Israel’s Bezeq and Generation Capital unite for electricity venture

Israel’s largest telecom group, Bezeq, opens new tab, said on Sunday it was entering the electricity supply sector as the country opened the market for new competition.

Bezeq said it entered a non-binding agreement with Generation Capital opens new tab to form a joint company that would supply electricity with a target of reaching a market share of 400,000 household customers and tens of thousands of businesses by the end of 2030.

Bezeq will handle marketing and sales while Generation Capital’s energy subsidiary Powergen will provide electric power through electricity generation and storage facilities, it said in a regulatory statement.

“Bezeq does not plan to make substantial capital investments and has no commitment to minimum quantities of customers,” said chief financial officer Tobi Fischbein in a letter to investors, adding that Powergen is responsible for project financing.

With its large customer base and operational capabilities, Fischbein said, Bezeq “has natural potential to be a major player in a sector that is opening up to competition.”

Israel has been reforming its electricity sector, which for decades was run solely by state-owned Israel Electric Corp (IEC) (ISECO.UL), and opening the different segments, from power generation to supply, to new competition. Retuers