- --- --- --- --- --- ---
Expected expected developments
Capacity construction construction Expected in the
Project (megawatts) Location date cost regulation project
Hadera 2 project (natural gas combined cycle)^41^ About 850 megawatts Hadera adjacent to the Hadera power plant Up to the end of 2026 About NIS 4.8 to NIS 5.2 billion. Decision No. 69407 – Regulation for Conventional Generation Units<br><br> <br><br><br> <br>Content: Four generation units that will reach a financial close up to the end of June 2027 (as at the approval date of the<br> report, 2 units had reported on a financial close in accordance with this regulation, and to the best of the Company’s knowledge there are two additional plans that are under consideration for Hadera 2).<br><br> <br>Main conditions: A capacity tariff was set that will apply for 25 years from the date of the financial close in the following<br> manner: financial close up to June 2026 will receive a capacity tariff of 3.31 agurot, up to December 2026, 3.18 agurot and up to June 2027 3.05 agurot. Sale of energy at the half‑hour “SMP” market price, with a future possibility<br> (contingent on regulatory approval) of transition to a model of sale of capacity to virtual suppliers (similar to that stated above with respect to the Ramat Beka project). The Company is taking action to sign project agreements (construction, equipment and financing) and is advancing the obtaining of all the required approvals and<br> permits (including assurance of connection to the grid): (1) on August 10, 2025, the Israeli government approved National Infrastructure Plan 20B (NIP 20B) (a plan for construction of the Hadera 2 power plant for generation of electricity<br> through use of natural gas); (2) as at the approval date of the report, the Company has signed a binding agreement for supply of equipment with the main equipment supplier for an aggregate consideration constituting about 20% of the<br> project’s estimated cost, which is to be paid on payment dates some of which occurred as at the approval date of the report. For details – see Section 7.15.3.1 of Part A of the Periodic Report; (3) the Group is carrying on negotiations<br> with Bank Leumi L’Israel in connection with provision of financing for construction of the project; and (4) the Company is carrying on negotiations with Infinia for acquisition of the rights in the project’s lands (and the lands of the<br> Hadera power plant) in exchange for an aggregate consideration of about NIS 450 million – this being in place of the option agreement and the lease agreements, where as at the approval date of the report there is no certainty regarding<br> completion of the said transaction.

For additional information regarding Ramat Beka and the Hadera 2 – see Sections 7.3.12.2 and 7.3.12.1, respectively, of Part A of the Periodic Report.

^41^ The information regarding the Hadera 2 project in this table includes “forward‑looking” information – for details see footnote 35 above.

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OPC Energy Ltd.

Report of the Board of Directors

6.          Initiation and Construction Projects (Cont.)

A. Israel segment – projects under construction and pipeline projects (held at 100% ownership by OPC Israel^35^: (Cont.)
3. Main details with reference to projects in the initial development stage^42^ in Israel^43^:
--- ---
Additional
--- --- --- ---
Project Technology Location details
Intel Natural gas combined cycle (about 450 to 650 megawatts, in the Company’s estimation as at the approval date of the report about 600 megawatts). Kiryat Gat (land leased from Intel) On March 3, 2024, OPC Power Plants signed a non‑binding memorandum of understanding with Intel Electronics (“Intel”), an existing customer of the Group, whereby OPC<br> Power Plants will construct and operate a power plant (“the Project”), which will supply electricity to Intel’s facilities, including expansion of the facilities presently being constructed, for a period of 20 years starting from the<br> operation date (“the Memorandum of Understanding”).<br><br> <br><br><br> <br>The parties are taking action to advance the development and planning of the project and to sign detailed agreements, while during the period of the report there was<br> advancement with respect to, among other things, receipt of a planning study, approval of access to the land and planning recommendation from the Planning Administration, and in March 2025 government consent was received for advancement<br> of the plan by the National Infrastructures Planning Board. In addition, the Company is carrying on negotiations with Intel for signing a PPA agreement in connection with the project. As at the approval date of the report, the Company<br> estimates that projected construction cost of the project will be in the range of about NIS 4.0 – 4.5 billion (depending on the size of the project), and subject to completion of the planning and development processes the project is<br> expected to reach the construction stage in the second half of 2027.
^42^ Natural gas projects with respect to which there is a tie to (right in) the land (or that are in the midst of processes for the formulation<br> thereof) and/or government consent has been received for approval of a National Infrastructure Plan and the Group is taking action to obtain the permits and approvals required for their construction, are considered projects in initial<br> development. Renewable energy projects with respect to which the Group has a tie to (right in) the land, and the Group is taking action to obtain the permits and approvals required for their construction, are considered projects in<br> initial development.
^43^ That stated above and below regarding the Intel project and solar and storage projects with integrated storage includes “forward‑looking” information – for details see footnote 35 above.
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OPC Energy Ltd.

Report of the Board of Directors

6.          Initiation and Construction Projects (Cont.)

A. Israel segment – projects under construction and pipeline projects (held at 100% ownership by OPC Israel^35^: (Cont.)
3. Main details with reference to projects in the initial development stage^42^ in Israel^43^: (Cont.)
--- ---
Additional
--- --- --- ---
Project Technology Location details
Solar and storage projects with integrated storage Photovoltaic with integrated storage Rural areas – kibbutzim and communities The Company has signed agreements with holders of rights in lands (communities located in the periphery – kibbutzim and joint communities) that hold rights in<br> potential land sites for solar projects with integrated storage. As at the approval date of the report, agreements had been signed for construction of solar facilities estimated at a cumulative about 0.5 gigawatts and about 2,500<br> megawatts per hour of storage. In August 2025, the government’s consent was received for advancement of a plan estimated at about 0.15 gigawatts and about 0.75 gigawatts per hour of storage by the National Infrastructures Planning Board.

For additional details regarding the Intel project and solar projects with integrated storage – see Sections 7.3.12.3 and 7.3.12.4, respectively of Part A of the Periodic Report.

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OPC Energy Ltd.

Report of the Board of Directors

6.          Initiation and Construction Projects (Cont.)

B. Development and construction of natural gas (with potential for carbon capture) in the U.S.^44^:
1. Main details regarding the Basin Ranch power plant that is in the construction stage (which is held as at the approval date of the report at the rate of 100% by the CPV Group (1))^45^
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^44^ Projects in the construction and development stage are held at holding rates of 100% or 70% by the CPV Group, where a project that is not wholly owned is developed under joint development agreements with the equipment manufacturer and the partner in some of the projects is GE Vernova, and the CPV Group will also likely sign joint development agreements, as stated, with respect to additional projects. It is noted that potential carbon capture is a separate component that is subject to various development stages than development of the natural‑gas power plant and it is not included under the characteristics of the projects below. It is further noted that as at the approval date of the report, there is no certainty regarding development of the carbon capture component or the timing thereof.

The information with respect to projects under construction and development projects of the CPV Group, including regarding the expected commercial structure, the expected date of construction / commercial operation, the expected construction cost, characteristics (including capacity), ownership structure, financial results, entitlement to benefits, and carbon capture potential includes “forward‑looking” information, as it is defined in the Securities Law, regarding which there is no certainty it will materialize (in whole or in part). The information is based on, among other things, the estimates of the CPV Group as at the approval date of the report, regarding which there is no certainty they will be realized and that might not be realized due to various factors, such as: regulatory changes, changes in government/regulatory policies applicable to the projects, as stated, or changes in legislation or regulation (and changes impacting the main suppliers of the projects, and including changes in the area of energy or import tariffs into the U.S. due to the policies of the present administration in the U.S.), delays in receipt of permits, an increase in the construction or financing costs, delays in performance of the construction work and/or technical or operational breakdowns, difficulties or delays in signing an agreement for connection to the grid (including an increase in the connection‑related costs) or connection of the project to the transmission or other infrastructures, an increase in costs due to the commercial terms with the main suppliers (such as equipment and the construction contractor), difficulties in signing commercial agreements for sale of the project’s potential revenues, terms of the commercial agreements, conditions in the energy market, unforeseen expenses, macro‑economic changes, weather events, delays and an increase in costs relating to supply chains, transport (shipping), increases in raw‑material prices, etc. Completion of the projects pursuant to the said estimates is subject to existence of conditions which, as at the approval date of the report, have not yet occurred (in whole or in part) and, therefore, there is no certainty regarding their completion in accordance with that stated (if at all). Delays in the construction or commercial operation could also negatively impact projects, as stated, and the ability of companies in the CPV Group to comply with their obligations to third parties in connection with the project (including with respect to collaterals provided in favor of third parties, as stated (including financiers) and/or loss of payments made in the course of development and construction). For additional details regarding the risk factors involved in the activities of the CPV Group – see Section 8.21 to Part A of the Periodic Report.

^45^ The information presented below, the projected commercial operation date, the expected construction cost, the expected commercial format and signing of hedge agreements, the total senior financing and/or the expected results of the activities for the first full calendar year (revenues, EBITDA, and cash flows after service of the senior debt) constitutes “forward‑looking” information, as it is defined in the Securities Law, regarding which there is no certainty it will materialize (in whole or in part), including due to factors as stated in footnote 44 above. A delay or other difficulties (particularly significant ones) relating to completion of the project in accordance with that stated are expected to have an unfavorable impact on the CPV Group and the Company. See footnote 44 above.

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OPC Energy Ltd.

Report of the Board of Directors

6.          Initiation and Construction Projects (Cont.)

B. Development and construction of natural gas (with potential for carbon capture) in the U.S.^44^:
1. Main details regarding the Basin Ranch power plant that is in the construction stage (which is held as at the approval date of the report at the rate of 100% by the CPV Group (1))^45^
--- ---
Expectation for the first
--- --- --- --- --- --- --- --- --- --- ---
full year of operation
Expected Total Cash flows
start Total construction after
of the Expected expected cost as at Total service of
Capacity commercial commercial Regulated construction December 31 senior senior
Project (MW) Location operation structure market cost 2025 financing EBITDA debt
CPV Basin Ranch Holdings, LLC (“Basin Ranch”) 1,350 Ward County, Texas 2029 Sale of electricity in the ERCOT market (energy only), where the project is expected to sign commercial agreements to hedge about 75% of the power plant’s capacity for a period of 7 years<br> from the commercial operation date^46^ ERCOT - West NIS 5.7-6.4 billion ($1.8-2.0 billion) NIS 1.1 billion ($0.36 billion) ≈ NIS 3.5 billion<br><br> <br>(≈ $1.1 billion) ≈ NIS 1.0 billion<br><br> <br>(≈ $0.275 billion) ≈ NIS 0.9 billion<br><br> <br>(≈ $0.25 billion)
(1) In February 2026, upon completion of a transaction for acquisition of the remaining 30% of the ownership rights in the project from the remaining partner in the project (GE Vernova) and from the date of its completion, the CPV Group<br> holds 100% of the project and it will be consolidated in the Company’s financial statements, starting from the first quarter of 2026. The total scope of the transaction is estimated at about $371 million (about NIS 1.2 billion). This<br> amount includes the shareholders’ equity required in respect of the rights being acquired, in the amount of about $228 million (of which the amount of about NIS 58 million was paid as an advance deposit on the signing date of the<br> agreement in October 2025), performance guarantees, in the amount of about $63 million, and the balance, in the amount of about $80 million, that is to be paid to the seller in four equal annual payments in 2026–2029. The sources for<br> completion of the transaction included debt granted directly to the CPV Group by Bank Leumi, in the amount of about $130 million (for details – see Section 7A(9) below), frameworks for letters of credit provided, in the amount of about<br> $63 million and a combination of cash from the activities of the CPV Group and investment of capital by the partners (stakeholders) in the CPV Group.
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(2) For additional details regarding provision of sources for the project’s financial close in October 2025 – see Section 7A(8) below.
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^46^As at the approval date of the report, hedging of the exposure to market prices is expected by means of: gas agreements of the Netback type (which includes a pricing mechanism whereby the gas price paid by the generator of the electricity derives from the electricity price) and agreements for sale of electricity at a fixed price. In addition, as at the approval date of the report, a substantial portion of the agreements has been signed and some of them are expected to be signed up to the commercial operation date.

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OPC Energy Ltd.

Report of the Board of Directors

6.          Initiation and Construction Projects (Cont.)

B. Development and construction of natural gas (with potential for carbon capture) in the U.S.^44^:
2. Set forth below is a summary of the pipeline (awaiting) natural gas project with carbon capture potential in the U.S.^47^, as at the approval date of the report^48^:
--- ---
Regulated Capacity Rate of Share of the
--- --- --- --- --- --- ---
Project Location market Status (megawatts) holdings CPV Group
Shay (1) West Virginia PJM Initial 2,100 70% 1,470
Oregon Ohio PJM Initial 1,475 100% 1,475
Walker Ohio PJM Initial 1,450 100% 1,450
Total 5,025 4,395
(1) Pursuant to the Group’s strategy, advancement of natural‑gas projects with carbon capture potential is continuing with the goal of meeting the anticipated increase in electricity demand and maintaining grid reliability, while focusing<br> on, at this stage, the Shay project. As at the approval date of the report, the CPV Group has accelerated its advancement of the project’s development, including the processes for licensing and PJM grid interconnection, and has secured<br> significant equipment. In this regard, the CPV Group has signed an agreement for major electrical equipment and is expected to enter into a turbine (slot) reservation agreement with global equipment suppliers (which is also a partner in<br> the project). These undertakings (agreements) include payment of non‑refundable advance deposits, in the total amount of millions of dollars. In the estimation of the CPV Group, the initial estimate of the cost of the power plant (100%)<br> is about $4 billion^49^. In addition, possible commercial and regulatory formats are being considered, including “Gas Net Back” arrangements, subsidized financing plans and regulatory initiations for encouraging the increase<br> available capacity in the PJM market, to the extent they will be applicable, as detailed in Section 3C above. At this stage, the said alternatives are in the examination stage, some of which merely preliminary examination, and there is no<br> certainty regarding the manner of their implementation or their feasibility. The Group intends to advance commencement of construction of the project, subject to completion of all the development processes, particularly finalizing the<br> commercial format, within a period of about two years^50^.
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^47^ The information stated above regarding the projects in the development stage of the CPV Group, the scope thereof and their additional characteristics, such as, carbon capture potential and the stages of development of the project constitute “forward‑looking” information as it is defined in the Securities Law, and regarding which there is no certainty it will be realized, including due to the stages of development that have not yet been completed (as described in Section 10.8A of Part A of the Periodic Report) and/or a lack of certainty regarding the feasibility of assimilating the carbon capture technology in the development projects of the CPV Group and/or relevant costs. In addition, advancement of the projects, as stated, is subject to uncertainty and conditions, as noted in footnote 44 above.

^48^ In general, regarding natural gas with future carbon capture potential, the CPV Group views projects that have an expectation of connection to the grid within three years and a commercial format has been formulated for the project, as projects in the advanced development stage, and projects for which a tie to (a right in) the land exists and there is an expectation of an agreement for connection to the grid of more than three years or a connection expectation has not yet been formulated, as projects in the initial stage.

That stated regarding the stage of development is impacted by, among other things, the scope of the project, its location, the anticipated activity market, the relevant ISO, regulation and policies of the federal and local governments, and could change based on a given project’s specific characteristics, as well as due to the project’s relevant external circumstances.

^49^ Not including financing expenses in the construction period.

^50^ That stated regarding the Shay project, including in connection with an expected undertaking in an agreement for reserving generation capacity, constitutes “forward‑looking” information, regarding which there is no certainty it will materialize. For details – see footnote 44 above. As at the approval date of the report, there is no certainty regarding fulfillment of the conditions for advancement of the project.

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OPC Energy Ltd.

Report of the Board of Directors

6.          Initiation and Construction Projects (Cont.)

C. Renewable energies segment in the U.S. – projects under construction and development projects (100% held by CPV Renewable which is held at the rate of 66.7% by the CPV Group^51^:
1. Main details regarding a project under construction using wind technology (the data presented in the table below are in respect of 100% of each project)^52^:
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Project Capacity<br><br> <br>(megawatts) Location Expected<br><br> <br>commercial<br><br> <br>operation<br><br> <br>date Commercial<br><br> <br>structure Regulated<br><br> <br>market<br><br> <br>after<br><br> <br>the PPA<br><br> <br>period Total<br><br> <br>expected<br><br> <br>construction<br><br> <br>cost net<br><br> <br>for 100%<br><br> <br>of the project<br><br> <br>(NIS<br><br> <br>millions) Tax<br><br> <br>equity<br><br> <br>(NIS<br><br> <br>millions) Total<br><br> <br>construction<br><br> <br>cost<br><br> <br>as at<br><br> <br>December 31,<br><br> <br>2025<br><br> <br>(NIS<br><br> <br>millions) Expectation for a first full calendar year<br><br> in the period of the PPA agreements
--- --- --- --- --- --- --- --- --- --- --- ---
Revenues^36^<br><br> <br>(NIS<br><br> <br>millions) EBITDA^53^<br><br> <br>(NIS<br><br> <br>millions) Cash flows<br><br> <br>after tax<br><br> <br>partner<br><br> <br>(NIS<br><br> <br>millions)
CPV Rogues Wind, LLC (“Rogues”) 114 Pennsylvania 2026 Long-term PPA^54^ (including green certificates) PJM MAAC ≈ 1,164<br><br> <br>(≈ $365 million) ≈ 520<br><br> <br>(≈ $163 million)^55^ ≈ 962<br><br> <br>(≈ $302 million) ≈ 82<br><br> <br>(≈ $24 million) ≈ 63<br><br> <br>(≈ $18 million) ≈ 51<br><br> <br>(≈ $15 million)
^51^ For details regarding expansion of the Backbone project, which is in the construction stage – see Section 5E.
^52^ Details with respect to the scope of the investments in the United States were translated from dollars and presented in NIS based on the currency rate of exchange on December 31, 2025 –<br> $1 = NIS 3.19. The information presented below in this report regarding projects under construction and development, including with respect to the expected commercial structure, the projected commercial<br> operation date, the expected construction cost, an undertaking with a tax partner (if relevant) and/or the expected results of the activities for the first full calendar year (revenues, EBITDA, investments of the tax partner and cash<br> flows after the tax partner, as applicable) includes “forward‑looking” information, as it is defined in the Securities Law, regarding which there is no certainty it will materialize (in whole or in part), including due to factors that<br> are not under the control of the CPV Group. The information is based on, among other things, estimates of the CPV Group as at the approval date of the report, the realization of which is not certain, and which might not be realized<br> due to factors, such as: regulatory changes or legislative changes (including changes impacting main suppliers of the projects and/or import of equipment and including regulatory/legislative changes in the area of energy or import<br> tariffs due to changes in the government’s policies), delays in receipt of permits, an increase in the construction costs, delays in execution of the construction work and/or technical or operational malfunctions, problems or delays<br> regarding signing an agreement for connection to the network or connection of the project to transmission or other infrastructures, an increase in costs due to the commercial conditions in the agreements with main suppliers (such as<br> equipment suppliers and contractors), problems signing commercial agreements sale for of the potential revenues from the project, terms of the commercial agreements, conditions of the energy market, an increase in the financing<br> expenses, unforeseen expenses, macro‑economic changes, weather events, delays and an increase in costs related to the supply chain, transport and an increase in raw‑material prices, etc. Completion of the projects in accordance with<br> the said estimates is subject to the fulfillment of conditions which as at the approval date of the report had not yet been fulfilled (fully or partly) and, therefore, there is no certainty they will be completed in accordance with<br> that stated, if at all. Construction delays could even impact the ability to comply with liabilities of the project and the CPV Group to third parties in connection with the projects (including based on guarantees provided in favor of<br> those third parties) or to detract from the entitlement to tax benefits or to trigger forfeiture of guarantees and advance payments.
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^53^ It is clarified that the expected revenues and the EBITDA presented in the above table do not include the tax benefits, even though the project is expected to comply with conditions for<br> their receipt.
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^54^ In April 2021, the project signed an agreement for sale of all the electricity (as amended from time to time) and the environmental consideration (including Renewable Energy<br> Certificates (RECs), benefits relating to availability and accompanying services), the terms of which were improved in 2024. The agreement was signed for a period of 10 years starting from the commercial operation date. The CPV Group<br> has provided collateral for assurance of its obligations under the agreement, which includes execution of certain payments to the other party if certain milestones (including the commencement date of the activities) in the project are<br> not completed in accordance with the timetable determined.
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^55^ The project is located on a former coal mine and, therefore, it is expected to be entitled to enlarged tax benefits of 40% in accordance with the IRA Law. In August 2025, the CPV Group<br> signed an agreement with a tax partner (Equity Tax) in an ITC format in respect of about 40% of the cost of the project and use of the tax credits that are available to the project (subject to appropriate regulatory arrangements) on<br> terms that are customary for agreements of this type (including provision of a guarantee by the CPV Group for certain liabilities).
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OPC Energy Ltd.

Report of the Board of Directors

6.          Initiation and Construction Projects (Cont.)

C. Renewable energies segment in the U.S. – projects under construction and development projects (100% held by CPV Renewable which is held at the rate of 66.7% by the CPV Group^51^:
2. Set forth below is a summary of the scope of the pipeline projects (in megawatts) in the United States as at the approval date of the report^56^.
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Advanced Initial
--- --- --- --- --- --- ---
Renewable energy development^57^ development Total
PJM market
Solar 70 1,540 1,610
Wind – 130 130
Total PJM market (2) 70 1,670 1,740
Other markets
Solar 240 1,050 1,290
Wind – 1,200 1,200
Total other markets 240 2,250 2,490
Total renewable energy (1) 310 3,920 4,230
Share of the CPV Group (66.67%) 205 2,610 2,815

^56^ The information presented in the report regarding the backlog (pipeline) of development projects of the CPV Group, including with respect to the scope of the backlog, status of the projects and/or their characteristics (capacity, technology, integration possibilities with carbon capture potential, expected construction date, etc.), and assessments regarding entitlement to benefits and/or potential compliance with the safe harbor rules, constitutes “forward‑looking” information as it is defined in the Securities Law. For details – see footnote 55 above.

^57^ In general, in the area of renewable energies, the CPV Group views projects that in its estimation are in a period of up to two to three years to the start of the construction as projects in the advanced development stage (there is no certainty the development projects, including projects in the advanced stage, will be executed) – this being based on the expectation of a connection agreement to the grid within two to three years depending on the status of the connection request and assessment of the viability (commercial/project etc.) of reaching construction within two years. Also, the CPV Group views projects wherein there is a tie to (a right in) the land together with an expectation of connection to the grid of more than two years or where a connection agreement has not yet been formulated and the CPV Group is taking action to advance the approvals required for construction of the project, as projects in the initial development stage.

That stated regarding the development stage is impacted by, among other things, potential compliance with the safe harbor rules under the legislation in the U.S. (including additional regulatory changes and stricter regulations applying to renewable energy), the scope of the project and the technology, and could change based on specific characteristics of a certain project, as well as from the external circumstances that are relevant to the project, such as the anticipated activities’ market or additional regulatory circumstances. In general, projects that are designated to operate in the PJM market could be impacted by the connection processes as described in Section 8.1.2.1(A) of Part A to the Periodic Report for 2024, and their progress could be delayed as a result of these proposed processes. It is clarified that in the early development stages (in particular), the scope of the projects and their characteristics are subject to changes, if and to the extent they reach advanced stages.

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OPC Energy Ltd.

Report of the Board of Directors

6.          Initiation and Construction Projects (Cont.)

C. Renewable energies segment in the U.S. – projects under construction and development projects (100% held by CPV Renewable which is held at the rate of 66.7% by the CPV Group: (Cont.)
2. Set forth below is a summary of the scope of the pipeline projects (in megawatts) in the United States as at the approval date of the report^56^. (Cont.)
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(1) As at the approval date of the report, all the advanced development projects and certain projects in the initial development, with an aggregate scope of about 1.9 gigawatts (in terms of 100% – the share of the CPV Group is about 1.3<br> gigawatts), are expected to comply with the Safe Harbor rules (lenient threshold conditions that must be complied with in order to receive the tax benefits, ITC and PTC). As at the approval date of the report, the CPV Group has invested<br> and is expected to make additional investments in an aggregate scope estimated at tens of millions of dollars in the said projects, particularly procurement of equipment. For additional details regarding the policies of the U.S.<br> government with respect to renewable energies and legislation of the “One Big Beautiful Bill” law in the U.S., which gradually cancels the tax benefits and provides directives and dates and in connection with the Safe Harbor rules – see<br> Section 3D above.
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(2) It is noted that the process with respect to requests for connection to the grid in the PJM market (Interconnection Queue(, which constitutes a significant milestone in a project’s development stages, lengthy can be and could continue<br> on average 2–3 years, and in the estimation of the CPV Group delays in this process have occurred and may continue to cause delays in the timetables for development of certain projects, taking into account, among other things, the<br> required costs for upgrading the network and their position in the connection process and in the costs of the connection process in a case where upgrades are necessary^58^.
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^58^ That stated above in connection with the impacts of the processes with respect to the connection agreements of PJM on the projects of the CPV Group, includes “forward‑looking” information as it is defined in the Securities Law. For details – see footnote 55 above.

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OPC Energy Ltd.

Report of the Board of Directors

7.          Adjusted financial debt, net

A. Compositions of the adjusted financial debt, net^59^

The Company defines “net financial debt” as loans from banks and financial institutions, debentures and interest payable less cash and cash equivalents, including deposits and restricted cash that are intended for debt service and less/plus the fair value of derivative financial instruments used for hedging the principal and/or interest. The “adjusted net financial debt” includes the “net financial debt” of the Company and its consolidated subsidiaries and the “net financial debt” of its associated companies in the U.S. on the basis of the rate of the holdings of the CPV Group in these companies.

The Company defines “leverage ratio” as “adjusted financial debt, net” divided by “EBITDA after proportionate consolidation” for the 12 months that preceded the measurement date. For purposes of calculation of the leverage ratio, debt in respect of projects under construction (that do not yet generate EBITDA) is not included in the calculation. Regarding projects the construction of which has been completed and/or active projects that were acquired during the period of the report, a representative annual EBITDA is taken into account.

Set forth below is detail of the Group’s leverage ratio:

As at December 31, 2025^(1)(2)^ As at December 31, 2024^(3)^
2.9 5.2
^(1)^ After elimination of debt under construction in respect of the Basin Ranch power plant in the U.S. of about NIS 231 million, and for the Rogues Wind project, in the amount of about NIS 245 million, as detailed in the following table.<br> With reference to the Backbone project, the construction of which has been completed and acquisition of additional holdings in the Shore power plant in the U.S. in 2025, the representative EBITDA was calculated as follows: Shore based on<br> the rate of holdings as at the date of the report with respect to the actual results in 2025; and Backbone based on the representative EBITDA for the first full year of operation.
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^(2)^ As at December 31, 2025, the adjusted financial debt, net, includes a cash balance of about NIS 2,261 million, in the headquarters company, as detailed in the following table, the source of which is, among other things, issuances of<br> capital made during 2025 that are being used for financing of part of the shareholders’ equity required for construction of the Basin Ranch power plant, as well as for continued growth and development of the Company’s business.
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^(3)^ After elimination of debt under construction in the Renewable Energies segment in the U.S. of about NIS 132 million, as detailed in the following table. With reference to acquisition of additional holdings in some of the power plants<br> in the Energy Transition segment in the U.S. (“the Additional Acquisitions”) and regarding loss of control in the Renewable Energies segment (“the Loss of Control”), the representative EBITDA was calculated as follows: Maryland and Shore<br> based on the rate of holdings with respect to the actual results in 2024 for the Additional Acquisitions adjusted for a full year, and the renewable energy activities based on the rate of holdings with respect to the actual results in<br> 2024, taking into account the decline in the rate of holdings in the period prior to the Loss of Control.
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^59^ It is clarified that these are indices that are not defined in accordance with IFRS and are not audited, however Company management believes that they are capable of assisting investors in understating the Company’s financial position<br> and its results. It is noted that different companies are likely to define these indices differently.

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OPC Energy Ltd.

Report of the Board of Directors

7. Adjusted financial debt, net (Cont.)
A. Compositions of the adjusted financial debt, net (Cont.)
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The following table details the financial debt, net, as at December 31, 2025 (in millions of NIS)^60^:

Gross debt
Debt Cash and cash Derivative
Method of (including equivalents financial
presentation interest and deposits instruments
in the payable Weighted- Final (including for hedging
Company’s and average repayment restricted cash principal
financial deferred interest date of used for debt and/or Net
Name of project statements expenses) rate the loan service) (1) interest debt
Hadera Consolidated 548 4.9% 2037 68 41 439
Headquarters and others in Israel (2) Consolidated 2,300 6.3%–6.4% 2033 220 – 2,080
Total Israel 2,848 6.1% 288 41 2,519
Active renewable energy<br><br> <br>projects Associated (66.7%) 502 5.3% 2026–2030 12 4 486
Financing of construction of Rogues Wind Associated (66.7%) 249 5.1% 2029 2 2 245
Renewable energies headquarters Associated (66.7%) – – 85 – (85 )
Total renewable energy 751 5.3% 99 6 646
Fairview (3) (Cash Sweep 32%) Associated (25%) 539 6.2% 2030–2031 13 (1 ) 527
Towantic (Cash Sweep 8%) Associated (26%) 179 7.9% 2029 30 (3 ) 152
Maryland (4) (Cash Sweep 53%) Associated (75%) 625 5.8% 2028 62 3 560
Shore (5) (Cash Sweep 96%) Associated (89%) 821 7.8% 2030–2032 7 (5 ) 819
Valley (6) (Cash Sweep 100%) Associated (50%) 459 9.8 May 2026 101 – 358
Three Rivers (Cash Sweep 37%) Associated (10%) 202 5.2% 2028 15 8 179
Total energy transition^^(7) 2,825 7.2% 228 2 2,595
Basin Ranch loan (8) TEF Associated (70%) 421 3.0% 2045 190 – 231
Headquarters and others – U.S. (9) Consolidated 489 7.1 2032 886 – (397 )
Total U.S. 4,486 1,403 8 3,075
Total energy headquarters (11) 1,890 2.5%–6.2%<br><br> <br>(weighted-average 3.1%) 2028–2034 2,261 – (371 )
Total 9,224 3,952 49 5,223
(1) Includes restricted cash, in the amount of about NIS 40 million in Hadera, about NIS 157 million in the Energy Transition segment and about NIS 482 million in the headquarters in the U.S. designated for the construction of the Basin<br> Ranch power plant.
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(2) For details regarding an undertaking in financing agreements with additional entities in 2025 for provision of loans in the cumulative amount of NIS 700 million on terms similar to the financing agreements of the prior entities – see<br> Note 14B(1) to the Financial Statements.
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(3) In February 2025, Fairview’s financing agreement was amended such that the interest margin on the long‑term loan was reduced from 3.5% to 3.0%. In October 2025, the financing agreement was amended again such that the long‑term loan<br> principal (Term Loan B) increased from about $491 million to about $700 million (the share of the CPV increased from about $52 million (NIS 172 million)) and the interest margin on the loan was reduced from 3.0% to 2.5%. Upon completion<br> of the transaction, the amount of about $217 million (NIS 717 million) was distributed as a dividend to the partners holding the project, where the share of the CPV is about $54 million (NIS 179 million).
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(4) In March 2025, Maryland’s financing agreement was amended, such that the interest‑rate margin on the long‑term loan was reduced from 3.75% to 3.25%.
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^60^ In addition, the Group has a liability to holders of non‑controlling interests, the balance of which as at December 31, 2025 is about NIS 440 million.

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OPC Energy Ltd.

Report of the Board of Directors

7. Adjusted financial debt, net (Cont.)
A. Compositions of the adjusted financial debt, net (Cont.)
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(5) On February 4, 2025, Shore completed an undertaking in a new financing agreement in the framework of which the interest margin on the long‑term loan was updated to 3.75% and for purposes of its completion, the amount of about $80<br> million (NIS 286 million) was granted to Shore by all of its equity holders (CPV’s share – about $72 million).
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(6) Subsequent to the date of the report, in February 2026, Valley completed an undertaking in a new financing agreement, wherein the interest margin on the loan was significantly reduced to 2.75% and the Cash Sweep rate was updated from<br> 100% to a gradual mechanism based on a leverage ratio, such that if the leverage ratio declines, the Cash Sweep rate will be gradually reduced from a rate of 75% to 50% and down to a rate of 25%. Upon completion of the new financing<br> agreement in the aggregate amount of about $425 million (of which about $325 million is in respect of a long‑term Term Loan), about $100 million was used for repayment of shareholders’ loans and distribution of dividends, where the share<br> of the CPV Group is about $50 million.
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(7) The rate (%) of the Cash Sweep mechanism is in accordance with the estimate of the CPV Group and it could change from time to time based on the provisions of the financing agreements of the projects.
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(8) On October 28, 2025, an agreement was signed and entered into effect for financing the Basin Ranch power plant with Texas Energy Fund (TEF), whereby debt will be provided in the aggregate amount of about $1.1 billion (about NIS 3.5<br> billion), where the amount of the debt presented in the table above represents the balance that has been withdrawn as at the date of the report (for details – see Note 14B(4) to the financial statements. It is noted that pursuant to the<br> terms of the TEF loan, on the date of the financial close the CPV Group provided a commitment for the shareholders’ equity required for the project (proportionately (pro rata) to the holdings on the date of the financial close), in the<br> aggregate cash amount of about $470 million, of which about $300 million was provided by means of a loan from Bank Leumi and about $170 million (which includes recognition of development investments and payments made prior to the<br> financial close in the amount of about $67 million), was provided by the Company by means of a bridge loan for equity with reference to the balance of the amount required. Subsequent to the date of the report, upon completion of the<br> process of investment in equity together with the additional limited partners that are stakeholders in the CPV Group, the bridge loan was converted into equity. The Company used part of the monies raised in the equity issuance made in<br> June 2025 for this purpose.
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In addition, additional collaterals relating to the project were provided by the holders of the rights in the project as part of the financial closing of the TEF loan, where as at the approval date of the report the share of the CPV Group in the said collaterals was provided by means of letters of credit, in the amount of about $232 million (upon completion of acquisition of the share of the partner in the project, as detailed in Section 6B(1) above).

(9) In October 2025, the CPV Group signed an agreement for financing part of the shareholders’ equity provided for construction of the Basin Ranch power plant, in the amount of about $300 million, which was increased in February 2026 (upon<br> completion of acquisition of the partner in the project), to the aggregate amount of about $430 million. For additional details – see Note 14B(3) to the financial statements.
(10) As part of some of the financing agreements, financial covenants were determined for the projects. As at the date of the report, all the companies in the Group (including the associated companies) are in compliance with all the<br> financial covenants. For additional details regarding financial covenants of the subsidiaries – see Note 14B(7) to the financial statements.
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(11) Includes balances of debt and cash in the Company and cash in ICG Energy Inc.
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(12) On September 30, 2025, the Company made partial early repayment (debt prepayment), in the amount of about NIS 256 million, of the par value of the debentures (Series B). The amount of the redemption in respect of the partial early<br> repayment (debt prepayment), including linkage differences, is about NIS 302 million.
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(13) In November 2025, the Company made an expansion of the debentures (Series D), in the amount of about NIS 458 million par value. The proceeds from the issuance amounted to about NIS 500 million (gross), which was designated for purposes<br> of refinancing existing debts and current business activities.
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(14) As at the approval date of the report, the Company is examining the possibility of taking out additional long‑term debt, as well as refinancing (including early redemption) and existing long‑term debt to extend the weighted average<br> maturity. As at the approval date of the report, there is no certainty regarding the above, the timing thereof or its terms, which are subject to market conditions and the discretion of the Company’s competent organs.
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OPC Energy Ltd.

Report of the Board of Directors

7. Adjusted financial debt, net (Cont.)
A. Compositions of the adjusted financial debt, net (Cont.)
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The following table details the adjusted financial debt, net, as at December 31, 2024 (in millions of NIS):

Method of<br><br> <br>presentation<br><br> <br>in the<br><br> <br>Company’s<br><br> <br>financial<br><br> <br>statements Debt<br><br> <br>(including<br><br> <br>interest<br><br> <br>payable<br><br> <br>and deferred<br><br> <br>expenses) Cash and cash<br><br> <br>equivalents<br><br> <br>and deposits<br><br> <br>(including<br><br> <br>restricted cash used<br><br> <br>for debt service) Derivative<br><br> <br>financial<br><br> <br>instruments<br><br> <br>for hedging<br><br> <br>principal<br><br> <br>and/or interest Net<br><br> <br>debt
Hadera Consolidated 585 72 44 469
Headquarters and others – Israel Consolidated 1,649 16 – 1,633
Total Israel 2,234 88 44 2,102
Active renewable energy projects Associated (66.7%) 323 5 16 302
Financing construction of renewable energy projects Associated (66.7%) 426 69 9 348
Renewable energies headquarters Associated (66.7%) – 216 – (216 )
Total renewable energy 749 290 25 434
Fairview Associated (25%) 482 – 2 480
Towantic Associated (26%) 215 9 (1 ) 207
Maryland Associated (75%) 891 80 15 796
Shore Associated (69%) 1,114 235 – 879
Valley Associated (50%) 686 104 – 582
Three Rivers Associated (10%) 252 14 17 221
Total energy transition 3,640 442 33 3,165
Headquarters and others – U.S. Consolidated – 264 – (264 )
Total U.S. 4,389 996 58 3,335
Total Energy headquarters 1,891 664 – 1,227
Total 8,514 1,748 102 6,664
B. Financial covenants
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The Company and its investee companies are subject to financial covenants provided in their financing agreements and trust certificates. As at the date of the report, the Company and its investee companies were in compliance with all the financial covenants provided. For details regarding the covenants for violation, relating to significant loans and debentures – see Notes 14B(6) and 15C to the financial statements^61^.

In May 2025, Midroog determined an initial rating of A1.il with a stable rating outlook for the Company and its debentures (Series B, C and D). In addition, in May 2025, S&P Maalot raised the Company’s credit rating to ilA with a stable rating outlook and of its debentures to ilA+, due to an improvement in the business profile and the financial ratios.

^61^ For a description of the main provisions of material loans of the Company and the investee companies – see Note 14 to the annual Financial Statements.

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OPC Energy Ltd.

Report of the Board of Directors

7. Adjusted financial debt, net (Cont.)

Movement in the adjusted financial debt, net, for the period ended December 31, 2025 (in NIS millions):

FFO – NIS 1,295 million

(1) Includes mainly adjustments in respect of the fair value of the profit participation plan for employees of the CPV Group, in the amount of about NIS 141 million, where the date of its payment is in the first quarter of 2026, as<br> detailed in Section 4B above.
(2) Includes an amount of about NIS 68 million for upgrade works carried out at the Rotem power plant in the fourth quarter of 2025, as detailed in Section 4C(1) above.
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(3) Mainly in respect of translation of the net financial debt of the U.S., which is denominated in dollars, into shekels.
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OPC Energy Ltd.

Report of the Board of Directors

8.        Financial Position as at December 31, 2025 (in millions of NIS)

Category 12/31/2025 12/31/2024 Board’s Explanations
Current Assets
Cash and cash equivalents 2,913 962 For details – see Section 9 below.
Trade receivables 437 293 An increase, in the amount of about NIS 68 million, stems from an increase in the balances of receivables from customers in Israel mainly due to an increase in customer consumption, an<br> increase in the tariff for infrastructure services and an increase in the balances of receivables from customers in the U.S., in the amount of about NIS 76 million, mainly due to an increase in sales of electricity (Retail).
Receivables and debit balances 206 90 An increase, in the amount of about NIS 110 million, stems from reclassification of a short‑term loan to Valley. The balance of the loan was paid after the date of the report as part of<br> the refinancing of Valley.
Total current assets 3,556 1,345

73

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OPC Energy Ltd.

Report of the Board of Directors

8.        Financial Position as at December 31, 2025 (in millions of NIS) (Cont.)

Category 12/31/2025 12/31/2024 Board’s Explanations
Non-Current Assets
Long-term deposits and restricted cash 522 60 Most of the increase stems from deposit of restricted cash designated for construction of the Basin Ranch power plant. For additional details – see Section 6B(1)<br> above.
Long-term receivables and debit balances 377 162 Most of the increase, in the amount of about NIS 201 million, stems from an advance deposit in respect of acquisition of the remaining interest (30%) in the Basin Ranch power plant, an<br> increase, in the amount of about NIS 121 million, relating to the balance of the development fees receivable from the Basin Ranch power plant. On the other hand, there was a decrease of about NIS 110 million from reclassification of a<br> subordinated loan to Valley from long‑term to short‑term.
Investments in associated companies 5,186 5,320 Most of the decrease derives from a decline in shekel/dollar exchange rate, in the amount of about NIS 713 million, dividends distributed to the CPV Group by associated companies, in the<br> amount of about NIS 482 million, and an other comprehensive loss from associated companies, in the amount of about NIS 265 million, stemming mainly from transactions hedging the electricity margins. The said decrease was offset by an<br> investment in Shore, in the amount of about NIS 318 million, for purposes of refinancing the project debt, an investment in the Basin Ranch power plant, in the amount of about NIS 641 million, and the income of associated companies, in<br> the amount of about NIS 523 million. For additional details regarding the results of associated companies – see Sections 4D and 4E above.
Long-term derivative financial instruments 42 44
Property, plant and equipment 4,402 4,238 Most of the increase stems from an increase, in the amount of about NIS 363 million, in respect of investments in Israel. On the other hand there was a decrease of about NIS 214 million<br> deriving from depreciation expenses.
Right-of use assets and long-term deferred expenses 636 637
Intangible assets 266 261
Total non-current assets 11,431 10,722
Total assets 14,987 12,067

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OPC Energy Ltd.

Report of the Board of Directors

8.        Financial Position as at December 31, 2025 (in millions of NIS) (Cont.)

Category 12/31/2025 12/31/2024 Board’s Explanations
Current Liabilities
Loans and credit from banks and financial institutions (including current maturities) 131 82 Most of the increase stems from update of the current maturities of the loans of OPC Israel.
Current maturities of debt from holders of non-controlling interests – 14
Current maturities of debentures 244 212
Trade payables 404 213 Most of the increase stems from an increase in the balance with the System Operator deriving mostly from timing differences and seasonality and a rise in the tariff for infrastructure<br> services.
Payables and other credit balances 369 123 Most of the increase, in the amount of about NIS 220 million, stems from reclassification of current maturities of liabilities in respect of a profit participation plan for employees of<br> the CPV Group and due to an increase in the said liability as a result of an increase in the fair value of the plan.
Total current liabilities 1,148 644

75

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OPC Energy Ltd.

Report of the Board of Directors

8.        Financial Position as at December 31, 2025 (in millions of NIS) (Cont.)

Category 12/31/2025 12/31/2024 Board’s Explanations
Non-Current Liabilities
Long-term loans from banks and financial institutions 3,203 2,150 Most of the increase derives from taking out a loan, in the amount of NIS 700 million, in OPC Israel in the period of the report and a loan taken out from Bank Leumi<br> by the CPV Group, in the amount of about NIS 495 million (about $150 million) for financing the Basin Ranch power plant.
Long-term debt from holders of non-controlling interests 440 500 Most of the decrease in the amount of about NIS 60 million, stems from repayment of loans from holders of non‑controlling interests in OPC Israel.
Debentures 1,626 1,663 Most of the decrease, in the amount of about NIS 515 million, derives from repayment of debentures, including a partial early repayment, in the amount of about NIS 302 million of the<br> debentures (Series B). On the other hand, there was an increase of about NIS 500 million (gross) stemming from expansion of the debentures (Series D).
Long-term lease liabilities 21 31
Long-term derivative financial instruments 3 –
Other long-term liabilities 15 115 See explanation in the “other payables and credit balances” section above.
Liabilities for deferred taxes 524 543
Total non-current liabilities 5,832 5,002
Total liabilities 6,980 5,646
Total equity 8,007 6,421 Most of the increase stems from issuance of shares, net, in the amount of about NIS 2,057 million, and the net income, in the amount of about NIS 457 million. On the other hand, there was<br> a decrease as the result of an other comprehensive loss, in the amount of about NIS 926 million (deriving mainly from a sharp decline in a translation reserve shekel/dollar exchange rate).

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OPC Energy Ltd.

Report of the Board of Directors

9.        Liquidity and sources of financing

Set forth below is an analysis of significant changes in the cash flows in the period of the report compared with the corresponding period last year (in NIS millions):

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OPC Energy Ltd.

Report of the Board of Directors

9.        Liquidity and sources of financing (Cont.)

(1) Most of the increase in the cash flows provided by operating activities stems from an increase in dividends from associated companies in the U.S., in the amount of about NIS 99 million, a decrease, in the amount of about NIS 52<br> million, in the tax payments, mainly as a result of transition to the equity method of accounting in CPV Renewable in the corresponding period last year, and a receipt in respect of development fees from the Basin Ranch power plant, in<br> the amount of about NIS 92 million (about $29 million).
(2) Most of the increase derives from deposit of restricted cash designated for construction of the Basin Ranch power plant. For additional details regarding the project – see Section 6B(1) above.
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(3) 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.
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(4) Most of the increase stems from: (A) an increase in the rate of holdings in the Shore Power plant and an additional investment in the Shore power plant in the period of the report as part of a refinancing executed in February 2025;<br> (B) investments in the Basin Ranch power plant; and (C) acquisition of additional rights in the Shore and Maryland power plants, in the corresponding period last year.
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(5) For additional details regarding acquisition of the remaining interest in the Basin Ranch power plant – see Section 6B(1) above.
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(6) For additional details regarding an issuance of shares in the period of the report and in the corresponding period last year – see Note 18B to the financial statements.
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(7) For additional details – see Notes 14 and 15 to the financial statements.
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(8) For additional details regarding a partial early redemption (prepayment) of the debentures (Series B) – see Note 15 to the financial statements.
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(9) The decline stems from a decrease in the investments of the non‑controlling interests in the U.S. and repayment of loans to non‑controlling interests in Israel. For additional details – see Note 23D and 23A(3) to the financial<br> statements.
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(10) The decrease stems mainly from the impact of the sharp decline in the shekel/dollar exchange rate on the balances of the cash and cash equivalents in the period of the report.
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(11) Includes mainly: (A) interest paid, in the amount of about NIS 47 million, and a decrease in the investments of the tax partner, in the amount of about NIS 152 million – this being due to the exit of CPV Renewable from the<br> consolidation in the fourth quarter of 2024; and (B) an increase in receipts due to repayment of partnership capital, in the amount of about NIS 52 million.
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OPC Energy Ltd.

Report of the Board of Directors

9.        Liquidity and sources of financing (Cont.)

Set forth below is an analysis of significant changes in the cash flows in the fourth quarter of 2025 compared with the corresponding period last year (in NIS millions):

(1) Most of the increase in the cash flows provided by operating activities stems from an increase in the cash‑basis income, in the amount of about NIS 83 million, an increase in dividends from associated companies in the U.S., in the<br> amount of about NIS 101 million and, on the other hand, a decrease, in the amount of about NIS 56 million, in the tax payments, mainly as a result of transition to the equity method of accounting for CPV Renewable in the corresponding<br> period last year and a receipt in respect of initiation and development fees from the Basin Ranch power plant, in the amount of about NIS 92 million (about $29 million).
(2) Most of the increase derives from deposit of restricted cash designated for construction of the Basin Ranch power plant. For additional details regarding the project – see Section 6B(1) above.
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(3) Most of the increase stems from an increase in investments in Israel (particularly upgrading and maintenance work performed at the Rotem power plant in the fourth quarter of 2025 and advance payment in respect of main equipment of<br> Hadera 2).
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(4) Most of the decrease stems from acquisition of additional rights in the Shore and Maryland power plants in the corresponding quarter last year and, on the other hand, investments in the Basin Ranch power plant in the fourth quarter of<br> 2025.
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(5) For additional details regarding acquisition of the remaining interest in the Basin Ranch power plant – see Section 6B(1) above.
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(6) For additional details regarding an issuance of shares in the fourth quarter of 2025 – see Note 18B to the financial statements.
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(7) For additional details – see Notes 14 and 15 to the financial statements.
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(8) The decrease derives from a decline in the investments of the non‑controlling interests in the U.S. – see Note 23A(3) to the financial statements.
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(9) The decrease stems mainly from the sharp decline in the shekel/dollar exchange rate on the balances of cash and cash equivalents in the fourth quarter of 2025.
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(10) Includes mainly an increase in receipts from repayment of partnership capital in Fairview as part of the amendment of the financing agreement in the fourth quarter of 2025, and distribution of cash balances to the project’s partners.
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For additional details – see the statements of cash flow in the Company’s consolidated financial statements.

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OPC Energy Ltd.

Report of the Board of Directors

9.        Liquidity and sources of financing (Cont.)

As at December 31, 2025 and December 31, 2024, the Group’s working capital (current assets less current liabilities) amounted to about NIS 2,408 million and about NIS 701 million, respectively.

As at December 31, 2025, there were no warning signs pursuant to Regulation 10(B)(14) of the Securities Regulations (Periodic and Immediate Reports), 1970, that require publication of a forecasted statement of cash flows by the Company.

10.       Debentures (Series B, C and D)

As at the approval date of the report, the Company has three series of debentures it issued (Series B, Series C and Series D). For details regarding the said debentures, including regarding financial covenants and the manner of compliance therewith – see Note 15 to the Financial Statements.

Set forth below are additional details regarding the Company’s debentures (Series B, Series C and Series D):

Name of trustee Reznik Paz Nevo Trustees Ltd.
Name of the party responsible for the series of liability certificates with the trustee Michal Avatlon and/or Hagar Shaul
Contact information Name: Yossi Reznik
Address: 14 Yad Harutzim St., Tel‑Aviv<br><br> <br>Telephone: 03–6389200<br><br> <br>Fax: 03–6389222<br><br> <br>E–mail: Yossi@rpn.co.il
Rating of the debentures since the issuance date In May 2025, Midroog determined an initial rating of A1.il with a stable rating outlook for the Company and its debentures (Series B, C and D). In addition, in May<br> 2025, S&P Maalot raised the Company’s credit rating to ilA+, due to an improvement in the business profile and the financial ratios.
Pledged assets None.<br><br> <br>There is a future commitment that the Company will not create a general current lien on its assets and rights, existing and future, in favor of any third party<br> without the conditions stipulated in the trust certificate being fulfilled.
Is the series material Series B, C and D are material.

As at the date of the report, the Company is in compliance with all the conditions of the Company’s debentures (Series B, Series C and Series D) and the trust certificates. The Company was not required to take any action in accordance with the request of the trustees for the said debentures.

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OPC Energy Ltd.

Report of the Board of Directors

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

Changes in the macro‑economic environment, which are characterized by inflation, changes in the currency exchange rates, particularly the dollar against the shekel and changes in interest rates, could impact the Group’s activities in different ways, including, an impact on the electricity generation component (and as a result an impact on the Company’s natural gas revenues and costs) and other index‑linked revenues, an increase in fixed expenses (including wages), maintenance costs, project construction costs – both in Israel and in the U.S., equipment acquisition costs and financing expenses in respect of loans and debentures the Group companies are liable for that bear variable interest and/or are linked to the CPI. In addition, a change in the interest rate could impact the economic feasibility of projects under construction, the discount rates used for examining value (including impairment of value) of active projects, projects under construction or in the development stage and cash‑generating units to which goodwill was allocated, financing costs in respect of taking out of new debt and the fair value of a liability in respect of a profit‑sharing plan in the CPV Group.

Set forth below is disclosure regarding the main impacts of changes in the currency exchange rates, inflation (Consumer Price Index) and interest rates on the Group’s activities^62^. Taking into account the complexity of an analysis of the impacts of the said factors, particularly since some of them are indirect (and not direct) impacts and the existence of reciprocal relationships between the various macro‑economic parameters, the Company is not able to estimate the impacts of the changes in the said macro‑economic parameters on the Company’s overall results.

Currency (particularly the dollar)

The Group is exposed to changes in the currency exchange rates, particularly the exchange rate of the dollar.

The Company’s activities in Israel are exposed to a change in the exchange rate of the dollar, directly and indirectly, due to the linkage of a significant part of its revenues to the generation tariff (which is impacted, in part, by changes in the exchange rate of the dollar), while on the other hand acquisitions of the natural gas, some of which are linked to the dollar exchange rate and/or are denominated based on the dollar exchange rate, are also linked to the generation tariff (which, as noted is impacted in part by changes in the dollar exchange rate) and include dollar floor prices.

Therefore, the structure of the Company’s activities in Israel includes a partial natural (intrinsic) hedge – even though strengthening of the dollar increases the cost of the natural gas purchased by the Company, the structure of the revenues should reduce the said exposure. Nonetheless, it is pointed out that the generation component, which is impacted by various parameters and is subject to changes (including by force of regulation) is updated, generally, once a year (in 2026–2028 once every six months in accordance with a predetermined linkage mechanism), and accordingly differences are possible, including timing differences, between the impact of a strengthening of the rate of the dollar on the current gas cost and its impact on the revenues and, in turn, on Company’s gross margin for that period. Timing differences, as stated, could have a negative effect on the Company’s current profit and cash flows – at least in the short run.

^62^ The disclosure stated in this Section below is based on the Company’s estimates in accordance with assumptions and analyses made as at the date of the report only. Ultimately, the impacts of macro‑economic events could be different than that stated, as a result of, among other things, the type and scope of the macro‑economic events, the impact thereof on third parties related to the Company and/or changes in the relevant regulatory policies. In addition, the Company’s estimates regarding the impacts of the said factors on its results might not materialize, in whole or in part, as a result of, among other things, regulatory policies, market conditions, operating factors and changes in the Company’s undertakings and/or due to one or more of the risk factors the Company is exposed to, as stated in Section 19 of Part A of the Periodic Report.

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Report of the Board of Directors

11. Impacts of changes in the macro‑economic environment on the Group’s activities and its results (Cont.)

Currency (particularly the dollar) (Cont.)

It is noted that where the gas price is equal to or lower than the floor price, the Company is exposed to a larger extent to changes in the dollar/shekel exchange rate and to reductions in the generation component since the natural (built‑in) protection, as stated above, is fully or partly compromised, and that stated could have a negative impact on the Company’s profits.

In addition, from time to time the Company signs significant construction and maintenance contracts that are denominated in different currencies, particularly the dollar and the euro.

It is noted that from time to time, and based on business considerations and risk‑management policies, the Company makes use of forward contracts on the exchange rates for hedging part of the currency exposures as detailed above.

With reference to the Company’s investment in the CPV Group, which operates in the U.S. with a dollar functional currency, in general a weakening of the dollar rate has a negative impact on the (dollar) value of the Company’s investment and on the Company’s net income and shareholders’ equity, due to translation of the results of the CPV Group from dollars into shekels (which is the operational currency of the Company). On the other hand, from time to time there could be a need to raise financing in Israel in shekels in order to finance the activities of the CPV Group, particularly for the benefit of expected investments in the backlog of construction and pipeline projects of the CPV Group. Accordingly, a strengthening of the dollar exchange rate could lead to an increase in the financing requirements in order to realize these needs.

Set forth below is data with reference to the currency exchange rate:

Dollar/shekel exchange rate* 2025 2024 Change
On December 31 3.190 3.647 (12.5 )%
On September 30 3.306 3.710 (10.9 )%
Average January – December 3.453 3.699 (6.7 )%
Average October – December 3.249 3.692 (12.0 )%
* The dollar/shekel exchange rate shortly before the approval date of the report (on March 9, 2026) is 3.115.
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Consumer Price Index (CPI) (inflation)

The Group is exposed to changes in the CPI. Regarding its activities in Israel, the Company is exposed to changes in the CPI, directly and indirectly, mainly due to linkage of a significant part of its revenues to the generation component (which is impacted partly by a change in the CPI), and due to the fact that most of its capacity revenues are linked to the CPI. On the other hand, purchases of the natural gas are partly linked to the generation tariff. Also, part of the Company’s capital costs and investments and part^63^ of the Hadera financing agreement are linked to the CPI, directly or indirectly. Furthermore, the Company is exposed to changes in the CPI with respect to the terms of the Company’s debentures (Series B). An increase in the CPI increases the Company’s liabilities and financing costs.

^63^ In order to reduce part of the exposure to changes in the CPI relating to the Hadera financing agreement, in June 2019 the Group entered into transactions with a bank to hedge part of the exposure to the CPI.

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OPC Energy Ltd.

Report of the Board of Directors

11. Impacts of changes in the macro‑economic environment on the Group’s activities and its results (Cont.)

Consumer Price Index (CPI) (inflation) (Cont.)

Therefore, the structure of the Company’s activities includes a partial natural (intrinsic) hedge – despite the fact that an increase in the CPI increases the Company’s costs (including the financing costs) and investments, the structure of the revenues should reduce the said exposure, such that the Company’s profits could be positively affected by an increase in the CPI. Nonetheless, it is noted that the generation component is impacted by various parameters and is subject to changes (including by force of regulation), generally, once a year (in 2026–2028 once every six months in accordance with a predetermined linkage mechanism), and, accordingly, differences are possible between the impact of inflation of the Company’s costs and its impact of the revenues and, accordingly, on the Company’s gross margin for that period.

Interest rate (mainly shekel and dollar)

The Group has loans and liabilities bearing variable interest that are based on prime or SOFR plus a margin. An increase in the variable interest rates could cause an increase in the Group’s financing costs. In addition, an increase in the interest rates could trigger an increase in the financing costs in respect of new debt taken out by the Group (for purposes of refinancing and/or growth). Furthermore, an increase in the interest rates could impact the discount rates for projects (active, under construction and in development) and could also lead to a lack of economic feasibility of continued development and/or acquisition of projects and a slowdown in the Company’s growth processes, along with changes in the fair value of assets, particularly the existence of signs of impairment of value of assets and/or recording of impairment losses in the financial statements.

In order to reduce the exposure to changes in the interest rates in Israel, the Group makes use of a mix of loans (including credit frameworks) and debentures in such a manner that part of the loans and the debentures bear fixed interest and part of them bear variable interest.

In the CPV Group, most of the long‑term loans and credit frameworks bear variable interest (mainly SOFR) and have exposure to changes in the interest rates. In order to reduce part of the exposure to interest risk, the CPV Group enters into transactions for swaps of variable dollar interest for fixed dollar interest (IRS) with respect to a significant part of the balances of its long‑term loans. In addition, due to the project financing conditions of the associated companies (cash sweep mechanisms), there is a significant decline in the scope of the debt in the Energy Transition segment and, accordingly, in the exposure of the CPV Group to an increase in the interest rate of the time of refinancing.

Set forth below are details regarding changes in the interest in the period of the report and thereafter:

In Israel, in November 2025, Bank of Israel decided to lower the interest by 0.25% and to set it at 4.25%. In January 2026, Bank of Israel decided to make another interest rate reduction of 0.25% and to set it at 4.00%. Pursuant to the latest forecast published by Bank of Israel, the interest rate is expected to decline to an average of 3.50% in the fourth quarter of 2026.

In the U.S., in September, October and December 2025, the U.S. Federal Reserve Bank decided to lower the interest by 0.25% (in each decision) to the level of 3.50%–3.75%, where this rate prevailed as at the date of the report. Pursuant to the latest projection published by the U.S. Federal Reserve Bank, the interest rate is expected to decline to an average in the range of 2.9%–3.6% during 2026.

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Report of the Board of Directors

11. Impacts of changes in the macro‑economic environment on the Group’s activities and its results (Cont.)

Interest rate (mainly shekel and dollar) (Cont.)

It is noted that the changes and the geopolitical tensions in and outside of Israel also have an impact on the macro‑economic environment, including on Bank of Israel’s policy decisions (among other things with respect to the circumstances of the war), as detailed in Section B2. above, and events of this type could have an impact on inflationary aspects and interest rates.

Set forth below is data relating to the Consumer Price Index (CPI) in Israel and in the U.S., interest rates of Bank of Israel and interest rates of the U.S. Federal Reserve Bank:

Bank of
Israel Federal
Israeli U.S. Interest interest
CPI CPI Rate rate
On March 9, 2026 117.5 325.2 4.00 % 3.50%–3.75 %
On December 31, 2025 117.3 324.1 4.25 % 3.50%–3.75 %
On September 30, 2025 118.5 324.0 4.5 % 4.00%–4.25 %
On December 31, 2024 115.1 315.5 4.5 % 4.25%–4.50 %
On September 30, 2024 115.2 314.8 4.5 % 4.75%–5.00 %
On December 31, 2023 111.3 307.1 4.75 % 5.25%–5.50 %
Change in 2025 1.9 % 2.7 % (0.25 )% (0.75 )%
Change in 2024 3.4 % 2.7 % (0.25 )% (1.0 )%
Change in the fourth quarter of 2025 (1.0 )% 0 % (0.25 )% (0.50 )%
Change in the fourth quarter of 2024 (0.1 )% 0.2 % 0 % (0.50 )%

For details with respect to credit linked to the CPI or the prime interest rate – see this Section below and Note 14B to the financial statements.

For additional details regarding the Group’s policies for management of the financial risks and sensitivity analyses, including changes in the CPI and interest – see Note 21 to the financial statements.

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Report of the Board of Directors

11. Impacts of changes in the macro‑economic environment on the Group’s activities and its results (Cont.)

Interest and linkage bases

Set forth below are tables detailing the adjusted financial debt as at December 31, 2025 and 2024 (in millions of NIS) in Israel broken down into debt bearing unlinked fixed interest / fixed debt, debt bearing fixed interest linked to the CPI and debt bearing prime interest:

As at<br><br> <br>December 31, 2025 Total<br><br> <br>debt Debt bearing<br><br> <br>unlinked<br><br> <br>fixed interest/<br><br> <br>fixed debt Debt bearing<br><br> <br>fixed interest<br><br> <br>linked to the CPI Debt bearing<br><br> <br>prime interest Weighted-<br><br> <br>average<br><br> <br>interest as of<br><br> <br>December 31<br><br> <br>2025
Total Interest Total Interest Total Interest
The Company (debentures) 1,889 1,364 4.4 % 525 2.8 % – – 3.9 %
OPC Israel (bank) 2,300 – – – – 2,300 6.25%–6.4 % 6.25%–6.4 %
Hadera (bank) 548 459 5.3 % 89 3.5 % – – 4.9 %
As at<br><br> <br>December 31, 2024 Total<br><br> <br>debt Debt bearing<br><br> <br>unlinked<br><br> <br>fixed interest/<br><br> <br>fixed debt Debt bearing<br><br> <br>fixed interest<br><br> <br>linked to the CPI Debt bearing<br><br> <br>prime interest Weighted-<br><br> <br>average<br><br> <br>interest as of<br><br> <br>December 31<br><br> <br>2024
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Total Interest Total Interest Total Interest
The Company (debentures) 1,891 969 3.3 % 922 2.8 % – – 3.0 %
OPC Israel (bank) 1,649 – – – – 1,649 6.3%–6.4 % 6.3%–6.4 %
Hadera (bank) 585 484 5.3 % 101 3.5 % – – 4.9 %

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OPC Energy Ltd.

Report of the Board of Directors

11. Impacts of changes in the macro‑economic environment on the Group’s activities and its results (Cont.)

Interest and linkage bases (Cont.)

Set forth below are tables detailing the adjusted financial debt as at December 31, 2025 and 2024 (in millions of NIS) in Israel broken down into debt bearing fixed interest and debt bearing SOFR interest. The debt includes the net financial debt of the associated companies in the U.S. based on the rate of holdings of the CPV Group in these companies:

As at<br><br> <br>December 31, 2025 Rate of<br><br> <br>holdings<br><br> <br>of the<br><br> <br>CPV<br><br> <br>Group Total<br><br> <br>debt Interest<br><br> <br>margin<br><br> <br>on<br><br> <br>long-<br><br> <br>term<br><br> <br>loans Fixed debt Debt bearing<br><br> <br>SOFR interest Weighted-<br><br> <br>average<br><br> <br>interest as at<br><br> <br>December 31<br><br> <br>2025
Total Interest Total Interest
Active renewable energy 1.24 %
projects 66.7 % 502 2.85 % 333 5.1 % 169 5.9 % 5.3 %
Financing of construction of 1.50 %
Rogues Wind 66.7 % 249 1.75 % 202 5.0 % 47 5.6 % 5.1 %
Fairview* 25 % 539 2.50 % 269 6.0 % 270 6.4 % 6.2 %
Towantic 26 % 179 3.75 % 129 8.0 % 50 7.7 % 7.9 %
Maryland 75 % 625 3.25 % 385 5.1 % 240 6.9 % 5.8 %
Shore 89 % 821 3.75 % 417 7.8 % 404 7.8 % 7.8 %
Valley* 50 % 459 5.50 % – – 459 9.8 % 9.8 %
Three Rivers 10 % 202 3.75 % 173 4.7 % 29 7.9 % 5.2 %
Basin Ranch 70 % 421 – 421 3.0 % – – 3.0 %
CPV Group 100 % 489 3.08 % – – 489 7.1 % 7.1 %
(*) For details regarding an undertaking in a new financing agreement after the date of the report, including reduction of the interest margin on the loan to 2.75% – see Section 7A(6) above.
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As at<br><br> <br>December 31, 2024 Rate of<br><br> <br>holdings<br><br> <br>of the<br><br> <br>CPV<br><br> <br>Group Total<br><br> <br>debt Interest<br><br> <br>margin<br><br> <br>on<br><br> <br>long-<br><br> <br>term<br><br> <br>loans Fixed debt Debt bearing<br><br> <br>SOFR interest Weighted-<br><br> <br>average<br><br> <br>interest as at<br><br> <br>December 31<br><br> <br>2024
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Total Interest Total Interest
Active renewable energy 1.13 %
projects 66.7 % 322 1.73 % 238 3.5 % 84 6.0 % 4.2 %
Financing of construction of 2.10 %
renewable energy projects 66.7 % 425 2.85 % 178 6.9 % 247 6.2 % 6.5 %
Fairview 25 % 481 3.50 % 243 7.2 % 238 8.1 % 7.6 %
Towantic 26 % 213 3.75 % 156 8.0 % 57 8.4 % 8.1 %
Maryland 75 % 893 3.75 % 497 5.6 % 396 7.9 % 6.6 %
Shore 69 % 1,096 3.75 % 803 4.1 % 293 8.4 % 5.2 %
Valley 50 % 687 5.50 % – – 687 10.4 % 10.4 %
Three Rivers 10 % 252 3.75 % 212 4.6 % 40 8.4 % 5.2 %

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OPC Energy Ltd.

Report of the Board of Directors

12. Material Valuations

Annual examination of impairment of value of goodwill created in respect of acquisition of the Gat power plant

Further to that stated in Note 11 to the financial statements regarding the balance of the goodwill created in respect of acquisition of the Gat power plant and an annual examination of impairment of value, as at the date of the report the Company performed a valuation for determination of the recoverable amount of the cash generating unit included in the Rotem, Hadera and Gat power plants (“the Cash Generating Units”) for purposes of an annual impairment of value of the goodwill examination (“the Valuation”). The Valuation was performed at the level of the Cash Generating Unit since this is the lowest level at which the goodwill is monitored for internal management purposes.

Details of the valuation:

Subject matter of the Valuation Determination of the recoverable amount of the Cash Generating Units for purposes of an annual impairment of value of goodwill examination in<br> accordance with the provisions of IAS 36.
Date of the Valuation Effective date of the valuation: December 31, 2025.<br><br> <br>Approval date of the valuation: March 11, 2026.
Book value attributed to a Cash‑Generating Unit as at the date of the Valuation Total of the Cash‑Generating Unit – about NIS 2.7 billion.
Recoverable amount of the Rotem power plant as determined pursuant to the Valuation Only the Rotem power plant– about NIS 4.9 billion.<br><br> <br>The recoverable amount of the Rotem power plant alone exceeds the book value of the entire Cash‑Generating Unit and, therefore, it is not<br> necessary to recognize a loss from impairment of value in the Company’s books.
Identity of the appraiser and its characteristics The valuation was performed by the Company.
Valuation model The recoverable amount of the cash generating unit was determined as follows: for the Rotem power plant only based on the value in use using the<br> DCF (discounting of cash flows) method.
The assumptions based on which the appraiser performed the Valuation Set forth below are the main assumptions that were used in determination of the use value of the Rotem power plant:
– Forecast years – represent the period between 2026 and 2043, and are based on an estimate of the economic life of the power plant and its value at the end of the forecast period.
– Forecast of the generation component and natural gas prices that are not backed by an agreement – based on market forecasts received from external independent information sources.
– Long-term annual inflation rate of 2.2%.
– Weighted‑average cost of capital (WACC) – 7% which was determined by an external, independent appraiser.

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OPC Energy Ltd.

Report of the Board of Directors

12. Material Valuations (Cont.)

Annual examination of impairment of value of goodwill created in respect of acquisition of the Gat power plant (Cont.)

Details of the valuation: (Cont.)

Sensitivity analysis for changes in the main parameters An increase of 1% in the WACC (about NIS 490 million).<br><br> <br>A decrease of 5% in the generation component tariff (about NIS 395 million).
Examination of attachment of the valuation Notwithstanding that the valuation meets the quantitative thresholds for “Very Significant Valuations”, as determined in the Position of the<br> Securities Authority 105‑23 “Parameters for Examination of the Significance of the Valuation”, since here a periodic examination of impairment of value of goodwill is involved without there having been signs of impairment, and in the<br> Company’s estimation, based on sensitivity analyses performed by it, as at the date of the report, whereby every possible reasonable change in the key assumptions used in determination of the recoverable amount of the cash‑generating unit<br> would not lead to recognition of a significant loss from impairment of value, instead of attaching the Valuation it is permissible to disclose the Valuation as a “Significant Valuation” pursuant to Regulation 8(I) of the Securities<br> Regulations (Periodic and Immediate Reports), 1970^64^.

^64^ After an examination, as stated, in accordance with that stated in Section 3 of the Clarification to a Legal Position No. 23‑105 “Parameters for Examination of the Significance of Valuations: Questions and Answers”.

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OPC Energy Ltd.

Report of the Board of Directors

12. Material Valuations (Cont.)

Discontinuance of consolidation of the renewable energies segment in the U.S. and transition to the equity method of accounting

Further to that stated in Note 23 to the financial statements regarding a transaction involving entry of an investor into CPV Renewable Power LP (“CPV Renewable”), discontinuance of consolidation in the Company’s financial statements and transition to application of the equity method of accounting, as at the completion date of the transaction, in November 2024, an initial valuation was performed to determine the fair value of the assets and liabilities of CPV Renewable, by means of an independent, external appraiser (EY). The valuation was finished in the fourth quarter of 2025, without there having been a significant impact on the financial statements.

Details of the valuation:

Subject matter of the Valuation Allocation of the fair value of the investment in CPV Renewable on the date of the transition from consolidation to significant influence to the<br> share of the CPV Group in the identifiable assets and liabilities of CPV Renewable.
Date of the Valuation Effective date of the valuation: October 31, 2024.<br><br> <br>Approval date of the valuation: March 8, 2026.
Value of the identifiable assets and liabilities and the amount of the goodwill as at the date of the<br> valuation The fair value of CPV Renewable amounts to about NIS 3.4 billion (about $892 million), the share of the CPV Group (66.7%) amounts to about NIS 2.2<br> billion (about $595 million).
Identity of the appraiser and its characteristics The valuation was performed by a team headed by Mr. Guy Feibish, CPA, partner in the area of valuations and economic models (VME) of the<br> international firm of Certified Public Accountants EY (Ernst & Young).<br><br> <br><br><br> <br>Mr. Feibish is a Certified Public Accountant (CPA) in Israel and holds a bachelor’s degree (BA) in economics with specialization in accounting<br> from Ben‑Gurion University in the South, Beer Sheva.<br><br> <br><br><br> <br>As part of his position, Mr. Feibish runs projects for leading public and private companies in their areas of activities – in and outside of<br> Israel, and accompanies domestic and foreign transactions, directs complicated valuations having a range of targets, including financial reporting, taxation, regulatory compliance and raising of capital, in a variety of sectors,<br> including, real estate, retail, industry, energy and communications. In addition, as part of his position, Mr. Feibish accompanies companies in planning and assimilation of business strategy and processes. Also, Mr. Feibish has experience<br> in issuance of economic opinions for purposes of legal proceedings and/or commercial disputes.

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OPC Energy Ltd.

Report of the Board of Directors

12.      Material Valuations (Cont.)

Discontinuance of consolidation of the renewable energies segment in the U.S. and transition to the equity method of accounting (Cont.)

Valuation model The fair value of the projects was estimated using the following methodology:<br><br> <br>A.  With reference to projects in commercial operation or under construction – using the DFC (discounted cash flows) method by discounting the<br> future cash flows of each project, at the after‑tax weighted‑average cost of capital (WACC).<br><br> <br>B.   With reference to the projects in interim and advanced development stages – based on an estimate of the fair value per kilowatt and the<br> probability rates with respect to realization depending on the stage of the development.<br><br> <br>C.   With reference to pipeline projects in initial development stage – based on cost.
Assumptions according to which the appraiser performed the valuation Set forth below are the main assumptions used in determination of the fair value of the projects:
– The weighted‑average cost of capital (WACC) – was calculated for each significant active and under construction project separately and ranged between about 6.25% and about 7%.
– Market prices and capacity – the market prices (electricity, capacity, RECs, etc.) are based on PPA agreements and market forecasts received from external and independent information<br> sources, taking into account the relevant area (region) and market for each project as well as the relevant regulation.
– Forecast years – represent the period between 2024 and 2054, and are based on an estimate of the economic life of the power plants and their value at the end of the forecast period.
– Estimate of the construction cost of the projects and the entitlement to tax benefits in respect of projects under construction (ITC or PTC, as applicable).
– A long‑term rate of inflation of 2.2%.

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Report of the Board of Directors

Corporate Governance

13.      Directors having Accounting and Financial Expertise

As at the date of this report, seven of the members of the Company’s Board of Directors have accounting and financial expertise. For details regarding the directors Aviad Kaufman, Antoin Bonaire, Robert Rosen, Yosef Tene, Sarit Sagiv, Shirly Mashkif and Itay Makov who were classified as directors with accounting and financial expertise – see Regulation 26 of Chapter D (Additional Details regarding the Company).

The Board of Directors determined that the minimum number of directors having accounting and financial expertise in accordance with Section 92(A)(12) of the Companies Law, 1999, is two – this being taking into account the type of the Company, its size, the scope of its activities and the complexity of its activities.

14.      Independent Directors

In addition to the external directors Yosef Tene and Shirly Mashkif, the directors Sarit Sagiv and Itay Makov, serve as independent directors of the Company.

As at the date of the report, the Company’s Articles of Association do not include a provision regarding the required proportion of the independent directors.

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Report of the Board of Directors

15.      Internal Auditor

Name of the Internal Auditor Mr. Eyal Baasch (“the Internal Auditor”).
Education and professional experience Certified Internal Auditor (C.I.A.); Certified Risk Management Auditor (CRMA).<br><br> <br>Bachelor’s degree in Social Sciences (Extended Economics) – Hebrew University in Jerusalem; Master’s degree in Business Administration (MBA) (specialization in<br> accounting and finance) from the College of Management.<br><br> <br>Since 2012 he is a partner in the area of risk management and economics in the Office of Rosenbloom – Holzman, CPAs. Possesses extensive professional experience in<br> the area of internal auditing.
Start date of service August 13, 2024.
Compliance with legal requirements To the best of the Company’s knowledge, according to the declaration of the Internal Auditor, the Internal Auditor meet the requirements of Section 146(B) of the<br> Companies Law and the provisions of Section 8 of the Internal Audit Law, 1992 (“the Internal Audit Law”).
Employment format The Internal Auditor provides the Company internal audit services and he is not an employee of the Company in a full‑time position. In addition, he does not hold an<br> additional position in the Company aside from his service as the Internal Auditor.
Manner of appointment The appointment of the Internal Auditor was approved by the Board of Directors on August 13, 2024, after a recommendation of the Audit Committee on August 11, 2024.<br><br> <br>The Company’s Audit Committee and Board of Directors examined his qualifications, education and experience in internal auditing.
The party to whom the Internal Auditor reports The Chairman of the Board of Directors.
Other relationships the Internal Auditor has with the Company To the best of the Company’s knowledge, the Internal Auditor does not hold securities of the Company.<br><br> <br>The Internal Auditor is not an interested party in the Company or a relative of an interested party in the Company and is not a relative of the auditing CPA or a<br> party on its behalf.

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Report of the Board of Directors

15.      Internal Auditor (Cont.)

The work plan The audit work plan for 2025, which was approved by the Audit Committee, is for one year. The work plan of the Company and<br> its subsidiaries was determined based on, among others, the following considerations: coverage of the Company’s main areas of activity, risk centers and exposures known to the Internal Auditor and to management; a risks’ survey for<br> purposes of the internal audit work that was performed by the Internal Auditor, potential for savings and efficiency; recurring items and monitoring correction of deficiencies; and implementation of recommendations.<br><br> <br><br><br> <br>The audit work plan is submitted for analysis and approval by the Company’s Audit Committee and Board of Directors. The<br> Internal Auditor has discretion to recommend a variance from the work plan to management and the Audit Committee, where necessary.<br><br> <br><br><br> <br>Audit reports were submitted to the Audit Committee and management. The Company’s Board of Directors received an update<br> regarding the audit reports.<br><br> <br><br><br> <br>Meetings of the Audit Committee were held to discuss the audit reports on the following dates: August 10, 2025;<br> November 16, 2025; December 30, 2025 and March 9, 2026.<br><br> <br><br><br> <br>During 2025, the Internal Auditor performed audits of the CPV Group, this being in place of monitoring the existence and<br> appropriateness of the work of the party providing internal audit services in the CPV Group as was done up to 2024 (inclusive). The audit plan, including with respect to the CPV Group, is submitted to the Board of Directors of the CPV<br> Group and to the Company’s Audit Committee and is reported to the Company’s Board of Directors. During the period of the report, no material transactions (as defined in the Fourth Addendum to the Reporting Regulations) were examined.<br><br> <br><br><br> <br>In the estimation of the Board of Directors, the scope, nature and continuity of the activities of the Internal Auditor and<br> the internal audit work plan are reasonable under the circumstances of the manner, and they are sufficient to achieve the Company’s internal audit goals.

93

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Report of the Board of Directors

15.      Internal Auditor (Cont.)

Performance of the audit and the professional standards Based on information provided to the Company, performance of the internal audit is made in accordance with the generally<br> accepted professional standards in and outside of Israel and in accordance with Section 4(B) of the Internal Audit Law.<br><br> <br><br><br> <br>The Board of Directors relied on the confirmations of the Internal Auditor regarding his compliance with the requirements<br> of the said generally accepted professional standards. In addition, the audit reports are submitted in writing and are discussed at the meetings of the Audit Committee, where as part of the discussion the Internal Auditor reports with<br> respect to the manner of his performance, the policies and procedures applied and the findings. The Board of Directors is satisfied, based on the reports of the Internal Auditor, that the internal audit is in compliance with all the<br> requirements provided in the said standards.
Access to information The Internal Auditor had free access to information, as stated in Section 9 of the Internal Audit Law, including constant<br> and direct access to the Company’s information systems, including financial data.
Remuneration The remuneration of the Internal Auditor in respect of services provided in 2025 amounted to about NIS 271 thousand, this<br> being based on a work scope of 1,085 audit hours (including 400 work hours in respect of the CPV Group).
Set forth below is detail regarding the scope of the investments made, distinguishing between hours invested in internal<br> auditing with respect to the Company and the investee companies:
The<br><br> <br>Company<br> <br>* * * Investee<br><br> <br>companies<br><br> <br>in Israel<br> <br>* * * CPV*<br> <br>* * * Total<br> <br>* * *
235 450 400 1,085
*  As stated, in 2025 an audit plan was implemented in the CPV Group by the Internal Auditor, in such a manner that rendered<br> superfluous the activities of the provider of external internal audit services in the CPV Group.<br><br> <br><br><br> <br>In the opinion of the Board of Directors, the remuneration for the internal audit is reasonable and does not impact or<br> adversely affect use of his professional judgment in performance of the audit.<br><br> <br><br><br> <br>The remuneration of the Internal Auditor is a function of the total number of work hours as provided in the annual work<br> plan that is approved by the Company’s Audit Committee and Board of Directors.

94

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OPC Energy Ltd.

Report of the Board of Directors

16. Details regarding the auditing CPAs
16.1 The Company’s auditing CPAs are KPMG Somekh Chaikin (“the Auditor”).
--- ---
16.2 The fee is determined in negotiations between the Company’s management and the Auditor, based on the scope of the work, nature of the work, past experience and market conditions and is approved by the Company’s Board of Directors after<br> the Balance Sheet Committee has examined the scope of its work and his fee and has submitted its recommendations to the Board of Directors. The fee is in respect of an audit and review of three quarterly reviewed reports and one audited<br> annual report. In addition, the fee includes tax services in connection with preparation of the Company’s annual tax report.
--- ---
16.3 Set forth below is the Auditor’s fee (in NIS millions):
--- ---
For the Year Ended December 31
--- --- --- --- --- --- --- ---
2025 2024
Audit services (1) Other services (2) Audit services (1) Other services (2)
7.3 0.9 12.1 0.8
^(1)^ Audit services including<br> services related to the audit and tax services related to the audit. Of the said amount for 2025 and 2024, the amounts of about NIS 5 million and about NIS 10 million, respectively, are in respect of audits of CPV. The decrease in fees is mainly due to the deconsolidation of the renewable energy segment as of November 2024 and the transition to the equity method of<br> accounting. The fees of the auditing CPAs, as stated, were determined in accordance with negotiations carried on by the management of the CPV Group and were approved by CPV’s competent organs.
--- ---
^(2)^ Other services include mainly tax consulting services in Israel. It is noted that most of the tax services in the U.S. are not provided by the Auditor.
--- ---

95

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Report of the Board of Directors

17. Contributions policy

In addition to the Company’s regular contributions’ policy as stated below, upon the outbreak of the “Rising Lion” operation, the Company’s Board of Directors approved an increase in the contributions’ budget of about NIS 2 million, for recipients relating to restoration and support due to events relating to the war. In this framework, the Company contributed NIS 1 million for restoration of the Soroka Medical Center in Beer Sheva^65^.

The Company has a policy for making contributions that places emphasis on activities in the periphery and non-profit organizations that operate in the field of education. The Group’s expenses in respect of contributions in the year of the report amounted to about NIS 3 million (including the contribution to Soroka as stated above).

Set forth below is detail of contributions in the year of the report of more than NIS 50 thousand and indication of the relationship to the recipient of the contribution (in NIS thousands):

Recipient of the Amount of the Relationship to the
Contribution Contribution Recipient of the Contribution
“Password for Every Student” Society 1,000 “Password for Every Student” also receives contributions from parties related to the Company’s controlling shareholder,<br> including corporations in which officers serving as directors of the Company hold positions (including from the Israel Corporation Group and its controlling shareholders). The Company’s CEO is a representative of the project’s Steering<br> Committee without compensation.
“Rahashei Lev” Society 150 It is noted that as the Company was informed, commencing from November 2022, the daughter of Mr. Yosef Tena, an external director of the Company, is employed by the<br> Tel‑Aviv Medical Center in the name of Sorosky.
Droma Tzafona Tikum Olam Ltd. 100 It is noted that the Company’s CEO serves as a director of the public benefit company.
“Running to Give” Society 50 It is noted that a relative of the Company’s CEO serves as Chairman of the Society without compensation.
Yair Caspi Giora Almogy
--- ---
Chairman of the Board of Directors CEO

Date: March 11, 2026

^65^ The Company was informed that parties related directly or indirectly to the Company’s controlling shareholder also contributed (as well as other parties in the economy) to restoration of the Soroka Hospital. Increase of the contributions’ budget, including making of the above‑mentioned contributions, was approved by the Company’s Board of Directors after approval of the Contributions Committee (the members of which are members of the Audit Committee).

96

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Report of the Board of Directors

Appendix A

Additional Information regarding the Natural‑Gas Power Plants in the U.S.

EOX Forecast of Natural Gas and Electricity Prices for the Years 2026–2028

As additional background with respect to the activities of the Energy Transition Segment in the U.S. and in order to assist regarding accessibility to additional available external data, presented below are forecasts of electricity and natural gas prices (Mid-Market) in the regions in which the power plants of the CPV Group in the Energy Transition segment in the U.S. operate, and in the region of the planned activities of the Basin Ranch power plant, which is under construction, which were prepared by the EOX Company^66^ and it is based on future market prices of electricity and natural gas.

The data in the tables below reflect forecasts of the electricity and natural gas prices as received from EOX, where with reference to the forecast of the electricity prices the information was processed by the CPV Group in the following manner:

– 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.
--- ---

The electricity margin appearing in the table below is calculated based on the following formula:

Electricity margin ($/MWh) = the electricity price ($/MWh) – [the gas price ($/MMBTU) X the thermal conversion ratio* (heat rate) (MMBtu/MWh)]

* Assumption of a thermal conversion ratio (heat rate) of 6.9 MMBtu/MWh for Maryland, Shore and Valley, and a thermal conversion ratio (heat rate) of 6.5 MMBtu/MWh for Three Rivers, Towantic, Fairview and Basin Ranch.

It should be noted that there may be material differences between the actual electricity and natural gas prices at CPV Group’s power plants and the prices presented in the table below, due, among other things, to the existence of bid–ask spreads, power basis, and the like. Accordingly, the actual electricity margins of CPV Group’s power plants may differ materially from the margins presented in the table below.

The data included in this Appendix below is based on forecasts of electricity and gas prices made by EOX – a market consulting company that provides information and data services in the area of the Company’s activities in the U.S. in the Energy Transition segment, and it is presented as additional background and in order to assist accessibility to available external data regarding the area of activities. It is clarified and emphasized that in light of the fact these are market forecasts, quite naturally the Company is not able to make (and did not make) an independent examination of the forecasts or the underlying data. It is clarified that there are additional entities that provide similar information services that might provide forecasts that differ from these prices. The Company does not undertake to update data as stated.

In addition, it is emphasized that forecasts are involved regarding which there is no certainty with respect to the accuracy or actual viability thereof. The electricity and natural gas prices (in the market, in general, and of the power plants of the CPV Group, in particular) might be different, even significantly, from that presented as a result of various factors, including, macro‑economic factors, regulatory changes, political and/or geopolitical events (including global events) that impact the supply and demand of natural gas and electricity, weather events, events relating to the electricity sector in the U.S. (demand, supply, availability of power plants, operational events, proper functioning of the electricity grid, transmission infrastructures) and/or failures in (problems with) the assumptions and estimates that form the basis of the forecast.

^66^ EOX is a subsidiary of a commodity broker, OTC Global Holdings, which publishes forward prices for the electricity and natural gas markets based on trading data in the futures markets. The futures prices are an objective way of estimating the future expectation with respect to electricity and natural gas prices since they represent transactions with entities operating in these markets involving buying and selling futures contracts at specific prices.

97

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Report of the Board of Directors

Appendix A (Cont.)

Appendix A

Additional Information regarding the Natural‑Gas Power Plants in the U.S.

EOX Forecast of Natural Gas and Electricity Prices for the Years 2026–2028

Power Plant 2026 2027 2028
Fairview
Gas price (Texas Eastern M3) 3.71 4.05 3.97
Electricity price (AEP Dayton (AD)) 51.53 55.80 54.80
Electricity margin 27.40 29.45 28.98
Towantic
Gas price (Algonquin City Gate) 6.15 6.03 5.66
Electricity price (Mass Hub) 73.34 70.35 64.69
Electricity margin 33.39 31.14 27.93
Maryland
Gas price (Transco Zone 5) 4.62 4.72 4.45
Electricity price (PJM West Hub) 60.71 65.03 63.66
Electricity margin 28.85 32.47 32.94
Shore
Gas price (Texas Eastern M3) 3.71 4.05 3.97
Electricity price (PJM West Hub) 60.71 65.03 63.66
Electricity margin 35.09 37.06 36.26
Valley
Gas price (Texas Eastern M3 – 70%, Dominion South Pt – 30%) 3.46 3.75 3.65
Electricity price (New York Zone G) 69.35 69.18 63.79
Electricity margin 45.45 43.32 38.64
Three Rivers
Gas price (Chicago City Gate) 3.51 3.79 3.65
Electricity price (PJM ComEd) 44.96 48.50 47.35
Electricity margin 22.16 23.85 23.60
Basin Ranch (under construction)
Gas price (Waha) 1.01 3.00 2.95
Electricity price (ERCOT West Pk) 54.14 60.56 61.59
Electricity margin 47.56 41.06 42.41

98

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Report of the Board of Directors

Set forth below is gross (raw) data as included in the forecast of EOX (without processing)

East NY ZnG OPk East NY ZnG Pk PJM<br><br> ComEd<br><br> OPk PJM<br><br> ComEd Pk AEP-<br><br> Dayton<br><br> OPk AEP-<br><br> Dayton Pk PJM West<br><br> OPk PJM West<br><br> Pk Contract Date
112.11 128.56 37.23 51.78 49.99 60.90 67.66 83.64 01/01/2026
--- --- --- --- --- --- --- --- ---
95.01 107.49 33.83 45.25 44.74 53.09 54.07 65.52 01/02/2026
54.40 64.02 27.73 35.48 40.89 46.49 44.82 51.94 01/03/2026
44.45 49.96 22.55 36.74 40.38 48.72 42.87 53.37 01/04/2026
39.12 50.89 24.24 42.10 34.35 50.75 35.89 55.19 01/05/2026
41.72 63.93 28.90 53.42 34.99 58.37 36.78 62.98 01/06/2026
61.51 91.94 42.15 80.31 46.72 80.92 48.37 91.96 01/07/2026
50.30 76.60 35.52 64.19 39.09 69.07 40.95 78.03 01/08/2026
38.07 52.17 30.38 51.72 36.46 56.49 37.97 60.66 01/09/2026
42.24 51.22 29.71 45.79 42.69 54.76 45.49 58.59 01/10/2026
56.42 64.28 27.36 47.17 43.74 55.89 46.20 59.99 01/11/2026
82.85 95.63 39.60 53.77 54.15 63.90 59.12 71.52 01/12/2026
117.94 128.91 58.46 71.22 69.80 80.94 82.43 95.63 01/01/2027
92.61 113.13 46.04 58.47 58.27 68.94 69.99 83.06 01/02/2027
57.80 67.48 26.60 40.57 44.43 51.77 48.07 58.10 01/03/2027
44.86 51.32 26.67 40.10 41.52 51.31 43.98 56.63 01/04/2027
40.39 49.49 23.49 40.99 34.83 51.77 36.84 57.39 01/05/2027
40.21 59.80 24.26 54.17 35.35 60.79 36.71 65.57 01/06/2027
53.93 95.17 36.98 83.90 45.84 87.70 47.96 98.21 01/07/2027
49.20 75.24 33.11 72.57 41.85 70.97 43.91 80.19 01/08/2027
39.10 52.33 31.69 47.98 37.33 56.12 38.84 61.27 01/09/2027
41.83 49.76 33.09 48.22 45.65 54.53 49.03 59.75 01/10/2027
53.85 61.95 26.50 45.91 46.03 55.54 48.05 60.66 01/11/2027
79.47 92.86 37.75 53.46 51.74 65.17 56.96 72.31 01/12/2027
98.26 112.07 57.05 69.85 71.65 80.52 81.23 92.94 01/01/2028
91.45 102.06 47.77 63.45 63.82 70.30 73.34 83.11 01/02/2028
52.01 60.09 30.94 42.17 43.62 49.34 48.78 57.26 01/03/2028
41.43 49.27 25.58 38.54 37.87 48.97 41.01 54.52 01/04/2028
37.87 48.78 16.17 34.48 35.41 49.88 38.09 55.56 01/05/2028
39.31 56.30 20.82 47.43 35.02 57.76 37.14 63.02 01/06/2028
53.68 82.95 33.36 84.27 42.50 87.33 45.89 93.09 01/07/2028
49.55 74.23 29.76 74.09 38.91 76.11 42.16 82.01 01/08/2028
37.53 52.54 26.23 48.90 35.10 54.94 37.79 60.09 01/09/2028
40.45 44.09 31.29 46.24 40.93 51.70 43.72 56.72 01/10/2028
45.52 53.93 31.63 42.45 42.40 53.62 46.56 59.65 01/11/2028
72.96 88.92 40.76 51.63 52.08 64.04 58.24 71.51 01/12/2028

99

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Report of the Board of Directors

Waha Transco<br><br> <br>Zn5 Dlvd Chicago<br><br> <br>CG Algonquin<br><br> <br>CG Dominion<br><br> <br>S Pt Texas<br><br> <br>Eastern M-3 ERCOT<br><br> <br>West OPk ERCOT<br><br> <br>West Pk Mass Hub<br><br> <br>OPk Mass Hub<br><br> <br>Pk Contract Date
0.93 8.09 4.70 16.18 3.99 7.63 48.84 52.85 134.48 145.34 01/01/2026
--- --- --- --- --- --- --- --- --- --- ---
1.14 6.10 4.00 13.15 3.21 5.90 56.27 55.39 116.93 125.67 01/02/2026
-0.52 3.60 2.93 5.71 2.64 2.86 36.79 34.85 62.59 69.23 01/03/2026
-0.57 3.61 2.96 3.31 2.53 2.67 36.65 39.20 44.15 50.72 01/04/2026
-0.20 3.95 2.92 2.84 2.41 2.58 4168 46.32 38.58 49.00 01/05/2026
0.33 3.98 3.09 3.38 2.53 2.71 44.81 St% 41.37 63.54 01/06/2026
1.30 4.22 3.31 4.07 2.82 3.10 59.66 78.42 58.47 91.20 01/07/2026
1.61 4.23 3.37 4.03 2.85 3.16 75.49 137.48 46.37 74.53 01/08/2026
1.36 3.80 3.25 3.02 2.52 2.60 5147 6173 40.85 49.72 01/09/2026
1.29 3.79 3.30 3.06 2.38 2.54 43.35 47.87 42.87 47.24 01/10/2026
2.15 3.87 3.E9 4.90 2.97 3.29 45.98 46.30 59.13 67.18 01/11/2026
3.32 6.17 4.61 10.11 3.76 5.51 56.41 51.E9 99.10 107.96 01/12/2026
3.95 8.63 5.33 14.50 4.02 8.17 77.64 72.06 126.79 137.11 01/01/2027
3.52 7.39 4.96 1297 3.71 7.41 7205 70.87 101.45 115.46 01/02/2027
2.61 4.59 3.49 6.41 3.13 3.40 42.72 46.93 60.27 71.24 01/03/2027
2.26 3.88 3.22 3.89 2.82 2.99 43.66 46.95 45.61 51.91 01/04/2027
2.21 3.89 3.12 3.23 2.65 2.87 44.05 48.01 39.65 47.21 01/05/2027
2.61 3.86 3.23 3.36 2.70 2.99 48.08 53.93 38.03 58.01 01/06/2027
3.09 4.01 3.43 4.32 2.88 3.16 73 93 89.16 53.88 93.03 01/07/2027
3.10 3.86 3.48 4.12 2.82 3.07 78.85 132.93 48.50 73.35 01/08/2027
2.89 3.62 3.39 3.07 2.56 2.72 53.42 E2.53 39.80 50.79 01/09/2027
2.97 3.59 3.47 3.31 2.54 2.85 47.30 48.45 44.42 49.12 01/10/2027
3.10 3.77 3.71 4.69 2.94 3.42 44.51 46.97 54.00 64.06 01/11/2027
3.69 5.56 4.63 8.53 3.67 5.61 56.43 63.94 84.44 101.89 01/12/2027
4.11 8.82 5.39 14.06 4.09 8.55 83.54 76.22 118.66 127.85 01/01/2028
3.65 7.48 5.00 12.36 3.71 7.60 80.95 74.02 108.55 118.08 01/02/2028
2.47 4.16 3.47 5.22 3.10 3.60 47.10 47.17 51.36 55.68 01/03/2028
2.13 3.54 3.06 3.66 2.63 2.81 42.33 46.87 39.29 47.58 01/04/2028
2.19 3.59 2.94 3.08 2.40 2.68 4143 44.86 34.89 4436 01/05/2028
2.36 3.47 3.03 3.19 2.54 2.79 48.83 53.14 35.30 52.14 01/06/2028
2.87 3.49 3.22 3.60 2.55 2.81 73 19 94.31 46.50 82.35 01/07/2028
3.03 3.35 3.29 3.43 2.62 2.76 74.64 126.00 43.19 72.43 01/08/2028
2.87 3.27 3.23 2.93 2.37 2.56 55.05 1E2.17 35.04 47.91 01/09/2028
2.82 3.22 3.27 3.21 2.41 2.70 49.96 49.09 39.95 45.28 01/10/2028
3.14 3.63 3.51 4.61 2.75 3.30 46.77 48.32 47.02 56.82 01/11/2028
3.74 5.42 4.44 8.52 3.45 5.51 54.59 E2.73 75.30 90.66 01/12/2028

100

Exhibit 99.2

OPC Energy Ltd.

Consolidated Financial Statements

As of December 31, 2025

Unofficial English translation of certain sections of the Company’s 2025 Annual Report, for convenience purposes only.<br><br> <br>The complete and binding report is the official Hebrew Annual Report published by the Company on the Tel Aviv Stock Exchange website.<br><br> <br>In case of any discrepancy, the official and full Hebrew report shall prevail.<br><br> <br>This unofficial translation does not constitute an offer, advice or invitation to make any transaction in the Company’s securities.

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Consolidated Financial Statements as of December 31, 2025

Table of Contents
Page
Independent Auditors’ Report F-3 - F-8
Consolidated Statements of Financial Position F-9 - F-10
Consolidated Statements of Income F-11
Consolidated Statements of Comprehensive Income or Loss F-12
Consolidated Statements of Changes in Equity F-13 - F-14
Consolidated Statements of Cash Flow F-15 - F-18
Notes to the Consolidated Financial Statements F-19 - F-138

F - 2

---Unofficial translation for convenience purposes---

Somekh Chaikin

Millennium Tower KPMG

17 Ha'arba'a St., P.O.B. 609

Tel Aviv 6100601

+972-3-684-8000

Report of the Independent Auditors to the Shareholders of OPC Energy Ltd.

We have audited the consolidated financial statements of OPC Energy Ltd. (hereinafter - the “Company"), which include the consolidated statement of financial position as of December 31, 2025 and the consolidated statements of income, comprehensive income, changes in equity and cash flows for the year then ended, and the notes to the consolidated financial statements, including significant accounting policies.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position as of December 31, 2025, and the consolidated financial results and the consolidated cash flows for the year then ended, in accordance with International Financial Reporting Standards (IFRS) and the provisions of the Securities Regulations (Annual Financial Statements), 2010.

Basis for Opinion

We conducted our audit in accordance with generally accepted auditing standards in Israel, including those prescribed by the Certified Public Accountants (Modus Operandi of Certified Public Accountant) Regulations, 1973. Our responsibilities under those standards are described in the Independent Auditor's Responsibilities for the Audit of the Consolidated Financial Statements section in this report. We are independent of the Company and its consolidated companies in accordance with the statutory provisions applicable in Israel regarding the independent auditor’s independence and prevention of conflict of interest in Israel. In addition, we fulfilled our other ethical responsibilities in accordance with the Auditors Law, 1955 and the regulations promulgated thereunder. We believe that the audit evidence we obtained is appropriate and sufficient to provide a basis for our opinion.

Key audit matters

The key audit matters listed below are those matters which were communicated or should have communicated to the Company’s Board of Directors, and which in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters include, among other things, any matter that: (1) Relates, or may relate to material items or disclosures on the Consolidated Financial Statements; and (2) our judgment in connection therewith was particularly challenging, subjective or complex. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon; communicating these matters, as follows, does not alter our opinion on the consolidated financial statements as a whole, and we do not use their communication to provide a separate opinion on these matters, nor on the items or disclosures to which they relate.

F - 3

---Unofficial translation for convenience purposes---

Annual impairment testing of goodwill generated on the acquisition of the Gat Power Plant

Why was this matter deemed as a key audit matter

The Company tests for goodwill impairment for each cash-generating unit comprising goodwill on a fixed date once a year, or more often if there are indications of impairment to the value of these cash-generating units. In order to test such assets for impairment, the Group checks whether the carrying amount of the cash-generating unit exceeds its recoverable amount, in accordance with the provisions of IAS 36 regarding impairment.

As stated in Note 11B to the aforementioned financial statements, the Company has goodwill whose balance as per the statement of financial position as of December 31, 2025 is approx. NIS 221 million, which was created upon acquisition of the Gat Power Plant and is associated with the Israel power plants operations (especially Rotem, Hadera and Gat) (hereinafter - the "Companies").

As stated in Section 3G1 to the aforesaid financial statements, subsequent to initial recognition goodwill is measured at cost less accumulated impairment losses. The Company’s management tested for impairment the balance of goodwill as of December 31, 2025. The Company’s management reached the conclusion that it is not required to recognize an impairment loss in the Financial Statements for 2025.

We identified the impairment testing of the goodwill attributable to the companies as a key audit matter. The key considerations for this decision are:

• Discounted cash flow calculations are based on subjective assumptions of the Company's management, including estimates of projected cash flows and discount rate.
• The audit procedures we implemented with respect to the impairment testing of the goodwill attributable to the Companies involved the exercise of the audit team’s judgement and the use of experts who had valuation-related knowledge and<br> experience.
--- ---

How the key matter was addressed in the audit

Following are the key audit procedures implemented by the audit team in connection with the key matter:

• We obtained an understanding of the process of goodwill impairment testing, and reviewed the process used by management to assess the need to record impairment. We also examined the effectiveness of the audits executed by management.
• We sought the assistance of experts possessing the required knowledge and experience in valuations in order to assess the valuation method and assess the reasonableness of the weighted average cost of capital.
--- ---
• We received from the Company calculations of discounted cash flows relating to the most significant component associated with the activity of the Rotem Power Plant, and assessed the reasonableness of the significant assumptions used in<br> calculating the projected cash flows, by, among other things, comparing them to historical results and projections regarding the Generation Component.
--- ---
• We tested the completeness of the data included in the valuation model and their adequacy.
--- ---
• We conducted a sensitivity analysis to the results of the model with respect to the key assumptions, such as the electricity tariff (generation component) and the weighted average cost of capital.
--- ---

F - 4

---Unofficial translation for convenience purposes---

Responsibilities of Board of Directors and Management for the Consolidated Financial Statements

The Board of Directors and management are responsible for the preparation and fair presentation of the consolidated financial statements in accordance with IFRS and the provisions of the Securities Regulations (Annual Financial Statements), 2010; they are also responsible for such internal control deemed necessary by the Board of Directors and management to enable the preparation of consolidated financial statements which are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, the Board of Directors and management are responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters pertaining to going concern and implementing the going concern basis of accounting unless the Board of Directors and management either intend to liquidate the Company or to cease its operations, or have no realistic alternative but to do so.

Independent Auditor's Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an independent auditor’s report which includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with generally accepted auditing standards in Israel will always detect a material misstatement when it exists. Misstatements may arise from fraud or error and are deemed material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

In an audit conducted in accordance with generally accepted auditing standards in Israel, we exercise professional judgment and maintain professional skepticism throughout the audit. Furthermore, we:

• Identify and assess the risks of material misstatement in the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence which is<br> sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement arising from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional<br> omissions, malicious misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures which are appropriate in the circumstances.
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• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Board of Directors and management.
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• Reach a conclusion regarding the appropriateness of the Board of Directors’ and management's use of the going concern assumption and, based on the audit evidence obtained, whether a material uncertainty exists regarding events or<br> conditions which may cast significant doubts on the Company’s ability to continue as a going concern. If we concluded that a material uncertainty exists, we are required to draw attention in our independent auditor's report to the<br> relevant disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained through the date of our independent auditor's report.<br> However, future events or conditions may cause the Company to cease to continue as a going concern.
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• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a<br> manner which achieves fair presentation.
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We communicate to the Board of Directors and management regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control which we identify during the audit.

In addition, we provide the Board of Directors and management with a statement to the effect that we have complied with relevant ethical requirements regarding our independence and communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, the safeguards implemented to eliminate identified threats to our independence.

From the matters communicated to the Board of Directors and management, we determined those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our independent auditor's report unless law or regulation precludes public disclosure of the matter.

We also have audited - in accordance with the standards of the Public Company Accounting Oversight Board (United States), regarding the audit of internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO), and our report, dated March 11, 2026 included an unqualified opinion on the effectiveness of internal control over the Company’s financial reporting.

The engagement partner of the audit, which is the subject matter of the independent auditor's report is Ran Zuriel.

Somekh Chaikin

Certified Public Accountants

March 11, 2026

KPMG Somekh Chaikin, an Israeli registered partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a privately-held, limited-liability English company.

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Somekh Chaikin

Millennium Tower KPMG

17 Ha'arba'a St., P.O.B. 609

Tel Aviv 6100601

+972-3-684-8000

Report of the Independent Auditors to the Shareholders of OPC Energy Ltd. regarding the Audit of the Components of the Internal Control over Financial Reporting

We have audited internal control over financial reporting of OPC Energy Ltd. and its subsidiaries (hereinafter, jointly - the "Company”) as of December 31, 2025. Based on criteria established in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company's Board of Directors and management are responsible for maintaining effective internal control over financial reporting, and for evaluating the effectiveness of the internal control over financial reporting which is included in the attached Report of the Board of Directors and Management with regard to internal control over financial reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (PCAOB) in the United States regarding audit of internal control over financial reporting, as adopted by the Institute of Certified Public Accountants in Israel. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the faithful representation of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of the Company’s management and directors; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition (including removal from possession) of the Company’s assets that could have a material effect on the financial statements.

Due to its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. In addition, drawing conclusions regarding the future based on any evaluation of effectiveness for future periods is subject to the risk that controls may become inadequate due to changes in circumstance, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, the Company maintained, in all material respects, effective internal control as of December 31, 2025, based on criteria established in the Internal Control - Integrated Framework published by COSO.

We have also audited, in accordance with generally accepted auditing standards in Israel, the consolidated statements financial position of the Company as of December 31, 2025 and for the year then ended and our report dated March 11, 2026 includes an unqualified opinion on the abovementioned financial statements, with no departures from the standard wording.

Somekh Chaikin

Certified Public Accountants

Tel Aviv, Israel

March 11, 2026

KPMG Somekh Chaikin, an Israeli registered partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a privately-held, limited-liability English company.

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Somekh Chaikin

Millennium Tower KPMG

17 Ha'arba'a St., P.O.B. 609

Tel Aviv 6100601

+972-3-684-8000

March 11, 2026

To

The Board of Directors of

OPC Energy Ltd. (hereinafter - the “Company”)

Dear Sirs/Madams,

Re: Letter of Consent in Connection with the Company’s Shelf Prospectus of May 2023

This is to inform you that we agree to the inclusion in the shelf prospectus (including by way of reference) of our reports listed below in connection with the shelf offerings of May 2023:

Report of the independent auditors dated March 11, 2026 on the Company's Consolidated Financial Statements as of December 31, 2025 and for the year then ended.

Report of the independent auditors of March 11, 2026 regarding the Company’s separate financial information in accordance with Regulation 9C to the Securities Regulations (Periodic and Immediate Reports), 1970 as of December 31, 2025 and for the year then ended.

Report of the independent auditors of March 11, 2026 regarding the audit of internal control over financial reporting of the Company as of December 31, 2025.

Respectfully,

Somekh Chaikin

Certified Public Accountants

KPMG Somekh Chaikin, an Israeli registered partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a privately-held, limited-liability English company.

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OPC Energy Ltd.

Consolidated Statements of Financial Position as of December 31

2025 2024
Note NIS million NIS million
Current assets
Cash and cash equivalents 5 2,913 962
Trade receivables 437 293
Other receivables and debit balances 7 206 90
Total current assets 3,556 1,345
Non‑current assets
Long-term restricted deposits and cash 6 522 60
Long-term receivables and debit balances 8 377 162
Investments in associates 24 5,186 5,320
Long-term derivative financial instruments 21 42 44
Property, plant & equipment 9 4,402 4,238
Right‑of‑use assets and deferred expenses 10 636 637
Intangible assets 11 266 261
Total non‑current assets 11,431 10,722
Total assets 14,987 12,067

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OPC Energy Ltd.

Consolidated Statements of Financial Position as of December 31

2025 2024
Note NIS million NIS million
Current liabilities
Loans and credit from banking corporations and financial institutions (including current maturities) 14 131 82
Current maturities of debt from non‑controlling interests 23D - 14
Current maturities of debentures 15 244 212
Trade payables 404 213
Payables and credit balances 12 369 123
Total current liabilities 1,148 644
Non‑current liabilities
Long-term loans from banking corporations and financial institutions 14 3,203 2,150
Long-term debt from non-controlling interests 23D 440 500
Debentures 15 1,626 1,663
Long-term lease liabilities 10 21 31
Long-term derivative financial instruments 21 3 -
Other long‑term liabilities 13 15 115
Deferred tax liabilities 17 524 543
Total non-current liabilities 5,832 5,002
Total liabilities 6,980 5,646
Equity 18
Share capital 3 3
Share premium 6,082 3,993
Capital reserves (185 ) 532
Retained earnings 570 224
Total equity attributable to the Company’s shareholders 6,470 4,752
Non‑controlling interests 1,537 1,669
Total equity 8,007 6,421
Total liabilities and equity 14,987 12,067
Yair Caspi Giora Almogy Ana Bernstein Schwartzman
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Chairman of the Board Chief Executive Officer Chief Financial Officer

Approval date of the financial statements: March 11, 2026.

The accompanying notes are an integral part of the consolidated financial statements.

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OPC Energy Ltd.

Consolidated Income Statement for the Year Ended December 31

2025 2024 2023
Note NIS million NIS million NIS million
Revenues from sales and provision of services 19A 3,002 2,779 2,552
Cost of sales and services (excluding depreciation and amortization) 19B (2,263 ) (1,931 ) (1,827 )
Depreciation and amortization (232 ) (317 ) (288 )
Gross profit 507 531 437
Share in profits of associates 24 523 166 242
Compensation in respect of loss of income 19E 16 44 41
General and administrative expenses 19C (365 ) (263 ) (212 )
Business development expenses 19D (14 ) (45 ) (58 )
Other revenues (expenses), net 19F 95 (56 ) (16 )
Gain on deconsolidation of the US Renewable Energies Segment 23F - 259 -
Operating profit 762 636 434
Finance expenses 19G (298 ) (339 ) (240 )
Finance income 19G 80 87 43
Loss from extinguishment of financial liabilities 19G - (49 ) -
Finance expenses, net (218 ) (301 ) (197 )
Profit before taxes on income 544 335 237
Income tax expenses 17 (87 ) (138 ) (68 )
Profit for the year 457 197 169
Attributable to:
The Company’s shareholders 346 111 144
Non-controlling interests 111 86 25
Profit for the year 457 197 169
Earnings per share attributable to the Company’s owners 20
Basic and diluted earnings per share (in NIS) 1.26 0.46 0.63

The accompanying notes are an integral part of the consolidated financial statements.

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OPC Energy Ltd.

Consolidated Statement of Comprehensive Income or Loss for the Year Ended December 31

2025 2024 2023
NIS million NIS million NIS million
Profit for the year 457 197 169
Components of other comprehensive income (loss) that, subsequent<br><br> <br>to initial recognition in comprehensive income, were or will be<br><br> <br>transferred to profit and loss
Effective portion of the change in the fair value of cash flow hedges (6 ) 42 (40 )
Net change in fair value of derivatives used to hedge cash flows carried to the cost of the hedged item - - (5 )
Net change in fair value of derivative financial instruments used to hedge cash flows transferred to profit and loss (3 ) (11 ) (20 )
Group’s share in other comprehensive income (loss) of associates, net of tax (215 ) 13 (48 )
Foreign currency translation differences in respect of foreign operations (*)(762) (8 ) 126
Tax on other comprehensive income (loss) items 60 (6 ) 1
Other comprehensive income (loss) for the year, net of tax (926 ) 30 14
Total comprehensive income (loss) for the year (469 ) 227 183
Attributable to:
The Company’s shareholders (344 ) 121 169
Non-controlling interests (125 ) 106 14
Total comprehensive income (loss) for the year (469 ) 227 183

(*) Mainly due to a decrease of approx. 12.5% in the USD/NIS exchange rate during 2025.

The accompanying notes are an integral part of the consolidated financial statements.

F - 12

OPC Energy Ltd.

Consolidated Statements of Changes in Equity

Attributable to the Company’s shareholders
Share capital Share premium Capital reserves Hedge fund Foreign operations translation reserve Retained earnings Total Non‑control-ling interests Total equity
NIS million NIS million NIS million NIS million NIS million NIS million NIS million NIS million NIS million
For the year ended December 31, 2025
Balance as of January 1, 2025 3 3,993 247 49 236 224 4,752 1,669 6,421
Issuance of shares (less issuance expenses) *- 2,057 - - - - 2,057 - 2,057
Investments by holders of non-controlling interests in equity of subsidiary - - - - - - - 50 50
Share-based payment - - 7 - - - 7 1 8
Exercised and expired options and RSUs *- 32 (32 ) - - - - - -
Dividend to non-controlling interests - - - - - - - (60 ) (60 )
Other - - (2 ) - - - (2 ) 2 -
Other comprehensive loss for the year, net of tax - - - (145 ) (545 ) - (690 ) (236 ) (926 )
Profit for the year - - - - - 346 346 111 457
Balance as of December 31, 2025 3 6,082 220 (96 ) (309 ) 570 6,470 1,537 8,007
For the year ended December 31, 2024
Balance as of January 1, 2024 2 3,210 248 25 250 113 3,848 1,394 5,242
Issuance of shares (less issuance expenses) 1 779 - - - - 780 - 780
Investments by holders of non-controlling interests in equity of subsidiary - - - - - - - 175 175
Share-based payment - - 7 - - - 7 1 8
Exercised options and RSUs *- 4 (4 ) - - - - - -
Other - - (4 ) - - - (4 ) (7 ) (11 )
Other comprehensive income (loss) for the year, net of tax - - - 24 (14 ) - 10 20 30
Profit for the year - - - - - 111 111 86 197
Balance as of December 31, 2024 3 3,993 247 49 236 224 4,752 1,669 6,421

* Amount is less than NIS 1 million.

The accompanying notes are an integral part of the consolidated financial statements.

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OPC Energy Ltd.

Consolidated Statements of Changes in Equity

Attributable to the Company’s shareholders
Share capital Share premium Capital reserves Hedge fund Foreign operations translation reserve Retained earnings (retained loss) Total Non‑controlling interests Total equity
NIS million NIS million NIS million NIS million NIS million NIS million NIS million NIS million NIS million
For the year ended December 31, 2023
Balance as of January 1, 2023 2 3,209 77 91 159 (31 ) 3,507 859 4,366
Investments by holders of non-controlling interests in equity of subsidiary - - - - - - - 231 231
Share-based payment - - 9 - - - 9 1 10
Exercised options and RSUs *- 1 (1 ) - - - - - -
Restructuring - share exchange and investment transaction with Veridis - - 163 - - - 163 289 452
Other comprehensive income (loss) for the year, net of tax - - - (66 ) 91 - 25 (11 ) 14
Profit for the year - - - - - 144 144 25 169
Balance as of December 31, 2023 2 3,210 248 25 250 113 3,848 1,394 5,242

* Amount is less than NIS 1 million.

The accompanying notes are an integral part of the consolidated financial statements.

F - 14

OPC Energy Ltd.

Consolidated Statement of Cash Flows for the year ended December 31

2025 2024 2023
NIS million NIS million NIS million
Cash flows from operating activities
Profit for the year 457 197 169
Adjustments:
Depreciation and amortization 249 333 303
Diesel fuel consumption 26 12 32
Finance expenses, net 218 301 197
Income tax expenses 87 138 68
Share in profits of associates (523 ) (166 ) (242 )
Other expenses, net (95 ) 56 16
Gain on deconsolidation of the US Renewable Energies Segment - (259 ) -
Proceeds in respect of development fees from the Basin Ranch Power Plant 92 - -
Share-based compensation transactions 149 35 (7 )
660 647 536
Changes in trade and other receivables (231 ) (64 ) (22 )
Changes in trade payables, service providers, payables and other long-term liabilities 258 14 (25 )
27 (50 ) (47 )
Dividends received from associates ^(1)^ 334 235 13
Income taxes paid ^(2)^ (18 ) (67 ) (7 )
316 168 6
Net cash provided by operating activities 1,003 765 495
Cash flows from investing activities
Interest received 70 35 35
Change in restricted deposits and cash, net ^(3)^ (473 ) (8 ) 173
Provision of short-term collateral, net - 14 110
Acquisition of subsidiaries, net of cash acquired - - (1,172 )
Investment in associates ^(4)^ (993 ) (737 ) (29 )
Subordinated long-term loans to Valley - - (87 )
Purchase of property, plant, and equipment, intangible assets and deferred expenses (402 ) (1,260 ) (1,223 )
Deconsolidation of the US Renewable Energies Segment - 134 -
Advance payment in respect of acquisition of the remaining ownership stakes in Basin Ranch (190 ) - -
Proceeds for repayment of partnership capital from associates ^(1)^ 148 95 11
Other 40 15 16
Net cash used for investing activities (1,800 ) (1,712 ) (2,166 )
(1) For further details regarding capital and dividend distributions from associates of the CPV Group - see Note 24.
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(2) Taxes paid during 2024 include taxes paid for restructuring. For further details, see Note 23F.
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(3) In the reporting period in respect of balances designated for the construction of the Basin Ranch project.
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(4) In the reporting period, mainly includes investments in Basin Ranch and Shore totaling approx. NIS 550 million and approx. NIS 318 million, respectively. In 2024 - mainly including investments in the Maryland and Shore power plants;<br> for further details see Note 23E2.
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The accompanying notes are an integral part of the consolidated financial statements.

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OPC Energy Ltd.

Consolidated Statement of Cash Flows for the year ended December 31

2025 2024 2023
NIS million NIS million NIS million
Cash flows for financing activities
Proceeds of share issuance, less issuance expenses ^(1)^ 2,057 780 -
Proceeds of debenture issuance, less issuance expenses 495 198 -
Receipt of long-term loans from banking corporations and financial institutions, net^(2)^ 1,169 1,951 1,242
Receipt of long-term debt from non-controlling interests 16 104 110
Investments by holders of non-controlling interests in equity of subsidiary 50 175 231
Proceed in respect of restructuring - share exchange and investment transaction with Veridis - - 452
Short term loans from banking corporations, net 14 (204 ) 231
Tax equity partner’s investments in US Renewable Energies projects - 152 304
Interest paid (180 ) (228 ) (152 )
Dividend paid to non‑controlling interests (60 ) - -
Repayment of long-term loans from banking corporations and others^(2)^ (95 ) (1,755 ) (144 )
Repayment of long-term loans as part of the acquisition of Gat - - (303 )
Repayment of long-term loans from non-controlling interests (62 ) (76 ) (123 )
Repayment of debentures^(3)^ (515 ) (193 ) (31 )
Other 6 (13 ) -
Net cash provided by financing activities 2,895 891 1,817
Net increase (decrease) in cash and cash equivalents 2,098 (56 ) 146
Balance of cash and cash equivalents as of the beginning of the year 962 1,007 849
Effect of exchange rate fluctuations on cash and cash equivalent balances (147 ) 11 12
Balance of cash and cash equivalents at the end of the year 2,913 962 1,007
(1) For further details – see Note 18B.
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(2) For further details – see Note 14B1.
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(3) For details regarding the partial early redemption of Debentures (Series B) in the third quarter of 2025, see Note 15C2.
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The accompanying notes are an integral part of the consolidated financial statements.

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OPC Energy Ltd.

Consolidated Statement of Cash Flows for the year ended December 31

Appendix A - Changes Arising from Financing Activity

Loans from banking corporations and financial institutions Loans from non‑controlling interests Debentures Financial instruments designated for hedging
NIS million
Liabilities (assets) as of January 1, 2025 2,234 514 1,891 (43 )
Changes arising from cash flows:
Proceeds for derivative financial instruments - - - (1 )
Receipt of loans, net from transaction costs 1,171 16 495 -
Repayment of debentures and loans (95 ) (62 ) (515 ) -
Short term loans from banking corporations, net 14 - - -
Interest paid (129 ) (2 ) (47 ) -
Total changes arising from cash flows from financing activities 961 (48 ) (67 ) (1 )
Changes in foreign currency exchange rates (6 ) (59 ) - -
Interest expenses 157 33 52 5
Linkage differences 9 - 22 (7 )
Changes in fair value, hedge accounting and other (18 ) - (8 ) 5
Total changes arising from non-cash activity 142 (26 ) 66 3
Liabilities (assets) as of December 31, 2025 3,337 440 1,890 (41 )
Loans from banking corporations and financial institutions Loans from non‑controlling interests Debentures Financial instruments designated for hedging
--- --- --- --- --- --- --- --- --- --- --- --- ---
NIS million
Liabilities (assets) as of January 1, 2024 3,259 454 1,853 (52 )
Changes arising from cash flows:
Payment for derivative financial instruments - - - 7
Receipt of loans, net from transaction costs 1,991 104 198 -
Repayment of debentures and loans (1,755 ) (76 ) (193 ) -
Short term loans from banking corporations, net (204 ) - - -
Interest paid (182 ) (3 ) (41 ) -
Total changes arising from cash flows from financing activities (150 ) 25 (36 ) 7
Changes in foreign currency exchange rates 25 1 - -
Interest expenses 250 34 57 5
Linkage differences 14 - 32 (11 )
Deconsolidation (1,163 ) - - (4 )
Changes in fair value, hedge accounting and other (1 ) - (15 ) 12
Total changes arising from non-cash activity (875 ) 35 74 2
Liabilities (assets) as of December 31, 2024 2,234 514 1,891 (43 )

The accompanying notes are an integral part of the consolidated financial statements.

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OPC Energy Ltd.

Consolidated Statement of Cash Flows for the year ended December 31

Loans from banking corporations and financial institutions Loans from non‑controlling interests Debentures Financial instruments designated for hedging
NIS million
Liabilities (assets) as of January 1, 2023 1,817 437 1,854 (57 )
Changes arising from cash flows:
Payment for derivative financial instruments - - - 9
Receipt of loans, net 1,242 110 - -
Repayment of debentures and loans (144 ) (123 ) (31 ) -
Repayment of loans as part of the acquisition of Gat (303 ) - - -
Short term loans from banking corporations, net 231 - - -
Interest paid (112 ) (2 ) (23 ) -
Total changes arising from cash flows from financing activities 914 (15 ) (54 ) 9
First-time consolidation of limited partnership 303 - - -
Changes in foreign currency exchange rates (2 ) 8 - (1 )
Interest expenses 174 26 46 -
Linkage differences 15 - 33 (11 )
Changes in fair value, hedge accounting and other 38 (2 ) (26 ) 8
Total changes arising from non-cash activity 528 32 53 (4 )
Liabilities (assets) as at December 31, 2023 3,259 454 1,853 (52 )

The accompanying notes are an integral part of the consolidated financial statements.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 1 – GENERAL

The Reporting Entity

OPC Energy Ltd. (hereinafter – the "Company”) was incorporated in Israel on February 2, 2010. The Company’s registered address is 121 Menachem Begin Road., Tel Aviv, Israel. The Company’s controlling shareholder is Kenon Holdings Ltd. (hereinafter - the “Parent Company”), a company incorporated in Singapore, the shares of which are dual-listed on the New York Stock Exchange (NYSE) and the Tel Aviv Stock Exchange Ltd. (hereinafter - the “TASE”).

The Company is a publicly-traded company whose securities are traded on the TASE.

As of the Report date, the Group is engaged in the initiation, development, construction, operation and generation and supply of electricity and energy through three operating segments (which constitute reportable segments in the financial statements): Israel (through OPC Power Israel Ltd. (hereinafter - “OPC Israel”), in which the Company has an 80% stake), US Energy Transition and US Renewable Energies (the US operations - through CPV Group, in which the Company has a 70.69% stake).

In addition, the Company is engaged, through CPV Group, in a number of business activities in the US, which - as of the Report date - do not constitute reportable operating segments in the financial statements: For further details – see Note 25.

State of war in Israel

Since 2023, the State of Israel has been experiencing substantial geopolitical and security instability in addition to significant regional escalation, both against the backdrop of domestic events and following the events of October 7, 2023, due to security developments, with the outbreak of the Iron Swords War in the Gaza Strip (hereinafter - the “War”). During 2024-2025 fighting and security tensions intensified in other fronts, especially in Northern Israel and against the Houthis and Iran, when on June 12, 2025, a large-scale military conflict broke out between Israel and Iran (hereinafter - "Operation Rising Lion"). On June 24, 2025, a ceasefire was declared with Iran, and during October 2025 an agreement was signed which led to a ceasefire in the Gaza front.

Since the outbreak of the War in 2023 through the reporting date, the War has had external impacts of varying intensity, which include, among other things, disruption of marine shipping routes due to attacks on merchant and shipping vessels and considerably less flights by foreign airlines to and from Israel. Such events have affected, from time to time (and may continue to affect, due to the following) the arrival in Israel of equipment and foreign personnel (including those necessary for the execution of maintenance and construction work at the Group’s sites in Israel).

The said war and Operation Rising Lion have not had a material effect on the operating results in Israel in the Reporting Period.

Subsequent to the Report date, on February 28, 2026, there was a significant escalation in regional geopolitical conditions, upon the outbreak of a substantial large-scale military conflict between Israel and US military forces on the one hand and Iran on the other hand, which - according to reports - also involves Iranian attacks on other countries in the Middle East (hereinafter - "Operation Lion's Roar"). As part of the Operation, inter alia, air routes in Israel were suspended, a general state of emergency was declared across the Israeli home front - limiting activities in the public sphere, and a large-scale reserve mobilization was carried out.

The abovementioned events involve significant uncertainty and may adversely affect the macroeconomic environment, including adversely affect the Israeli economy’s robustness. The deterioration in the security situation may have an adverse effect on the Company’s activities in Israel, activities of the Company's customers and suppliers in Israel, as well as adversely affect the Company's operating results, the availability and cost of capital and sources of financing required by the Group.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 1 – GENERAL (cont.)

State of war in Israel (cont.)

During Operation Lion's Roar, all gas rigs (including the Karish Reservoir) were shut down for varying periods of time; as of the Report approval date, the Tamar Reservoir is active, while the Karish and Leviathan reservoirs have not yet resumed operations. As of the Report approval date, the Tamar Reservoir has supplied all of the Company’s gas needs. However, some of the gas was purchased at a higher price than the alternative price from a Karish Reservoir, which has not had a material effect as of the Report approval date. The Company is making preparations for a possible impact on the activity of the gas rigs, including the temporary use of diesel fuel by the Company's power plants where necessary. Additionally, in view of the state of emergency declared in Israel, demand has declined to a certain extent; however, the full effects of the operation on the Company's material customers (if any) are not yet clear. In addition, force majeure notices were received from suppliers and contractors alongside limited availability of work teams and foreign experts at the activity sites in Israel, including for Sorek 2 (which is currently under delivery inspections) and the Hadera site (which is currently undergoing unscheduled maintenance work).

As of the Report approval date, given that Operation Lion's Roar has only recently started, there is no full certainty as to its full effects and implications on the Group's activity, if any.

Definitions

1. The Company - OPC Energy Ltd.
2. The Group - the Company and its investees.
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3. Consolidated companies/subsidiaries - companies, including partnerships, whose financial statements are fully consolidated, whether directly or indirectly, in the Company’s financial statements, specifically: (1) In Israel: OPC Power<br> Israel (hereinafter - “OPC Israel”), OPC Hadera Expansion Ltd. (hereinafter - the “Hadera 2”), AGS Rotem Ltd. (hereinafter - “Rotem<br><br><br><br><br> 2”), Gnrgy Ltd. (hereinafter - “Gnrgy”), OPC Power Plants Ltd. (hereinafter - “OPC Power Plants”), OPC Rotem Ltd. (hereinafter - “Rotem”), OPC Hadera Ltd. (hereinafter - “Hadera”), Zomet Energy Ltd. (hereinafter - “Zomet”), OPC Sorek 2 Ltd.<br> (hereinafter - “Sorek 2”), OPC Mevuzarot Ltd. (hereinafter - “OPC Mevuzarot”), OPC Gat Power Plant - Limited Partnership (hereinafter - the “Gat Partnership”), and OPC Solar Ramat Beka Ltd. (hereinafter - “OPC Ramat Beka”). (2) In the US, the Company holds - through ICG Energy Inc (hereinafter - “ICG Energy”) - OPC Power Ventures LP (hereinafter - “OPC Power”), and OPC Power holds the CPV Group.
--- ---
4. Investees - consolidated companies and companies, including a partnership or joint venture, the Company’s investment in which is included, directly or indirectly, in the financial statements based on the equity method, specifically:<br> CPV Fairview, LLC (hereinafter - “Fairview”), CPV Maryland, LLC (hereinafter - “Maryland”), CPV Shore Holdings, LLC (hereinafter - “Shore”), CPV Towantic, LLC (hereinafter - “Towantic”), CPV Valley Holdings, LLC (hereinafter - “Valley”), CPV Three Rivers, LLC (hereinafter -<br> “Three Rivers”), CPV Basin Ranch Holdings, LLC (hereinafter - “Basin Ranch”) and CPV Renewable Power, LLC (hereinafter - “CPV<br> Renewable”).
--- ---

It is noted that the Shore and Basin Ranch power plants will be consolidated for the first time as from the first quarter of 2026. For further details, see Note 23E.

6. Related parties - as defined in IAS 24 (2009), Related Party Disclosures.
7. Interested parties - as defined in Paragraph (1) of the definition of an “interested party” in a corporation in Section 1 of the Israel Securities Law, 1968.
--- ---

F - 20

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 2 – BASIS OF PREPARATION OF THE FINANCIAL STATEMENTS

A. Statement of compliance with International Financial Reporting Standards (IFRS)

The consolidated financial statements were prepared by the Group in accordance with International Financial Reporting Standards (hereinafter - “IFRS”). Such financial statements were also prepared in accordance with the Israeli Securities Regulations (Annual Financial Statements), 2010.

The Company’s consolidated financial statements were approved for publication by its Board of Directors on March 11, 2026.

B.        Functional and presentation currency

During the reporting period, the currency that represents the primary economic environment in which the Company operates is the new Israeli shekel (hereinafter - “NIS”). Accordingly, the NIS served as the Company’s functional currency. The NIS also serves as the presentation currency in these financial statements. Currencies other than the NIS constitute foreign currency.

It is noted that in view of developments pertaining to the activity in the United States, which took place recently and continue into 2026 (as detailed, among other things, in Note 23E), as from January 1, 2026, the functional currency representing the primary economic environment in which the Company operates changed from NIS to US Dollar (hereinafter - “USD"), and as of the Report approval date, the Company has submitted to the Israel Securities Authority a pre-ruling application on the matter, and subject to receipt of the ISA’s Position on the matter, it intends to switch to reporting in USD as its functional currency as from the financial statements of the first quarter of 2026.

C.        Basis of measurement

The financial statements were prepared according to the historical cost basis, other than: derivative financial instruments at fair value through profit and loss, derivatives measured at fair value through other comprehensive income, liability in respect of profit-sharing to CPV Group employees, treated as a cash-settled share-based payment transaction, investments in associates, and deferred tax assets and liabilities. For further details, see Note 3.

D.        The operating cycle period

The Group’s normal operating cycle period is one year. Therefore, current assets and current liabilities include items whose disposal is planned and expected during the Group’s normal operating cycle.

E.        Use of estimates and judgments

In preparation of the condensed consolidated interim financial statements in accordance with the IFRS, the Company’s management is required to use judgment when making estimates, assessments and assumptions that affect implementation of the accounting policies and the amounts of assets, liabilities, revenues and expenses. Actual results may differ from these estimates.

When formulating accounting estimates used in preparing the Group’s financial statements, the Group’s management was required to use assumptions concerning circumstances and events that involve significant uncertainty. In determining the estimates, the Group’s management’s discretion is based on past experience, various facts, external factors and reasonable assumption under the appropriate circumstances for each estimate.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 2 – BASIS OF PREPARATION OF THE FINANCIAL STATEMENTS (cont.)

E.        Use of estimates and judgments (cont.)

These estimates and underlying assumptions are reviewed regularly. Changes in accounting estimates are recognized in the period in which the estimates were revised and in any future affected period.

Information regarding the assumptions made by the Group in respect of the future and other major factors for uncertainty regarding the estimates that have a significant risk of resulting in a material adjustment in the carrying amount of assets and liabilities in the next financial year, is included in the following line items:

1. Expected useful life of property, plant and equipment

Property, plant and equipment is depreciated using the straight line method over the expected useful life, considering the residual value of the assets. The Group routinely re-examines the expected useful life of property, plant and equipment in order to determine the depreciation expenses to be recognized for the period. The useful life is based on the Group’s past experience in respect of similar assets and takes into account expected technological changes. Depreciation expenses in respect of future periods are adjusted to reflect significant changes compared to previous estimates, if any. For further details, see Note 3F.

Change in the estimated useful life of property, plant & equipment

At the end of the reporting period, upon completion of a major overhaul in the Rotem Power Plant during the fourth quarter of 2025, the Company assessed the estimated useful life of the Rotem Power Plant. Based on the opinion of an independent external expert, the useful life of the Rotem Power Plant has been extended by 10 years. The effect of the change in the estimate is accounted for prospectively, and therefore the annual depreciation expenses of the Rotem Power Plant from 2026 onwards will decline by approx. NIS 19 million per year.

2. Allocation of acquisition costs

The Group uses estimates to allocate the acquisition costs, specifically in business combination transactions and investments in associates, to tangible and intangible assets and to the acquired liabilities. In addition, when estimating the depreciation rates of the tangible and intangible assets and liabilities, the Group estimates the expected life of the asset or liability. In its calculation of those estimates, the Group uses, among other things, external and independent appraisers.

3. Recoverable amount of cash-generating units that include goodwill and testing for indications of impairment of non-financial assets, including investments in equity-accounted associates

Each year, the Group calculates the recoverable amount of a cash-generating unit to which a goodwill balance has been allocated, based, among other things, on the discounted expected cash flows.

Furthermore, on each reporting date, the Group assesses whether there are indications of impairment of non-financial assets and/or cash-generating units, specifically property, plant & equipment, and investments in associates, and where necessary calculates the recoverable amount of those assets/investments.

In its calculation of the recoverable amount, the Group uses, among other things, external and independent appraisers. For further details, see Note 11B.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 2 – BASIS OF PREPARATION OF THE FINANCIAL STATEMENTS (cont.)

E.        Use of estimates and judgments (cont.)

4. Ability to recover development and construction costs of projects under development and construction

In order to capitalize development and construction costs of projects under development and construction, the Group uses estimates for receipt of regulatory approvals, the existence of an interest in the land, the ability to connect to the electrical grid, signing PPAs with customers, where relevant, and the expectation of generating future economic benefits from the projects. If in subsequent periods the Group's estimates regarding a project deteriorate, in particular with regard to failure to obtain the required regulatory approvals for projects under development, capitalized costs are amortized in profit and loss and/or the capitalization of additional project costs is discontinued.

F.        Seasonality

The results of Group companies in Israel are based on the load and time tariff (hereinafter - the “DSM Tariff”), as published from time to time by the Israeli Electricity Authority, with a certain discount with respect to the generation component. The DSM Tariff is determined given two daily demand hours clusters - on-peak and off-peak and given the seasons such that the summer season covers June to September, the transition season covers March to May and October to November, and the winter season covers January, February and December.

In the USA, as a rule, the CPV Group is subject to seasonality. In gas-fired power plants, profitability tends to be higher during periods in which the weather is either colder or hotter than the annual average, which often occurs in summer and winter. Furthermore, with regard to wind-powered renewable energy projects, the speed of the wind tends to be higher during the winter and lower during the summer. Whereas in solar projects, solar radiation tends to be higher during the spring and summer months and lower during fall and winter.

NOTE 3 – SIGNIFICANT ACCOUNTING POLICIES

The accounting policy principles below will be applied consistently to all periods presented in these consolidated financial statements by entities of the Group.

A. Business combinations and investment in subsidiaries
1. Business combinations
--- ---

The Group applies the acquisition method to all business combinations.

The Group recognizes goodwill on acquisition date according to the fair value of the consideration transferred less the net amount of the identifiable assets acquired and the liabilities assumed. Goodwill is initially recognized as an asset based on its cost, and in subsequent periods, is measured at cost less accumulated impairment losses.

2. Subsidiaries

Subsidiaries are entities controlled by the Company. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date of loss of control.

The accounting policies of subsidiaries have been changed when necessary to align them with the policies adopted by the Group.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 3 – SIGNIFICANT ACCOUNTING POLICIES (cont.)

3. Non‑controlling interests

Transactions with non-controlling interests, while maintaining control

Transactions with non-controlling interests while maintaining control are treated as equity transactions. Any difference between the consideration paid or received and the change in non-controlling interests is attributed to the share of the owners of the Company in a capital reserve from transactions with non-controlling interests and mergers.

4. Loss of control

Upon loss of control in a subsidiary, the Group derecognizes the subsidiary’s assets and liabilities, any non-controlling interests, and other equity components attributable to that subsidiary. The Group’s remaining stake in the former subsidiary is measured at fair value at the loss of control date.

The difference between the consideration and fair value of the remaining stake and the derecognized balances is recognized in profit and loss under the gains on loss of control in a subsidiary line item. As from that date, the remaining stake is accounted for using the equity method.

The amounts recognized in equity through other comprehensive income with respect to that subsidiary are reclassified to profit or loss or to retained earnings on the same basis that would have been applicable if the subsidiary had directly disposed of the related assets or liabilities.

For further details regarding loss of control in CPV Renewable, see Note 23F.

B. Investment in associates and joint ventures
1. Investment in associates and joint ventures
--- ---

Associates are entities in which the Group has significant influence, but not control or joint control, over the financial and operating policies. Significant influence is the power to participate in making decisions relating to the financial and operational policies of the investee company. There is a rebuttable assumption whereby a 20% to 50% stake in an investee confers significant influence. In testing for significant influence, potential voting rights that are currently exercisable or convertible into shares of the investee are taken into account.

Investments in associates and joint ventures are accounted for using the equity method and are initially recognized at cost. The investment cost includes transaction costs. The consolidated financial statements include the Group’s share of the revenues and expenses in profit or loss and of other comprehensive income of associates, after adjustments to align the accounting policies with those of the Group, from the date that significant influence commences until the date that significant influence ceases. The Company's share in profit or loss from associates will be recorded under operating profit.

F - 24

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 3 – SIGNIFICANT ACCOUNTING POLICIES (cont.)

B. Investment in associates and joint ventures (cont.)
1. Investment in associates and joint ventures (cont.)
--- ---

The Company has investments in associates whose holding stake therein exceeds 50% and in accordance with the analysis of the contractual rights awarded to interest holders in these entities, the Group has concluded that it does not control these entities and will implement the equity method thereto. For further details, see Note 23E.

2. Increase in holdings stake of equity-accounted companies where significant influence has been retained

When increasing its stake in a company accounted for using the equity method while maintaining significant influence or joint control, the Group applies the acquisition method only in respect of additional interests while making no changes in accounting for the previous interests.

3. Increase in the holding stake in companies accounted for by the equity method while losing significant influence and assuming control (hereinafter - “Step Acquisition")

Under the acquisition of additional interests in the Shore and Basin Ranch power plants subsequent to the reporting period and assuming control therein (for further details, see Note 23E), the Parent Company assessed whether the acquisition of the interests constitutes a business combination transaction or an asset acquisition transaction.

To this end, the Company implemented the concentration test. Accordingly, the Company reached the conclusion that the acquisitions constitute asset acquisition transactions. On the completion date of the transactions for the acquisition of the Shore and Basin Ranch power plants and assuming control therein, the implementation of the equity method was discontinued, and their assets and liabilities were consolidated into the Company's Consolidated Financial Statements. The acquisition cost of the Shore and Basin Ranch power plants includes the carrying amounts of previously-held interests, the consideration paid for the acquisition of the additional interests and transaction costs directly attributable to the acquisition.

On the completion date of the acquisition transactions, the acquisition cost was allocated to the identifiable assets and liabilities acquired. Assets and liabilities which are not initially measured at cost in accordance with the relevant IFRSs were measured in accordance with the provisions of the specific applicable standard, and the balance was allocated to the other assets, mainly property, plant, and equipment (including, in Basin Ranch, the right to receive a loan under favorable terms) and a right-of-use asset - based on their relative fair value on the acquisition date. Subsequent to such allocation, the assets and liabilities are measured in accordance with the applicable IFRS.

F - 25

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 3 – SIGNIFICANT ACCOUNTING POLICIES (cont.)

C. Foreign currency
1. Foreign currency transactions
--- ---

Foreign currency transactions are translated into the functional currency of the Group companies at the exchange rate effective on the transaction dates. Financial assets and liabilities denominated in Foreign Currencies on the reporting date are translated to the functional currency at the exchange rate at that date. The exchange rate differences due to translation of the functional currency are usually recognized in profit and loss (except for differences from cash flow hedges, which are recognized in other comprehensive income, in respect of the effective part of the hedge).

2. Foreign operation

The Group has investments in investees in the US, which constitute a foreign operation.

The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition, are translated to NIS at exchange rates in effect at the reporting date. The revenues and expenses of foreign operations are translated to NIS at exchange rates in effect at the transaction dates. Foreign exchange differences are recognized in other comprehensive income and are presented in equity in the foreign operations translation reserve (hereinafter – “translation reserve”).

Generally, exchange rate differences from loans received from or provided to foreign operations, including foreign operations that are subsidiaries, are recognized in profit and loss in the consolidated financial statements.

When the settlement of loans provided to a foreign operation is neither planned nor likely in the foreseeable future, gains and losses from exchange rate differences arising from these monetary items are included in the investment in the foreign operation, net, and are recognized in other comprehensive income and stated in equity under the translation reserve.

D. Financial instruments
1. Non‑derivative financial instruments
--- ---

Non‑derivative financial assets include: Cash and cash equivalents, restricted cash and deposits, trade receivables, certain receivables and debit balances and loans to investees.

Non-derivative financial liabilities include: Loans and credit from banking corporations and financial institutions, debt from non-controlling interests, debentures, lease liabilities, trade payables and certain other payables.

2. Derivative financial instruments, including hedge accounting

Derivatives used for hedge accounting

On initial designation of the accounting hedge, the Group formally documents the relationship between the hedging instrument and hedged item, including the Group’s risk management objectives and strategy in undertaking the hedge transaction, together with the methods that will be used to assess the effectiveness of the hedging relationship. The Group estimates, upon creation of the hedge and in the subsequent periods, whether the hedge is expected to be highly effective in offsetting changes in fair value or in the cash flows attributable to the hedged risk during the period for which the hedge is designated.

F - 26

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 3 – SIGNIFICANT ACCOUNTING POLICIES (cont.)

D. Financial instruments (cont.)
2. Derivative financial instruments, including hedge accounting (cont.)
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Derivatives used for hedge accounting (cont.)

In respect of cash flow hedging, a forecast transaction that is a hedged item must be at a highly probable level and cause exposure to cash flow changes that may ultimately affect profit and loss.

Changes in fair value of derivatives used to hedge cash flows in respect of the effective part of the hedge are recognized through other comprehensive income or loss directly in a capital reserve for hedges. For the non-effective part, the changes in fair value are recognized in profit and loss. The amount accumulated in a capital reserve for hedges is reclassified to the hedged assets in the statement of financial position or income statement in the period in which the cash flows affect such assets or the income statement, respectively, and is presented in the same line item in the financial statements as the hedged item.

If the hedging instrument no longer meets the criteria for hedge accounting, expires or is sold, terminated or exercised, hedge accounting is discontinued. The cumulative profit or loss previously recognized through other comprehensive income or loss and presented in the hedging capital reserve remains in the reserve until the projected transaction occurs or is no longer expected to occur. If the forecast transaction is no longer expected to occur, the cumulative profit or loss previously recognized in the hedging capital reserve is reclassified to profit and loss. When the hedged item is a non-financial asset, the amount recognized in the capital reserve for hedges is added to the carrying amount of the asset when it is recognized.

Derivatives not used for hedge accounting

Derivatives are initially recognized at fair value. Subsequent to initial recognition, changes in fair value of non-hedge derivatives are recognized in profit and loss as finance income (expenses).

3. Derecognition of total financial liabilities

The Company derecognizes a financial liability when, and only when, it is settled - i.e., when the obligation defined in the contract expires or when it is discharged or canceled. A financial liability is extinguished when the debtor pays the liability by a cash payment, other financial assets, goods or services, or is legally discharged of the liability.

In the event of a change in the terms of an existing financial liability, the Company assesses whether the terms of the liability are materially different from the existing terms, taking into account qualitative and quantitative considerations.

When a substantial modification is made to the terms of an existing financial liability, or when a liability is exchanged with another liability with materially different terms between the Company and an existing lender, the transaction is accounted for as a derecognition of the original liability and the recognition of a new liability. The differences between these two financial liabilities in the financial statements are recognized in profit or loss.

F - 27

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 3 – SIGNIFICANT ACCOUNTING POLICIES (cont.)

D. Financial instruments (cont.)
3. Derecognition of total financial liabilities (cont.)
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When an immaterial modification is made to the terms of an existing liability, or when a liability is exchanged with another liability whose terms are not materially different, between the Company and an existing lender, the Company revises the liability amount, i.e., discounts the new cash flows by the original effective interest rate, and the difference is carried to profit or loss.

4. Government loan at a preferential interest rate

When the Group receives loans from government entities bearing interest lower than the market interest rate, such loans are initially recognized at fair value in accordance with the provisions of IFRS 9. The difference between the fair value of the loans at initial recognition and the amount received constitutes a government grant. Where the grant pertains to the acquisition, construction or financing of an asset, it is accounted for as an asset grant and is systematically recognized in profit or loss over the useful life of the relevant asset, subject to compliance with the terms and undertakings set with respect to the loan.

Subsequent to initial recognition, the loan is measured at amortized cost in accordance with IFRS 9, using the effective interest method.

For details regarding the receipt of a loan at a preferential interest rate from TEF with respect to the Basin Ranch project, see Note 14B4.

E. Property, plant & equipment
1. Recognition and measurement
--- ---

Property, plant and equipment items are measured at cost less accumulated depreciation.

The cost of property, plant and equipment includes expenditure that is directly attributable to the purchase of the asset. The cost of self-constructed assets includes the cost of materials, direct labor costs, any additional costs directly attributable to bringing the asset to the location and the condition necessary for it to be capable of operating in the manner intended by management, the estimated cost for decommissioning and removing the items and restoring the site on which they are located, as well as capitalized borrowing costs. Advance payments made in respect of self-constructed assets are recognized as part of the cost of the said equipment.

The Company recognized in the income statement, all development costs in respect of projects that it develops until a stage at which, in management’s opinion, the feasibility of construction of the project has been proven. From the stage at which the project is feasible, the development costs and subsequently the construction costs are capitalized to the project costs. A project is considered feasible when the Company’s management believes that the likelihood of the project materializing and generating future economic benefits is greater than the likelihood that it will not materialize.

Purchased software that is integral to the functionality of the related equipment is recognized under the cost of that equipment.

Spare parts, auxiliary equipment, emergency inventory and backup equipment are classified as property, plant and equipment when they meet the definition of property, plant and equipment under IAS 16, Property, Plant and Equipment.

F - 28

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 3 – SIGNIFICANT ACCOUNTING POLICIES (cont.)

E. Property, plant & equipment (cont.)
1. Recognition and measurement (cont.)
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When major parts of a property, plant and equipment item (including costs of periodic tests) have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.

The Company has BOT service concession arrangements in accordance with the provisions of IFRIC 12, Service Concession Arrangements (hereinafter - the “Interpretation”); for each arrangement, the Company assesses whether it falls within the scope of the Interpretation. When the grantor does not control the arrangement, the Company classifies the infrastructure, which is the subject matter of the arrangement, as property, plant & equipment in accordance with the provisions of IAS 16.

2. Compensation in respect of delay in the construction of a power plant

In cases where the Group is entitled to compensation in respect of delay in the construction of a power plant, the Group assesses the economic substance of the compensation. If the compensation is intended to cover losses incurred to the Company in practice, or loss of income, it is recognized in profit and loss. On other cases, the compensation amount is generally offset against the cost of property, plant and equipment.

3. Depreciation

Depreciation is a systematic allocation of the depreciable amount of an asset over its useful life. The amortizable amount is the cost of the asset, or another amount that replaces the cost, less its residual value. An asset is depreciated from the date it is ready for use, meaning the date it reaches the location and condition required for it to operate in the manner intended by management.

Amortization is recognized in the income statement (unless included in the carrying amount of another asset) on a straight-line basis over the estimated useful life of each part of the property, plant and equipment items, since this method reflects the expected consumption pattern of the future economic benefits inherent in the asset in the best way possible.

Estimates regarding depreciation methods, useful life and residual value are reviewed at the end of each reporting year and adjusted as needed.

The estimated useful life of the principal assets (including in associates) for the current period is as follows:

Power plants 23 - 40 years
Maintenance work 3 – 15 years
Roads and buildings 23 - 30 years
Back up diesel fuel by consumption
Freehold land is not depreciated.

For details regarding extending the estimated useful life of the Rotem Power Plant, see Note 2E1.

F - 29

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 3 – SIGNIFICANT ACCOUNTING POLICIES (cont.)

F. Intangible assets
1. Goodwill
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Goodwill resulting from the acquisition of subsidiaries is presented under intangible assets. For information regarding measurement of goodwill upon initial recognition, see Section A1 above.

In subsequent periods, goodwill is measured at cost less accumulated impairment losses. For details, see Note 11B.

2 Other intangible assets

Other intangible assets acquired by the Group that have a defined useful life are measured at cost less amortization.

3. Amortization

Amortization is the systematic allocation of the amortizable amount of an intangible asset over its useful life. The amortizable amount is the cost of the asset, less its residual value.

Amortization is recognized in the income statement on a straight-line basis, over the estimated useful life of the intangible assets from the date they are available for use, since these methods most closely reflect the expected pattern of consumption of the future economic benefits best embodied in each asset. Goodwill is not amortized systematically unless tested for impairment at least once a year.

Estimates regarding the amortization method and the useful life are reviewed at the end of each reporting year and adjusted as needed.

G. Impairment

Non-financial assets

Timing of impairment testing

The carrying amounts of the Group’s non-financial assets, other than inventory and deferred tax assets, are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, the recoverable amount of the asset is estimated.

Determining cash-generating units

For the purpose of impairment testing, assets which cannot be specifically tested are grouped into the smallest asset class that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or other groups of assets (hereinafter - a “cash-generating unit").

Measurement of recoverable amount

The recoverable amount of an asset or cash-generating unit is the higher of its value in use and its fair value less disposal costs. When determining the value in use, the Group discounts the projected future cash flows at the pre-tax discount rate that reflects the estimates of the market participants regarding the time value of money and the specific risks attributed to the asset. For the purpose of impairment testing, assets are grouped together into the smallest asset class that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or other groups of assets (hereinafter - a “cash-generating unit").

F - 30

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 3 – SIGNIFICANT ACCOUNTING POLICIES (cont.)

G. Impairment (cont.)

Recognition of impairment loss

Impairment losses are recognized if the carrying amount of an asset or cash-generating unit exceeds its recoverable amount, and are recognized in profit and loss. With regard to cash-generating units that include goodwill, an impairment loss is recognized when the carrying amount of the cash-generating unit, after grossing up the goodwill balance, with the non-controlling interests measured according to their proportionate share in the net identifiable assets, exceeds its recoverable amount. Impairment losses recognized in respect of cash-generating units are first allocated to impairment of the carrying value of goodwill attributed to those units and subsequently to impairment of the carrying value of the other assets in the cash-generating units, proportionally.

H. Employee benefits

Defined contribution plans

The Group has a defined contribution plan. A defined contribution plan is a post-employment benefit plan under which the Group pays fixed contributions into a separate entity and has no legal or constructive obligation to pay further amounts. The Group’s obligations for contributions to defined contribution plans are recognized as an expense in profit and loss in the periods during which related services are rendered by the employees. Liabilities for contributions into a defined contribution plan that are due for payment within more than 12 months from the end of the period in which the employees rendered the service are recognized at their present value.

Share-based compensation transactions

The fair value at the grant date of share-based compensation bonuses to the Company’s employees is recognized as a salary expense in parallel to an increase in equity over the period in which a non-contingent entitlement to the bonuses is achieved. The amount recognized as an expense in respect of share-based compensation bonuses that is subject to vesting conditions that are service terms is adjusted to reflect the number of bonuses that are expected to vest.

The fair value of the liability for employees for rights to share in the profits of the CPV Group was treated as a cash-settled share-based payment and recognized as an expense against a corresponding increase in liability, over the period in which the unconditional right to payment is achieved. The liability is remeasured at each reporting date until the settlement date. CPV Group’s profit sharing rights are based on CPV Group’s fair value. The changes in the fair value of the liability were included in general and administrative expenses in the income statement. For further details, see Note 16C to the Financial Statements.

I. Revenues

The Group recognizes revenues when the customer gains control over the promised goods or services. The revenue is measured at fair value of the consideration to which the Group expects to be entitled in exchange for the goods or services promised to the customer, other than amounts collected for third parties.

Revenues from the sale of electricity and steam are recognized in the period in which the sale takes place in accordance with the price set in the electricity sale agreements with customers and the quantities of electricity supplied.

F - 31

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 3 – SIGNIFICANT ACCOUNTING POLICIES (cont.)

I. Revenues (cont.)

The Group has three main types of revenues:

1. Revenues from the sale of electricity and steam to private customers are recognized in the period in which the electricity was supplied, and in accordance with the price set in the agreements with the customers.
2. Revenues from the sale of electricity to the System Operator are recognized upon its transmission into the electrical grid.
--- ---
3. Revenues from provision of power plants’ availability to the System Operator are recognized over the period during which capacity was provided.
--- ---

When setting the transaction price, the Groups takes into consideration fixed amounts and amounts that may vary as a result of discounts, credits, price concessions, penalties, claims and disputes and contract modifications that the consideration in their respect has not yet been agreed by the parties.

The Group includes in the transaction price the variable consideration amount, or part thereof, when it is highly probable that a significant reversal of the recognized accumulated revenues amount will not occur when the uncertainty associated with the variable consideration has been subsequently resolved. At the end of each reporting period and if necessary, the Group revises the estimate of the variable consideration included in the transaction price.

Furthermore, the Group recognizes compensation paid to customers in respect of delays in the commercial operation date of power plants on payment date within long-term prepaid expenses, and amortizes them throughout the term of the contract, from the date of commercial operation of the power plant, against a decrease in revenues from contracts with customers.

Upon the sale of electricity to private customers, the Group collects from the customers costs in respect of public utilities provided by Israel Electric Corporation (hereinafter - the “IEC”), whose rates are set by the Israeli Electricity Authority. Those utility costs are transferred by the Group to the IEC without a margin. The Group views the sale of electricity and the sale of the utility services as a single performance obligation, since these are services and/or commodities that are inseparable. Since the customer views the Company as its main supplier in respect of this performance obligation according to indicators defined above, the Group recognizes the revenues at the gross amount of the proceeds.

J. Finance income and expenses

Finance expenses include, among other things, interest expenses in respect of loans and debentures received, losses from derivative financial instruments recognized in profit and loss, losses from hedging instruments recognized in profit and loss and early repayment fees of loans. Borrowing costs are recognized in the income statement using the effective interest method.

Finance income includes interest income in respect of loans granted and amounts invested, and gains from derivative financial instruments recognized in profit and loss.

Profits and losses from exchange rate differences in respect of financial assets and liabilities are reported on a net basis as finance income or finance expenses, depending on their position (net profit or loss).

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 3 – SIGNIFICANT ACCOUNTING POLICIES (cont.)

J. Finance income and expenses (cont.)

In statements of cash flows, interest received is presented under cash flows from investing activities. Interest paid is presented under cash flows from financing activities.

Borrowing costs capitalized to qualifying assets and paid are presented as part of the costs to construct property, plant, and equipment under cash flows from investing activities. Cash flows paid (or received) in respect of derivative financial instruments used to hedge loans are presented under cash flows from financing activities.

K. Income tax expenses

Income tax includes current and deferred taxes. Income taxes are recognized in the income statement unless the tax derives from a business combination, or are recognized directly to equity or other comprehensive income if derived from items recognized directly in equity or other comprehensive income.

Current taxes

Current tax is the tax amount expected to be paid (or received) on taxable income in the tax year, when it is calculated at the tax rates under the applicable laws that have been enacted or substantively enacted as of the reporting date. Current taxes include taxes in respect of previous years.

Deferred taxes

Deferred taxes are recognized in respect of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and their value for tax purposes. The Group does not recognize deferred taxes in respect of the following temporary differences: (1) initial recognition of goodwill; (2) initial recognition of assets and liabilities in a transaction that does not constitute a business combination and does not affect the accounting profit and the profit for tax purposes; (3) the differences are due to an investment in subsidiaries, if the Group controls the reversal date of the difference and, they are not expected to reverse in the foreseeable future, whether by way of disposal of an investment or by way of dividend distribution in respect of an investment.

Deferred taxes are measured at the tax rates that are expected to be applied to temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by the reporting date.

A deferred tax asset for carryforward losses, tax benefits and deductible temporary differences is recognized if it is probable that future taxable income can be utilized. Deferred tax assets are examined on every reporting date, and if the attributed tax benefits are not expected to materialize, they are amortized.

Deferred tax assets which were not recognized are reassessed on every reporting date and recognized if the expectation changes such that future taxable income will be available against which they can be utilized.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 3 – SIGNIFICANT ACCOUNTING POLICIES (cont.)

K. Income tax expenses (cont.)

Offsetting current and deferred tax assets and liabilities

The Group offsets deferred tax assets and liabilities if there is a legally enforceable right to offset current tax liabilities and assets, and they are attributed to the same taxable income levied by the same tax authority on the same taxable company, or on various tax entities, but they intend to settle deferred tax liabilities and assets on a net basis or their current tax assets and liabilities will be realized simultaneously.

Provision in respect of uncertain tax positions, including additional tax and interest expenses, is recognized when it is more likely than not that the Group will need to use its economic resources to settle the obligation.

L. Capitalization of borrowing costs

A qualifying asset is an asset that requires a substantial period to prepare it for its intended use or sale. Specific and non-specific borrowing costs are capitalized to a qualifying asset during the period required for construction and completion until the date it is ready for its intended use. Other borrowing costs are expensed in profit and loss as incurred.

M. Leases
1. Leased assets and lease liabilities
--- ---

Contracts that confer on the Group the right to control the use of an asset in respect of a lease for a period of time in exchange for a consideration are accounted for as leases. Upon initial recognition, the Group recognizes a liability in the amount of the present value of the future lease payments (such payments do not include certain variable lease payments), and at the same time, the Group recognizes a right-of-use asset in the amount of the lease liability, adjusted for the lease payments - prepaid or accrued - plus direct costs incurred in the lease.

Since the interest rate implicit in the Group’s leases cannot be determined, the Group uses the incremental interest rate of the lessee.

Subsequent to initial recognition, the right-of-use asset is accounted for using the cost model, and amortized throughout the lease term or throughout the useful life of the asset, whichever is earlier.

2. Lease term

The lease term is determined as the period in which the lease is non-terminable, together with the periods covered by an option to extend or terminate the lease if it is reasonably certain that the lessee will exercise or not to exercise the option, respectively.

3. Amortization of right-of-use asset

Subsequent to the lease commencement date, the right-of-use asset is measured using the cost method, less accumulated depreciation and accrued impairment losses adjusted for remeasurement of the lease liability. The depreciation is calculated on the straight line basis over the useful life or the contractual lease term, whichever is earlier: Land - 24-49 years and other assets - 12-16 years.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 3 – SIGNIFICANT ACCOUNTING POLICIES (cont.)

N. New standards and interpretations not yet adopted

IFRS 18, Presentation and Disclosure in Financial Statements

This standard supersedes IAS 1 - Presentation of Financial Statements. The objective of the standard is to provide improved structure and content for the financial statements, specifically the income statement. The standard includes new disclosure and presentation requirements, and requirements which have been retained from IAS 1 with slight changes in wording. Generally, expenses in the income statement are classified into three categories: operating profit, investment income, and finance income. The standard also includes requirements to provide separate disclosure in the financial statements regarding the use of NON-GAAP measures, and specific guidance on aggregation and disaggregation of items in the financial statements and notes.

The standard’s initial application date is for annual periods commencing on January 1, 2027; early application is permitted. The Group is studying the effects of the standard on the Financial Statements.

NOTE 4 – DETERMINATION OF FAIR VALUE

In determining the fair value of an asset or liability, the Group uses as many observable inputs as possible. Fair value measurements are divided into three levels in the fair value hierarchy, based on the inputs used in the valuation, as follows:

Level 1 - Quoted (unadjusted) prices in an active market for identical assets or liabilities.

Level 2 - Observable inputs, directly or indirectly, which are not included in Level 1 above.

Level 3 - Data that are not based on observable market inputs.

As part of the accounting policy principles and disclosure requirements, the Group is required to determine the fair value of financial and non-financial assets and liabilities. The fair value is determined for measurement and/or disclosure purposes using the methods described below. Additional information regarding the assumptions used to determine the fair values is provided in the notes referring to that asset or liability.

A. Trade and other receivables and debit balances

The fair value of trade and other receivables is determined upon initial recognition based on the present value of the future cash flows, discounted at the market interest rate as of the measurement date. With regard to most of the Group’s trade and other receivables, since the credit period is short and constitutes the accepted credit in the industry, the future consideration is not capitalized, and subsequent to initial recognition the carrying amount approximates their fair value. The carrying amount of cash and restricted deposits as well as long-term receivables also approximates their fair value, since those assets bear interest at a rate similar to the interest rate accepted in the market for similar assets.

B. Derivative financial instruments

The fair value of foreign currency forwards is determined by using quotations of a trading system that quotes the market input entered by financial entities and used to calculate the fair value. The fair value is determined by discounting the future value arising from the difference between the opening price and the price as of measurement date.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 4 – DETERMINATION OF FAIR VALUE (cont.)

B. Derivative financial instruments (cont.)

The fair value of interest rate swaps is determined by using quotations of a trading system that quotes the market input entered by financial entities and used to calculate the fair value. The fair value is determined by discounting the estimated future cash flows based on the conditions and the term to maturity of each contract, using market interest rates for a similar instruments at the measurement date. When determining the fair value, the Company takes into account the credit risk of the parties to the contract.

The fair value of CPI swap contracts is determined in accordance with the discounted NIS amount payable in nominal NIS interest and the discounted expected cash flow from NIS real interest. When determining the fair value, the Company takes into account the credit risk of the parties to the contract.

The fair value of commodity contracts (primarily natural gas and electricity), is determined using quotes for the relevant future commodity prices.

For further details, see Note 21C.

C. Non-derivative financial liabilities

The fair value of certain trade and other payables is determined upon initial recognition based on the present value of the future cash flows, discounted at the market interest rate as of the measurement date. With regard to most of the Group’s trade and other payables, since the credit period is short, the future consideration is not discounted, and subsequent to initial recognition the carrying amount approximates their fair value.

The fair value of all other financial liabilities, which is determined subsequent to initial recognition for disclosure purposes, is calculated as follows: loans from banks, financial institutions and others and loans from non-controlling interests - based on the present value of the future cash flows in respect of the principal and interest component, discounted by the relevant rating curve; marketable debentures - their quoted price on closing of trade as of measurement date.

D. Share-based compensation transactions

In Israel

The fair value of employee options is measured using the Black & Scholes option pricing model. The model's assumptions include the share price as of measurement date, the option’s exercise price, expected volatility of the share, the option’s contractual term, expected dividend yield, and risk-free interest rate (based on government bonds). Service terms are not taken into account when determining the fair value.

In CPV Group (cash-settled)

The fair value of employees’ profit sharing plan, which is calculated every reporting period for measurement purposes, is determined using an option pricing model (OPM). The model's assumptions include the estimated fair value of the plan, which is derived from the value of CPV Group (which is based, in general, on an independent appraisal), and the base mechanism set in the plan - all as of the measurement date, expected standard deviation, expected life and risk-free interest rate (on the basis of US government bonds). Service terms are not taken into account when determining the fair value. For further details – see Note 16C.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 5 - CASH AND CASH EQUIVALENTS

Nominal interest<br><br> <br>December 31, 2025 As of December 31
2025 2024
NIS million NIS million
Current account balances 1,021 746
Deposits 1,892 216
3.9 % 2,913 962

For additional information about transactions and balances with related and interested parties, see Note 22.

For further details regarding the Group’s exposure to credit, interest and foreign currency risks and sensitivity analyses, see Note 21.

NOTE 6 - LONG-TERM CASH AND RESTRICTED DEPOSITS WITH BANKING CORPORATIONS

Nominal interest<br><br> <br>December 31, 2025 As of December 31
2025 2024
NIS million NIS million
Long-term restricted cash and deposits in the US (1) 3.9 % 482 -
Long-term restricted cash and deposits in Israel (2) 4.0 % 40 60
522 60
(1) Balances designated for the construction of the Basin Ranch project For further details regarding the Project, see Note 23E1.
--- ---
(2) For further details, see Note 14B2.
--- ---

For further details regarding the Group’s exposure to credit, interest and foreign currency risks and sensitivity analyses, see Note 21.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 7 – RECEIVABLES AND DEBIT BALANCES

As of December 31
2025 2024
NIS million NIS million
Prepaid expenses 45 40
Government authorities 41 39
Subordinate loans to Valley power plant (1) 110 -
Other 10 11
206 90
(1) Subordinated loans advanced by the project partners in previous years, and repaid subsequent to the Report date under the refinancing of the Valley power plant completed in February 2026.
--- ---

For additional information about transactions and balances with related and interested parties, see Note 22.

For further details regarding the Group’s exposure to credit and foreign currency risks and sensitivity analyses, see Note 21.

NOTE 8 – LONG-TERM PREPAID EXPENSES AND OTHER RECEIVABLES

As of December 31
2025 2024
NIS million NIS million
Receivable development fees from the Basin Ranch project 121 -
Advance payment for the acquisition of the remaining partner in the Basin Ranch (1) project 186 -
Subordinate loans to Valley power plant (2) - 117
Payments to customers 25 24
Deferred tax assets 32 10
Other 13 11
377 162
(1) For details regarding the agreement to acquire the remaining ownership rights in the Basin Ranch project (30%), see Note 23E1.
--- ---
(2) As of December 31, 2025, the balance was classified as short-term. For details, see Note 7.
--- ---

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 9 – PROPERTY, PLANT & EQUIPMENT

A. Composition
Active power plants and ancillary equipment Power plants under construction and development Land and other<br><br> <br>assets (1) Total
--- --- --- --- --- --- --- --- --- --- --- --- ---
NIS million NIS million NIS million NIS million
Cost
Balance as of January 1, 2024 5,649 1,052 571 7,272
Additions 74 913 59 1,046
Diesel fuel consumption - - (12 ) (12 )
Derecognitions (24 ) - (3 ) (27 )
Classification from assets under construction due to commercial operation 401 (401 ) - -
Impairment (2) - (31 ) - (31 )
Deconsolidation (3) (1,588 ) (1,267 ) (30 ) (2,885 )
Effect of changes in exchange rates 41 28 - 69
Balance as of December 31, 2024 4,553 294 585 5,432
Additions 152 187 61 400
Diesel fuel consumption - - (26 ) (26 )
Derecognitions (1 ) - (21 ) (22 )
Classification from assets under construction due to commercial operation 55 (55 ) - -
Reversal of impairment (2) - 31 - 31
Effect of changes in exchange rates - (1 ) (1 ) (2 )
Balance as of December 31, 2025 4,759 456 598 5,813
Accumulated depreciation
Balance as of January 1, 2024 949 - 80 1,029
Depreciation per year 245 - 14 259
Derecognitions (24 ) - (2 ) (26 )
Deconsolidation (3) (64 ) - (5 ) (69 )
Effect of changes in exchange rates 1 - - 1
Balance as of December 31, 2024 1,107 - 87 1,194
Depreciation per year 203 - 15 218
Derecognitions - - (1 ) (1 )
Balance as of December 31, 2025 1,310 - 101 1,411
Amortized balance as of December 31, 2025 3,449 456 497 4,402
Amortized balance as of December 31, 2024 3,446 294 498 4,238
Amortized balance as of January 1, 2024 4,700 1,052 491 6,243
(1) Includes land owned by the Gat Power Plant totaling approx. NIS 84 million.
--- ---
(2) For details regarding impairment loss in the Hadera 2 Project in 2024 and its reversal during the reporting period, see Note 10B4.
--- ---
(3) For details regarding deconsolidation and transition to the equity method in the fourth quarter of 2024 with respect to the investment in CPV Renewable, see Note 23F.
--- ---

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 9 – PROPERTY, PLANT & EQUIPMENT (cont.)

B. Non-cash purchase of property, plant and equipment

In the years ended December 31, 2025 and 2024, non-cash property, plant and equipment was purchased in the amount of approx. NIS 26 million for each year.

C.        Significant scheduled maintenance work

During the year ended December 31, 2025, scheduled upgrading and maintenance work was carried out at the Rotem Power Plant at a total cost of approx. NIS 133 million.

For further details regarding maintenance and service agreements into which Group companies entered, see Note 26B.

D. Projects under construction - material construction and equipment agreements
1. Sorek 2 Project in Israel (construction completed, undergoing delivery inspections)
--- ---

In May 2020, Sorek 2 (a special-purpose company wholly‑owned by OPC Power Plants) signed an agreement with SMS IDE Ltd. (hereinafter - “IDE”),

      which won a tender of the State of Israel for the construction, operation, maintenance and transfer of a seawater desalination facility on the Sorek 2 site, whereby Sorek is to supply equipment, construct, operate, and maintain a \(natural
      gas-fired\) energy generation facility on the site of the Desalination Facility, with a production capacity of approx. 87 MW \(hereinafter – the “Generation Facility”\). Sorek 2’s engagement with IDE includes,
      among other things, undertakings by Sorek 2 to construct the Generation Facility within the time frames set in the agreement \(when, among other things, deviation from the time frames may require compensation subject to the provisions of the
      agreement\), and an undertaking to supply energy at a certain capacity and scope to the desalination facility over a period that will end 25 years from the commercial operation date of the desalination facility. At the end of the aforesaid period,
      ownership of the Generation Facility will be transferred to the State. To secure Sorek 2’s commitments under the construction agreement of the generation facility, the Company provided IDE guarantees that will remain valid throughout the term of
      the construction agreement.

In June 2021, Sorek 2 contracted with BHI CO. Ltd. (hereinafter - “BHI”) a South Korean-owned corporation that will serve as the project’s construction contractor entered into a “lump sum turn-key” EPC agreement, under which the construction contractor will build the said generation facility, all in accordance with the milestones, terms and dates set with respect to each of the agreement’s components. An IDE group corporation is also a party to the construction agreement (in its capacity as the commissioning party), under which systems are supplied to the desalination facility, for which the said corporation is required to pay.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 9 – PROPERTY, PLANT & EQUIPMENT (cont.)

D. Projects under construction - material construction and equipment agreements (cont.)
1. Sorek 2 Project in Israel (construction completed, undergoing delivery inspections) (cont.)
--- ---

Sorek 2’s share in the amount payable to the construction contractor is estimated at approx. USD 42 million (as of the signing date of the agreement); this amount also includes the amount payable for the purchase of the gas turbines.^1^ The consideration as per the agreement is paid in various foreign currencies, specifically the USD and the EUR. As part of its currency risk management policy, Sorek 2 partially hedged its exposure to changes in the exchange rates under the construction agreement through forwards, and opted to implement cash flow hedge accounting.

In addition, the construction agreement includes provisions that are generally accepted in agreements of this type, including with regard to capped agreed compensation in respect of delays, non-compliance with execution and availability requirements; the agreement also sets the scope of liability and requirements for provision of guarantees in the various stages of the project.

In 2023, the construction contractor served Sorek 2 with a force majeure notice following the outbreak of the War. In 2024-2025, following an escalation in the state of war and due to Operation Rising Lion, notices were received regarding the evacuation from Israel of the contractors’ foreign workers. Upon receiving these notices, Sorek 2 notified IDE and the State of the above notices of events stating that, due to the expected schedule overruns, as well as due to the migrant workers’ evacuation from the site, schedule overruns and construction completion delays are expected. Such delays may make an increase in project costs beyond the expected costs.

As of the Report approval date, the construction of the power plant has been essentially completed and its commercial operation is subject to the fulfillment of conditions and factors which have not yet been met and, including operational and technical factors associated with delivery inspections.

It is noted that a delay in the commercial operation beyond the original contractual date, which is not deemed a justified delay as defined in the project agreements, may trigger the payment of a limited-rate graduated monthly compensation (taking into consideration the duration of the delay, with a delay beyond the utilization of the compensation cap possibly giving rise to a termination right). It is hereby clarified that, during the first delay period, the amount of the compensation in respect of unjustified delay is immaterial.

As of the report approval date, the ultimate consequences of these delays (including other potential delays), considering, inter alia, various force majeure claims that have not yet been fully investigated to date, are uncertain.

^1^  The gas turbine shall be supplied by companies of the General Electric (GE) group by virtue of an equipment supply agreement originally signed by Sorek 2 and assigned to the construction contractor under the same terms.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 9 – PROPERTY, PLANT & EQUIPMENT (cont.)

D. Projects under construction - material construction and equipment agreements (cont.)
2. Ramat Beka Project in Israel (in advanced development)
--- ---
A. In December 2024, OPC Power Plants signed a binding agreement to supply solar panels for the Ramat Beka project with a global supplier (hereinafter – the “Panel Supplier”), to purchase solar<br> panels with a capacity of up to 500 MW and at a total estimated cost of approx. NIS 160 million (approx. USD 50 million). In addition, as per the agreement, the solar panels’ technical specifications, ordering mechanisms, early<br> termination provisions and terms and conditions thereof, supply dates, warranty terms and conditions, payment of advances to the supplier, price adjustment mechanisms, and compensation in the event of a significant delay, as well as the<br> collateral that the Company and Panel Supplier would provide to ensure their compliance with their contractual undertakings, were stipulated.
--- ---
B. In February 2026, OPC Ramat Beka entered into an engineering, procurement and construction agreement (EPC) for the construction of a substation (private substation) and a switching station with a total capacity of approx. 970 MW,<br> designed to convert the voltage of the electricity generated in the Ramat Beka Project to the electrical grid, at a total of approx. NIS 310 million.
--- ---

The Agreement includes customary provisions for agreements of this type, including collateral, payment execution terms and conditions, the work schedule, warranty periods, and limitations on the contractor’s liability.

Furthermore, it was stipulated that OPC Ramat Beka may terminate the Agreement before a notice to proceed was issued, and the contractor may terminate the Agreement if a notice to proceed was not issued within the period set in the Agreement, all subject to a certain payment to the contractor, as stipulated in the Agreement and in accordance with the circumstances.

The commencement of the construction work depends, among other things, on the completion of the project’s financial closing, receipt of the required permits and regulatory approvals, and fulfillment of additional conditions as detailed in the Agreement. As of the Report approval date, there is no certainty as to the completion of the abovementioned processes.

3. Hadera 2 Project in Israel (in advanced development)

In February 2026, Hadera 2 and GE Vernova (hereinafter in this section - the "Supplier”) entered into an agreement for the supply of the Hadera 2 power plant’s primary equipment, including the gas and steam turbines and ancillary equipment (hereinafter in this section - "Equipment Supply Agreement") and a maintenance agreement with respect to the abovementioned equipment. Under the Equipment Supply Agreement, the Supplier undertook, inter alia, to supply the main equipment in accordance with the agreed timetable and terms. Furthermore, the Equipment Supply Agreement includes certain provisions regarding the equipment’s performance, guarantees, caps and limitation of liability and Supplier warranty in respect of the equipment (which are capped and subject to the prescribed circumstances, terms and conditions). In accordance with the Equipment Supply Agreement, Hadera 2 undertook to pay - on scheduled dates, some of which had already been made as of the Report approval date (with the total amount paid estimated at tens of millions of euros) - a total consideration estimated at approx. 20% of the estimated cost of the project (which is estimated - as of the Report approval date - at approx. NIS 4.8-5.2 billion).

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 9 – PROPERTY, PLANT & EQUIPMENT (cont.)

D. Projects under construction - material construction and equipment agreements (cont.)
4. Basin Ranch Project in the US (under construction, will be consolidated in the Company's reports as from Q1/2026)
--- ---

At the financial closing date of the Project, in October 2025, an engineering procurement and construction agreement (hereinafter - the "EPC Agreement") and an agreement to acquire the project’s principal equipment (hereinafter - the “Equipment Purchase Agreement") came into effect. In accordance with the EPC Agreement, the construction contractor undertook to provide full construction services, which include a combination of the equipment acquired under the Equipment Purchase Agreement and procurement of the remaining equipment (which was not acquired under the Equipment Purchase Agreement). The EPC Agreement includes standard terms and conditions and undertakings generally accepted in such transactions (similar to CPV’s other energy transition projects), such as the contractor's undertaking to complete within set schedules; warranty periods; project acceptance tests; performance and availability undertakings; various guarantees to secure the contractor's undertakings and performance metrics under the agreement; agreed (capped) compensation for a delay in project delivery; standard grounds for agreement termination; insurance; contractor liability limitation and other provisions, which are relevant for the project’s construction and operation.

The project’s principal equipment is supplied by an affiliate of a project partner, as of the financial closing date, under the Equipment Purchase Agreement. The Equipment Purchase Agreement includes specifications regarding the project’s power generation equipment (H Class technology) including two gas turbines and two steam turbines, certain guarantees and liability (subject to caps) and product warranty.

The consideration under the EPC Agreement and Equipment Purchase Agreement will be paid over time, in accordance with the milestones set in each agreement and is expected to total approx. NIS 4.6 billion (approx. USD 1.4 billion) (as of the signing date of the Agreements) with respect to both agreements and additional EPC agreements. The agreements include fixed consideration and a variable component in respect of relevant customs tariffs, which will be paid by the project in accordance with the arrangements set forth in the agreements, and which may affect the overall expected cost.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 10 – RIGHT-OF-USE ASSETS AND DEFERRED EXPENSES

A. Composition of right‑of‑use assets and deferred expenses
Land (b) Other (1) Long-term deferred expenses (2) Total
--- --- --- --- --- --- --- --- --- --- --- --- ---
NIS million NIS million NIS million NIS million
Balance as of January 1, 2024 334 88 209 631
Additions - - 193 193
Derecognitions - (2 ) - (2 )
Depreciation (13 ) (13 ) (5 ) (31 )
Deconsolidation (3) (159 ) - - (159 )
Effect of changes in exchange rates 5 - - 5
Balance as of December 31, 2024 167 73 397 637
Additions - - 29 29
Depreciation (8 ) (11 ) (6 ) (25 )
Derecognitions (1 ) (2 ) - (3 )
Effect of changes in exchange rates - (2 ) - (2 )
Balance as of December 31, 2025 158 58 420 636
(1) Mainly includes costs paid with respect to the construction of the PRMS Facilities for the Hadera and Zomet power plants and leases on offices in Israel and the US.
--- ---
(2) Mainly in respect of payments in respect of infrastructure for electricity transmission lines, and payments in respect of the Ramat Beka project’s land, as described in Section B5 below.
--- ---
(3) For details regarding deconsolidation and transition to the equity method in the fourth quarter of 2024 with respect to the investment in CPV Renewable, see Note 23F.
--- ---

For details regarding maturity analysis of land lease liabilities, see Note 21B2.

B. Main agreements in Israel
1. The Rotem Power Plant
--- ---

Rotem has a lease agreement for a 55 dunam plot of land in Mishor Rotem. Under the conditions set out in the agreement, the lease is for a term of 49 years as from November 4, 2010, with an option to extend the lease for one additional term of 49 years, subject to advance notice. In the event of rezoning of the plot during the Lease Term, the Lessor will not be required to extend the Lease Term. The lessor may cancel the lease agreement in events defined in the Agreement as a fundamental breach.

2. The Hadera Power Plant

Hadera leases land covering approx. 28 dunams (including an emergency road) from Infinya. The monthly rent amounts to approx. NIS 118 thousand (linked to the CPI), subject to adjustments in certain cases, and the lease term is 24 years and 11 months starting from December 2018. The agreement grants the parties a termination right, inter alia, in various default events, and grants Infinya a termination right in the event of a material breach by Hadera, including breach of the commitment to pay rent, subject to remediation periods and as determined in the agreement.

F - 44

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 10 – RIGHT-OF-USE ASSETS, LONG-TERM DEFERRED EXPENSES (cont.)

B. Main agreements in Israel (cont.)
3. Zomet Power Plant
--- ---

In January 2020, the Israel Lands Authority (hereinafter - the “ILA”) approved the designation of an area of approx. 85 dunams for construction of a power plant for electricity generation by Zomet. In January 2020, the ILA and Kibbutz Netiv HLH (hereinafter - the “Kibbutz”) signed a development agreement for the Land, effective until November 5, 2024, and after fulfillment of its terms, a lease agreement will be signed for a term of 24 years and 11 months from approval of the transaction, namely until November 4, 2044. The lease contract allows the extension of the lease term subject to the extension of the electricity generation license, and accordingly subject to the ILA’s procedures that will be in effect at that time.

In addition, in January 2020, Zomet and the Kibbutz signed an agreement of principles for the founding of a joint corporation, which was established by Zomet and the Kibbutz as a limited partnership,^2^ to which the rights to the land were transferred upon approval of the transaction by the ILA in May 2020. The consideration for the rights of the Kibbutz to the land under which a development agreement with the ILA can be signed amounted to NIS 30 million. In February 2020, an updated lease agreement was also signed according to which the Joint Corporation, as the owner of the Land, will lease the Land to Zomet in favor of the project.

In order to complete the land transaction, the Joint Corporation paid the ILA approx. NIS 154 million in capitalization fees based on land value (excluding development expenses) set in a final assessment. During the reporting period, final netting was made with the ILA for an immaterial amount, and Zomet was refunded the guarantee provided to ILA during the assessment proceedings, totaling approx. NIS 58 million (before linkage differences).

4. Hadera 2 Project (in advanced development)

Hadera 2 has an agreement with Infinya to lease of a plot of approx. 68 dunams adjacent to the Hadera Power Plant, whereby an annual option was awarded to Hadera 2 to exercise a lease agreement regarding land designated for the construction of a power plant, for an average payment of approx. NIS 6 million per year. The option may be renewed every year for a period of up to 5 years (end of 2027) under the terms set in the agreement. In December 2025, Hadera 2 renewed the option in respect of 2026 and paid approx. NIS 4 million.

If the option is exercised and a lease agreement will be signed, it will be for a period of 24 years and 11 months, commencing on exercise date. Furthermore, it provided that the Company will bear all the fees, taxes and payments that will be imposed with regard to the construction of a power plant on the leased property.

On April 17, 2024, the Israeli government rejected National Infrastructures Plan (NIP) 20B, for the construction of a natural gas-fired power generation plant (hereinafter - “Hadera 2 Project”) on the said land. In view of the Government Resolution, the Company assessed the recoverable amount of the Hadera 2 Project in its financial statements in accordance with the provisions of IAS 36, and accordingly recognized an impairment loss at the full carrying value of approx. NIS 31 million under other expenses, net.

^2^ Composition of the Joint Corporation: (1) The general partner, Zomet HLH General Partner Ltd. (1%) held by Zomet (74%) and the Kibbutz (26%); (2) The limited partners are Zomet (73%) and the Kibbutz (26%).

F - 45

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 10 – RIGHT-OF-USE ASSETS, LONG-TERM DEFERRED EXPENSES (cont.)

B. Main agreements in Israel (cont.)
4. Hadera 2 Project (in advanced development) (cont.)
--- ---

In June 2024, subsequent to the said government resolution, Hadera 2 filed a petition with the High Court of Justice, and in August 2025, in an additional hearing held by the Israeli government, the latter decided to approve the plan. In view of the above, in the third quarter of 2025 the Company reversed the impairment loss, which was recognized following the rejection of the plan in 2024, and recognized a NIS 31 million revenue under the other revenues, net line item.

5. The Ramat Beka renewable energy project (in advanced development)

In 2023-2024, it was announced that the Group through OPC Power Plants (hereinafter - the “Winner”) won tenders issued by ILA for planning and an option to purchase leasehold rights in land for the construction of renewable energy electricity generation facilities using photovoltaic technology in combination with storage in the Neot Hovav Industrial Local Council, according to the following breakdown:

(1) On May 10, 2023, the Group was announced the winning bidder with respect to three compounds, with an aggregate area of approx. 2,270 dunams (hereinafter – the "First Tender"). The Group’s bids in<br> the First Tender totaled approx. NIS 484 million, in the aggregate, for all three Compounds.
(2) On June 30, 2024, the Group was announced the winning bidder with respect to two compounds with an aggregate area of approx. 1,617 dunams located in proximity to the compounds won by the Group in the First Tender (hereinafter - the<br> “Second Tender”). The Group’s bids in the Second Tender total approx. NIS 890 million, in the aggregate, for the two compounds.
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In accordance with the terms of the First and Second Tenders, in August 2023 and September 2024, respectively, OPC Power Plants completed the first payment for the two tenders totaling approx. NIS 275 million (which constitutes 20% of the total consideration for the tenders’ areas). Upon authorizing a new outline plan, under which the project may be constructed (to the extent that it is authorized), lease agreements will be signed for a period of 24 years and 11 months, to build and operate the project(s), against payment of the remaining 80% of the bid amount per compound.

Subsequent to the Reporting date, in January 2026, the National Infrastructures Committee approved a plan for a consolidated project for both tenders, pending final approval. The remaining 80% of the bid amount totaling approx. NIS 1.2 billion is expected to be paid 90 days after the plan’s final approval date.

On July 23, 2024 OPC Power Plants received purchase tax assessments in connection with the First Tender amounting to approx. NIS 29 million. During the reporting period, OPC Power Plants filed an appeal against the decision of the Israel Tax Authority, which rejected the appeal. Consequently, OPC Power Plants filed an appeal against the ruling with the Appeals Committee.

OPC Power Plants disagrees with the Israel Tax Authority’s position and its financial demands as included in the purchase tax assessments, due to, among other things, the Company’s position that the arrangement as per the Israel Land Authority’s tender does not establish a “land ownership interest”. As of the Report date, the Company believes – based on the opinion of its legal counsel – that since the likelihood of its position being accepted is higher than the likelihood of its being rejected; therefore, the Company did not make a provision in its financial statements.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 10 – RIGHT-OF-USE ASSETS, LONG-TERM DEFERRED EXPENSES (cont.)

B. Main agreements in Israel (cont.)
6. Land in Rotem 2 (under construction)
--- ---

Rotem 2 has a lease agreement for plots with a total area of approx. 55 dunam. Land adjacent to the Rotem Power Plant. Under the conditions set out in the agreement, the lease is for a term of 49 years as from March 9, 2014, with an option to extend the lease for one additional term of 49 years, subject to the terms and conditions of the agreement. The lessor may cancel the lease agreement in events defined in the Agreement as a fundamental breach. In August 2022, the Company received from the ILA an extension for the land development period under the lease agreement until March 9, 2025, in consideration for an amount which is immaterial to the Company. As of the Report approval date, a date has not yet been set for the filing of the permit application. The Company is working with the ILA to obtain an additional extension for the development period, which has not yet been approved as of the Report approval date and there is no certainty it will be given.

C. Main agreements in the US
1. Shore power plant (will be consolidated in the Company’s financial statements as from the first quarter of 2026)
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The Shore Power Plant has a gas pipeline connected to two separate interstate transmission lines as detailed below:

Shore entered into agreements with Transcontinental Gas Pipeline Company, LLC (hereinafter - “Transco”) for transmission services and an agreement for the connection, construction and operation of a natural gas delivery point. In accordance with the abovementioned agreements, Transco provides Shore with gas-system connection services and firm-capacity natural gas transmission services through a dedicated lateral pipeline, which connects Transco's existing interstate pipeline to the power plant’s connection point. The term of the agreements is 15 years (until April 2030), with two additional 10-year extension options, which CPV Group believes are reasonably certain to be exercised, such that the term of the agreements will be extended until April 2050. The annual consideration during the First Agreement Term totals approx. USD 6 million (approx. NIS 21 million).

On December 19, 2018, Shore entered into an agreement with Texas Eastern Transmission LP (hereinafter - “Tetco”) for transmission services and an agreement for the connection, construction and operation of a natural gas delivery point. Pursuant to the agreement, Tetco provides Shore with connection services and firm-capacity natural gas transmission services, through a lateral pipeline, which connects Tetco's interstate transmission system to the power plant’s connection point. The lateral pipeline was completed and commissioned on September 28, 2021. The term of the agreement is 20 years (until September 2041), after which the agreement will be renewed for renewable annual periods, subject to the right to terminate the agreement by giving a one-year advance notice. The annual consideration during the First Agreement Term totals approx. USD 10 million (approx. NIS 34 million).

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 11 – INTANGIBLE ASSETS

A. Composition
Goodwill (1) PPA Other Total
--- --- --- --- --- --- --- --- --- --- --- --- ---
NIS million NIS million NIS million NIS million
Cost
Balance as of January 1, 2024 697 495 110 1,302
Additions - - 25 25
Derecognitions - - (2 ) (2 )
Impairment loss in respect of Gnrgy (2) (19 ) - (4 ) (23 )
Deconsolidation (3) (471 ) (510 ) (72 ) (1,053 )
Effect of changes in exchange rates 14 15 2 31
Balance as of December 31, 2024 221 - 59 280
Additions - - 11 11
Balance as of December 31, 2025 221 - 70 291
Amortization
Balance as of January 1, 2024 - 118 19 137
Depreciation per year - 41 8 49
Derecognitions - - (2 ) (2 )
Reclassification - 5 (5 ) -
Deconsolidation (3) - (166 ) (1 ) (167 )
Effect of changes in exchange rates - 2 - 2
Balance as of December 31, 2024 - - 19 19
Depreciation per year - - 6 6
Balance as of December 31, 2025 - - 25 25
Amortized balance as of December 31, 2025 221 - 45 266
Amortized balance as of December 31, 2024 221 - 40 261
Amortized balance as of January 1, 2024 697 377 91 1,165
(1) As of December 31, 2025, it includes a balance in respect of: The Israel power plants operations (mostly Rotem, Hadera and Gat) due to the acquisition of the Gat Power Plant in 2023 for a total of approx. NIS 221 million.
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(2) A goodwill impairment loss recognized in respect of the investment in Gnrgy prior to its sale in the third quarter of 2024 . For further details, see Note 23A4.
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(3) For details regarding deconsolidation and transition to the equity method in the fourth quarter of 2024 with respect to the investment in CPV Renewable, see Note 23F.
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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 11 – INTANGIBLE ASSETS (cont.)

B. Annual impairment testing of goodwill arising as part of the acquisition of the Gat Power Plant

As of the Report date, goodwill amounting to approx. NIS 221 million - which arose from the acquisition of the Gat Power Plant - reflects the synergy between Israeli power plants’ activity, whose business model is based on sale to private customers (mostly Rotem, Hadera and Gat).

The annual impairment testing of goodwill as of December 31, 2025, was carried out at the level of the cash-generating unit comprising the three power plants (Rotem, Hadera and Gat) (hereinafter - the “cash‑generating units”), since this is the lowest level at which goodwill is subject to monitoring for internal reporting purposes.

The impairment testing was carried out by calculating the recoverable amount of the Rotem Power Plant only in accordance with a value in use based on the DCF (discounted cash flows) method.

Following are the key assumptions used in determining Rotem’s value in use:

A. Forecast years - represent the period spanning from 2026 to 2043 and are based on the estimate of the economic life of the power plant and its value as of the end of the forecast period.
B. Generation Component forecasts and natural gas prices, which are not backed by an agreement - are based on market forecasts received from external and independent information sources.
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C. An annual long-term inflation rate of 2.2%.
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D. Weighted average cost of capital (WACC) calculated by an independent external appraiser - 7%.
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As of December 31, 2025, the recoverable amount of the Rotem Power Plant alone is estimated at approx. NIS 4.9 billion, which exceeds the carrying amount of the cash-generating unit by approx. NIS 2.7 billion, and accordingly, no impairment loss was recognized.

NOTE 12 – PAYABLES AND CREDIT BALANCES

As of December 31
2025 2024
NIS million NIS million
Profit-sharing plan for CPV Group employees (1) 221 -
Employees and institutions for salaries 58 63
Government authorities 44 18
Interest payable 23 20
Current maturities of lease liabilities 8 14
Other 15 8
369 123
(1) For details, see Note 16C.
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For further details regarding the Group’s exposure to liquidity and foreign currency risks and sensitivity analyses, see Note 21.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 13 – OTHER LONG‑TERM LIABILITIES

As of December 31
2025 2024
NIS million NIS million
Profit-sharing plan for CPV Group employees (1) - 105
Liabilities for evacuation, decommissioning, and removal 7 3
Other liabilities 8 7
15 115
(1) As of December 31, 2025, the balance was classified as short-term. For details, see Note 16C.
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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 14 – LOANS FROM BANKING CORPORATIONS AND FINANCIAL INSTITUTIONS

This Note provides information regarding the contractual terms of the Group's interest-bearing loans and credit measured at amortized cost. Additional information regarding the Group's exposure to interest rate, foreign currency and liquidity risks is provided in Note 21.

A. Composition

(1) Current maturities and short-term credit:

As of December 31
2025 2024
NIS million NIS million
Current maturities of long-term loans in Israel 117 80
Short-term credit in Israel - 2
Short-term credit in the US (a) 14 -
131 82

(2) Long-term loans from banking corporations and financial institutions:

As of December 31
2025 2024
NIS million NIS million
Loans to OPC Israel (b) 2,303 1,650
Loans to Hadera (b) 556 592
Loan to CPV (c) 484 -
Total from banking corporations and financial institutions 3,343 2,242
Net of deferred finance costs (23 ) (12 )
Net of current maturities of long-term loans in Israel (117 ) (80 )
3,203 2,150
A. With respect of utilization of a credit facility to finance receivable balances under CPV Group’s retail activity.
--- ---
B. For details regarding long-term loan agreements and interest rates in Israel, see Section B1 and 2 below.
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C. For details regarding the Bank Leumi loan agreement with the CPV Group in the US, see Section B3 below.
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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 14 – LOANS FROM BANKING CORPORATIONS AND FINANCIAL INSTITUTIONS (cont.)

B. Further details regarding finance agreements
1. Corporate finance agreements in Israel
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On August 11, 2024 OPC Israel (hereinafter - the “Borrower”) engaged in a finance agreement with Bank Hapoalim Ltd. and a finance agreement with Bank Leumi le-Israel B.M. (hereinafter - the “Lenders”) for the provision of loans totaling NIS 1.65 billion, which were advanced on August 15, 2024 and served mainly for early repayment of Zomet’s project finance - totaling approx. NIS 1,144 million (including approx. NIS 10 million in accrued interest and approx. NIS 8 million as an early repayment fee) - and Gat’s project finance totaling approx. NIS 443 million (including approx. NIS 4 million in accrued interest and approx. NIS 4 million as an early repayment fee), and for the financing of the Borrower’s activity as defined in the Finance Agreements. Most of the amount required for the Early Repayment of the Project Credit was advanced to Zomet and Gat by the Borrower thorough intercompany loans.

In respect of the abovementioned early repayment, the Company recognized in 2024, one-off finance expenses totaling approx. NIS 49 million under the loss from extinguishment of financial liabilities line item, of which approx. NIS 12 million are in respect of early repayment fees including in the above repayment amounts, and approx. NIS 37 million in respect of amortization of deferred finance costs (non-cash flow).

In January and July 2025, the Borrower entered into finance agreements with Israel Discount Bank Ltd. and Bank Hapoalim Ltd. for the provision of loans totaling NIS 700 million, under conditions similar to those of the finance agreements described above and as detailed below, which were used by the Borrower to repay shareholder loans (including the full and final repayment of the shareholder loan advanced to Rotem as detailed in Note 23D(1)a), the restructuring of a long-term debt and a dividend distribution (it is noted that the Company used its share mainly to repay debentures).

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 14 – LOANS FROM BANKING CORPORATIONS AND FINANCIAL INSTITUTIONS (cont.)

B. Further details regarding finance agreements in Israel (cont.)
1. Corporate finance agreements in Israel (cont.)
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Following are the key principles of the Finance Agreements

Loan provision date Various dates during 2024-2025
Principal terms A total of NIS 2,350 million under three separate (bilateral) finance agreements.^3^<br><br> <br>^^<br><br> <br>The loans’ principal will be repaid in quarterly installments from March 25, 2025 through December 25, 2033, as follows: 0.5% in every<br> quarter in 2025; 0.75% in every quarter in 2026; 1% in every quarter in 2027-2029; 5% in every quarter in 2030-2032; 5.75% in every quarter in 2033.
Outstanding balance of principal as of December 31, 2025 Approx. NIS 2,303 million.
Interest terms The Finance Agreements bear annual interest at a rate based on Prime interest + a spread ranging from 0.25% to 0.4%.<br><br> <br><br><br> <br>The interest in respect of each loan will be repaid in quarterly installments from September 25, 2024 through December 25, 2033.<br><br> <br><br><br> <br>Furthermore, the Finance Agreements include additional interest as is generally accepted, which is payable upon the occurrence of default<br> events (with respect to additional interest due to temporary non-compliance with financial covenants which does not constitute default, see below) and in respect of failure to make payments on time (interest on arrears).
Collateral and pledges Under the Finance Agreements, the Borrower undertook not to place liens on, or provide collateral for, its assets, including its holdings in<br> subsidiaries, except for certain allowed pledges as defined in the Finance Agreements, mostly for the purpose of existing and/or future project finance (for the Hadera Power Plant) (if any), under the defined terms and conditions.<br><br> <br><br><br> <br>Furthermore, the Borrower’s subsidiaries provided the Lenders with an undertaking not to take credit, excluding existing and/or future<br> Project Credit (for the Hadera Power Plant) and except with respect to activity in the ordinary course of business, all in accordance with the defined terms and conditions. In addition, company guarantees were provided to the Lenders by<br> certain subsidiaries which are wholly-owned (100%) by the Borrower (directly and/or indirectly).
Additional restrictions, liabilities and material conditions The Finance Agreements include various undertakings of the Borrower and grounds, upon the fulfillment of which the Lenders will be allowed to<br> call for immediate repayment of the loans (subject to remediation periods or to amounts set if applicable under the circumstances),^4^ which include, among other things, failure to make payments in respect of the loan on the<br> dates which were set for that purpose, liquidation procedures, receivership, insolvency or debt settlement agreements of the Borrower as set forth in the Finance Agreements, change of control in the Company or the Borrower under defined<br> circumstances and conditions, certain events which have an adverse effect on the Borrower’s activity as set forth in the Finance Agreements, restructuring - except for certain defined exceptions, a change in the area of activity of the<br> Borrower under set conditions, restrictions on the sale of assets under set conditions, failure to comply with the following financial covenants in accordance with the terms and conditions which were set (except for cases where a certain<br> deviation does not constitute grounds subject to the provisions regarding additional interest as detailed below), and a cross-default clause where the Borrower’s debt is called for immediate repayment upon the fulfillment of certain set<br> terms and conditions.<br><br> <br><br><br> <br>In addition, provisions were set with regard to fees, as is generally accepted in finance agreements, including transaction and early<br> repayment fees. It is clarified that early repayment fees in respect of each loan (except for fees in respect of economic damage, as applicable) were set at levels which decrease gradually over the loan term, such that within a set number<br> of years no early repayment fees will apply.
Conditions for distribution Distribution by the Borrower (including repayment of subordinated shareholder loans provided to the Borrower and/or its investees, excluding<br> the Rotem Loan) is subject to conditions generally accepted in finance agreements, and to compliance with the following financial covenants:<br><br> <br>The ratio between the net financial debt less the financial debt designated for construction of the projects that have not yet started generating EBITDA, and the<br> adjusted EBITDA, as defined below, shall not exceed 7.

^3^The Finance Agreements are separate and independent of each other; however, considering their similar characteristics, they are described collectively, where relevant.

^4^  In accordance with the Finance Agreements, some of the Borrower’s undertakings and grounds for immediate repayment (as detailed below) apply in respect of events of material subsidiaries of the Borrower (which include, among other things, OPC Power Plants, Rotem, Zomet, etc.).

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 14 – LOANS FROM BANKING CORPORATIONS AND FINANCIAL INSTITUTIONS (cont.)

B. Further details regarding finance agreements in Israel (cont.)
1. Corporate finance agreements in Israel (cont.)
--- ---

Following are the key principles of the Finance Agreements (cont.)

Financial covenants The financial covenants will be assessed at the end of each quarter (hereinafter - the “Measurement Date”),<br><br><br><br><br> immediately after the approval date of the financial statements of the Borrower. Following are the financial covenants applicable to the Borrower (on a consolidated basis) on each measurement date in connection with each of the Finance<br> Agreements:<br><br> <br>• The ratio of the net financial debt^(1)^ less financial debt designated for construction<br> of the projects that have not yet started generating EBITDA^(2)^, and the adjusted EBITDA^(3)^ shall not exceed 8 (hereinafter - “Debt to EBITDA Ratio”).<br><br> <br>• The equity^(4)^ to total assets ratio^(5)^ shall not fall below 20%.<br><br> <br>• The Company's equity^(4)^ will not fall below NIS 1.1 billion.<br><br> <br>(1)  Net<br> financial debt - Total (1) Long and short-term interest-bearing debts (including the Borrower’s share in such debts of associates) to banking institutions, financial entities and any other entity engaged in the provision of loans;<br> (2) Shareholder loans, excluding subordinated shareholder loans, as defined by the Finance Agreements, excluding the Rotem Loan;^5^ (3) Plus and/or less principal and/or interest swaps at their nominal value (less and/or plus<br> the deposits provided to secure them); and (4) Net of financial assets.<br><br> <br>Financial assets - total (1) Cash and cash equivalents and (2) Deposits with banks and financial institutions<br> (excluding restricted deposits provided against a guarantee), provided that they are clear and free of any pledge, incumbrance and foreclosure. It is noted that cash and cash equivalents and deposits restricted to the servicing of a<br> financial debt shall constitute part of the financial assets.<br><br> <br>(2)  A<br> financial debt designated for the construction of projects which have not yet started generating EBITDA - (1) Financial debt provided to a special-purpose corporation as part of project credit; or (2) In an unpledged project - the<br> outstanding balance of a financial debt provided at an amount that does not exceed the balance of actual investment in the project, provided that the aggregate amount will not exceed - on each measurement date - NIS 200 million; all of<br> the above - in connection with a project that has not yet reached commercial operation.<br><br> <br>(3)  Adjusted<br> EBITDA - EBITDA in the four quarters preceding the measurement date (including the Borrower’s share in the EBITDA of associates) net of other and/or one-off expenses or income and share-based payment. Plus:<br><br> <br>(a)  The annualized EBITDA^6^<br> of assets which commenced commercial operation during the four quarters preceding the measurement date; and<br><br> <br>(b)  The annualized EBITDA, based on<br> assets acquired by the Borrower and/or investees as part of an acquisition and/or merger transaction, and all of the respective financial debt was recognized upon their purchase.<br><br> <br>(4)  Equity<br> capital - as per the Borrower’s consolidated financial statements - attributable to the parent company’s shareholders, plus subordinated shareholder loans (but excluding the Rotem Loan).<br><br> <br>(5)  Total<br> assets - as per the Borrower’s consolidated financial statements.<br><br> <br><br><br> <br>It is noted that if the Borrower fails to comply with any financial covenants in a certain quarter at a range which does not exceed 10% of<br> the values set for the relevant covenant, the loan will bear additional interest at a rate set in the Finance Agreements as from the quarter in which the financial statements were published, according to which the Borrower failed to<br> comply the relevant covenants, up to a period of two consecutive quarters. Provided that such a deviation period will not occur more often than a frequency set in the Finance Agreements, the failure to comply with such financial covenants<br> in the said period shall not be deemed a default event and shall not constitute grounds for calling for immediate repayment of the loan.<br><br> <br><br><br> <br>For details regarding the actual amounts and/or ratios in respect of the abovementioned covenants as of December 31, 2025, see Section 7<br> below.

^5^For details regarding the shareholder loan advanced to Rotem see Note 23D.

^6^  Annualized EBITDA - the EBITDA divided by the number of days during the period commencing on the commercial operation or acquisition date and ending on the relevant measurement date, multiplied by 365.

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---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 14 – LOANS FROM BANKING CORPORATIONS AND FINANCIAL INSTITUTIONS (cont.)

B. Further details regarding finance agreements in Israel (cont.)
2. Project finance agreement in Hadera
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Loan provision date July 2016
--- ---
The financing entities A consortium of lenders headed by Israel Discount Bank Ltd. and Harel Insurance Company Ltd.
Outstanding balance of principal as of December 31, 2025 Approx. NIS 556 million.
Principal terms Repayable in quarterly installments, starting from March 25, 2020, with the final repayment date being in 2037 (subject to the stipulated<br> early repayment provisions in the agreement).^7^<br><br> <br>Linkage mechanism: Approx. 67% of the principal is CPI-linked, and approx. 33% of the principal is not CPI-linked. The Group entered<br> into a swap to hedge up to approx. 70% of the exposure to the CPI.
Interest terms •    Annual<br> interest at rates between 2.4% and approx. 3.9% (for the linked loans) and between 3.6% and approx. 5.4% (for the unlinked loans).<br><br> <br>•    Repayment<br> in quarterly installments, starting on March 25, 2020.
Additional credit facilities as of the Report date •    Working capital facility of<br> NIS 30 million;<br><br> <br>•    Guarantees facility of NIS 60<br> million;<br><br> <br>•    A hedge facility of NIS 68<br> million.<br><br> <br>The withdrawals from the various facilities are subject to the absence of default events and to compliance with various conditions as is standard in agreements of this type.
Collateral and pledges Liens were placed in favor of Discount Bank, as a trustee for the collateral on behalf of the Hadera Lenders, on all of Hadera’s existing and<br> future assets, on Hadera’s rights, and on the holdings in Hadera.
Restrictions and undertakings The agreements prescribe certain restrictions and liabilities as is generally accepted in agreements of this type, including:<br><br> <br>•     Restrictions<br> on assuming financial debts and providing guarantees;<br><br> <br>•     Requirement to<br> obtain the Lender’s approval for engagement in material agreements and other material actions;<br><br> <br>•     Undertaking in<br> connection with holding certain reserve funds for maintenance (scheduled and unscheduled) and debt service;^8^<br><br> <br>•     The lender was<br> granted veto rights and other rights in connection with certain decisions as is generally accepted in agreements of this type;<br><br> <br>•     Certain<br> changes in ownership;<br><br> <br>•    As is generally<br> accepted in project finance, there are certain rights that are exercisable only after obtaining the financing entities’ consent, and certain rights, which the financing entities may oblige the lender to exercise (reserved discretion);<br><br> <br>o     Various<br> restrictions on deviation from the project budgets;<br><br> <br>o     Restrictions<br> on distribution and interested party transactions;<br><br> <br>o    Undertakings to<br> provide confirmations of compliance with the terms of the agreement, including financial covenants;<br><br> <br>o     Prohibition on<br> making material changes such as a merger;<br><br> <br>o     Undertaking to<br> obtain rating for the project under circumstances set forth;<br><br> <br>o     Cross-default<br> clauses are in place under certain conditions and circumstances set forth;

^7^  A voluntary early repayment of the entire debt will be possible subject to advance notice as is generally accepted in agreements of this type, provided that on that date all existing loans will be fully repaid and all undertakings to senior lenders will be canceled in full and all hedging liabilities will be paid and the positions closed. As of the end of the seventh year from the Commercial Operation Date, early repayment will involve the payment of an immaterial fee.

^8^In Hadera, a debt service reserve was allocated, totaling two consecutive quarterly debt payments (as of the Report date - approx. NIS 40 million).

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 14 – LOANS FROM BANKING CORPORATIONS AND FINANCIAL INSTITUTIONS (cont.)

B. Further details regarding finance agreements in Israel (cont.)
2. Project finance agreement in Hadera (cont.)
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Conditions for distribution A distribution by Hadera, as defined in the finance agreement, is subject to a number of conditions set in the agreement, including, among<br> other things:<br><br> <br>•      Compliance<br> with the following financial covenants: Historic DSCR, Projected DSCR and LLCR at a minimum rate of 1.25;<br><br> <br>•      Non-occurrence<br><br><br><br><br> of a breach or potential breach;<br><br> <br>•      Maintaining a<br> minimum pre-defined cash amount, which is required as part of the amendment to the Hadera Equity Subscription Agreement, which is described below;<br><br> <br>•      Proven<br> ability to comply with the take or pay undertakings as per the natural gas supply agreement until the next planned calculation date (as defined in the agreement);<br><br> <br>•     If the Hadera<br> Power Plant fails to meet the conditions for generation facilities using cogeneration technology as detailed in the Cogeneration Regulations, it will be required to provide proof of its ability to meet payments to the Israel Electric<br> Corporation and the Israeli Electricity Authority as a result of non-compliance with the said conditions;<br><br> <br>•      No more than<br> two distributions will be carried out in a 12-month period.
--- ---
Equity Subscription Agreements The Hadera Equity Subscription Agreement (as amended from time to time) includes various undertakings by the shareholder to provide equity <br> to Hadera, including in accordance with the regulatory rules of the Israeli Electricity Authority (provided it will not exceed 40% of the project’s normative cost), providing equity in case of deficit in own capital due to excess project<br> costs or due to hedging agreements, and commitments to provide various guarantees, including guarantees for debt service not paid due to termination of a PPA by the borrower up to NIS 8 million, as well as additional bank guarantees in<br> certain cases. Furthermore, the Company and Veridis Power Plants Ltd. (hereinafter - “Veridis”)^9^ are required to comply with certain covenants.
3. Finance agreements relating to the financial closing of the Basin Ranch project (under construction as of the Report date)
--- ---

On October 28, 2025, the financial closing of the Basin Ranch project (hereinafter - the "Project”). As of the Financial Closing Date, CPV Group had a 70% holding stake in the Project and a partner had a 30% holding stake (for details regarding the acquisition of the partner's interests subsequent to the Report date, see Note 23E1).

Under the financial closing, inter alia: (a) the equity undertaking of the Project’s interest holders was met in full, in accordance with the requirements of the TEF Loan agreements, as detailed in Section A below; (b) the loan agreement with Bank Leumi was finalized, as detailed in Section A below; (d) the TEF Loan agreements were finalized, as detailed in Note 14B4.

A. Equity financing and provision of collateral:

At the Financial Closing Date, the project’s interest holders provided the entire equity required for the project relative to their holding stakes as of the Financial Closing Date. For this purpose, the CPV Group (70%) provided a total amount of approx. NIS 1.5 billion (approx. USD 470 million), of which approx. NIS 1 billion (approx. USD 300 million) was provided by way of a loan from Bank Leumi as detailed below, and approx. NIS 562 million (approx. USD 170 million)^10^ was provided by the Company through an equity bridge loan until the equity investment process with the additional partners at OPC Power is completed; it was completed in March 2026 (for details, see Note 23A3). To provide the bridge loan, the Company used some of the funds raised in the share issuance in June 2025, as detailed in Note 18B.

^9^It is noted that in the event that Veridis does not meet one of the financial covenants and the Company assumes all of Veridis’s liabilities and obligations, the event shall not be considered a breach.

^10^ The amount includes recognition of pre-financial closing development investments totaling approx. NIS 221 million (approx. USD 67 million).

F - 56

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 14 – LOANS FROM BANKING CORPORATIONS AND FINANCIAL INSTITUTIONS (cont.)

B. Further details regarding finance agreements in Israel (cont.)
3. Finance agreements relating to the financial closing of the Basin Ranch project (under construction as of the Report date) (cont.)
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A. Equity financing and provision of collateral:
--- ---

Moreover, additional collateral in connection with the project was provided by the project’s interest holders as part of the TEF Loan’s financial closing. The CPV Group’s share (70%) in the additional collateral, which was provided by way of letters of credit, totals approx. NIS 446 million (approx. USD 135 million), as detailed in Note 14C.

B. Finance agreement with Bank Leumi in the CPV Group

On October 22, 2025, the CPV Group and Bank Leumi le-Israel B.M. signed a finance agreement (hereinafter - the “Finance Agreement” and the “Lender”, or “Bank Leumi”, respectively) for a loan totaling USD 300 million (approx. NIS 1 billion), to finance part of the CPV Group's share in the equity required for the Basin Ranch project (hereinafter in this section - the “Project”). The agreement was completed on October 28, 2025, upon the financial closing of the TEF Loan. In view of the engagement in an agreement for the acquisition of the remaining ownership interests in the Project as stated in Note 23E, which was completed in February 2026, in January 2026, CPV Group and Bank Leumi entered into an amendment to the finance agreement, whose main purpose is to increase the Loan Amount by additional USD 130 million (approx. NIS 0.4 billion).

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 14 – LOANS FROM BANKING CORPORATIONS AND FINANCIAL INSTITUTIONS (cont.)

B. Further details regarding finance agreements in Israel (cont.)
3. Finance agreements relating to the financial closing of the Basin Ranch project (under construction as of the Report date) (cont.)
--- ---
B. Finance Agreement with Bank Leumi in the CPV Group (cont.)
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Borrower CPV Group
--- ---
Loan amount (principal) USD 430 million (approx. NIS 1.4 billion).
Loan provision date USD 300 million in October 2025 (as of the Report date - approx. USD 150 million had been withdrawn in cash and an additional USD 150 million<br> had been made available as letters of credit (LCs)<br><br> <br>Additional USD 130 million in January 2026 (as of the Report approval date, approx. USD 65 million were withdrawn in cash and additional<br> approx. USD 65 million were provided as letters of credit)<br><br> <br>Under the terms of the finance agreement, by the end of 2026 the letters of credit will be converted to cash withdrawals.
Interest rate (annual) Long-term loan: Interest based on SOFR plus a 2.8% to 3.4% spread.<br><br> <br>Financial guarantee fee (through the abovementioned letters of credit): 1.3% to 2%.
Repayment dates principal and interest The interest on the loan principal shall be payable each quarter starting on March 31, 2027, with the interest accrued until the first<br> payment date is added to the loan principal;<br><br> <br>The loan principal (including said accrued interest) is payable by March 31, 2027 in accordance with the amortization schedule, as follows:<br><br> <br>2027-2029: 5% per annum<br><br> <br>2030-2031: 25% per annum<br><br> <br>2032: 35%.<br><br> <br>•    Notwithstanding<br><br><br><br><br> the foregoing, if the commercial operation of the Project commences during 2029, an adjustment will be made to the principal payment rates (an increase from 1.25% per quarter to 6.25% per quarter) as of the first quarter after the<br> commercial operation date, all such that the entire loan is repaid no later than December 31, 2032.
Default financial covenants Financial covenants applicable to Borrower:<br><br> <br>•    Total equity<br> attributable to the shareholders of the CPV Group: More than USD 750 million;<br><br> <br>•    Adjusted net<br> debt to adjusted EBITDA ratio of the CPV Group is less than 7.0.<br><br> <br>The financial covenants will be examined each quarter and will be subject to the terms and provisions (as well as to agreed-upon remediation<br> periods) and testing mechanisms as shall be set forth in the Finance Agreement.<br><br> <br><br><br> <br>For details regarding the actual amounts and/or ratios in respect of the abovementioned covenants as of<br> December 31, 2025, see Section 7 below.
Collateral Subject to the relevant statutory provisions and the terms of the project’s finance agreements (including the TEF Loan described in Note<br> 14B4), the Lender will be entitled to a lien on the account to which the dividends from the project companies are paid directly to the Borrower, all as stipulated in the Finance Agreement;<br><br> <br>Furthermore, the Borrower undertook to have in place a negative pledge, except under the following circumstances: (a) Existing and future<br> project finance or the provision of liens under the financing of the portfolio assets of the Borrower and/or its subsidiaries and/or associates; (b) other existing and future permitted liens, in the ordinary course of business, all as<br> stipulated under the Finance Agreement.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 14 – LOANS FROM BANKING CORPORATIONS AND FINANCIAL INSTITUTIONS (cont.)

B. Further details regarding finance agreements in Israel (cont.)
3. Finance agreements relating to the financial closing of the Basin Ranch project (under construction as of the Report date) (cont.)
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B. Finance Agreement with Bank Leumi in the CPV Group (cont.)
--- ---
Additional material terms and conditions Additional terms, undertakings and grounds for repayment (if applicable), include (as the case may be) certain restrictions on the Borrower<br> and/or its subsidiaries and/or associates, with respect to:<br><br> <br><br><br> <br>(a) Undertaking debt as stipulated in the Finance Agreement, except for the undertaking of a permitted debt (as defined in the Finance<br> Agreement and under pre-determined conditions as to the Borrower’s level of leveraging and liquidity) with respect to the areas of activity of the Borrower and/or its subsidiaries and/or associates (such as undertaking non-recourse<br> project finance for a new project and/or the refinancing a debt of an existing project or the financing of a portfolio of existing/ new projects through non-recourse financing, the Borrower’s undertaking corporate debts under the<br> conditions stipulated in the Finance Agreement, undertaking and/or extending certain credit facilities, etc.);<br><br> <br><br><br> <br>(b) Restrictions on the sale of assets, except for assets, which meet the pre-determined conditions set in the finance agreement as to the<br> Borrower’s level of leveraging and liquidity or assets, or assets which are immaterial to the business activities of the Borrower and/or its subsidiaries and/or associates;<br><br> <br><br><br> <br>(c) Restrictions on investments outside the normal business activities originating from the Borrower’s free cash flow, where (i) the net debt<br> to EBITDA ratio covenant (as detailed above) exceeds the value stipulated in the Finance Agreement; or (ii) the occurrence of certain default events in the project and/or other ongoing default events in the project, which were not<br> remediated within the remediation periods stipulated in the Finance Agreement;<br><br> <br>(d) Other undertakings, default events and grounds for repayment as is generally accepted in agreements of this type, including: Restrictions<br> on change of control in the Borrower (including the Company and its controlling shareholders); restrictions on changes to the Borrower’s area of activity; cross acceleration as defined in the Finance Agreement; non-payment; default<br> events; legal or regulatory proceedings/matters as defined in the Finance Agreement; breach of covenants and undertakings (subject to remediation periods); cross-default for certain events pertaining to the project (including material<br> adverse effect events as defined in the Finance Agreement, breach of an undertaking to repay a TEF Loan or its acceleration, bankruptcy and abandonment event); non-payment of a debt of the Borrower or the project above a certain<br> threshold, all in accordance with the definitions, remediation periods and other conditions set in the Finance Agreement.
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Payments to the Borrower’s shareholders As from March 31, 2027, dividend distributions and repayment of shareholder loans^11^ are subject to the following financial<br> covenants (as defined above):<br><br> <br>•     Total equity<br> attributable to the shareholders of the CPV Group: More than USD 1 billion;<br><br> <br>•     Adjusted net<br> debt to adjusted EBITDA ratio of the CPV Group is less than 4.0 up to 12 months subsequent to the project's commercial operation date (COD) and less than 5.0 thereafter.<br><br> <br>Furthermore, under certain adverse circumstances defined in the Finance Agreement, such payments and additional payments to shareholders<br> (such as management fees) will not be permitted even if the abovementioned financial covenants are met.
Fees Provisions have been set regarding fees, including upfront-fees and non-utilization fees, as is generally accepted in finance agreements, as<br> well as early repayment fees. It is clarified that the loan’s early repayment fees (except with respect to financial damage, if incurred) were set at declining levels over the loan term, such that after a set number of years no early<br> repayment fees will apply.

^11^ Except for certain shareholder loans defined in the agreement, the repayment of which is not conditional on compliance with covenants.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 14 – LOANS FROM BANKING CORPORATIONS AND FINANCIAL INSTITUTIONS (cont.)

B. Further details regarding finance agreements in Israel (cont.)
4. TEF Loan Agreement (senior debt in Basin Ranch project (under construction, will be consolidated in the Company's financial statements as from the first quarter of 2026)
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In October 2025, the Financial Closing Date of the Basin Ranch Project, a senior loan agreement with Texas Energy Fund (hereinafter - “TEF”),

      managed by the Public Utility Commission of Texas \(hereinafter - “PUCT”\), was entered into to finance the project’s construction \(hereinafter - the “TEF Loan”\)

Following is a summary of the main terms of the TEF Loan:

Borrower Basin Ranch
Amount of loan to the Project Company (100%) Approx. USD 1.1 billion (approx. NIS 3.6 billion).
Loan provision date As from October 2025, in a number of tranches in accordance with the percentage of completion of the project’s construction.<br><br> <br>As of the Report date a loan principal of approx. USD 191 million was withdrawn).
Interest rate Annual interest at a fixed rate of 3%.
Amortization schedule of the principal and interest Final repayment date: September 30, 2045.<br><br> <br>The loan principal will be repaid in quarterly principal payments as from March 31, 2031, at a rate equal to 0.25% per quarter, through March<br> 31, 2032. Thereafter, repayments of principal and interest in accordance with an amortization schedule in a mortgage format (hereinafter - "Spitzer”).<br><br> <br>Interest payments will be paid every quarter, including during the construction period.
Pledges A first degree, senior, fixed and secured pledge on the project, its assets and the rights arising therefrom.
Default financial covenants •    A<br> historical 12-month debt service coverage ratio (DSCR) of 1.10x, which shall be measured on a quarterly basis starting one year after the commercial operation date (COD), as defined in the loan agreement.<br><br> <br>•   Expected<br> 5-year contracted DSCR of 1.20x on COD; the contracts for compliance with this ratio should be renewed or replaced two years before their termination date, on a rolling basis. The project entered into hedging arrangements^12^ for a substantial portion of the project's capacity, which comply with this requirement.<br><br> <br>•   Performance-based<br><br><br><br><br> project covenants for the past 12 months, which will be measured monthly as from the date on which full 12 calendar months will elapse after COD. The covenants set minimum uptime of 85% and maximum downtime of 15%, which may be<br> remediated by presenting a remedial action plan and a reserve to finance the plan for the next 12 months.
Other key conditions (including certain collateral) •   Distributions<br><br><br><br><br> are subject to generally accepted definitions and conditions and to the following: (a) Compliance with contracted DSCR of 1.20x over 4 consecutive quarters, or a DSCR of 1.35x based on the total cash flow; and (b) a performance test<br> (downtime/uptime) for the past 12 months, which includes certain conditions, which allow distribution even if the criteria are not met.<br><br> <br>•   Additional<br> undertakings of the project interest holders (100%) totaling approx. NIS 191 million. These undertakings include collateral in the form of letters of credit (LCs) or other generally acceptable collateral (such as cash) to secure certain<br> matters pertaining to key agreements and the cost of the project, and to secure completion of construction (which can be forfeited after exhausting a budget contingency); and to secure the project’s connection to the grid within 4<br> years, subject to an extension option (with the collateral released in accordance with the abovementioned date). For further details regarding the balance of the guarantees provided by the Group in favor of the project as of the Report<br> date and the report approval date, see Note 14C.<br><br> <br>•   Additional<br> project-level undertakings pertaining to collateral include, among other things, cash reserves or letters of credit on COD to secure expected DSR and operating expenses.<br><br> <br>•   Other<br> undertakings and default and repayment events include, among other things, events that are deemed “change of control” including circumstances where CPV Power Holdings, LP (a wholly owned subsidiary partnership of the CPV Group) no<br> longer holds and controls at least 50% of the Borrower, and circumstances where the CPV Group no longer holds or controls at least 50% of CPV Power Holdings, LP (as applicable in accordance with the relevant provisions), and generally<br> accepted immediate repayment grounds such as non-payment, failure to comply with certain undertakings, breach of representations, undertakings and covenants, default events, regulatory and legal proceedings – all in accordance with the<br> conditions and the remediation periods (as applicable) set in the loan agreement.

^12^The project entered into Gas Netback commercial agreements (including a pricing mechanism under which the gas price paid by the electricity producer is derived from the price of electricity) and fixed-price power purchase agreements in order to hedge a substantial portion of the power plant's capacity for a period of 7 years from the commercial operation date under a plan aiming to hedge approx. 75% of the power plant's capacity as of the commercial operation date.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 14 – LOANS FROM BANKING CORPORATIONS AND FINANCIAL INSTITUTIONS (cont.)

B. Further details regarding finance agreements in Israel (cont.)
5. Project finance agreement (senior debt)^13^ in the Shore project (will be consolidated in the Company's financial statements<br> as from the first quarter of 2026)
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In the first quarter of 2025, Shore completed an engagement in a refinance agreement, under which the total amount of undertakings was approx. NIS 1.39 billion (approx. USD 436 million). With respect to the completion of the New Refinance Agreement, all equity holders in the Shore power plant provided a total of approx. USD 80 million for the purpose of deleveraging (CPV Group's share, including in respect of the additional acquisition detailed in Note 23E, was approx. USD 71 million). Following are the main terms of the finance agreement:

Loan provision date February 4, 2025
Amount of loan to the Project Company (100%) Term Loan B - a long-term loan totaling USD 325 million.<br><br> <br>Ancillary credit facilities:<br><br> <br>Term Loan C - letters of credit totaling USD 61 million<br><br> <br>Revolving credit facility totaling USD 50 million<br><br> <br><br><br> <br>As of the Report date, the outstanding balance of the long-term loan (Term Loan B) totals approx. USD 290 million, and the utilized balance<br> of the letters of credit facility totals approx. USD 57 million (withdrawals were made from the revolving credit facility).
Interest rate Long-term loan: Interest based on SOFR plus a 3.75% spread.
Amortization schedule of the principal and interest The frequency and scope of repayment of the long-term loan principal vary until the final repayment date, in accordance with a combination of<br> a mandatory amortization schedule (1% per year) and a leverage-based repayment mechanism, with a cash sweep of 100% to 75%.<br><br> <br>Final repayment date of the loan and the credit facilities:<br><br> <br>Term Loan B and Term Loan C - February 4, 2032<br><br> <br>Revolving credit facility: February 4, 2030
Pledges A first degree, senior, fixed and secured pledge on the project, its assets and the rights arising therefrom.
Default financial covenants The finance agreement includes grounds for repayment that are standard in agreements of this type, including, inter alia – breach of<br> representations and commitments that have a material adverse effect, non‑payment events, non‑compliance with certain obligations, various default events, winding down of the project or termination of significant parties in the project (as<br> defined in the agreement), occurrence of certain events relating to the regulatory status of the project and holding government approvals, certain changes in ownership of the project, certain events in connection with the project,<br> existence of legal proceedings relating to the project, and a situation wherein the project is not entitled to receive payments for availability and electricity – all in accordance with and subject to the terms and conditions, definitions<br> and remedial periods detailed in the amendment to the finance agreement.<br><br> <br>Furthermore, it is required to maintain a historical debt service coverage ratio (DSCR) of 1:1 over the past 12 months. The ratio will be<br> assessed for the first time as of December 31, 2025 (adjusted on a pro rata basis as from the agreement’s effective date), and subsequently at the end of each calendar quarter.<br><br> <br>As of the Report date, the historical debt service coverage ratio stands at x2.4.
Other key conditions (including certain collateral) In accordance with the finance agreement, it is required to hedge the interest rate with respect of at least 50% of the projected nominal<br> loan balance for a period of three years from the completion date.

^13^ Non-recourse financing, as accepted in agreements of this type in the US.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 14 – LOANS FROM BANKING CORPORATIONS AND FINANCIAL INSTITUTIONS (cont.)

B. Further details regarding finance agreements in Israel (cont.)
6. Short-term credit facilities
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As of the report approval date, the Company and OPC Israel have binding short-term credit facilities from Israeli banking corporations in effect as of various dates, most of which are during the second half of 2026. Generally, the interest rate payable on the said facilities is Prime plus a credit margin as is generally accepted in the market for similar credit facilities.

The Company’s credit facilities are subject to compliance with financial covenants as detailed in Section 7 below, and generally accepted provisions and undertakings, including an undertaking and conditions in connection with non-creation of pledges, changes in control, non-change in the nature of the businesses, and restrictions on distribution and/or repayment of shareholder loans under certain conditions set forth (among other things, a restriction that it will not execute a distribution and/or repayment of shareholder loans if the source for the distribution and/or the repayment is the disposal of a holding (or any part thereof) of OPC Israel in Rotem). In some of the facilities, there are also cross-default and/or cross-acceleration causes which vary from one facility to another.

OPC Israel's credit facilities are subject to compliance with financial covenants as detailed in Section 7 below and to generally accepted provisions and undertakings, which are similar to those of the Corporate Finance Agreements in Israel as detailed in Section B1 above.

Following is information regarding short-term binding credit facilities of the Group companies from banking corporations as of the Report date and immediately prior to the report approval date (in NIS million):

The facility amount immediately prior to the report approval date (March 6, 2026) Utilization as of<br><br> <br>the Report date ^(1)^ Utilization immediately prior to the report approval date (March 3, 2026)
Company - -
OPC Israel 4 4
The Company for CPV Group ^(2)^ 526 (approx. 165 million) 196 303
CPV Group^(2)^ 542 (approx. 170 million) 502 489
Total binding facilities 702 796

All values are in US Dollars.

(1) Mostly for the purpose of letters of credit and bank guarantees.
(2) The facilities provided for CPV Group are backed with a Company guarantee.
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Furthermore, as of the Report date and shortly before the report approval date, non-binding credit facilities from banking corporations and financial institutions were utilized for the purpose of issuing letters of credit and bank guarantees in Israel totaling approx. NIS 349 million and approx. NIS 361 million, and in the US - totaling approx. NIS 226 million and approx. NIS 223 million (backed by the Company’s guarantee), respectively. The utilization of non-binding facilities is subject to the discretion of any financing entity on a case by case basis on every utilization request date, and therefore there is no certainty as to the ability to utilize them at any given time.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 14 – LOANS FROM BANKING CORPORATIONS AND FINANCIAL INSTITUTIONS (cont.)

B. Further details regarding finance agreements in Israel (cont.)

7.        Financial covenants:

Breach ratio Actual value
Covenants applicable to OPC Israel with respect to the corporate finance agreements^14^
OPC Israel’s equity capital Will not fall below NIS 1,100 million Approx. NIS 2,107 million
OPC Israel’s equity to asset ratio Will not fall below 20% 36%
OPC Israel’s ratio of net debt to EBITDA Will not exceed 8 4.1
Covenants applicable to Hadera in connection with the Hadera Finance Agreement
Minimum expected DSCR (1) 1.10 1.13
Average expected DSCR (1) 1.10 1.68
LLCR (2) 1.10 1.59
Covenants applicable to the Company in connection with binding credit facilities with Israeli banking corporations^15^
The Company equity capital (separate) Will not fall below NIS 1,200 million Approx. NIS 6,471 million
The Company’s equity to asset ratio (separate) Will not fall below 30% 77%
The Company’s net debt to EBITDA ratio Will not exceed 12 3.2
Covenants applicable to the CPV Group in connection with a finance agreement with Bank Leumi
Equity attributable to the shareholders of the CPV Group No less than<br><br> <br>USD 750 million Approx. USD 1.6 billion
CPV group’s net debt to EBITDA ratio Will not exceed 7 3.0
(1) DSCR - The ratio between the free cash flows for debt service and the principal and interest payments for the relevant period – all subject to the definitions and terms and conditions of the relevant finance agreement.
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(2) LLCR - The ratio between the present value of the future free cash flows for debt service from projects and the balance of the loan as of the calculation date – all subject to the definitions and terms and conditions of the relevant<br> finance agreement.
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As of the reporting date, the Group companies comply with all of the financial covenants.

^14^ Additionally, OPC Israel has short-term bank credit facilities, which include financial covenants identical to the abovementioned financial covenants.

^15^ Additionally, the Company has financial covenants applicable by virtue of the Hadera Equity Subscription Agreement, which are not stricter than the abovementioned covenants.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 14 – LOANS FROM BANKING CORPORATIONS AND FINANCIAL INSTITUTIONS (cont.)

C. Guarantees

Following is a breakdown of the bank guarantees provided by the Company and Group companies to third parties:

As of December 31
2025 2024
NIS million NIS million
For operating projects in Israel (mostly Rotem, Hadera, Zomet and Gat) (1) 189 249
For projects under construction and development in Israel (Sorek 2 and consumers’ premises) (2) 91 74
In respect of the filing of a bid in the Sorek tender (3) 50 100
For virtual supply activity in Israel 33 21
In respect of projects under construction and development in the US (CPV Group) (4)* 158 339
For the Basin Ranch Project* (5) 700 -
In respect of operating projects in the US Renewable Energies and Other Segment* 66 22
1,287 805

* Out of the Company's facilities or guaranteed by the Company.

(1) As of the Report date, mainly in respect of: bank guarantees of approx. NIS 109 million (CPI-linked) provided by OPC Israel for Rotem and Hadera in favor of Noga - Independent System Operator Ltd. (hereinafter - the “System Operator”) as required under the PPAs and/or covenants of the Israeli Electricity Authority. As of December 31, 2024, includes a bank guarantee of approx. NIS 67 million (approx. NIS 58 million,<br> CPI-linked) provided by OPC Israel for Zomet in favor of the ILA, which was released in the reporting period (for further details, see Note 10B3).
(2) Mainly in respect of a bank guarantee of approx. NIS 53 million (CPI-linked) provided by OPC Israel on behalf of Sorek 2 in favor of the Accountant General at the Ministry of Finance in connection with the financial closing of the<br> Sorek 2 project (for further details, see Note 9D).
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(3) A bank guarantee provided by OPC Israel with respect to a bid submitted by OPC Power Plants for a planning, financing, build and operate tender of a new conventional electricity generation power plant. In December 2024, OPC Power<br> Plants was served with a notice whereby the Tenders Committee announced that a third party’s bid is the winning bid in the tender, and that OPC Power Plants’s bid is the “second eligible” bidder; therefore, during the reporting period,<br> the guarantee was reduced to a total of NIS 50 million.
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(4) The decrease is mainly due to the sale of the Mason Road project for a consideration, which is immaterial to the Company, the transition of the Backbone project to commercial operation in the fourth quarter of 2025 and the transition<br> to utilizing bank guarantees of the Rogue's Wind project at the project level (instead of utilizing the credit guarantees of CPV Group, which are backed by the Company's guarantee).
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(5) Arises mainly from the provision of bank guarantees with respect to the financial closing of the TEF Loan as detailed in Note 14B4.
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Furthermore, the Company and the Group companies provide, from time to time, corporate guarantees to secure Group companies’ undertakings in connection with their activity.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 15 – DEBENTURES

A. Composition
As of December 31
--- --- --- --- --- --- ---
2025 2024
NIS million NIS million
Marketable debentures 1,870 1,875
Less current maturities (244 ) (212 )
1,626 1,663

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 15 – DEBENTURES (cont.)

B. Additional details regarding the Company’s marketable debentures as of the Report date
Series Original issuance date p.v. on issuance<br><br> <br>dates (2) Nominal value as of the Report date Fair value as of December 31, 2025 (3) Nominal annual interest rate Principal payment dates Interest payment dates Linkage basis and terms (principal and interest)
--- --- --- --- --- --- --- --- ---
Series B April 26, 2020 (1) Approx. NIS 956 million Approx. NIS 442 million (approx. NIS 518 million after linkage) Approx. NIS 525 million 2.75% 16 unequal semi-annual payments, to be paid on March 31 and September 30 of each of the years 2021 to 2028 (inclusive). The interest on the outstanding balance of the principal of the debentures is paid - as from September 2020 - twice a year (except for 2020), on September 30, 2020, and on March 31 and<br> September 30 of each of the years 2021 to 2028 (inclusive). Linked to the Consumer Price Index in respect of March 2020.
Series C September 9, 2021 Approx. NIS 851 million Approx. NIS 664 million Approx. NIS 636 million 2.5% 12 unequal semi-annual payments, to be paid on February 28 and August 31 of each of the years 2024 to 2030 (inclusive), except for 2028. The interest is paid on the outstanding balance of the principal of Debentures (Series C), as it shall be from time to time, as from February 2022, twice a year, on February 28 and on<br> August 31 of each of the years 2022 to 2030 (inclusive). Non-linked
Series D January 22, 2024 (1) Approx. NIS 658 million Approx. NIS 658 million Approx. NIS 723 million 6.2% 18 unequal semi-annual payments, to be paid on March 25 and September 25 of each of the years 2026 to 2034 (inclusive). The interest on the outstanding balance of the principal of Debentures (Series D), as it shall be from time to time, is paid - as from September 2024 - twice a year (except for 2024), on<br> September 25, 2024 and on March 25 and September 25 of each of the years 2025 to 2034 (inclusive). Non-linked
(1) In addition to their original issuance date, Series B and D were expanded in October 2020 and December 2025, respectively.
--- ---
(2) As of the issuance date of Debentures (Series B, C and D), the issuance costs amounted to approx. NIS 11 million, approx. NIS 9 million, and approx. NIS 7 million, respectively.
--- ---
(3) The fair value is based on the closing price quoted on the stock exchange.
--- ---
(4) As of December 31, 2025, the balance of interest payable in respect of the Debentures (Series B, C and D) amounts to approx. NIS 20 million.
--- ---

F - 66

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 15 – DEBENTURES (cont.)

C. Additional details
1. Issue of Debentures (Series D)
--- ---

In January 2024, the Company issued Debentures (Series D) at a par value of approx. NIS 200 million (hereinafter – “Debentures (Series D)").

      The debentures are listed for trading on the TASE, are not linked to the CPI and bear an annual interest \(coupon\) of 6.2%. The issuance expenses totaled approx. NIS 2 million.

In November 2025, the Company issued Debentures (Series D) by way of a series expansion at a par value of approx. NIS 458 million, with the proceeds of the issuance totaling approx. NIS 500 million. The effective interest rate is approx. 4.8%. The issuance expenses totaled approx. NIS 5 million.

The issuances proceeds were designated for the refinancing of existing debts and for the Group’s operating business activities. For details regarding principal and interest repayments see Section B above.

2. Partial early redemption of Debentures (Series B)

On September 30, 2025, the Company repaid, by way of partial early redemption, approx. NIS 256 million par value in Debentures (Series B) in addition to the fixed payment in accordance with the amortization schedule of Debentures (Series B) as of that date. The total amount redeemed with respect to the partial early redemption, including linkage, is approx. NIS 302 million.

3. Rating of Debentures (Series B, C and D)

In May 2025, Midroog assigned an initial rating of A1.il with a stable outlook for the Company and its debentures. In addition, in May 2025, Ma’alot S&P upgraded the Company's credit rating to ilA with a stable outlook and the rating of its debentures to ilA+, following an improvement in business profile and financial ratios.

F - 67

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 15 – DEBENTURES (cont.)

C. Additional details (cont.)
4. Additional terms of the debentures
--- ---

The deeds of trust of Debentures (Series B, C and D) (hereinafter in this section - the “Deeds of Trust”) include generally acceptable causes to call for immediate repayment (subject to stipulated remediation periods), including default events, liquidation proceedings, receivership, suspension of proceedings and debt arrangements, merger under certain conditions without obtaining debenture holders’ approval, material deterioration in the condition of the Company, failure to publish financial statements in a timely manner, etc. Furthermore, a right to call for immediate repayment was established under the following circumstances: (1) In case of a call for immediate repayment of another series of debentures (marketable on the TASE or on the TACT Institutional system) that the Company has issued; or of another financial debt (or a number of cumulative debts) of the Company and of consolidated companies (except for the case of having to make immediate repayment of a non-recourse debt), including forfeiture of a guarantee (that secure payment of a debt to financial creditor) that the Company or consolidated companies made available to a creditor, in an amount of no less than USD 75 million (and for Series B - shall not be lower than USD 40 million); (2) Upon breach of financial covenants on two consecutive review dates; (3) In the case described in Subsection 2 (and even without waiting for the second review date) if the Company has carried out an extraordinary transaction with a controlling shareholder, excluding transactions other than in accordance with the Companies Regulations (Expedients in Transactions with an Interested Party), 2000  without obtaining prior approval of the debenture holders by special resolution; (4) If an asset or a number of assets of the Company are sold in an amount representing over 50% of the value of the Company’s assets according to the Company’s consolidated financial statements during a period of 12 consecutive months, or if a change is made to the main operations of the Company, except where the consideration of the sale is intended for the purchase of an asset or assets within the Company’s main area of operations (the “main operations of the Company” - the field of energy, including electricity generation in power plants and from renewable energies); (5) Upon the concurrence of certain events leading to loss of control; (6) In the event that a “going concern” emphasis-of-matter paragraph is included in the Company’s financial statements solely in respect of the Company, for a period of two consecutive quarters; (7) If the Company breaches its undertaking not to place a general floating charge on its current and future assets and rights, in favor of any third party, without the criteria set in the Deeds of Trust being met; (8) Distribution in breach of the provisions of the Deeds of Trust. All in accordance with the terms set out in the Deeds of Trust signed between the Company and the trustee, Reznick Paz Nevo Trustee Company Ltd.

F - 68

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 15 – DEBENTURES (cont.)

C. Additional details (cont.)
4. Additional terms of the debentures (cont.)
--- ---

Furthermore, the Deeds of Trust include an undertaking on behalf of the Company to comply with financial covenants and restrictions (including restrictions as to distribution, expansion of series, provisions as to interest adjustment in the event of change in rating or non-compliance with financial covenants). Following are the financial covenants:

Ratio Required value Series B Required value Series C and D Actual value
Net financial debt (1) to adjusted EBITDA (2) Will not exceed 13 (for distribution purposes - 11) Will not exceed 13 (for distribution purposes - 11) 3.2
The Company equity capital (separate) Will not fall below NIS 250 million (for distribution purposes - NIS 350 million) With respect to Debentures (Series C): will not fall below NIS 1 billion (for distribution purposes – NIS 1.4 billion)<br><br> <br>With respect to Debentures (Series D): will not fall below NIS 2 billion (for distribution purposes – NIS 2.4 billion) Approx. NIS 6,470 million
The Company’s equity to asset ratio (separate) Will not fall below 17% (for distribution purposes: 27%) Will not fall below 20% (for distribution purposes - 30%) 77%
The Company’s equity to asset ratio (consolidated) -- Will not fall below 17% 53%

(1) The consolidated net financial debt less the financial debt designated for construction of the projects that have not yet started to generate EBITDA.

(2) Adjusted EBITDA as defined in the deed of trust.

As of December 31, 2025, the Company complies with the said financial covenants.

In addition, the Deeds of Trust includes an undertaking not to create a floating charge on the Company’s assets and rights, both current and future, in favor of any third party without fulfillment of one of the terms and conditions stipulated in the Deeds of Trust; everything shall be according to the terms stipulated in the Deeds of Trust (it is clarified that the Company and/or its investees will be entitled to create a fixed and/or floating lien on any of their assets, without fulfillment of any of the said terms and conditions).

The terms of the debentures also include an option to increase the interest rate under certain instances of changes in rating and in certain cases of failure to comply with financial covenants (in accordance with thresholds set in the Deeds of Trust). The Company’s ability to expand the series of debentures is subject to certain restrictions, including maintaining the rating of the debentures as it stood prior to the expansion of the series and non-breach.

F - 69

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 15 – DEBENTURES (cont.)

C. Additional details (cont.)
4. Additional terms of the debentures (cont.)
--- ---

Furthermore, the Company may initiate the execution of early redemption of the debentures, in accordance with dates and generally accepted provisions set for that purpose, including in an amount that will not fall below the highest of the market value of the outstanding debentures (based on the average in the 30 trading days that preceded the Board of Directors’ resolution), the outstanding par value of the debentures (principal plus interest until the early redemption date), and the balance of the cash flow of the debentures in respect of which early redemption is to be executed, discounted according to the rates set in each of the Deeds of Trust.

NOTE 16 – EMPLOYEE BENEFITS

A. Post-employment benefit plans – defined contribution plan

The Group has a defined contribution plan in respect of its liabilities to employees in Israel and the US. The amount recognized as an expense in 2025 is approx. NIS 14 million (in 2024 and 2023 - approx. NIS 13 million).

It is noted that the Group has defined benefit plans in non-material amounts.

B. Equity compensation plan in Israel

In July 2017, the Company's board of directors (after the approval of the Company's Compensation Committee) approved an options plan (hereinafter – the “Option Plan”) for offerees. Under the plan, the Company will allocate to the offerees, whose identity will be determined by the board of directors (and the general meeting of the shareholders, as the case may be) at its sole discretion, non-marketable and non-transferable options (other than transfer to successors in the event of death, as set out in the Options Plan) that are exercisable for the Company’s shares, in an amount to be instructed by the board of directors, as the case may be. The options are non-marketable and non-transferable. Each option will confer on the offeree the right to receive from the Company, by way of an allocation, one ordinary share of NIS 0.01 par value, at the exercise price to be determined for each offeree, and which will be at least the average share price in the 30 trading days prior to the board decision on the allocation and subject to certain adjustments set out in the Options Plan. The ordinary shares to be allocated following exercise of the options will have the same rights as the Company’s ordinary shares, immediately upon their allotment. The exercise price is subject to certain adjustments (including in respect of dividend distribution, issuance of rights, etc.).

In May 2018, the employee Options Plan was revised to an alternative for allocating restricted stock units (hereinafter – the “RSUs”) and an amendment to the adjustment mechanism in the event of change of control. Each RSU will confer the right to receive from the Company, by way of an allocation and for no consideration, one ordinary share of the Company of NIS 0.01 par value of the Company. The RSUs will not confer on the holder any right conferred on a shareholder, prior to their exercise for shares of the Company, including a voting right, with the exception of the right to receive an amount equivalent to a dividend, should the Company decide to distribute a dividend.

The provisions of Section 102 to the Income Tax Ordinance apply to the allocated options. The allocation was made through a trustee in the capital gains track. In accordance with this track, the Company is not entitled to claim a tax deduction for amounts credited to an employee as a benefit, for the options received by the offeree under the plan, other than a yield benefit component, if any, determined on the allocation/grant date.

F - 70

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 16 – EMPLOYEE BENEFITS (cont.)

B. Equity compensation plan in Israel (cont.)

From time to time, the Company allocates options and RSUs to offerees in several allocations in an equity track (with a trustee) in accordance with Section 102 of the Income Tax Ordinance, in three or four equal tranches, which are exercisable at net (hereinafter – the “Offered Securities”). The vesting terms and expiration dates of the offered securities are as follows:

Tranche No. Vesting terms and conditions Expiration date
Tranche One At the end of 12 months from the grant date At the end of 36 months from the vesting date
Tranche Two At the end of 24 months from the grant date At the end of 24 months from the vesting date
Tranche Three At the end of 36 months from the grant date At the end of 24 months from the vesting date
Tranche Four At the end of 48 months from the grant date At the end of 24 months from the vesting date

Following is information regarding allocation of offered securities in accordance with the option plan:

Offerees and allocation dates No. of options at the grant date (in thousands) Average fair value of each option at the award date (1) (in NIS) Exercise price per option (in NIS, unlinked) No. of unvested options as of December 31, 2024 (in thousands) No. of unvested options as of December 31, 2025 (in thousands) Risk-free interest rate (2)
Officer, May 2020 99 7.76 25.81 50 - 0.36% - 0.58 %
Chairman of the Board, January 2021 367 13.07 32.78 367 - 0.20% - 0.40 %
CEO, April 2021 1,253 9.54 34.46 1,253 - 0.35% - 0.59 %
Officer, January 2022 272 9.91 33.21 272 68 0.47% - 0.75 %
Managers and officer, May 2022 1,649 10.42 36.60 1,177 288 1.84% - 2.05 %
Officer, September 2022 254 15.70 39.86 254 64 2.93% - 2.94 %
Executives, March 2024 497 9.77 25.19 497 295 3.81% - 3.91 %
Chairman of the Board, November 2024 204 10.21 30.78 204 153 4.13% - 4.19 %
Executives, March 2025 441 11.80 31.98 N/A 441 4.09% - 4.15 %
CEO, July 2025 646 19.84 43.39 N/A 646 3.93% - 3.94 %
Officer, March 2026 (*) 37 37.91 94.67 N/A N/A 3.46% - 3.51 %
4,074 1,955

(*) In addition, 4,431 RSUs were granted

(1) The share’s standard deviation in all awards is within the range of 30%-36% based on the historical volatility of the Company's share over the option’s expected life through the exercise date.
(2) The rate of the risk-free interest is based on the Fair Spread database and an expected life of 4 to 6 years.
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F - 71

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 16 – EMPLOYEE BENEFITS (cont.)

B. Equity compensation plan in Israel (cont.)
(1) Exercise of options and issuance of shares
--- ---
A. Issuance of shares - In the years ended December 31, 2025, 2024, and 2023, following the vesting of the RSUs, the Company issued approx. 7, approx. 14 thousand, and approx. 14 thousand ordinary shares of the Company of NIS 0.01 par<br> value, respectively.
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B. Exercise of options - in the years ended December 31, 2025, 2024 and 2023, the Company issued approx. 450 thousand, approx. 12 thousand and approx. 8 thousand ordinary shares of the Company of NIS 0.01 par value, respectively,<br> following a notice on the exercise of approx. 2,823 thousand, approx. 72 thousand and approx. 23 thousand options, respectively. Of which, during the Reporting Period, the Company’s CEO – Mr. Giora Almogy – exercised approx. 1,253<br> thousand options into approx. 161 thousand Company shares and the Chairman of the Board of Directors – Mr. Yair Caspi – exercised approx. 184 thousand options into approx. 35 thousand Company shares. The weighted average price per share<br> on the exercise dates of the options was NIS 46.26, NIS 18.84, and NIS 24.42, respectively.
--- ---
(2) Expiry of options
--- ---

In the years ended December 31, 2025, 2024, and 2023 - approx. 384, 608, and 542 thousand options expired, respectively, inter alia following exits of Company employees. Out of which, during the reporting period, approx. 184 thousand options awarded to the Chairman of the Board, Mr. Yair Caspi, expired.

(3) Allotments

The value of the benefit implicit in the allocation of securities in the years ended December 31, 2025 and 2024 is approx. NIS 18 million and approx. NIS 7 million, respectively. This amount will be recorded in profit and loss over the vesting period.

(4) Expenses recognized

In the years ended December 31, 2025, 2024, and 2023, the Company recognized an expense in the amount of approx. NIS 8 million, approx. NIS 8 million, and approx. NIS 10 million, respectively, in respect of the offered options and securities.

C. Profit-sharing plan for CPV Group employees

In April 2021, the CPV Group LP (hereinafter in this Note - the “Partnership”) approved an allocation of 6.5% of the profit participation rights in the Partnership for allocations to certain CPV Group employees and managers (hereinafter in this note - the “Offerees”) as part of long-term compensation (hereinafter in this note - the “Plan”). The Offerees’ participation rights relate to earnings and appreciation net of repayment of investment amounts to investors and subject to vesting periods that may be accelerated in certain cases, such as merger, sale of activities, and termination of employment under certain circumstances, etc. The deeds of allocation granted to the Offerees stipulate, among other things, events upon the occurrence of which the Partnership will buy the Offerees’ rights. Included in that stated above, subject to the vesting as, as stated, the Offerees are entitled to require the Partnership to acquire their rights on exercise dates that fall after three and five years from the grant date at the rates and under the conditions defined, and in certain cases of sale of rights in the Partnership by the Company (including a change in control). In addition, the Partnership is entitled to acquire rights of the Offerees under certain circumstances, such as conclusion of the transaction and passage of five years.

F - 72

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 16 – EMPLOYEE BENEFITS (cont.)

C. Profit-sharing plan for CPV Group employees (cont.)

In 2024, CPV Group approved a 1% increase in the profit participation rights and the allocation to a CPV Group officer.

In March 2024, a partial exercise was carried out of the participation units awarded to CPV Group employees, by way of purchasing the units exercised by CPV Group, totaling approx. NIS 11 million (approx. USD 3 million).

The entire plan vested in January 2026 (at the end of five years from CPV Group’s acquisition date), and according to the exercise notices received, a total of approx. NIS 223 million (approx. USD 70 million) is expected to be paid to the CPV Group’s employees and executives at the end of the first quarter of 2026. The balance of the liability in respect of the plan was included under the other payables and credit balances line item.

Subsequent to the Report date, a new compensation plan was approved, under which the award of new participation units is expected (hereinafter – the “New Plan”); the New Plan is based mainly on conditions similar to those of the 2021 Plan, mutatis mutandis, including, among other things, the cancellation of the option of partial exercise before the end of five years (except under certain circumstances such as a change of control, as defined in the New Plan), and the addition of a certain hurdle rate to the investment amounts. The New Plan is expected to be allocated by the end of Q2 2026 (with a vesting date in January 2026), and the total award is expected to represent approx. 5.8% of the profit participation rights (as of the New Plan Approval Date).

NOTE 17 – TAXES ON INCOME

A. Information about the tax environment in which the Group operates
1. Corporate tax rate
--- ---

Israel - The rate of corporate tax in Israel between 2023 and 2025 is 23%.

US

The corporate tax rate applicable to the Group’s US operations is composed of two main tax systems: (1) Federal corporate tax at a rate of 21% and (2) state tax, depending of the state where the operations are carried out, mostly between 2.5% and 11.5%, while the state tax rate constitutes an expense for calculation of the federal tax.

The profits (losses) of investees in the US, which are not taxable entities, are indirectly attributed to the partnership OPC Power (indirectly held by the ICG Energy) based on their share in equity. Profits (losses) of the OPC Power are attributed directly to the partners in accordance with their share in the equity, since according to US tax laws, a partnership and LLC through which the Group operates in the US are transparent for tax purposes. Therefore, ICG Energy will be attributed the profits (losses) of OPC Power, in which it serves as a limited partner. ICG Energy will be liable to tax in the US in respect of such profits attributed to it; the tax will be determined in accordance with the federal corporate tax rate and the state tax rate, which constitutes, as aforesaid, an expense for the purpose of calculating the federal tax.

F - 73

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 17 – TAXES ON INCOME (cont.)

A. Information about the tax environment in which the Group operates (cont.)
1. Corporate tax rate (cont.)
--- ---

US (cont.)

The US tax laws include a limit on finance expenses that may be deducted. The expenses are capped at 30% of the Adjusted Taxable Income (hereinafter – "ATI”); in 2022-2024 the ATI calculation is based on EBIT (without depreciation and amortization) and as from 2025 the ATI calculation is based on EBITDA. Furthermore, offsetting of net operating losses (NOL) is limited: in general, losses accrued up to 2018, it may be carried forward for up to 20 years, without any limit to the offset amount in a specific year. Losses accrued thereafter are subject to a time limit but may be generally used to offset up to 80% of the taxable income only.

In addition, the tax system in the US grants various tax benefits to investors in renewable energy projects, including under the Inflation Reduction Act of 2022 (hereinafter - ”IRA”):

• Bonus depreciation - In 2023 and 2024 the accelerated depreciation rate is 80% and 60%, respectively. As from 2025, the accelerated depreciation rate will be 100%. It is noted that also in the project acquisition procedure, this<br> depreciation may be recognized on the acquisition date.
• Investment Tax Credit (hereinafter - ”ITC”) - A tax credit of up to 30% of the amount invested in solar assets, and another credit equal to up to 10% of the construction costs of projects that<br> integrate equipment manufactured in the US or constructed at certain sites (hereinafter - the ”Brownfield Sites”).
--- ---
• Production tax credit (hereinafter - ”PTC”) - A tax credit in respect of revenues from the sale of electricity generated by renewable energy facilities.
--- ---

According to the provisions of the IRA, these ITC and PTC benefits can be traded or offset in future against future taxes.

On July 4, 2025, the federal law known as the One Big Beautiful Bill was enacted, which eliminated, among other things, the ITC and PTC tax benefits with respect to projects whose construction has not yet commenced. In accordance with the provisions of the law and the safe harbor rules (lenient threshold conditions), renewable energy projects (sun and wind) will be required to commence construction (as this term was defined by the IRS) by July 4, 2026 and to complete it no later than the end of 4 years, or if their construction will commence after July 4, 2026 to complete it no later than the end of 2027 in order to comply with the conditions for receipt of the tax benefits.

According to the provisions of the tax treaty between Israel and the US, interest payments are subject to withholding tax of 17.5%, and dividend payments are subject to withholding tax of 12.5%. It is noted that in Israel, credit is awarded according to Israeli tax laws.

2. Benefits under the Law for Encouragement of Industry (Taxes), 1969 (hereinafter – the “Encouragement of Industry Law”)

The industrial plants owned by some of the Company’s consolidated companies in Israel have a single production line, and as such, these companies, together with the consolidated company that holds these companies (hereinafter in this section - the “Parent Company”), are entitled to file a consolidated tax report under Section 23 of the Encouragement of Industry Law. Pursuant to Section 24 of said Law, the taxable income or loss of each of the said companies which own the industrial plants shall be regarded as taxable income or as a loss of the parent company.

F - 74

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 17 – TAXES ON INCOME (cont.)

A. Information about the tax environment in which the Group operates (cont.)
2. Benefits under the Law for Encouragement of Industry (Taxes), 1969 (hereinafter – the “Encouragement of Industry Law”) (cont.)
--- ---

“Industrial Companies” as defined in the Encouragement of Industry Law are entitled to tax benefits, mainly: Increased depreciation rates for tax purpose, and filing of consolidated tax returns of companies with a common production line.

B. Tax assessments

The Company and the other Group companies in Israel (except Rotem and Hadera) have tax assessments that are considered final up to and including the 2020 tax year (subject to reservations stipulated in the law). Rotem and Hadera were issued with final tax assessments through the 2023 tax year.

ICG Energy is subject to taxation in several US jurisdictions. Tax year 2021 and all periods thereafter are open for audits by US federal and state tax authorities.

C. Components of expenses for income tax
For the year ended December 31
--- --- --- --- --- --- ---
2025 2024 2023
NIS million NIS million NIS million
Current tax expenses - for the current period 7 2 11
Current tax expenses - for previous years 10 - -
Current tax expenses - restructuring in the US Renewable Energies Segment prior to the investment transaction (see Note 23F) - 53 -
Deferred tax expenses 70 83 57
Income tax expenses 87 138 68

F - 75

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 17 – TAXES ON INCOME (cont.)

D. Adjustments between theoretical profit tax before taxes and tax expenses:
For the year ended December 31
--- --- --- --- --- --- --- --- --- ---
2025 2024 2023
NIS million NIS million NIS million
Profit before taxes on income 544 335 237
Statutory tax rate of the Company 23 % 23 % 23 %
Tax calculated at the statutory tax rate of the Company 125 77 55
Additional tax (savings) for:
Non‑controlling interests’ share in profits of tax transparent entities (18 ) (22 ) -
Temporary differences and losses for tax purposes for which deferred taxes were not created (1) (17 ) 20 2
Effect of the creation of deferred taxes at a tax rate that is different from the main tax rate 9 12 2
Effect of restructuring and loss of control in the US Renewable Energies Segment (2) - 40 -
Other (12 ) 11 9
Income tax expenses 87 138 68
(1) During the reporting period mainly includes the effects of reversal of an impairment loss for Hadera 2 and in 2024 mainly includes the effects of impairment losses in Gnrgy and Hadera 2. For details, see Notes 23A4 and 10B4.
--- ---
(2) For details, see Note 23F.
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F - 76

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 17 – TAXES ON INCOME (cont.)

E. Deferred tax assets and liabilities
(1) Deferred tax assets and liabilities recognized in the books of accounts
--- ---

Deferred taxes are calculated at the tax rate that is expected to apply on the reverse date.

Movement in deferred tax assets and liabilities attributable to the following items:

Balance of deferred tax asset (liability) As of December 31, 2024 Carried to profit and loss Carried to other comprehensive income Effect of changes in exchange rates As of December 31, 2025
NIS million
Property, plant, and equipment, right‑of‑use assets and intangible assets (659 ) (16 ) - 2 (673 )
Carryforward losses and deductions for tax purposes 552 73 - (55 ) 570
Investments in transparent companies (445 ) (113 ) 49 60 (449 )
Other 19 (14 ) 60 (5 ) 60
(533 ) (70 ) 109 2 (492 )
Balance of deferred tax<br><br> <br>asset (liability) As of December 31, 2023 Carried to profit and loss Carried to other comprehensive income Effect of changes in exchange rates Deconsolidation As of December 31, 2024
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
NIS million
Property, plant, and equipment, right‑of‑use assets and intangible assets (590 ) (125 ) - (2 ) 58 (659 )
Carryforward losses and deductions for tax purposes 437 114 - 1 - 552
Investments in transparent companies (320 ) (63 ) (10 ) - (52 ) (445 )
Other 32 (9 ) 3 - (7 ) 19
(441 ) (83 ) (7 ) (1 ) (1 ) (533 )
(2) Deferred taxes are recognized in the statement of financial position as follows:
--- ---
As of December 31
--- --- --- --- --- --- ---
2025 2024
NIS million NIS million
Under non-current assets (under the ‘other long-term receivables’ line item) 32 10
Under non-current liabilities (524 ) (543 )
Deferred taxes, net (492 ) (533 )

F - 77

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 17 – TAXES ON INCOME (cont.)

E. Deferred tax assets and liabilities (cont.)
(3) Loss carryforwards for tax purposes:
--- ---
A. The Company - As of the Report date, the Company has loss carryforwards totaling approx. NIS 236 million, in respect of some of which no deferred taxes were recognized.
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B. Israel (through OPC Israel and subsidiaries) - as of the Report Date, the Group's companies in Israel have loss carryforwards totaling approx. NIS 620 million, for which deferred taxes were<br> recorded.
--- ---
C. US (through ICG Energy) - In the US, as of the Report Date, ICG Energy has loss carryforwards totaling approx. NIS 2,063 million (approx. USD 647 million) at the federal level. Out of the said<br> losses, no deferred tax assets were recognized with respect to a total of approx. NIS 284 million (approx. USD 89 million), since these losses are subject to compliance with the provisions of the law, some of which are beyond ICG Energy’s<br> control; these losses will expire in 2032-2037. Furthermore, ICG Energy has losses at state-level amounting to approx. NIS 900 million, in respect of which deferred tax assets were recognized.
--- ---

NOTE 18 – EQUITY

A. Composition
As of December 31, 2025 As of December 31, 2024
--- --- --- --- --- --- --- --- ---
No. of shares Authorized Issued and paid up Authorized Issued and paid up
Ordinary shares of NIS 0.01 par value 500,000,000 301,753,383 500,000,000 255,713,977

F - 78

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 18 – EQUITY (cont.)

B. Share issuances
Transaction date Transaction type Scope of the transaction Transaction consideration<br><br> <br>(in NIS million) Issuance costs (in NIS million)
--- --- --- --- --- --- ---
July 2024 (1) Shares issuance 31,250,000 shares 800 20
June 2025 (2) Shares issuance 21,303,200 shares 850 23
August 2025 (3) Shares issuance 18,750,000 shares 900 6
November 2025 (4) Shares issuance 5,529,322 shares 340 4
(1) A public offering in which it submitted bids in the tender and 16,707,400 ordinary shares of the Company were issued to it.
--- ---
(2) A public offering in which the parent company submitted bids in the tender and 7,923,600 ordinary shares of the Company were issued to it.
--- ---
(3) An issuance for qualified investors, including Migdal Insurance and Financial Holdings Ltd., Phoenix Financial Ltd. and Phoenix Investment House Ltd., Menora Mivtachim Holdings Ltd. and Harel Insurance Investments & Financial<br> Services Ltd. (which are interested parties in the Company as of the issuance date).
--- ---
(4) An issuance for qualified investors, including Phoenix Financial Ltd. and Phoenix Investment House Ltd., Menora Mivtachim Holdings Ltd. and Harel Insurance Investments & Financial Services Ltd. (which are interested parties in the<br> Company as of the issuance date).
--- ---

As of the Report date, and subsequent to the completion of the above capital raising, the Parent Company holds approx. 47.04% of the Company's share capital.

For details regarding the changes in the Company's equity arising from an equity compensation plan in Israel, see Note 16B.

C. Dividend

From 2023 to 2025, the Company did not distribute dividends.

In July 2017, the Company’s Board of Directors decided to adopt a dividend distribution policy, whereby in every calendar year, a dividend will be distributed to the shareholders; the dividend will be equal to at least 50% of the Company’s after‑tax net income in the calendar year preceding the dividend distribution date. Implementation of the dividend distribution policy and approval of the distribution from time to time by the Company’s board of directors is subject to the provisions of any law, including the distribution tests set out in Section 302 of the Companies Law, 1999 (the profit test and the solvency test), restrictions imposed by agreements to which the Company is a party, present or future covenants or financial covenants undertaken by the Company, tax considerations, investments required in the Company’s projects (present or future), and additional restrictions that may apply to the Company, if any, and decisions that the Company is permitted to make, including a different designation of its profits and an amendment to this policy.

F - 79

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 18 – EQUITY (cont.)

C. Dividend (cont.)

For the avoidance of doubt, the Company’s Board of Directors will be permitted at any time, taking into account business considerations and in accordance with the law, to change the abovementioned dividend rate or to decide to refrain from any distribution, such as was the case as of the date of the report, taking into account the Company’s business needs, the market conditions in the environment in which the Company operates, and specifically its strategic plans to expand its activity, all at the discretion of the Board of Directors.

In light of the Company’s growth strategy and the expansion of operation targets in recent years, taking into account the Company’s financial strength, in March 2024 the Company’s Board of Directors decided to suspend the Company’s dividend distribution policy for two years. In March 2026, the Company’s Board of Directors reiterated its decision to suspend the Company’s dividend distribution policy for at least another two years. After the said suspension period, the Board of Directors will discuss again the renewal of the dividend distribution policy and its adjustment to the circumstances as they will be at that time.

D. Shelf prospectus

During the Reporting Period, the Company's shelf prospectus was extended through May 30, 2026.

F - 80

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 19 – DATA ON INCOME STATEMENT ITEMS

A. Revenues
For the year ended December 31
--- --- --- --- --- --- ---
2025 2024 2023
NIS million NIS million NIS million
Revenues from sale of electricity in Israel:
Revenues from the sale of energy to private customers 1,271 1,368 1,424
Revenues from energy sales to the System Operator and other suppliers 181 165 120
Revenues for availability services 143 171 59
Revenues from the sale of energy to the System Operator, at cogeneration tariff 76 83 82
Revenues from sale of steam in Israel 57 57 59
Other revenues in Israel 2 23 59
Total revenues from sale of energy and others in Israel (excluding infrastructure services) 1,730 1,867 1,803
Revenues from private customers for infrastructure services 591 445 480
Total revenues in Israel 2,321 2,312 2,283
Revenues from sale of electricity from renewable energy (1) - 195 136
Revenues from sale of retail electricity 470 145 12
Revenues from provision of services and other in the US 211 127 121
Total revenues in the US 681 467 269
Total revenues 3,002 2,779 2,552
(1) As from November 2024, the results of the US Renewable Energies Segment are presented under the ‘share in profits of associates’ line item. For details, see Note 23F.
--- ---

Following are details regarding the total sales of the Group to material customers in Israel and the rate out of the Company’s total revenues (in NIS million):

For the year ended December 31
Customer 2025 2024 2023
Total revenues % of the Company’s revenues Total revenues % of the Company’s revenues Total revenues % of the Company’s revenues
Customer 1 394 13.1 % 370 13.3 % 262 10 %
Customer 2 311 10.4 % 368 13.2 % 369 14.4 %
Customer 3 - - - - 291 11.4 %

F - 81

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 19 – DATA ON INCOME STATEMENT ITEMS (cont.)

B. Cost of sales (less depreciation and amortization)
For the year ended December 31
--- --- --- --- --- --- ---
2025 2024 2023
NIS million NIS million NIS million
Cost of sales in Israel:
Natural gas and diesel fuel (1) 596 645 663
Energy acquisition expenses 274 320 303
Gas transmission costs 52 55 41
Salaries and related expenses 43 46 37
Operating expenses 117 120 87
Other expenses - 18 65
Total cost of sales in Israel (excluding the cost of infrastructure services) 1,082 1,204 1,196
Infrastructure services expenses 591 445 480
Total cost of sales in Israel 1,673 1,649 1,676
Cost of sales and provision of services in the US:
Cost of sales in respect of revenues from the sale of electricity from renewable energy (2) - 60 49
Cost of sales with respect of the sale of electricity (retail) 436 130 12
Cost of sales in respect of provision of services and others 154 92 90
Total cost of sales in the US 590 282 151
Total cost of sales 2,263 1,931 1,827
(1) After deducting third-party participation costs.
--- ---
(2) As from November 2024, the results of the US Renewable Energies Segment are presented under the ‘share in profits of associates’ line item. For details, see Note 23F.
--- ---

F - 82

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 19 – DATA ON INCOME STATEMENT ITEMS (cont.)

C. General and administrative expenses
For the year ended December 31
--- --- --- --- --- --- --- ---
2025 2024 2023
NIS million NIS million NIS million
General and administrative expenses at headquarters and in Israel:
Salaries and related expenses 33 37 51
Directors’ fees 5 5 4
Professional services 6 11 10
Depreciation 11 10 9
Office maintenance 12 10 8
Other 8 8 10
Total general and administrative expenses at headquarters and in Israel 75 81 92
General and administrative expenses in the U.S.:
Salaries and related expenses 71 71 49
Professional services 21 30 38
Depreciation 6 6 6
Office maintenance 20 17 16
Other 23 23 18
Total general and administrative expenses in the U.S. 141 147 127
216 228 219
Share-based payment expenses (revenues) (*) 149 35 (7 )
Total general and administrative expenses 365 263 212

(*) In 2025, expenses totaling approx. NIS 141 million (2024 - expenses totaling approx. NIS 28 million and revenues of approx. NIS 17 million in 2024 and 2023, respectively) are due to a change in the fair value of the CPV Group’s Profit-Sharing Plan for its employees. For details, see Note 16C.

D.       Business development expenses

For the year ended December 31
2025 2024 2023
NIS million NIS million NIS million
Business development in Israel 6 11 19
Business development in the US (1) 8 34 39
14 45 58

(1)  In 2024 and 2023 mainly with respect to renewable energy. As from November 2024, the results of the US Renewable Energies Segment are presented under the ‘share in profits of associates’ line item. For details, see Note 23F.

F - 83

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 19 – DATA ON INCOME STATEMENT ITEMS (cont.)

E.       Compensation in respect of loss of income

1.    In 2025 - includes compensation from the insurers of the Hadera and Gat power plants with respect to loss of income due to malfunctions which occurred in previous periods.

In 2024 - includes compensation from the insurers of the Hadera Power Plant totaling approx. NIS 18 million (USD 5 million) and from the construction contractor of the Zomet Power Plant totaling approx. NIS 26 million (approx. USD 7 million), with respect to loss of income prior to the power plants’ COD.

2.    In 2023 - includes compensation from the construction contractor of the Hadera Power Plant with respect to loss of income prior to the power plant’s COD.

F.       Other income (expenses), net

For the year ended December 31
2025 2024 2023
NIS million NIS million NIS million
Development fees from the Basin Ranch project 68 - -
Impairment (reversal of impairment) of Hadera 2 (see Note 10B4) 31 (31 ) -
Impairment of Gnrgy’s goodwill - (19 ) (23 )
Other (4 ) (6 ) 7
95 (56 ) (16 )

F - 84

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 19 – DATA ON INCOME STATEMENT ITEMS (cont.)

G.       Finance income and expenses

For the year ended December 31
2025 2024 2023
NIS million NIS million NIS million
Finance income
Exchange rate differences - 39 3
Interest revenues from deposits 71 35 35
Subordinate loan to an associate (Valley) 8 8 4
Other 1 5 1
80 87 43
Finance expenses
Exchange rate differences 39 - -
Interest expenses for debentures 74 89 80
Interest expenses for loans from banks and financial institutions 165 203 170
Interest expense for loans from non‑controlling interests 33 34 26
Interest expenses in respect of deferred consideration in the acquisition of the Gat Power Plant - - 14
Interest expenses in respect of tax equity partner in the US - 18 -
Fees and commissions and others 17 22 30
Capitalization of borrowing costs for assets under construction (30 ) (27 ) (80 )
298 339 240
Loss from extinguishment of financial liabilities, net (1) - 49 -
Finance expenses, net, recognized in the income statement (2) 218 301 197
(1) For details regarding early repayment of the Zomet and Gat finance agreements, see Note 14B1.
--- ---
(2) Including linkage differences in respect of debentures and CPI-linked loans totaling approx. NIS 24 million (approx. NIS 36 million and approx. NIS 37 million in 2024 and 2023, respectively).
--- ---

F - 85

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 20 – EARNINGS PER SHARE

Information used in the calculation of the basic and diluted earnings per share:

For the year ended December 31
2025 2024 2023
Profit for the year attributable to shareholders of the Company (in NIS million) 346 111 144
Weighted average number of shares used for the basic and diluted calculation 275,258 238,758 224,461
Basic and diluted earnings per share (in NIS) 1.26 0.46 0.63

NOTE 21 – FINANCIAL INSTRUMENTS AND RISK MANAGEMENT

A. Financial risk management
1. General
--- ---

The Group has operations that expose it to credit, liquidity risks and market risks (foreign currency, interest rate, CPI, and other market price risks). In order to mitigate the exposure to these risks, the Group takes various actions; specifically, the Group uses derivative financial instruments, including forward transactions (mainly foreign currency forwards) and index swaps; in associates (and companies which will be consolidated as from the first quarter of 2026) held by CPV Group in the United States - the Group uses interest rate swaps, transactions to hedge electricity prices in the renewable energy segment and futures to hedge the spark spreads in gas-fired power plants.

2. Credit risk

Credit risk is the risk of financial loss incurred by the Group if a customer or counterparty to a financial instrument fails to meet its contractual liabilities. The Group’s main exposure to credit risk is in respect of the following assets:

Trade receivables

The Group’s management assesses the exposure to credit risk in respect of customers debts and analyzes their financial resilience in order to determine the type and amount of the collaterals required in the various sale transactions.

Most of the Group’s customers have strong financial robustness, therefore sales to them are made without any collateral. In exceptional cases that are considered high risk, in the opinion of the Group companies, they receive adequate collateral to reduce the risks arising from the provision of credit to customers.

Cash and cash equivalents and short and long-term deposits (including restricted balances)

The Group’s cash and cash equivalents and deposits are deposited mainly in banking corporations, with attention to their financial strength. Therefore, in the Group’s estimation, no significant credit risk is expected in respect of them.

Derivative financial instruments

Generally, derivative transactions are entered into with banking corporations, investment houses and global trade companies, noting the financial resilience of these entities. Therefore, in the Group’s estimation, no significant credit risk is expected in respect of them.

F - 86

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 21 – FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (cont.)

A. Financial risk management (cont.)
3. Liquidity risk
--- ---

Liquidity risk is the risk that the Group companies will not be able to meet with their financial liabilities when they are due. The Group’s approach to liquidity risk management is to ensure, to the extent possible, a sufficient liquidity level to meet its liabilities in a timely manner.

For the purpose of management of the Group’s liquidity, a mix of short- and long-term financing tools are used, with attention to adjustment of the scope and duration of the long-term liabilities, as well as the financial covenants applicable to the Company and the nature and scope of its business operations.

The short term financing tool includes mainly secured and unsecured credit facilities from banking corporations and financial institutions. The long-term financing tools include mainly long-term loans from banking corporations and financial institutions (including as part of project finance) and debentures. For further details, see Notes 14, 15 and 23D.

In addition to the financing tools referred to above, from time to time, and as needed, the Company raises capital - by issuing equity instruments - in order to manage its robustness and liquidity. In addition, the Group's dividend policy takes into account the issue of financial strength and liquidity; for details see Note 18C.

4. Market risks

Market risk is the risk that changes in market prices, such as the electricity prices, electricity margins, foreign exchange rates, inflation and interest rates shall impact the fair value or future cash flows of a financial instrument.

The Company uses derivative financial instruments as part of the market risk management policy.

5. Currency risk

As of the Report Date, the functional currency of the Company and its Israeli subsidiaries is the shekel, and the functional currency of CPV Group is the USD. Therefore, the exposure of the Group companies in Israel is measured with respect to exchange rate changes of the NIS with respect to other currencies in which they operate.

The CPV Group enters into agreements mainly in the USD and therefore, its activity is not materially exposed to foreign currency risk.

In its activity in Israel, the Group is exposed to changes in the exchange rate of the USD, both directly and indirectly, due to the natural gas purchases, some of which are linked to the exchange rate of the USD and/or denominated in USD and are linked to the generation tariff (which is partly affected by a change in the USD exchange rate) and include floor prices in USD and on the other hand - linking a significant part of its revenues to the generation component (which is partially affected by changes in the USD exchange rate). Therefore, despite the fact that an increase in the USD exchange rate increases the cost of natural gas purchased by the group companies in Israel, the structure of revenues may mitigate the said exposure. However, it is noted that the generation component, which is affected by various parameters and is subject to changes (including due to regulation), is generally revised annually (and in 2026-2028 - every six month in accordance with a preset linkage mechanism); accordingly, there may be timing differences between the effect of the strengthening of the USD on the current cost of gas, and its effect on revenues, and accordingly, on the Company's gross margin as of that period.

F - 87

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 21 – FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (cont.)

A. Financial risk management (cont.)
5. Currency risk (cont.)
--- ---

Furthermore, from time to time, Group companies in Israel enter into significant construction and maintenance contracts in various currencies, specifically the USD and the EUR. The Group companies in Israel also partially hedge the exposure to changes in the cash flows from payments in foreign currency (mainly USD and EUR) in respect of equipment procurement, EPC and LTSA agreements by the use of forward transactions. Generally, contracts entered into to hedge equipment procurement and EPC agreements as stated above are designated as hedges for the purpose of implementing cash flow hedge accounting.

With respect to the Company’s investment in CPV Group, which operates in the US, and whose functional currency is the USD, generally, a depreciation of the USD may adversely affect the value of the Company’s USD-denominated investment, and the Company's net income and equity. In addition, when there is a need to raise NIS-denominated sources in Israel to fund the expected investments in CPV Group’s backlog of projects under construction and development, an appreciation of the USD may lead to an increase in the financing required to implement those investments.

6. CPI risk

Group companies in Israel are exposed to the CPI risk, mainly due to the linkage of a substantial portion of their revenues to the generation tariff (which is partly affected by changes in the CPI). In addition, the purchase price of natural gas is linked to the generation tariff, which - as stated above - is linked in part to the generation component. Furthermore, some of the Company’s capital costs and investments are linked to the CPI, whether directly or indirectly. Therefore, despite the fact that an increase in the CPI increases the Company’s costs and investments, the structure of revenues includes a certain natural protection that mitigates the said exposure.

Furthermore, the Debentures (Series B), and some of the long-term loans in Hadera are linked to the Consumer Price Index. In order to mitigate some of the exposure to changes in the CPI with respect to Hadera’s long-term loans, in June 2019, the Group entered into hedging transactions with a banking corporation in order to hedge some of the exposure to the CPI. These contracts were designated as hedges for the purpose of application of cash flow hedge accounting principles.

7. Interest rate risk

To reduce the exposure to interest rate changes in Israel (mainly Prime interest), the Group uses a mix of loans (including credit facilities) and debentures in a way that some of the loans and debentures are at fixed interest rates and others at variable interest rates.

Most of CPV Group’s long-term loans and credit facilities (through consolidated companies and associates) bear a variable interest rate (mainly SOFR) and in terms of cash flow, are exposed to interest rate changes. To reduce part of the exposure to interest rate risk, CPV Group enters into USD-denominated interest rate swaps to exchange variable USD interest rates for fixed USD interest rates in respect of some of the long-term loans and enters into loans bearing fixed interest rate swaps (such as the TEF Loan). These hedging transactions are designated as hedged for the purpose of application of cash flow hedge accounting principles.

F - 88

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 21 – FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT (cont.)

A. Financial risk management (cont.)
8. Other market price risks - electricity margins and prices
--- ---

From time to time, the CPV Group (through consolidated companies and associates) hedges a certain portion of the capacity of the power plants in the US Energy Transition Segment, which changes from one project to another, in order to hedge the fluctuations in spark spreads for short periods (mainly a year). The purpose of the hedging is to fix the energy margin (the margin between the price received for the electricity and the price paid for the gas), by entering into commodities contracts in respect of gas and electricity prices.

In the field of renewable energies (through an associate), CPV Group enters into long-term PPAs and in agreements for the sale of RECs, in a manner that mitigates part of the exposure to changes in electricity margins and prices.

As a general rule, these transactions are designated as hedging instruments for the purposes of applying cash flow hedge accounting.

The Basin Ranch power plant, which will be consolidated into the Company's financial statements as from the first quarter of 2026, signed commercial agreements which include a gas netback mechanism, under which up to 165,000 MMbtu per day will be supplied at a price derived from the electricity price; the power plant also signed PPAs for the sale of electricity at a fixed price. These agreements are designed to hedge a substantial portion of the power plant's capacity for a period of 7 years from the COD.

B. Financial instruments
1. Credit risk
--- ---

The carrying amount of the following financial assets represents the maximum credit exposure without taking into account the value of collateral or other credit enhancements in respect thereof: cash and cash equivalents, and deposits (including restricted and long-term), trade and other receivables (including long-term), and derivative financial instruments.

Maximum exposure to credit risk in respect of trade receivables

The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk as of the reporting date was as follows:

As of December 31
2025 2024
NIS million NIS million
Trade receivables in Israel 306 239
Trade receivables in the US 131 54
437 293

As of December 31, 2025 and 2024, trade receivables arise from trade receivables not in arrears.

For details regarding credit risk management, see above.

F - 89

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 21 – FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (cont.)

B. Financial instruments (cont.)
2. Liquidity risk
--- ---

Following are the contractual repayment dates of the financial liabilities at non-discounted values, including expected interest payments (according to the interest rates prevailing on the reporting date):

As of December 31, 2025
Carrying amount Contractual amount 12 months or less One to two years 2-5<br><br> years (1) More than 5 years
NIS million
Non-derivative financial liabilities
Trade payables 404 404 404 - - -
Payables and credit balances 12 12 12 - - -
Debt from non‑controlling interests (including interest payable) 440 507 - - 507 -
Debentures (including interest payable) 1,890 2,189 310 302 1,002 575
Lease liability (including interest payable) 29 43 9 23 2 9
Loans from banking corporations and financial institutions<br><br> <br>(including interest payable) 3,337 4,236 291 318 1,354 2,273
Total financial liabilities 6,112 7,391 1,026 643 2,865 2,857
As of December 31, 2024
--- --- --- --- --- --- --- --- --- --- --- --- ---
Carrying amount Contractual amount 12 months or less One to two years 2-5 years More than 5 years
NIS million
Non-derivative financial liabilities
Trade payables 213 213 213 - - -
Payables and credit balances 7 7 7 - - -
Debt from non‑controlling interests (including interest payable) 515 633 17 4 576 36
Debentures (including interest payable) 1,891 2,116 267 305 1,124 420
Lease liability (including interest payable) 45 57 16 10 21 10
Loans from banking corporations and financial institutions<br><br> <br>(including interest payable) 2,234 3,070 209 219 692 1;950
Total financial liabilities 4,905 6,096 729 538 2,413 2,416
(1) In 2028, including a total of approx. NIS 465 million and a total of approx. NIS 507 million for debentures and debt from non‑controlling interests, respectively.
--- ---
(2) Excluding a short-term liability in respect of a profit participation plan for CPV Group employees totaling approx. USD 70 million, whose payment is due at the end of the first quarter of 2026; for details, see Note 16C.
--- ---

F - 90

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 21 – FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (cont.)

B. Financial instruments (cont.)
2. Liquidity risk (cont.)
--- ---

In respect of certain liabilities, particularly to banking corporations, and debentures, the Company is subject to financial covenants (for further details, see Notes 14B4 and 15C).) Non-compliance with the financial covenants may lead to redemption of the liabilities earlier than shown in the above table. Actual interest payments in respect of variable interest liabilities (presented in the above table using spot interest rates as of the Report date) may vary from the amounts presented in the above table.

3. Market risk

CPI and currency risks

The Group's exposure to CPI and foreign exchange risks, excluding derivative financial instruments (see below), is as follows:

NIS Foreign currency
CPI-linked Non-linked (*) Other Total
NIS million
December 31, 2025
Assets
Cash and cash equivalents - 1,792 1 2,913
Restricted deposits and cash - 40 - 522
Trade receivables - 300 - 437
Other receivables and debit balances - 4 - 241
Total financial assets - 2,136 1 4,113
Liabilities
Trade payables - (269 ) ) (7 ) (404 )
Payables and credit balances - (2 ) ) - (12 )
Debentures (525 ) (1,365 ) - (1,890 )
Lease liabilities (12 ) - ) - (29 )
Debt from non‑controlling interests - - ) - (440 )
Loans from banking corporations and financial institutions (382 ) (2,466 ) ) - (3,337 )
Total financial liabilities (919 ) (4,102 ) ) (7 ) (6,112 )
Total financial instruments (919 ) (1,966 ) (6 ) (1,999 )

All values are in US Dollars.

F - 91

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 21 – FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (cont.)

(1) Financial instruments (cont.)
3. Market risk (cont.)
--- ---

CPI and currency risks (cont.)

NIS Foreign currency
CPI-linked Non-linked (*) Other Total
NIS million
December 31, 2024
Assets
Cash and cash equivalents - 232 2 962
Restricted deposits and cash - 60 - 60
Trade and other receivables - 237 - 423
Total financial assets - 529 2 1,445
Liabilities
Trade payables - (91 ) ) - (213 )
Payables and credit balances - (6 ) ) - (7 )
Debentures (922 ) (969 ) - (1,891 )
Lease liabilities (14 ) (6 ) ) - (45 )
Debt from non‑controlling interests (13 ) (49 ) ) - (515 )
Loans from banking corporations and<br><br> <br>financial institutions (405 ) (1,829 ) - (2,234 )
Total financial liabilities (1,354 ) (2,950 ) ) - (4,905 )
Total financial instruments (1,354 ) (2,421 ) 2 (3,460 )

All values are in US Dollars.

(*) The balances as of December 31, 2025 and 2024 include a net asset totaling approx. NIS 886 million and of approx. NIS 366 million, respectively, in respect of the Group’s activity in the USA (mainly CPV Group), whose functional<br> currency is the USD.

F - 92

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 21 – FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (cont.)

B. Financial instruments (cont.)
3. Market risk (cont.)
--- ---

CPI and currency risks (cont.)

The Group hedges some of the currency risks with derivative financial instruments as follows:

As of December 31, 2025
In NIS million Currency / linkage receivable Currency / linkage payable Amount receivable Amount payable Expiration dates Fair value
Forwards on exchange rates (*) USD NIS 317 1,002 2026-2028 (2 )
As of December 31, 2024
--- --- --- --- --- --- --- --- --- --- ---
In NIS million Currency / linkage receivable Currency / linkage payable Amount receivable Amount payable Expiration date Fair value
Forwards on exchange rates USD NIS 1 3 2025 -

(*) Mainly includes contracts for hedging expected payments with respect to development projects in Israel. These contracts will be designated as hedged for the purpose of application of cash flow hedge accounting principles.

The Group hedges some of the CPI risks with derivative financial instruments as follows:

As of December 31, 2025
Linkage receivable Interest payable Expiration date Amount of the linked principal Fair value
NIS million
CPI swap contracts Index 1.76 % 2036 250 41
As of December 31, 2024
--- --- --- --- --- --- --- --- --- --- ---
Linkage receivable Interest payable Expiration date Amount of the linked principal Fair value
NIS million
CPI swap contracts Index 1.76 % 2036 272 43

CPI swap contract to hedge up to approx. 70% of the exposure to the CPI in respect of the Hadera’s loan principal, in exchange for payment of additional interest at an annual rate of between 1.76%. The Group will designate this transaction to cash flow hedge accounting.

F - 93

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 21 – FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (cont.)

B. Financial instruments (cont.)

3.Market risk (cont.)

Currency sensitivity analyses:

Appreciation (depreciation) of the NIS by a rate of 5% or 10% against the following currencies would have increased (decreased) the comprehensive income or loss (after tax) by the amounts shown below. This analysis assumes that all other variables, in particular interest rates, remain fixed.
5% decrease 5% increase 10% increase
NIS million NIS million NIS million
Non-derivative instruments /NIS
US (mainly CPV Group) (*) (66 ) (33 ) 33 66
Israel - - - -
(66 ) (33 ) 33 66
Derivative instruments - /NIS
Israel (**) (74 ) (37 ) 37 76
(74 ) (37 ) 37 76

All values are in US Dollars.
5% decrease 5% increase 10% increase
NIS million NIS million NIS million
Non-derivative instruments /NIS
US (mainly CPV Group) (*) (27 ) (13 ) 13 27
Israel 4 2 (2 ) (4 )
(23 ) (11 ) 11 23

All values are in US Dollars.

(*) Changes in the exchange rate of the USD in connection with the US activity will be carried to other comprehensive income (loss).

(**) A change in the USD exchange rate with respect to hedging of expected payments with respect to development projects in Israel will be carried to other comprehensive income (loss).

F - 94

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 21 – FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (cont.)

C. Financial instruments (cont.)
3. Market risk (cont.)
--- ---

Index sensitivity analyses:

A change of 1% or 2% in the CPI would have increased (decreased) the comprehensive income or loss (after tax) in the amounts presented below. The analysis below is based on index changes that the Group believes are reasonably feasible as of the Report Date. The analysis is based on the assumption that all other variables, in particular the interest rates, remained constant.

As of December 31, 2025
Effect on total comprehensive income (loss) and capital
2% decrease 1% decrease 1% increase 2% increase
NIS million
Long-term loans 6 3 (3 ) (6 )
Debentures 10 5 (5 ) (10 )
CPI swap contracts (4 ) (2 ) 2 4
As of December 31, 2024
--- --- --- --- --- --- --- --- --- --- --- --- ---
Effect on total comprehensive income (loss) and capital
2% decrease 1% decrease 1% increase 2% increase
NIS million
Long-term loans 6 3 (3 ) (6 )
Debentures 18 9 (9 ) (18 )
CPI swap contracts (4 ) (2 ) 2 4

F - 95

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 21 – FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (cont.)

B. Financial instruments (cont.)
3. Market risk (cont.)
--- ---

Interest rate and CPI risk

Below is a breakdown of the types of interest of the Group’s interest-bearing financial instruments as of the end of the Reporting Period, based on reports to the Group’s management:

Fixed interest instruments linked to the CPI:

As of December 31
2025 2024
NIS million NIS million
Financial liabilities (*) 904 1,334
(904 ) (1,334 )

Fixed interest instruments not linked to the CPI:

As of December 31
2025 2024
NIS million NIS million
Financial assets 3,105 762
Financial liabilities 1,954 1,643
1,151 (881 )

(*) Includes a total of approx. NIS 250 million and approx. NIS 272 million as of December 31, 2025 and 2024, respectively, which were converted into non-linked loans through a CPI swap.

Variable interest instruments:

As of December 31
2025 2024
NIS million NIS million
Financial assets 1 210
Financial liabilities 2,787 1,645
(2,786 ) (1,435 )

Analyses of sensitivity to variable interest (Prime and SOFR):

A change of 1% or 2% in the Prime and SOFR variable interest rate would have increased (decreased) the comprehensive income or loss (after tax) in the amounts presented below. The analysis below is based on the Prime interest rate changes that the Group believes are reasonably feasible as of the end of the Reporting Period. The analysis is based on the assumption that all other variables remained constant.

As of December 31, 2025
Effect on total comprehensive income (loss) and capital
2% decrease 1% decrease 1% increase 2% increase
NIS million
Long-term loans - Prime interest (Israel) 35 17 (17 ) (35 )
Long-term loans - SOFR interest (US) 8 4 (4 ) (8 )
As of December 31, 2024
--- --- --- --- --- --- --- --- --- --- ---
Effect on total comprehensive income (loss) and capital
2% decrease 1% decrease 1% increase 2% increase
NIS million
Long-term loans - Prime interest (Israel) 25 13 (13 ) (25 )

F - 96

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 21 – FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (cont.)

C.       Fair value

1.        Financial instruments measured at fair value for disclosure purposes only

The carrying amount of certain financial assets and financial liabilities, including cash and cash equivalents, deposits, restricted cash and deposits (including long-term), receivables and debit balances (including long-term), financial derivatives, short term credit, trade payables, payables and credit balances, and other long-term liabilities (excluding lease liabilities), corresponds with or is close to their fair value.

Below is the fair value of financial liabilities and the carrying amount presented in the statement of financial position:

As of December 31, 2025
Carrying amount (*) Fair value Discount rate used to determine the fair value
NIS million NIS million
Loans from banking corporations and financial institutions (Level 2) 3,337 3,382 5.0%-5.4 %
Loans from non‑controlling interests (Level 2) 440 447 6.3 %
Debentures (Level 1) 1,890 1,885 4.5%-4.8 %
5,667 5,714
As of December 31, 2024
--- --- --- --- --- --- --- ---
Carrying amount (*) Fair value Discount rate used to determine the fair value
NIS million NIS million
Loans from banking corporations and financial institutions (Level 2) 2,234 2,237 5.5%-6.2 %
Loans from non‑controlling interests (Level 2) 514 508 5.5%-7.7 %
Debentures (Level 1) 1,891 1,805 5.3%-5.9 %
4,639 4,550

(*) Includes current maturities and interest payable.

F - 97

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 21 – FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (cont.)

C.       Fair value (cont.)

2.       Fair value hierarchy of financial instruments measured at fair value

The table below presents an analysis of financial instruments measured at fair value, on a periodic basis.

The valuation method and the different levels appear in Note 4 above.

As of December 31
2025 2024
NIS million NIS million
Financial assets (financial liabilities)
Derivatives used for hedge accounting
CPI swap contracts (Level 2) (1) 41 43
Forwards on exchange rates (Level 2) (2 ) -
39 43
(1) The nominal NIS discount interest rate range in the value calculations is 3.9%-4.5% and the real discount interest rate range is 1.3%-2.1%.
--- ---

NOTE 22 – RELATED AND INTERESTED PARTIES

A.       Compensation and benefits for key management personnel (including directors)

The Group’s Chairman of the Board and senior directors (hereinafter - “Key Management Personnel”) are usually entitled, in addition to salary, to arrangements regarding the notice and adjustment periods, various social benefits, including - among other things - vacation leave, sick leave and convalescence pay, various insurance coverages, advanced education fund, car and telephone. In addition, the Group makes contributions for them to defined contribution and benefit plans and post-employment benefit plans. Generally, Key Management Personnel are also entitled to annual bonuses in accordance with the Group’s Compensation Policy, and participate in the Company’s equity compensation plan, and senior executives in CPV Group take part in the profit-sharing plan for CPV Group employees. For additional information, see Note 16C.

F - 98

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 22 – RELATED AND INTERESTED PARTIES (cont.)

A.       Compensation and benefits for key management personnel (including directors) (cont.)

Compensation and benefits for the Key Management Personnel employed in the Group (including the Chairman of the Board):

For the year ended December 31
2025 2024 2023
No. of people NIS million No. of people NIS million No. of people NIS million
Employee benefits 6 25 6 23 9 23
Share-based payment 6 18 6 9 9 4
43 32 27

Compensation and benefits for non-employee directors in the Group:

For the year ended December 31
2025 2024 2023
No. of people NIS million No. of people NIS million No. of people NIS million
Total benefits for non-employee directors in the Group 10 2 9 2 10 2

The following are further details regarding the compensation of key management personnel:

1. Giora Almogy is the CEO of the Company and a director of the subsidiaries, from January 1, 2011. According to his employment agreement, which was revised in 2023, the Company’s CEO is entitled to a monthly salary, which is linked to<br> the CPI (the monthly salary as of December 31, 2025 stood at approx. NIS 214 thousand). Furthermore, the CEO is entitled to social benefits as is generally accepted in the Company, and to related benefits in accordance with the<br> compensation policy (such as vehicle, reimbursement of expenses, and 13th salary).

The engagement between the Company and the CEO is for an indefinite period and may be canceled by any of the parties by six-months’ written notice. During the notice period, the Company CEO will be entitled to the full salary and related benefits paid in accordance with the provisions of the agreement. Upon termination of the employment of the Company’s CEO for any reason whatsoever other than dismissal in circumstances in which severance pay may be denied according to the provisions of the law, the CEO will be entitled to the funds accrued in the pension fund/executive insurance, and also to a supplementation to one gross monthly salary, according to his latest monthly salary immediately prior to the termination date, multiplied by the number of his years of service in the Company. The CEO will be entitled to a six-months adjustment period (that does not overlap with the advance notice period), in any event of termination of service, other than dismissal in circumstances in which severance pay may be denied according to the provisions of the law. The adjustment period shall commence at the end of the advance notice period, and the CEO will continue receiving his service and employment terms in full during that period. In addition, the Company CEO will be entitled to bonuses according to the Company’s compensation policy as applicable from time to time, based on the approvals required by law.

F - 99

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 22 – RELATED AND INTERESTED PARTIES (cont.)

A.       Compensation and benefits for key management personnel (including directors) (cont.)

The following are further details regarding the compensation of key management personnel: (cont.)

1. (cont.)

For details regarding options granted to the Company CEO, see Note 16B.

Subsequent to the Report date, the Company's Board of Directors approved (after approval by the Compensation Committee) a bonus to the Company’s CEO in respect of 2025 in the amount of approx. NIS 2,454 thousand (in 2024 - approx. NIS 2,545 thousand).

2. Mr. Yair Caspi has been serving as the Company’s Chairman of the Board since January 3, 2021. On February 17, 2021, the General Meeting of the Company’s shareholders approved his terms of office and employment as Chairman of the Board<br> from the date of commencement of his term of office and for a period of four years since that date (Mr. Caspi serves as a director in companies related to the Company’s controlling shareholder, and the controlling shareholder in the<br> Company may be considered as having a vested interest in his compensation). On December 18, 2024, the general meeting of shareholders approved the terms of his tenure for an additional four-year term. According to his employment<br> agreement, the Chairman of the Board is entitled to a monthly salary, which is linked to the CPI (the monthly salary as of December 31, 2025 stood at approx. NIS 143 thousand). Furthermore, the Chairman of the Board is entitled to social<br> benefits as is generally accepted in the Company, and to related benefits in accordance with the compensation policy (such as vehicle, reimbursement of expenses, and 13th salary).

The engagement between the Company and the Chairman of the Board may be canceled by any of the parties by six-months’ written notice. During the notice period, the Chairman of the Board will be entitled to the full salary and related benefits paid in accordance with the provisions of the agreement. Upon termination of the employment of the Chairman of the Board for any reason whatsoever other than dismissal in circumstances in which severance pay may be denied according to the provisions of the law, he will be entitled to the funds accrued in the pension fund/executive insurance, and also to a supplementation to one gross monthly salary, according to his latest monthly salary immediately prior to the termination date, multiplied by the number of his years of service in the Company. The Chairman of the Board will be entitled to a three-month adjustment period (that does not overlap with the advance notice period), in any event of termination of service, other than dismissal in circumstances in which severance pay may be denied according to the provisions of the law. The adjustment period shall commence at the end of the specified notice period or at the end of the engagement, as the case may be, and the Chairman of the Board shall continue receiving full service and employment terms during that period.

For details regarding options granted to the Company’s Chairman of the Board, see Note 16B.

F - 100

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 22 – RELATED AND INTERESTED PARTIES (cont.)

B.       Balances with related and interested parties

As of December 31
2025 2024
NIS million NIS million
Balances in Israel (including ICG Energy):
Cash and cash equivalents (1) 347 447
Trade receivables (2) 3 4
Trade payables (3) (3 ) -
Other payables - benefits to key management personnel and directors (15 ) (14 )
Balances in the US:
Cash and cash equivalents (1) 86 16
Trade receivables (4) 46 15
Other receivables (including long-term) - subordinated loans to an associate (5) 110 117
Other long-term receivables - development fees receivable from the Basin Ranch project 121 -
Other payables - benefits to key management personnel (for details, see Note 16C) (34 ) (30 )
Debt from non‑controlling interests (6) (191 ) (196 )

C.       Transactions with related parties and interested parties (*)

For the year ended December 31
2025 2024 2023
NIS million NIS million NIS million
Transactions in Israel (including ICG Energy):
Sales (2) 21 42 37
Cost of sales (3) (7) (26 ) - (10 )
General and administrative expenses - reimbursement of expenses from the parent company 1 2 -
Compensation in respect of loss of income 4 - -
Other revenues, net 3 - -
Finance income, net (1) 24 17 22
Transactions in the US:
Revenues from provision of services (4) 187 91 80
Other revenues – development fees from Basin Ranch project 68 - -
Finance income - associates (5) (8) 12 8 4
Other finance income (1) 2 - -
Interest expenses in respect of a debt from non‑controlling interests (5) (14 ) (12 ) (10 )

(*) Transactions with interested and related parties are carried out in the ordinary course of business and at fair market value (FMV).

F - 101

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 22 – RELATED AND INTERESTED PARTIES (cont.)

C.          Transactions with related parties and interested parties (cont.)

1. The Group enters into agreements - during the ordinary course of business and at fair market value - with Mizrahi Tefahot Bank Group Ltd. for a wide range of banking transactions, including management of cash and deposits, binding<br> credit facilities (totaling approx. NIS 200 million, effective until June 2026), and short-term, non-binding credit facilities, etc.
2. PPA
--- ---

In 2016, Hadera entered into a PPA with Migdal Insurance Company Ltd.^16^ (hereinafter - “Migdal”); the consideration specified in the agreement is per kilowatt-hour consumed and based on the DSM tariff with a discount on the Generation Component tariff. The agreement term, which was revised in the reporting period, ends in February 2031. Furthermore, the agreement sets out provisions regarding power consumption by Migdal above the maximum quantity agreed upon, and conditions regarding an increase in the Maximum Quantity and Hadera’s undertaking to meet minimum availability rates for the power plant.

The agreement includes provisions generally accepted in agreements of this type regarding the cancellation thereof in respect of a breach or of events upon the occurrence of which, each party may terminate the agreement, without such termination being deemed as a breach of the agreement, and sets rights to Hadera’s lenders, and regarding its assignment to related parties.

Income from sale of electricity in 2025 stood at approx. NIS 21 million (in 2024 - approx. NIS 42 million, and in 2023 approx. NIS 37 million).

Partnership agreement with the Migdal Group for the development of power plants

During the reporting period, OPC Israel entered into an agreement with corporations of the Migdal Group to found a limited partnership that is held (indirectly) by OPC Israel and Migdal, with holding stakes of 51% and 49%, respectively, while OPC Israel indirectly holds the full rights to the General Partner of the Partnership. The Partnership works to develop, build and operate natural gas power plants in the areas stipulated in the Agreement. In accordance with the Partnership Agreement, OPC Israel will be given priority to purchase the power generated by the power plants. The Agreement also governs equity subscription for the purpose of covering the development and construction expenses, the activity in the Agreed Area and Migdal’s right of first refusal in another which is not in this area. The Agreement also includes customary provisions regarding management fees and development fees, restrictions on the transfer of rights, decisions requiring a special majority and information rights.

Under certain circumstances, including the introduction of an investor into OPC Israel, the parties shall have the right to convert Migdal's share in the partnership into an equity stake in OPC Israel, subject to the terms and conditions set forth.

In addition, an option agreement was signed with Migdal to lease a plot it owns in the Agreed Area, with the potential to build a gas-fired power plant thereon. The option is for an aggregate period of 9 years with early termination rights under set circumstances. The exercise of the option and the transfer of possession are subject to the fulfillment of certain conditions, including conditions dependent on third parties. If the option is exercised, a lease agreement will be entered into for a term equivalent to the land‑lease period with the ILA.

^16^ A subsidiary of Migdal Insurance and Financial Holdings Ltd., which - as of the Report date - is an interested party in the Company.

F - 102

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 22 – RELATED AND INTERESTED PARTIES (cont.)

C.          Transactions with related parties and interested parties (cont.)

3. On May 18, 2025, Rotem – following approval of the Company's Board of Directors – entered into an agreement for the purchase of energy and capacity from Dead Sea Works Ltd. (hereinafter – "Dead Sea<br> Works"), which – to the best of the Company's knowledge – is wholly-owned by ICL Group Ltd. The agreement is for a period ending on March 31, 2030 with the parties having an early termination option by giving a 12-month advance<br> notice. As part of the agreement, Dead Sea Works undertook to provide Rotem with quantities of energy and capacity up to a maximum of 40 MW/h, with a discount on the demand side management tariff (DSM Tariff), with Rotem undertaking to<br> consume a certain annual quantity (ToP), divided by seasons and demand hours clusters as agreed between the parties (hereinafter - “Minimum Annual Quantity").

In addition, the agreement includes generally accepted provisions in agreements for the purchase of energy and capacity, including, among other things, the purchase of electricity beyond the Minimum Annual Quantity in some of the demand hours clusters and beyond the maximum quantity regarding all hours, arrangements regarding the quantities of electricity purchased below the Minimum Annual Quantity, Dead Sea Works’ obligations to meet the minimum availability rates, grounds for termination which are generally acceptable in agreements of this type alongside grounds for termination, which will establish for Rotem the right to compensation in accordance with the terms set out in the agreement.

The Company's Audit Committee determined that the abovementioned engagement does not constitute an extraordinary transaction, within the meaning of this term in the Companies Law, 1999, since such engagements are conducted in the Company's ordinary course of business, at fair market value, and are not likely to have a material effect on the Company's profitability, assets and liabilities.

In 2025, energy acquisitions stood at approx. NIS 22 million.

4. As part of the asset and energy management operations, CPV Group provides management, initiation, development and maintenance services to specific associates. Most of the increase in the reporting period arises from the transition to<br> the equity method in the US Renewable Energies Segment, and accordingly - an increase in revenues from asset management services (which were previously eliminated under the consolidation).
5. Subordinated loans advanced to Valley by the CPV Group in April 2021 and June 2023 total approx. NIS 107 million. This amount was used by Valley mainly for the purpose of extending its finance agreement in June 2023. The loans were<br> repaid subsequent to the Report date under the refinancing of the Valley power plant completed in February 2026.
--- ---
6. For the purpose of investing in CPV Group, the Group has engaged in a partnership agreement with OPC Power, as detailed in Note 23A3, inter alia with institutional investors from Migdal Insurance Group, an interested party in the<br> Company.
--- ---
7. In 2023, the Company entered into engagements for the sale and purchase of natural gas surpluses of immaterial scope with ICL Group Ltd.
--- ---
8. The Group provides bank guarantees for development and construction projects in the United States held by associates.
--- ---
9. From time to time, institutional investors, which are interested parties in the Company, also purchase marketable debentures of the Company.
--- ---

F - 103

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 22 – RELATED AND INTERESTED PARTIES (cont.)

C.       Transactions with related parties and interested parties (cont.)

10. Further to Note 18B regarding the capital raising carried out by the Company in June 2025, the Parent Company participated in the institutional tender carried out with respect to the abovementioned capital raising. The Company's Audit<br> Committee discussed and approved, among other things, the payment of an early subscription fee to the Parent Company, on terms identical to those set for all Qualified Investors, which participated in the institutional tender, and at a<br> customary rate and market terms. The early subscription fee paid to Kenon totaled approx. NIS 6.4 million.
11. The Group has additional transactions with other related parties in Israel, which were classified as negligible transactions.
--- ---

NOTE 23 – SUBSIDIARIES

A.       Material Group subsidiaries

Following are details regarding the Group’s material subsidiaries (directly and indirectly held):

Main location of the Company's operations The Group’s ownership<br><br> <br>rights in the subsidiary
As of December 31
2025 2024
Company
OPC Israel (1) Israel 80 % 80 %
OPC Power Plants (2) Israel 80 % 80 %
CPV Group LP) 3) US 70.69 % 70.46 %
(1) OPC Israel
--- ---

The restructuring (transfer of assets and share exchange) and investment transaction (hereinafter - the “Transaction”) entered into between Veridis, the Company and OPC Israel (a wholly-owned subsidiary of the Company) was completed in January 2023; as part of the transaction, assets were transferred from the Company and Veridis to OPC Israel and a wholly-owned company thereof; the transfer was tax-exempt in accordance with the provisions of the Income Tax Ordinance and was made in consideration for the allocation of shares in OPC Israel and a wholly-owned company thereof.

F - 104

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 23 – SUBSIDIARIES (cont.)

A.       Material Group subsidiaries (cont.)

(1) OPC Israel (cont.)

In addition, a shareholders agreement between the Company and Veridis was signed and came into force, which regulates their relationship in OPC Israel, such that as from the Transaction Completion Date, all of the Company’s activities in the field of electricity and energy generation and supply in Israel are wholly-owned by OPC Israel.^17^ Furthermore, on the Transaction Completion Date, Veridis transferred to OPC Israel a total of approx. NIS 452 million (after adjustments to working capital as is generally accepted in agreements of this type); against the transfer of the said investment amount and Veridis’ rights in the Rotem Companies, Veridis was allocated 20% of OPC Israel’s issued capital. It is noted that a total of NIS 400 million out of the said investment amount was used by Rotem to repay (pro rata) part of shareholder loans extended by the Company and Veridis to Rotem in 2021. In addition, as part of the Transaction, arrangements were put in place regarding guarantees that the Company provided and/or will provide in favor of the assets transferred to OPC Israel, as well as indemnity arrangements in respect of such guarantees which will remain with the Company.

As of the Transaction Completion Date as stated above, a shareholders agreement between the Company and Veridis entered into effect, which pertained to OPC Israel; this agreement replaced the shareholder agreement made between the parties regarding their holdings in Rotem, which was in effect until the completion of the Veridis transaction. The shareholders' agreement of OPC Israel includes terms and conditions that are generally accepted in shareholders’ agreements, including, among other things, regarding: (1) General meetings; (2) rights to appoint directors (such that the Company, as the controlling shareholder, has the right to appoint the majority of directors, including the Chairman of the Board), decisions regarding certain issues that will require a special majority (as long as Veridis’s holdings do not fall below a threshold set in the shareholders agreement), including decisions pertaining to certain interested party transactions, merger or liquidation, entering into a new area of activity, and investments in projects above amounts and at set terms and conditions; (3) shareholders’ rights in case of share allocation or transfer; (4) defined areas of activity; (5) arrangements for execution of distributions by OPC Israel; (6) non-compete arrangements;^18^ (7) arrangements in connection with the provision of additional funds to OPC Israel by the shareholders in connection with its business needs, including a dilution mechanism at the terms set for that purpose, etc.

The shareholders’ agreement also places certain restrictions regarding the transfer of OPC Israel’s shares (other than to authorized transferees), including a right of first refusal to the parties in connection with the transfer of the parties’ holdings in OPC Israel, and a drag along right to oblige Veridis to join the sale, by the Company, of its holdings in OPC Israel; the shareholders’ agreement also confers upon Veridis a tag along right to join a sale of shares by the Company, all subject to the circumstances, conditions and dates set forth in the shareholders’ agreement with respect to each of the arrangements.

^17^ In January 2023, on the eve of the transaction’s completion, the Company transferred to OPC Israel, among other things, the shares of OPC Power Plants, the holdings in Rotem 2, the holdings in Gnrgy, as well as other companies and operations in the area of activity in Israel, such as energy generation facilities on consumers’ premises, virtual electricity supply activity, etc.

^18^ The shareholders agreement defines OPC Israel’s area of activity, which includes, among other things, electricity generation and supply in Israel, which will be carried out by OPC Israel, subject to the agreed arrangements, in accordance with the agreement.

F - 105

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 23 – SUBSIDIARIES (cont.)

A.       Material Group subsidiaries (cont.)

(2) OPC Power Plants

In December 2020, the Company carried out an internal reorganization in accordance with Section 104A of the Income Tax Ordinance, in which it transferred to OPC Power Plants its entire holdings in some of the subsidiaries it owned. As of the Report date, OPC Power Plants holds, among other things, the subsidiaries Rotem, Hadera, Zomet, Gat, Mevuzarot, Sorek 2 and Hadera Operations Company. In January 2023 and as part of the share exchange and investment transaction with Veridis, as detailed in Section A1 above, investments in generation facilities installed at consumers’ premises were transferred to OPC Power Plants and the shares of OPC Power Plants was transferred to OPC Israel.

(3) The CPV Group

CPV Group is an American limited partnership established under Delaware law in the United States; it is owned by the Company through OPC Power Ventures LP. As of the Report date, CPV Group coordinates the Company’s activity in the US. For details regarding CPV Group’s areas of activity, see Note 25. For further details regarding major projects of the CPV Group, held through associates, see Note 24.

OPC Power Ventures LP

In October 2020, the Company entered into partnership agreement with three financial entities (hereinafter - the “Partnership Agreement”),

      whereby the partners will invest in OPC Power. OPC Power is a special purpose partnership for the purpose of acquiring and holding CPV Group and for making additional investments in CPV Group, in the Power and Electricity segment in the United
      States. As of the Report date, the holding stakes of the Limited Partners in the Partnership are as follows: the Company \(through a subsidiary\) holds approx. 70.69% \(subsequent to the Report date, the Company increased its holding stake by an
      unsubstantial rate under the acquisition of ownership interests from one of the Financial Investors\); three Financial Investors which are: Institutional investors from the Clal Insurance Group - holding 12.59%; Institutional investors from the
      Migdal Insurance Group - holding 12.75%; a corporation of the Poalim Capital Markets Group - holding 3.97% \(the three abovementioned investors will be hereinafter referred to as the - "Financial Investors"\).

      It is noted that the holding stakes do not include profit participation rights allocated to managers in CPV Group, as detailed in Note 16C. A wholly-owned company of the Company serves as the General Partner of the Partnership and manages its
      business. As long as the Company controls the General Partner, any separate activity by the Company in the United States in the Partnership’s area of activity is subject to approval by a special majority of the other Partners.

The following is information regarding investment undertakings and loan provision of OPC Power partners (in USD million):

To the report approval date As of December 31, 2025 As of December 31, 2024
Total investment undertakings and loan provision ^(a) (b)^ 1,805 1,535 1,535
Utilization ^(c)^ (1,805 ) (1,535 ) (1,455 )
Balance of investment undertakings and loan provision - - 80

F - 106

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 23 – SUBSIDIARIES (cont.)

A.       Material Group subsidiaries (cont.)

(3) The CPV Group (cont.)

OPC Power Ventures LP (cont.)

A. Subsequent to the Report date, following the construction commencement of the Basin Ranch project, completion of transactions for the acquisition of ownership interests in the Basin Ranch and Shore power plants, and the signing of an<br> agreement to increase ownership interests in the Maryland power plant as described in Note 23E2, the investment undertakings and the shareholder loans undertakings of all partners were increased by approx. USD 270 million.
B. Excluding (1) an additional investment commitment for backing guarantees which were or will be provided for the purpose of development and expansion of projects – each partner based on its pro rata share in the partnership, for a total<br> of approx. USD 75 million. (2) Investment undertakings approved subsequent to the Report date totaling approx. USD 232 million (in addition to those stated in Section A above), which may be exercised through June 2031, in respect of<br> securing letters of credit provided by the Company/backed by a Company guarantee with respect to the construction of the Basin Ranch project as described in Note 14C.
--- ---
C. To acquire additional interests in projects held by the CPV Group and to fund additional investments, during the Reporting Period, the Company and non-controlling interests (both directly and indirectly) made equity investments in the<br> Partnership and advanced loans totaling approx. USD 61 million and approx. USD 19 million, respectively. The loans are denominated in USD and bear an annual interest rate of 7%. The loan principal will be repayable at any time as will be<br> agreed on between the parties, but no later than January 2028. Accrued interest is payable on a quarterly basis. To the extent the payment made by OPC Power is lower than the amount of the accrued interest, the payment in respect of the<br> balance will be postponed to the following quarter – but not later than January 2028.
--- ---

As of the Report date, the Company's share in the total investments in Partnership’s equity and the outstanding balance of the loans (including accrued interest) amount to approx. NIS 2,647 million (approx. USD 830 million), and approx. NIS 1,061 million (approx. USD 333 million), respectively.

The Partnership Agreement provides, among other things, the entitlement of the General Partner to management fees at a rate deriving from the scope of investments of the Partnership and a success fee (carried interest) that is dependent on the rate of return earned by the Partnership. Furthermore, the Partnership Agreement contains, among other things, arrangements for the relationships between the Limited Partners and the relationships between them and the General Partner of the Partnership, provisions relating to the management of the Partnership, restrictions on the transfer partners’ rights, tag-along rights of the financial investors in certain cases, right of first offer (ROFO) in certain cases and rights to force a sale (drag along rights).

The Company and the financial investors also signed agreements during the Reporting Year and subsequent thereto, whereby the Company granted the financial investors a put option, and they granted the Company a call option (in the event that the put option is not exercised), with respect to the holdings of the financial investors in the Partnership. The exercise price of the put option will be based on the fair value of the Partnership less a certain discount, and exercise price of the call option will be based on the fair value of the Partnership plus a certain premium. The Partnership Agreement defines the exercise period and expiry dates of the options. The Company may pay the exercise price through its shares based on their average price on the stock exchange shortly before the exercise.

F - 107

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 23 – SUBSIDIARIES (cont.)

A.        Material Group subsidiaries (cont.)

(4) Gnrgy

In 2021, the Company acquired (through several acquisitions) 51% of the share capital of Gnrgy, a privately-held company operating in the field of electric-vehicle charging infrastructure and the construction of charging stations for electric vehicles, at a total cost of approx. NIS 67 million, and as from the fourth quarter of 2021 it started to consolidate Gnrgy's financial statements. In 2024, the sale of Gnrgy shares by OPC Israel was completed and, as from that date, the Company deconsolidated Gnrgy’s financial statements.

B.        Significant restrictions on the transfer of resources between Group entities

For details regarding significant restrictions applicable to OPC Israel and Hadera, see Notes 14B1 and 14B2 and Section A(1) above. For details regarding significant restrictions applicable to the CPV Group, Shore and Basin Ranch, see Note 14B3b, 14B5and 14B4, respectively. Furthermore, distribution restrictions apply as is generally accepted in project credit agreements in respect of power plants in the US, which are held by associates.

F - 108

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 23 – SUBSIDIARIES (cont.)

C.        Non-controlling interests in consolidated companies

OPC Israel

Following is financial information about OPC Israel (before the elimination of intra-group transactions), in which there are - as of the Report date - non-controlling interests of 20% that are material to the Group.

As of December 31
2025 2024
NIS million NIS million
Current assets 604 320
Non-current assets 5,277 5,138
Current liabilities 512 383
Non-current liabilities 3,262 2,877
Non-controlling interests 421 439
Total assets, net 1,686 1,759

Data on results:

For the year ended December 31
2025 2024 2023
NIS million NIS million
Sales 2,321 2,312 2,283
Profit for the year 211 76 129
Total comprehensive income 203 74 122
Profit attributable to the non-controlling interests 42 13 22

Cash flow data:

For the year ended December 31
2025 2024 2023
NIS million NIS million
Cash flows from operating activities 742 631 631
Cash flows from investing activities (372 ) (424 ) (278 )
Cash flows for financing activities (160 ) (498 ) (286 )
Total increase in cash and cash equivalents 210 (291 ) 67

Dividend distribution

During the reporting period, OPC Israel distributed dividends totaling NIS 238 million to the Company and NIS 60 million to Veridis.

During 2024 and 2023, no dividends were distributed by OPC Israel.

F - 109

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 23 – SUBSIDIARIES (cont.)

C.       Non-controlling interests in consolidated companies (cont.)

OPC Power

Following is financial information about OPC Power (before the elimination of intra-group transactions), in which there are - as of the Report date - non-controlling interests of approx. 29.31% that are material to the Group.

As of December 31
2025 2024
NIS million NIS million
Current assets 691 424
Non-current assets 6,024 5,485
Current liabilities 919 87
Non-current liabilities 1,989 1,658
Non-controlling interests 1,116 1,230
Total assets, net 2,691 2,934

Data on results:

For the year ended December 31
2025 2024 2023
NIS million NIS million NIS million
Sales 681 467 269
Profit for the year* 234 239 9
Total comprehensive income (loss)* (31 ) 290 (107 )
Profit attributable to the non-controlling interests* 69 73 3

(*) The OPC Power partnership does not file tax returns; therefore - its results are presented before income tax effects.

Cash flow data:

For the year ended December 31
2025 2024 2023
NIS million NIS million NIS million
Cash flows from operating activities (used for operating activities) 257 21 (72 )
Cash flows from investing activities (1,482 ) (1,602 ) (1,295 )
Cash flows for financing activities 1,394 1,475 1,495
Effect of exchange rate fluctuations on cash and cash equivalent balances (30 ) 18 (15 )
Total increase (decrease) in cash and cash equivalents 139 (88 ) 113

Dividend distribution

During 2023-2025, no dividends were distributed by OPC Power.

F - 110

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 23 – SUBSIDIARIES (cont.)

D.         Loans from non‑controlling interests

1. Composition
As of December 31
--- --- --- --- --- ---
2025 2024
NIS million NIS million
Loans from non‑controlling interests (1) 440 514
Current maturities - (14 )
440 500

(1) Loans from non‑controlling interests:

As of December 31
2025 2024
NIS million NIS million
Loan to Rotem - 13
Loan to OPC Power (see Section A3 above) 440 452
Debt to OPC Israel (see Section A below) - 49
440 514
A. On December 27, 2023, the Company and Veridis advanced a debt to OPC Israel according to their share in its shares (hereinafter - the “Debt”), such that the Company advanced a total of approx.<br> NIS 240 million and Veridis advanced a total of approx. NIS 60 million. The debt is CPI-linked and bears annual interest of the higher of: 2.75% or interest in accordance with Section 3(j) to the Income Tax Ordinance. The Debt’s principal<br> and interest shall be repaid according to an amortization schedule as set in the agreement. In January 2024, the shareholders advanced an additional debt under identical conditions, such that the Company advanced a total of approx.<br> NIS 54 million and Veridis advanced a total of approx. NIS 13 million.
--- ---

On September 25, 2024, the Company and Veridis advanced a loan of approx. NIS 180 million to OPC Israel according to their share in its shares, such that the Company advanced a total of approx. NIS 144 million and Veridis advanced a total of approx. NIS 36 million. The loan is unlinked and bears the higher of: annual interest of Prime plus 0.35% or interest in accordance with Section 3(j) to the Income Tax Ordinance.

During the reporting period, the liabilities were repaid in full.

F - 111

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 23 – SUBSIDIARIES (cont.)

E.       Transactions to acquire additional interests in US-based power plants

  1. Acquisition of the remaining ownership interests in the Basin Ranch project (under construction)

On October 28, 2025, the Financial Closing Date of the Basin Ranch power plant, the CPV Group (through a wholly-owned subsidiary) entered into an agreement with the remaining partner in the project (hereinafter - the “Seller”) to acquire the remaining 30% stake in the project (hereinafter - the “Acquisition Agreement”), such that following the completion of the transaction, the CPV Group shall wholly own (100%) the project. Subsequent to the Report date, in February 2026, the acquisition transaction was completed, and as from the first quarter of 2026, the project will be consolidated in the CPV Group’s and Company's Consolidated Financial Statements.

The total amount set in the Acquisition Agreement is approx. NIS 1.22 billion (approx. USD 371 million^19^), payable and/or provided in the following manner and on the following dates:

• In October 2025, approx. USD 59 million was paid for the seller's investments in the project made as of the Transaction Completion Date.
• At the Transaction Completion Date, a total of approx. USD 169 million was provided by way of cash and/or letters of credit (LCs) in respect of the equity required in connection with the TEF Loan. Moreover, additional collateral were<br> provided by way of letters of credit (LCs) required to secure shareholders' liabilities related to the project in the amount of approx. USD 63 million. It is noted that the said letters of credit were provided out of the Company's<br> facilities and/or facilities guaranteed by the Company, as detailed in Note 14C above.
--- ---
• During the project’s construction PERIOD, an additional consideration will be paid to the Seller totaling approx. USD 80 million, in four equal annual installments from 2026 TO 2029.
--- ---

The Company opted to account for the acquisition transaction as an asset acquisition transaction. For further details, see Note 3B3.

Following is the allocation of the total cost of investment in Basin Ranch totaling NIS 1,095 million (approx. USD 353 million) (*) to assets and liabilities which will be consolidated for the first time in the first quarter of 2026:

NIS million
Cash and cash equivalents 408
Property, plant & equipment 1,343
Loan from TEF (434 )
Other long‑term liabilities (168 )
Other liabilities, net (54 )
Total 1,095

(*) The total said investment cost includes the consideration paid for the acquisition of the remaining stake (30%) in the Basin Ranch power plant and the balance of investment therein (70%) as of the transaction completion date.

^19^ Under the Acquisition Agreement, the CPV Group serves as the guarantor for future payments payable to the seller subsequent to the completion of the transaction. Furthermore, the seller is entitled to their share in the balance of future development fees in respect of the Project totaling approx. NIS 59 million (approx. USD 18 million), which are expected to be paid on the Project’s commercial operation date.

F - 112

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 23 – SUBSIDIARIES (cont.)

E.       Transactions to acquire additional interests in US-based power plants (cont.)

  1. Acquisition of the remaining ownership interests in the Shore and Maryland power plants

A transaction for the acquisition of 25% of the ownership interests in the Maryland power plant was completed in October 2024, and an acquisition of additional 25% was completed in December 2024, such that CPV Group's holding stake increased to 75%. Furthermore, a transaction for the acquisition of 31% of the ownership interests in the Shore power plant was completed in December 2024, such that CPV Group's holding stake increased to approx. 69%.

The amount paid for such transactions - with the addition of CPV’s share attributable to the Acquired Rights (approx. 31%) in the Equity Subscription with respect to the refinancing of the Shore Power Plant (which was completed in the first quarter of 2025) and totaled approx. USD 80 million (for 100% of the interests) - totaled approx. US 213 million (approx. NIS 770 million).

On April 1, 2025, an agreement was completed to acquire an additional 20% of the Shore Power Plant, such that upon its completion, the holding rose to 89%. At the transaction completion date, the CPV Group paid the seller an immaterial consideration amount, in addition to injecting the Partner's share on Shore Power Plant’s refinancing date during the first quarter of 2025 (for details, see Note 14B5 above).

Considering the interests of the remaining partners in the Shore and Maryland power plants, the Company continued to account for its investments therein according to the equity method.

On October 28, 2025, the Company entered into an agreement to acquire the remaining ownership interests (approx. 11%) in the Shore power plant from the remaining partner in consideration for an immaterial amount. Subsequent to the Report date, in January 2026, the Acquisition Transaction was completed, such that as of the Report approval date CPV Group holds 100% of the ownership interests in Shore. Accordingly, as of the financial statements for the first quarter of 2026, the power plant will be consolidated in the financial statements of CPV Group and, accordingly, in the Company's financial statements.

The Acquisition Transaction was accounted for as an asset acquisition transaction; for further details see Note 3B3. Following is the allocation of the total investment cost in Shore (*) to assets and liabilities which will be consolidated for the first time in the first quarter of 2026:

NIS million
Property, plant & equipment 1,650
Right‑of‑use asset 422
Bank loans (938 )
Lease liability (543 )
Derivative financial instruments (51 )
Other assets, net 10
Total 550

(*)  The total investment cost includes the consideration paid for the acquisition of the remaining stake (approx. 11%) in the Shore power plant and the balance of investment therein (approx. 89%) as of the transaction completion date.

Furthermore, on the Acquisition Transaction’s completion date, the Company is expected to recognize a (pre-tax) loss totaling approx. USD 15 million (approx. NIS 47 million) due to reclassification of capital reserves from other comprehensive income (mainly in respect of hedging of the spark spread) to profit or loss.

F - 113

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 23 – SUBSIDIARIES (cont.)

E.     Transactions to acquire additional interests in US-based power plants (cont.)

3. Signing an agreement for the acquisition of the remaining ownership interests in Maryland and disposal of the investment in Three Rivers

Subsequent to the Report date, in March 2026, CPV Group entered into an acquisition agreement with the partner holding 25% of the remaining ownership interests in the Maryland power plant. In accordance with the agreement, in consideration for the partner's ownership interests in Maryland, CPV Group will transfer to the partner its ownership interests (10%) in the Three Rivers power plant and a cash amount, which is immaterial. The completion of the transaction is subject to generally accepted conditions precedent, including obtaining regulatory approvals, which have yet to be completed as of the Report approval date.

Upon completion of the transaction (if it is indeed completed) CPV Group will hold the entire ownership interests in the Maryland power plant and at the same time will cease to hold the Three Rivers power plant; as from that date the Maryland power plant will be consolidated into the CVP Group and Company's Financial Statements.

As of the report approval date, the Company is assessing the transaction’s accounting treatment, and specifically the effect on profit and loss, if any, of the Maryland power plant’s transition from an associate to a consolidated company. After completing an initial assessment, the Company estimates that the acquisition of the share of the remaining partner in the Maryland power plant will be accounted for as an asset acquisition transaction (rather than as a business combination), and accordingly it is not expected that it will recognize a gain from the revaluation of the investment in Maryland due to the transition from an equity-accounted investment to a consolidated entity in the Financial Statements. However, balances recognized in other comprehensive income in respect of the investment in Maryland through the transaction completion date (if it is completed), are expected to be reclassified to profit and loss.

Furthermore, as a result of the sale of the Company's holding stake in Three Rivers, upon completion of the transaction (if it is completed), the Group is expected to recognize a post-tax capital gain, which is estimated at approx. NIS 23 million (approx. USD 8 million) as of the Report approval date.

F.     Deconsolidation in the US Renewable Energies Segment and transition of significant influence

Transaction for investment of capital in CPV Renewable

In November 2024, an investment transaction was entered into between the CPV Group and Harrison Street, an American private equity fund operating in the field of infrastructures (hereinafter - the “Investor”), whereunder a total of USD 300 million was invested (USD 200 million as of the Transaction Completion Date and an additional USD 100 million during 2025) in CPV Renewable Power LP (hereinafter - “CPV Renewable”)^20^ in consideration for allocating 33.33% of the ordinary interests in CPV Renewable (hereinafter - the “Investor’s

        Interest”\) at the Transaction Completion Date. The Transaction reflected a pre-money valuation of approx. USD 600 million for CPV Renewable.

^20^ Prior to the completion of the Transaction: (1) CPV Renewable changed its status from a Limited Partnership to a Limited Liability Company (LLC); (2) the holdings in CPV Keenan LLC (which is part of CPV Group’s renewable energy activities) were transferred into CPV Renewable.

F - 114

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 23 – SUBSIDIARIES (cont.)

F.     Deconsolidation in the US Renewable Energies Segment and transition of significant influence (cont.)

The interest holders agreement, which was signed by the parties and came into effect on the Transaction Completion Date, sets forth arrangements between the interest holders in CPV Renewable, and Corporate Governance provisions, including, among other things, as detailed below:

1. Board of Directors’ composition - the initial composition as of the completion date will include 4 board members (CPV Group and the Investor each appointing 2 directors). The voting power of the directors is based on the holding rate<br> of the appointing interest holder.
2. Generally accepted restrictions on the transfer of rights (including certain restriction periods), subject to agreed conditions and exclusions.
--- ---
3. Actions and resolutions requiring a special majority, which includes the votes of the directors appointed by the Investor - including, among other things, changes in the corporation’s documents, mergers, allocation of securities,<br> liquidation, future budgets (the agreement includes arrangements regarding budgetary continuity), interested party transactions (including regarding the service agreements), certain engagements and material transactions, etc., all subject<br> to the applicable conditions, thresholds and definitions as per the agreement. Furthermore, the replacement of the CPV Renewable’ lead business officer shall require the consent of the Investor under certain conditions.
--- ---
4. The activities of CPV Group in the field of renewable energy shall be carried out through CPV Renewable (except under certain circumstances prescribed by the Agreement).
--- ---

Furthermore, the parties agreed that CPV Group shall provide development and asset management services to CPV Renewables in accordance with a long-term services agreement,^21^ which will include, among other things, CPV Group’s undertaking to provide sufficient resources and skilled manpower for that purpose, in accordance with specific undertakings.^22^

In view of the arrangements put in place between the interest holders as detailed above, as from the transaction completion date CPV Group and the Company ceased to consolidate the financial statements of CPV Renewable and started implementing the equity method to this investment. Accordingly, in the fourth quarter of 2024, a one-off gain from the loss of control totaling approx. NIS 259 million and income tax expenses totaling approx. NIS 83 million were recognized: (1) Approx. NIS 12 million in tax expenses in respect of restructuring carried out in respect of the transfer of investment in CPV Keenan LLC (which is under CPV Group’s renewable energy segment) to CPV Renewable (the abovementioned tax expenses include approx. NIS 53 million in current tax expenses and approx. NIS 41 million in deferred tax income). And; (2) Deferred tax expenses totaling approx. NIS 71 million arising from remeasurement of the investment to fair value at the time of loss of control.

It is noted that CPV Group paid taxes totaling approx. NIS 64 million in respect of the abovementioned restructuring.

The fair value of CPV Renewable, based on the transaction price, amounts to approx. NIS 3,356 million (approx. USD 897 million); CPV Group’s share (66.67%) amounted to approx. NIS 2,225 million (approx. USD 595 million). On the transaction completion date, in November 2024, an initial appraisal was conducted for the purpose of determining the fair value of CPV Renewable's assets and liabilities; the appraisal was conducted by an external independent appraiser (EY). The appraisal was completed in the fourth quarter of 2025 and did not have a material effect on the Financial Statements.

^21^ The service agreements include provisions in connection with early termination by CPV Renewable under certain circumstances.

^22^  Includes undertakings regarding skilled lead business officer and development team. A breach of some of the undertakings (as the case may be) may trigger the termination of the services agreements and the appointment of a replacement officer, and lead to other impacts on CPV Group’s rights as per the Interest Holders’ Agreement.

F - 115

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 23 – SUBSIDIARIES (cont.)

F.     Deconsolidation in the US Renewable Energies Segment and transition of significant influence (cont.)

Following is a breakdown of the allocation of the fair value of the investment in CPV Renewable to CPV Group's share in the fair value of the assets and liabilities of CPV Renewable:

NIS million
Cash and cash equivalents 670
Receivables in respect of deferred consideration from the partner in CPV Renewable 243
Property, plant & equipment 2,579
Goodwill 99
Bank loans (967 )
Other long‑term liabilities (293 )
Other liabilities, net (106 )
Total 2,225

The projects’ fair value was evaluated based on the following methodology:

A. With regard to projects under commercial operation or construction using the DCF method by discounting the expected future cash flows of each project, by the weighted average cost of capital (WACC) after tax.
B. With respect to the backlog of projects under advanced development - at estimated fair value per KW, and the likelihood of materialization as a function of the development stages.
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C. With regard to the backlog of projects under initial development - at cost.
--- ---

Following are the key assumptions used in determining the Projects’ fair value:

A. Forecast years - represent the period spanning from 2024 to 2054 and are based on the estimate of the economic life of the power plants and their value as of the end of the forecast period.
B. Weighted Average Cost of Capital (WACC) - calculated for each active material project and under construction separately and ranges between approx. 6.25% and approx. 7%.
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C. Market prices and capacity - market prices (electricity, availability, RECs, etc.) are based on PPAs and market forecasts received from external and independent information sources, taking into account the relevant area and market for<br> each project and the relevant regulation.
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D. Forecast years - represent the period spanning from 2024 to 2054 and are based on the estimate of the economic life of the power plants and their value as of the end of the forecast period.
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E. Estimated construction costs of the projects, and entitlement to tax benefits in respect of projects under construction (ITC or PTC, as applicable).
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F. An annual long-term inflation rate of 2.2%.
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F - 116

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 24 – ASSOCIATES

CPV Group’s operations in the Energy Transition Segment, as detailed in Note 25 below, is carried out through associates. In addition, as from the completion date of the investment transaction in the renewable energy segment in the fourth quarter of 2024 as detailed in Note 23F, CPV Group’s activity in the said segment is also carried out through an associate - CPV Renewable.

Following is condensed information regarding principal associates of CPV Group. In addition, the CPV Group owns additional associates that hold rights to projects under development and in which the investment, as of the Report date, amounts to non-material amounts.

Condensed financial information on the financial position as of December 31, 2025:

Fairview Maryland (2) Shore (1) Towantic Valley Three<br><br> <br>Rivers (3) Basin<br><br> <br>Ranch (1) CPV Renewable Other investments Total
NIS million NIS million NIS million NIS million NIS million NIS million NIS million NIS million NIS million NIS million
Holding rate 25.0 % 75.0 % 88.8 % 26.0 % 50.0 % 10.0 % 70.0 % 66.7 %
Current assets 115 80 58 250 334 172 271 662 4
Non-current assets 2,692 2,007 2,565 2,595 1,887 3,899 1,426 4,066 121
Total assets 2,807 2,087 2,623 2,845 2,221 4,071 1,697 4,728 125
Current liabilities 125 191 205 329 1,136 220 123 936 3
Non-current liabilities 2,181 751 1,540 698 284 1,926 776 1,558 -
Total liabilities 2,306 942 1,745 1,027 1,420 2,146 899 2,494 3
Net assets 501 1,145 878 1,818 801 1,925 798 2,234 122
Company's share 125 859 779 473 401 193 559 1,489 57 4,935
Excess costs and other adjustments 239 (13 ) (387 ) 83 (2 ) 28 (71 ) 374 - 251
Carrying amount of investment 364 846 392 556 399 221 488 1,863 57 5,186
Dividends and capital distributions in 2025 247 129 7 80 - 19 - - - 482

F - 117

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 24 – ASSOCIATES (cont.)

Condensed financial information on the operating results for the year ended December 31, 2025:

Fairview Maryland (2) Shore (1) Towantic Valley Three<br><br> <br>Rivers (3) Basin<br><br> <br>Ranch (1) CPV Renewable (2) Total
NIS million NIS million NIS million NIS million NIS million NIS million NIS million NIS million NIS million
Total revenues 1,276 1,140 767 1,427 1,135 1,745 - 239
Operating expenses (excluding depreciation<br><br> <br>and amortization) (591 ) (692 ) (510 ) (941 ) (732 ) (1,216 ) (6 ) (292 )
Depreciation and amortization (120 ) (75 ) (135 ) (138 ) (89 ) (118 ) - 106
Operating income (loss) 565 373 122 348 314 411 (6 ) 53
Finance expenses, net (105 ) (64 ) (131 ) (63 ) (138 ) (130 ) 2 (80 )
Net income (loss) (3) 460 309 (9 ) 285 176 281 (4 ) (27 )
Other comprehensive income (loss) (3) (117 ) (84 ) (84 ) (55 ) (117 ) (108 ) - (22 )
Comprehensive income (loss) 343 225 (93 ) 230 59 173 (4 ) (49 )
Company’s share in net income (loss) 115 232 - 74 88 28 (3 ) (18 ) 516
Deductions of profit and loss in respect of adjustments to fair value made on the<br><br> <br>acquisition dates (9 ) - 24 (4 ) - - - (4 ) 7
Share in the profits (losses) of associates 106 232 24 70 88 28 (3 ) (22 ) 523
Company’s share in other comprehensive<br><br> <br>income (loss) (29 ) (64 ) (75 ) (14 ) (59 ) (11 ) - (14 ) (266 )
(1) For details regarding the acquisition of the remaining ownership interests in Shore and Basin Ranch subsequent to the Report date, see Note 23E above.
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(2) For details regarding the signing of an agreement for the acquisition of the remaining ownership interests in Maryland subsequent to the Report date under a transaction for the exchange of rights in Three Rivers, see Note 23E3 above.
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(3) It should be noted that the associates do not file tax returns and therefore their results do not reflect the tax effect.
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F - 118

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 24 – ASSOCIATES (cont.)

Condensed financial information on the financial position as of December 31, 2024:

Fairview Maryland (1) Shore (1) Towantic Valley Three Rivers CPV Renewable (2) Other investments Total
NIS million NIS million NIS million NIS million NIS million NIS million NIS million NIS million NIS million
Holding rate 25.0 % 75.0 % 68.8 % 26.0 % 50.0 % 10.0 % 66.7 %
Current assets 110 161 128 294 149 177 897 17
Non-current assets 3,169 2,355 3,304 2,977 2,419 4,759 3,900 167
Total assets 3,279 2,516 3,432 3,271 2,568 4,936 4,797 184
Current liabilities 59 192 1,806 263 197 339 496 6
Non-current liabilities 1,919 1,063 802 843 1,517 2,357 1,395 -
Total liabilities 1,978 1,255 2,608 1,106 1,714 2,696 1,891 6
Net assets 1,301 1,261 824 2,165 854 2,240 2,906 178
Company's share 325 946 567 563 427 227 1,937 82 5,074
Fair value adjustments made on acquisition dates 283 (16 ) (377 ) 99 (2 ) 30 232 (3 ) 246
Carrying amount of investment 608 930 190 662 425 257 2,169 79 5,320
Dividends and capital distributions<br><br> <br>in 2024 278 6 - 46 - - - - 330

F - 119

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 24 – ASSOCIATES (cont.)

Condensed financial information on the operating results for the year ended December 31, 2024:

Fairview Maryland (1) Shore (1) Towantic Valley Three Rivers CPV Renewable (2) Other investments Total
NIS million NIS million NIS million NIS million NIS million NIS million NIS million NIS million NIS million
Total revenues 1,108 883 618 1,548 969 1,233 40 -
Operating expenses (excluding depreciation<br><br> <br>and amortization) (517 ) (680 ) (537 ) (919 ) (644 ) (921 ) (16 ) (1 )
Depreciation and amortization (128 ) (82 ) (154 ) (131 ) (95 ) (130 ) (18 ) -
Operating income (loss) 463 121 (73 ) 498 230 182 6 (1 )
Finance expenses, net (82 ) (79 ) (151 ) (56 ) (176 ) (147 ) (11 ) -
Net income (loss) (3) 381 42 (224 ) 442 54 35 (5 ) (1 )
Other comprehensive income (loss) (3) 25 75 26 (34 ) (93 ) (35 ) 6 -
Comprehensive income (loss) 406 117 (198 ) 408 (39 ) - 1 (1 )
Company’s share in net income (loss) 95 6 (91 ) 115 27 4 (3 ) (1 ) 152
Excess costs and other adjustments (6 ) 3 16 3 - - (2 ) - 14
Share in the profits (losses) of associates 89 9 (75 ) 118 27 4 (5 ) (1 ) 166
Company’s share in other comprehensive<br><br> <br>income (loss) 6 48 15 (9 ) (47 ) (4 ) 4 - 13
(1) For details regarding the acquisition of additional interests in the reporting period and fourth quarter of 2024 - see Note 23E2.
--- ---
(2) For details regarding deconsolidation and transition to the equity method with respect to the investment in CPV Renewable, see Note 23F above.
--- ---
(3) It should be noted that the associates do not file tax returns and therefore their results do not reflect the tax effect.
--- ---

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 24 – ASSOCIATES (cont.)

A. Investments in property, plant and equipment of associates

Following is additional information regarding the scope of investments of Energy Transition associates in property, plant and equipment (including periodic maintenance), without adjustment for the holding stake:

Fairview Maryland Shore Towantic Valley Three Rivers
NIS million NIS million NIS million NIS million NIS million NIS million
Ownership stake as of the Report date 25.0 % 75.0 % 88.8 % 26.0 % 50.0 % 10.0 %
Investments in 2025 43 33 26 75 24 28
Investments in 2024 57 55 22 39 28 43
B. Attachment of financial statements of a material associate
--- ---

The Company includes in its Financial Statements as of December 31, 2025, Maryland’s financial statements. The financial statements of Maryland are drawn up in accordance with US GAAP, which vary, in some respects, from IFRS. For information regarding adjustments made to Maryland’s financial statements in order to make them compatible with the Company’s accounting policies and rules, see Note 28.

According to legal advice received by CPV Group, under the relevant US law it is not required to sign the financial statements of material associates, and the attached financial statements were approved by the competent organs, and an opinion of the independent auditors was attached thereto.

Maryland’s functional and presentation currency is the USD. As of the Report date, the exchange rate is NIS 3.190 per USD.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 25 – SEGMENT REPORTING

As of the Report date the Group has three reportable operating segments, which constitute strategic business units of the Group, and other activities that do not constitute reportable segments.

These strategic business units are managed separately for resource allocation and performance review evaluation due to the fact that some are in different markets, and others require different technology and adjustment of the trading structure of each unit.

Following is a brief description of the business activities of each of the Group’s three operating segments as of the Report date:

• The Israel Segment (through OPC Israel, 80%) - Under this operating segment, the Group is engaged in the generation and supply of electricity and energy, mainly to private customers and to the<br> System Operator, and in the initiation, development, construction and operation in Israel of power plants and energy generation facilities powered using natural gas and renewable energy co-located with storage in Israel.
• US Energy Transition Segment (through CPV Group, approx. 70.69%) - in this segment, the Group is engaged in the operation of conventional energy power plants (gas-fired), which supply efficient<br> and reliable electricity, and in the generation and supply of electricity and energy, mostly to the grid. The active power plants in this area of operation are held through associates As from the first quarter of 2026, the Shore power<br> plant will be consolidated into the Company's Financial Statements. Furthermore, subsequent to the Report approval date, an agreement was signed to acquire the remaining ownership interests in the Maryland power plant, which, subject to<br> its expected completion in the second quarter of 2026, will result in the consolidation of Maryland in the Company’s Financial Statements.
--- ---
• US Renewable Energies Segment (through CPV Group, approx. 70.69%) - in this area of operation, the Group engages in the initiation, development, construction and operation of renewable energy<br> electricity generation facilities (mostly solar and wind) in the USA, and the supply of electricity from renewable sources to customers. The activity in this segment is carried out through an associate in which CPV Group has an interest<br> of approx. 66.7%.
--- ---

Furthermore, the Group is engaged - through CPV Group - in several business activities in the United States which, as of the Report date and in accordance with IFRS, do not constitute reportable segments in the Financial Statements:

(1) Development and construction of high-efficiency conventional energy (natural gas) projects in combination with future carbon capture potential; and (2) retail activity for the sale of electricity to commercial customers.

The segment’s results are based on the EBITDA, which is the profit (loss) of the Company before: Depreciation and amortization, net finance expenses or income and income taxes, as well as one-off revenues (expenses). The data of associates and joint ventures are included by way of proportionate consolidation according to the CPV Group's holding rate therein, and accordingly, the adjustments column includes mainly adjustments relating to the transition from the “proportionate consolidation” method used in internal management reports, and accordingly in this note, to the equity method in accordance with IFRS.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 25 – SEGMENT REPORTING (cont.)

For the year ended December 31, 2025
Israel US Energy Transition US Renewable Energies Other activities in the US Adjustments to consolidated Consolidated - total
In NIS million (Audited)
Revenues from sales and provision of services 2,321 2,898 185 470 (2,872 ) 3,002
Cost of sales and provision of services (1,673 ) (1,750 ) (44 ) (436 ) 1,640 (2,263 )
EBITDA after proportionate consolidation^1^ 611 1,099 105 (18 ) (1,198 ) 599
Adjustments:
Share in profits of associates 523
General and administrative expenses at US headquarters (not allocated to US segments) (181 )
General and administrative expenses at Company headquarters (not attributed to the operating segments) (25 )
Total EBITDA 916
Depreciation and amortization (249 )
Finance expenses, net (218 )
Other expenses, net 95
(372 )
Profit before taxes on income 544
Income tax expenses (87 )
Profit for the period 457

The total EBITDA generated by the Group’s activities in the US (including the associates) in 2025 amounts to approx. NIS 1,005 million.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 25 – SEGMENT REPORTING (cont.)

For the year ended December 31, 2024
Israel US Energy Transition US Renewable Energies Other activities in the US Adjustments to consolidated Consolidated - total
In NIS million (Audited)
Revenues from sales and provision of services 2,312 1,796 228 145 (1,702 ) 2,779
Cost of sales and provision of services (1,649 ) (1,154 ) (66 ) (144 ) 1,082 (1,931 )
EBITDA after proportionate consolidation 639 588 112 (22 ) (608 ) 709
Adjustments:
Share in profits of associates 166
General and administrative expenses at US headquarters (not allocated to US segments) (89 )
General and administrative expenses at Company headquarters (not attributed to the operating segments) (20 )
Total EBITDA 766
Depreciation and amortization (333 )
Finance expenses, net (301 )
Gain on loss of control in the US Renewable Energies Segment 259
Other expenses, net (56 )
(431 )
Profit before taxes on income 335
Income tax expenses (138 )
Profit for the year 197

The total EBITDA generated by the Group’s activities in the US (including the associates) in 2024 amounts to approx. NIS 589 million.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 25 – SEGMENT REPORTING (cont.)

For the year ended December 31, 2023
Israel US Energy Transition US Renewable Energies Other activities in the US Adjustments to consolidated Consolidated - total
In NIS million (Audited)
Revenues from sales and provision of services 2,283 1,525 146 12 (1,414 ) 2,552
Cost of sales and provision of services (1,676 ) (904 ) (49 ) (22 ) 824 (1,827 )
EBITDA after<br><br> <br>proportionate consolidation 562 585 31 (26 ) (588 ) 564
Adjustments:
Share in profits of associates 242
General and administrative expenses at US headquarters (not allocated to US segments) (26 )
General and administrative expenses at Company headquarters (not attributed to the operating segments) (27 )
Total EBITDA 753
Depreciation and amortization (303 )
Finance expenses, net (197 )
Other expenses, net (16 )
(516 )
Profit before taxes on income 237
Income tax expenses (68 )
Profit for the year 169

The total EBITDA generated by the Group’s activities in the US (including the associates) in 2023 amounts to approx. NIS 564 million.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 26 – CONTINGENT LIABILITIES AND COMMITMENTS DURING AND SUBSEQUENT TO THE REPORTING PERIOD

A. Lawsuits and other contingent liabilities

The Group companies usually record provisions for claims which, in their management’s opinion, based on their legal counsel, will more likely than not materialize. The provision is made according to an estimate of the expected amounts of the payments for settlement of the liability. As of the Report date, additional exposure for which there is no provision amounts to approx. NIS 31 million (excluding a purchase tax assessment, as stated in Note 10B5).

B. Maintenance and service agreements

1.     Agreement for the Rotem Power Plant

On June 27, 2010, Rotem entered into an agreement with Mitsubishi^23^ for the long-term maintenance of Rotem Power Plant, from the commercial operation date, for an operating period of 100 thousand work hours or up to the date on which 8 scheduled maintenance services are completed on the gas turbine, at a cost of approx. EUR 55 million (as of the signing date of the agreement), payable over the period based on the formula provided in the agreement (hereinafter in this section – the “Original Maintenance Agreement”). In accordance with the Original Maintenance Agreement, Mitsubishi will carry out maintenance work in the power plant and provide new or refurbished spare parts as required. It is noted that the Maintenance Agreement covers scheduled maintenance work and that, as a rule, Rotem will be charged separate additional amounts for any unscheduled or additional work, if required. The Original Maintenance Agreement includes Mitsubishi’s guarantees with regard to the performance of the Rotem Power Plant. Mitsubishi undertook to compensate Rotem in the event of non-compliance with the foregoing guarantees, subject to the terms and provisions of the agreement, and Rotem undertook to pay Mitsubishi to for improvement in the performance of Rotem Power Plant resulting from the maintenance work; all this – up to an annual maximum limit, as detailed in the Maintenance Agreement.

In December 2023, Rotem entered into a new maintenance agreement with Mitsubishi Power Europe Ltd. and a company operating on its behalf that will serve as a local contractor (hereinafter, jointly - “Mitsubishi”) at a total estimated cost of approx. EUR 67 million that will be paid over the term of the agreement, in accordance with the payments schedule set in the agreement (hereinafter - the “New Maintenance Agreement”). The New Maintenance Agreement has superseded the Original Maintenance Agreement described above, which expired in October 2025. The term of the New Maintenance Agreement shall be 12 years as from the end of the term of the Original Maintenance Agreement, or the completion of the required maintenance work (which is quantified based on a number of parameters as detailed in the agreement), according to the latest of the options, and no later than 20 years from the end of the term of Rotem’s Original Maintenance Agreement. As part of the New Maintenance Agreement, Mitsubishi gives Rotem an undertaking to maintain a certain level of availability of the components relevant to the power plant and other parameters related to the performance of the relevant components in the power plant (including an undertaking regarding emissions). In addition, Mitsubishi gave Rotem a warranty undertaking with respect to with some of the maintained components, in accordance with the provisions set in the New Maintenance Agreement. It is also noted that the time tables for the execution of maintenance work in the power plant was extended such that it was decided that maintenance work will be executed in the power plant every 25,000 working hours (approx. three years).

^23^ Mitsubishi Heavy Industries Ltd. (which on June 24, 2014 was assigned to Mitsubishi Hitachi Power Systems Ltd. and on March 31, 2016 - to Mitsubishi Hitachi Power Systems Europe Ltd.).

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 26 – CONTINGENT LIABILITIES AND COMMITMENTS DURING AND SUBSEQUENT TO THE REPORTING PERIOD (cont.)

B. Maintenance and service agreements (cont.)

2.     Agreement for the Hadera Power Plant

In June 2016, Hadera entered into in a long-term service agreement with two companies of the GE Group^24^ (hereinafter in this section – the “Service Agreement”), under which they will carry out maintenance work in the key components of the Hadera Power Plant, which include the two gas turbines, generators and some of their auxiliary equipment, for a period commencing on the date of commercial operation, until the earlier of: (a) the date on which all of the covered units (as defined in the Service Agreement) will have reached the end-date of their service life and (b) 25 years from the date of signing the Service Agreement. The cost of the Service Agreement is estimated at approx. USD 42 million (as of the agreement signing date) (linked to various indexes), payable over the term of the Agreement, based on the formula set in the Agreement. The Service Agreement includes a warranty for reliability and other obligations concerning the performance of the power plant and indemnification to Hadera in the event of failure to meet the performance obligations, subject to the terms and provisions provided for, and on the other hand, Hadera undertook to pay bonuses in the event of improvement in the performance of the power plant as a result of the maintenance work, up to a cumulative maximum limit for each inspection period. The Service Agreement includes guarantees provided by the Parent Company to secure each of the parties’ undertakings.

3.     Agreement for the Zomet Power Plant

In December 2019, Zomet signed a long-term service agreement (hereinafter – the “Zomet Maintenance Agreement”) with PW Power Systems LLC (hereinafter – “PWPS”), for providing maintenance servicing for the Zomet Power Plant, for a period of 20 years commencing from the date of delivery of the plant. Zomet may terminate the Zomet Maintenance Agreement after a period of 5 years from the power plant’s delivery date. The cost of the Service Agreement is estimated at approx. USD 35 million (as of the agreement signing date) (linked to various indexes), payable over the term of the Agreement, based on the formula set in the Agreement.

The Zomet Maintenance Agreement provides a general framework for provision of maintenance services by PWPS for the generation units and additional equipment on the site during the Agreement term (hereinafter in this Section – the “Equipment”). Zomet is responsible for the current operation and maintenance of the Equipment. Pursuant to the terms and conditions of the agreement, PWPS will provide Zomet with ongoing services, including, among others, an annual inspection of the Equipment and engineering support, with a representative of PWPS being present onsite during the first 18 months of the operation. In addition, the agreement includes providing the Company with access to PWPS leasable equipment, and in case of interrupted production, PWPS will provide the Company with a replacement engine, pursuant to the terms and conditions and for the amounts set forth in the agreement. The agreement includes a mechanism for the performance of the replacement generator. Pursuant to the terms and conditions of the agreement and with the Zomet Power Plant being a peaker plant, other maintenance services, in addition to those set forth in the agreement, will be purchased based on work orders, i.e., the services will be provided by PWPS in accordance with the prices that will be agreed upon, or with respect to certain services - based on the prices stipulated in the agreement.

^24^ General Electric International Inc. and with GE Global Parts & Products GmbH.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 26 – CONTINGENT LIABILITIES AND COMMITMENTS DURING AND SUBSEQUENT TO THE REPORTING PERIOD (cont.)

B. Maintenance and service agreements (cont.)

4.     Agreement for the Gat Power Plant

On January 29, 2017, the Gat Partnership and Siemens Israel Ltd. (hereinafter - “Siemens”) entered into an operating and maintenance agreement in connection with the Gat Power Plant (hereinafter - the “Gat Operating and Maintenance Agreement”). This is an operation and maintenance agreement, by virtue of which Siemens undertook to provide all operation and maintenance services to the Gat Power Plant, at a cost of approx. NIS 287 million, which is paid over the term of the agreement, in accordance with a formula set in the agreement (including various linkages). The term of Gat’s Operating and Maintenance Agreement shall be 20 years or 170 thousand operating hours from the commercial operation date, the earlier of the two, subject to the set terms and conditions.

5.     Sorek 2 Maintenance Agreement

In June 2021, Sorek 2 entered into a long-term agreement with an international vendor (hereinafter - the “Vendor”)

      for the maintenance of the turbine and its related equipment; the term of the agreement is 16 years with an option to renew by 25 years, in return for up to approx. USD 29 million \(as of the signing of the Agreement\), in accordance with the term
      of the Agreement, subject to the milestones set in the agreement \(hereinafter in this section - the “Maintenance Agreement”\). The Maintenance Agreement includes provisions regarding agreed and capped
      compensation in respect of execution and meeting time tables for servicing, and regarding the Vendor’s responsibility for its equipment and services. The Maintenance Agreement includes guarantees provided by the Parent Company to secure each of
      the parties’ undertakings. It is noted that the above agreements require, among other things, the approval of the Water Desalination Administration, in accordance with and as required pursuant to the concession agreement signed between IDE and
      the State of Israel in connection with the desalination facility and the project, as detailed in Note 9D1.

6.     Operation and maintenance agreements for the Shore power plant (consolidated as of Q1/2026)

Shore entered into a maintenance agreement with its original equipment manufacturer for turbine maintenance services. In consideration for the maintenance services, Shore pays a fixed and variable payment as from the date set in the agreement. The term of the agreement is 20 years from 2014 or earlier if specific milestones will be achieved, which are based on use and wear and tear. The expected total cost from 2026 through the end of the agreement term is estimated at approx. NIS 153 million (approx. USD 48 million).

In addition, Shore entered into an operating and maintenance agreement of the power plant, which commenced in 2016. The consideration includes fixed annual management fees, a performance-based payment and reimbursement of employment expenses, including employee salary costs, payroll taxes, subcontractor costs and additional costs as detailed in the agreement. The agreement includes an automatic extension/renewal mechanism for a period of one year, unless one of the parties to the agreement serves a non-renewal notice in accordance with the provisions of the agreement. As of the Report approval date, the agreement is under the one-year automatic annual renewal option. In the last two years, the payments in respect of this agreement amounted to immaterial amounts.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 26 – CONTINGENT LIABILITIES AND COMMITMENTS DURING AND SUBSEQUENT TO THE REPORTING PERIOD (cont.)

B. Maintenance and service agreements (cont.)
7. Operation and maintenance agreements for the Basin Ranch power plant (project under construction, consolidated as of Q1/2026)
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Basin Ranch entered into a services agreement with GE Vernova International, LLC, for the provision of spare parts and scheduled and unscheduled maintenance services for the project's combustion turbines. The agreement will come into effect on the project’s substantial completion date and will end on the earlier of: (1) 25 years from its effective date; or (2) achievement of defined milestones based on the scope of use and wear and tear of the equipment. According to the agreement, Basin Ranch will pay a consideration composed of a fixed component and a variable component. The total cost expected throughout the agreement term, as from the COD, is estimated at approx. approx. NIS 670 million (approx. USD 210 million).

In addition, Basin Ranch entered into an operating and maintenance (O&M) agreement for the power plant. The agreement term is five years from the commercial operation date; subsequently, the agreement will be renewed automatically for additional one-year periods, unless one of the parties to the agreement serves a non-renewal notice in accordance with the provisions of the agreement.

For details regarding the construction agreement and main equipment purchase agreement for the project, see Note 9D4.

C. Agreements for acquisition of natural gas
1. Agreement between the Tamar Group and the Rotem Power Plant
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In November 2012, Rotem entered into an agreement, (as amended from time to time),^25^ with the Tamar Group in connection with the supply of natural gas to the power plants (hereinafter in this section - the “Agreement”). The Agreement will remain in effect until September 2029 or until the Total Contractual Quantity is consumed - the earlier of the two. Furthermore, if 93% of the Total Contractual Quantity is not consumed, both parties have the right to extend the agreement by the earlier between consumption of the full contractual quantity or two additional years. The Total Contractual Quantity under the Agreement amounts to 10.6 BCM.

Certain annual quantities in the Agreement between Tamar Group and Rotem are subject to a Take or Pay (TOP) obligation, based on a mechanism set out in the Agreement. Under the Agreement, under certain circumstances if payment is made for a quantity of natural gas that is not actually consumed or a quantity of gas over and above the TOP amount is purchased, Rotem may, subject to the restrictions and conditions set out in the Agreement, accumulate this quantity, for a limited time, and use it within the framework of the Agreement. The Agreement includes a mechanism that allows, under certain conditions, these rights to be assigned to related parties for unconsumed quantities until close to their expiration date. In addition, Rotem may sell surplus gas under a secondary sale, subject to conditions set in the agreement. In addition, in May 2022 Rotem exercised an option to reduce the contractual quantities (daily, annual, total and ToP quantities) to a certain rate stipulated in the Agreement, which entered into force at the end of May 2023 after the commercial operation of the Energean Reservoir.

^25^ To the best of the Company’s knowledge, as of the Report date, the Tamar Group includes Isramco Negev 2 Limited Partnership, Union Energy & Systems 2 Ltd. Mubadala Energy RSC Ltd., Chevron Mediterranean Ltd., Tamar Investment 2 Limited, Dor Gas Exploration Limited Partnership and Tamar Petroleum Ltd.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 26 – CONTINGENT LIABILITIES AND COMMITMENTS DURING AND SUBSEQUENT TO THE REPORTING PERIOD (cont.)

C. Agreements for acquisition of natural gas (cont.)
1. Agreement between the Tamar Group and the Rotem Power Plant (cont.)
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Pursuant to the Agreement, the price of gas is based on a base price in NIS, which was set on the date of signing the Agreement, linked to changes in the generation component tariff, which is part of the DSM, and in part (30%) to the USD representative exchange rate. In addition, the natural gas price formula set in the Agreement between Tamar Group and Rotem is subject to a minimum price in USD.

2. Agreement between the Tamar Group and the Hadera Power Plant

Hadera has a natural gas supply agreement with the Tamar Group (hereinafter in this section - the “Agreement”). The Agreement between Tamar and Hadera will end 15 years after the commencement of supply from the Tamar Reservoir (April 2013), or at the end of the consumption of the total contractual quantity, the earlier of the two. In addition, if at the end of the 14th year Hadera has not utilized the quantity of gas agreed upon out the total contractual quantity, both parties have the right to extend the agreement until the earlier of the utilization of the total contractual quantity or additional two years. The price of gas is denominated in USD, is linked to the weighted average of the generation component published by the Israeli Electricity Authority and includes a minimum price.

According to the agreement, Tamar has an obligation to supply all of the quantities included in the agreement; on the other hand, Hadera has a TOP commitment regarding a certain annual quantity of natural gas. In June 2022, Hadera exercised an option to reduce some of the contractual quantities (daily, annual and total quantities) to a certain rate as stipulated in the agreement, which entered into force in March 2023 immediately prior to the commercial operation of the Energean Reservoir.

3. Agreements between Energean and the Rotem and Hadera power plants

In December 2017, Rotem and Hadera engaged in agreements with Energean Israel Ltd. (hereinafter – “Energean”), which has holdings in the Karish Reservoir, for the purchase natural gas.^26^ According to the terms of the agreements, the total original basic natural gas quantities which Rotem and Hadera are expected to purchase was approx. 5.3 BCM and approx. 3.7 BCM, respectively (hereinafter – the “Total Contractual Quantity”). For details regarding the increase in the Total Basic Contractual Quantity, see below in this section. The agreement includes, among other things, a TOP mechanism, whereby Rotem and Hadera undertake to pay for a minimum quantity of natural gas even if they have not used it.

Furthermore, the agreements include additional provisions and arrangements customary in agreements for the purchase of natural gas, including with regard to maintenance, gas quality, limitation of liability, buyer and seller collateral, assignments and liens, dispute resolution and operating mechanisms. In accordance with the regulation, the Company is required to provide guarantees under certain conditions set forth in the agreement, including a downgrading of the rating, according to the value of the number of gas consumption days, in accordance with the contractual quantity set forth in the agreement.

^26^ At the time of signing the agreement, there was also an engagement with ICL Group Ltd. and Bazan Ltd. The agreements with respect to each of the Group Companies are separate and independent.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 26 – CONTINGENT LIABILITIES AND COMMITMENTS DURING AND SUBSEQUENT TO THE REPORTING PERIOD (cont.)

C. Agreements for acquisition of natural gas (cont.)
3. Agreements between Energean and the Rotem and Hadera power plants (cont.)
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Until the amendment of the agreements with Energean in November 2019, it was stipulated that the agreements will remain in effect until the earlier of: 15 years or until the Total Contractual Quantity will have been supplied by Energean to each of the subsidiaries (Rotem and Hadera) (hereinafter – the “First Agreement Period”), where the commencement date of the agreement will be no later than 12 months from the date Energean pumps its first gas (hereinafter - “Karish’s Commercial Operation Date”). Under each of the Agreements, if 14 years from Karish’s Commercial Operation Date will have elapsed and the contracting company has not taken a volume equivalent to 90% of the Total Contractual Quantity, subject to prior notice, each party may extend the agreement for an additional period which will begin at the end of 15 years from the date the agreement took effect, until the earlier of: (1) full consumption of the Total Contractual Quantity; or (2) for an additional 3 years from the end of the First Agreement Term.

As part of an amendment to Rotem and Hadera’s Energean agreements of 2019, the rate of gas consumption by Rotem was accelerated, such that Rotem’s daily and annual contractual gas consumption from Energean was increased by 50%, with no change in the Total Contractual Quantity being purchased from Energean. Accordingly, the agreement period was updated to the earlier of 10 years or until the Total Contractual Quantity will have been consumed (in lieu of the earlier of 15 years or until the Total Contractual Quantity will have been consumed) (hereinafter - the “Additional Agreement Term”). It is noted that the agreements with Energean include circumstances under which each party to the agreements will be entitled to terminate the relevant agreement before the end of the First Agreement Period (or the Additional Agreement Term), including cases of prolonged supply interruptions, compromised collateral, etc.

The price of the natural gas in the agreements with Energean is denominated in USD and is based on an agreed formula, which is linked to the Electricity Generation Component and includes a minimum price. The original total financial amount of the agreements was estimated at approx. USD 1.3 billion (assuming consumption of the total basic quantity and in accordance with the original agreements and in accordance with the gas price formula as of the engagement date); it depends mainly on the electricity generation component, the increase of the quantities as specified below and the volume of gas consumed.

It is noted that, in August 2022, Rotem and Hadera informed Energean regarding the increase of the contractual gas quantity under the original terms and conditions of the Energean agreements (the increase does not constitute exercise of the above option, which is exercisable by the end of 2022). It is clarified that increasing the contractual quantity increases the TOP commitment as part of the agreements.

In November 2022, Rotem served Energean with a notice of the exercise of the option to acquire an additional immaterial quantity, as set out in the amendment to the agreement with Energean. At the beginning of 2023, Energean issued Hadera and Rotem with a notice regarding the completion of the commissioning and commercial operation on March 26, 2023.

In addition, in 2023 Rotem and Hadera recognized a contractual amount totaling approx. NIS 18 million (approx. USD 5 million), which was received in 2024 and recognized in the cost of sales line item.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 26 – CONTINGENT LIABILITIES AND COMMITMENTS DURING AND SUBSEQUENT TO THE REPORTING PERIOD (cont.)

C. Agreements for acquisition of natural gas (cont.)
4. Agreement between Leviathan and the Sorek 2 Power Plant
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Under Sorek 2’s agreement with IDE (as detailed in Note 9D1), a mechanism was set for the supply of natural gas to Sorek 2 by virtue of the Gas Agreements signed between IDE and holders of interests in the Leviathan natural gas field (hereinafter in this section – the "Leviathan Gas Agreement"), for a period of 24 years and 11 months starting from the commercial operation of the desalination facility; under the agreement, Sorek 2 assumed IDE’s rights and obligations under the Leviathan Gas Agreement on a back-to-back basis, except for the obligation to provide collateral or guarantees under the Gas Agreements. It was also determined that IDE retains independent rights regarding the exercise of rights, including its right of early termination of the Gas Agreement and engagement in a new Gas Agreement, provided that these conditions will not have a material adverse effect on the Company, while adjusting the consideration for the electricity in the event of a gas price reduction. Reporting, billing, payment and dispute resolution mechanisms were also provided for, as was the Company's right to reject off-specification gas

The gas price under the Leviathan Gas Agreement is denominated in USD for the entire term of the agreement and includes price adjustment mechanisms that may be activated in the event of a breach of the commercial balance. The agreement includes a Take-or-Pay (ToP) mechanism pursuant to which Sorek 2 is required to pay for a minimum quantity of natural gas, calculated from the annual contract quantity as defined therein; the agreement also establishes arrangements for reducing this quantity in accordance with the guidance of the Israel Water Authority and its Water Desalination Administration with respect to the operation of the desalination plant at the site. The Leviathan Gas Agreement includes additional provisions and arrangements customary in natural gas purchase agreements, including with regard to maintenance, mechanisms regarding gas quality, limitation of liability, dispute resolution, maintenance and operating mechanisms. Furthermore, the agreements include provisions regarding restrictions on the sale of gas to third parties, who are not related parties and cases which give rise to an early termination right.

5. Natural gas acquisition agreement with a third party

On March 18, 2024, a wholly-owned partnership of OPC Israel (hereinafter - the “Partnership”) engaged with a third party in an agreement for the purchase of natural gas. The agreement will terminate on June 30, 2030 or at the earlier of: the end of the consumption of the Total Contractual Quantity of approx. 0.46 BCM as set out in the agreement.

Under the agreement, the Seller undertook to provide to the Partnership a daily quantity of gas, as will be decided by the Partnership each month, in accordance with the mechanism set out in the agreement, and - for its part - the Partnership assumed a take or pay liability for a certain annual consumption as set out in the agreement. The agreement includes arrangements regarding quantities consumed above or below the minimum annual quantity. The price of the natural gas is denominated in USD and based on an agreed formula, which is linked to the generation component and includes a minimum price. Furthermore, the agreement included additional provisions and arrangements customary in agreements for the purchase of natural gas, including with regard to the natural gas’s quality, supply shortage, force majeure, limitation of liability, early termination provisions under certain cases, subject to terms and conditions and reassignment.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 26 – CONTINGENT LIABILITIES AND COMMITMENTS DURING AND SUBSEQUENT TO THE REPORTING PERIOD (cont.)

C. Agreements for the acquisition of natural gas (cont.)
6. Amendment to the Excise Tax on Fuel Ordinance
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In September 2024, an amendment to the Fuel Excise Tax Ordinance (Imposition of Excise Tax) went into effect, as from January 1, 2025. The amended ordinance includes an increase of the excise tax rates applicable to various types of fuels, including natural gas, such that in 2025, the excise tax on natural gas will increase from NIS 19 to NIS 33 and will continue to increase in a graduated manner until reaching a maximum excise tax of NIS 192 in 2030. The increase in the excise tax rate on natural gas is expected to increase the cost of natural gas for the Company; the Company estimates that some of the effect may be mitigated as a result of an increase in the Company’s revenues, provided that the generation component will be increased and subject to the effect of such a possible increase, for the Company, in the price of natural gas, which is linked to the generation component. As of the report approval date, the effect of the amendment to the Excise Tax Ordinance on the Company’s results in Israel over time cannot be estimated. With respect to 2026, the Company estimates that the amended Excise Tax order is not expected to have a material impact on its results

D. Agreement for the sale of surplus electricity for the Rotem Power Plant

On August 18, 2024, an agreement was signed for the purchase and sale of surplus electricity between Rotem and a third party holding an electricity generation license (hereinafter - the “Electricity Producer”); the term of the agreement is five years.

As part of the agreement, Rotem undertakes to sell to the Electricity Producer and the Electricity Producer undertakes to purchase from Rotem surplus quantities of electricity, during certain demand hour clusters, at a discount for the demand side management tariff (DSM Tariff) (hereinafter - the “Contractual Discount”); with respect to surplus electricity in other demand hour clusters, which were defined, the parties will give certain priority under agreed conditions. Under the provisions of the agreement, the sale of surpluses shall be carried up in accordance with set maximum and minimum quantities. Furthermore, the agreement includes additional provisions and arrangements regarding early termination thereof and provisions which are generally accepted in agreements for the purchase of surplus electricity.

For details regarding the agreement to purchase energy and power from Dead Sea Works, see Note 22C3.

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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 27 – SUBSEQUENT EVENTS

1. For details regarding the engagement in the EPC agreement for the construction of a substation in the Ramat Beka project in Israel, see Note 9D2B.
2. For details regarding entering into an equipment supply agreement and a maintenance agreement in connection with the Hadera 2 Project, see Note 9D3.
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3. For details regarding the vesting of the profit participation plan for CPV Group employees  in January 2026 and the amounts expected to be paid by virtue thereof, as well as the new plan approved subsequent to the Report date, see Note<br> 16C.
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4. For details regarding the provision of an additional amount of USD 130 million to the CPV Group in January 2026, as part of the finance agreement with Bank Leumi with respect to the Basin Ranch project, see Note 14B3.
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5. For details regarding the increase in investment undertakings and the provision of shareholder loans by the Partners in OPC Power, see Note 23A2.
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6. For further details regarding the completion of transactions for the acquisition of the remaining stakes in the Shore and Basin Ranch projects, see Note 23E.
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7. For details regarding entering into the agreement to acquire the remaining interests in the Maryland Power Plant and disposal of the investment in the Three Rivers Power Plant, see Note 23E3.
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OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 28 - ATTACHMENT OF FINANCIAL STATEMENTS OF A MATERIAL ASSOCIATE

Maryland

Statement of Financial Position:

As of December 31, 2025
US GAAP Adjustments IFRS
In thousand In thousand In thousand
Cash and cash equivalents D
Restricted cash D )
Property, plant & equipment A,C
Intangible assets C )
Other assets
Total assets
Accounts payable and deferred expenses A )
Other liabilities )
Total liabilities )
Partners’ equity A
Total liabilities and equity

All values are in US Dollars.

As of December 31, 2024
US GAAP Adjustments IFRS
In thousand In thousand In thousand
Cash and cash equivalents D
Restricted cash D )
Property, plant & equipment A,C
Intangible assets C )
Other assets )
Total assets
Accounts payable and deferred expenses A )
Other liabilities )
Total liabilities )
Partners’ equity A
Total liabilities and equity

All values are in US Dollars.

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---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 28 - ATTACHMENT OF FINANCIAL STATEMENTS OF A MATERIAL ASSOCIATE (cont.)

Maryland (cont.)

Statements of Income and Other Comprehensive Income:

For the year ended December 31, 2025
US GAAP Adjustments IFRS
In thousand In thousand In thousand
Revenues )
Operating expenses A )
Depreciation and amortization A
Operating profit
Finance expenses B )
Profit for the period
Other comprehensive loss B ) )
Comprehensive income for the period

All values are in US Dollars.

For the year ended December 31, 2024
US GAAP Adjustments IFRS
In thousand In thousand In thousand
Revenues )
Operating expenses A )
Depreciation and amortization A
Operating profit
Finance expenses B )
Profit for the year
Other comprehensive income B
Comprehensive income for the year

All values are in US Dollars.

F - 136

---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 28 - ATTACHMENT OF FINANCIAL STATEMENTS OF A MATERIAL ASSOCIATE (cont.)

Maryland (cont.)

Material adjustments to the statement of cash flows:

For the year ended December 31, 2025
US GAAP Adjustments IFRS
In thousand In thousand In thousand
Profit for the period A,B
Net cash provided by operating activities
Net cash provided by (used for) investing activities D )
Net cash used for financing activities ) )
Net decrease in cash and cash equivalents ) )
Balance of cash and cash equivalents as of the beginning of the period D
Balance of restricted cash as of the beginning<br><br> <br>of the period D )
Balance of cash and cash equivalents at the end of the period D
Balance of restricted cash as of the end of the period D )

All values are in US Dollars.

For the year ended December 31, 2024
US GAAP Adjustments IFRS
In thousand In thousand In thousand
Profit for the year
Net cash provided by operating activities
Net cash used for investing activities D ) )
Net cash used for financing activities ) )
Net decrease in cash and cash equivalents
Balance of cash and cash equivalents as of the beginning of the year D
Balance of restricted cash as of the beginning<br><br> <br>of the year D )
Balance of cash and cash equivalents at the end of the year D
Balance of restricted cash as of the end of the period D )

All values are in US Dollars.

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---Unofficial translation for convenience purposes---

OPC Energy Ltd.

Notes to the Consolidated Financial Statements as of December 31, 2025

NOTE 28 - ATTACHMENT OF FINANCIAL STATEMENTS OF A MATERIAL ASSOCIATE (cont.)

Maryland (cont.)

Following is a breakdown of the key adjustments between US GAAP and IFRS in Maryland

A. Maintenance costs under the Long Term Maintenance Plan (hereinafter - the “LTPC Agreement”): under IFRS, variable payments which were paid in accordance with the milestones as set in the LTPC<br> Agreement are capitalized to the cost of property, plant and equipment and amortized over the period from the date on which maintenance work was carried out until the date on which maintenance work is due to take place again. Under US<br> GAAP, the said payments are recognized on payment date within current expenses in the statement of profit and loss.
B. Hedge effectiveness of swaps: in accordance with the IFRS - the associates recognize adjustments relating to the ineffective portion of their cash flow hedge under profit and loss. Under US GAAP, there is no part which is not<br> effective, and the hedging results are recognized in full in other comprehensive income.
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C. Intangible assets: Under IFRS, certain intangible assets are defined as property, plant and equipment.
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D. Restricted cash: There is a difference between the presentation and classification of restricted cash in the Statements of Cash Flows and in the Statements of Financial Position.
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