Background:
The Neot Hovav Waste-to-Energy (WtE) plant is a significant development in Israel’s efforts to address its growing waste management challenges. Located in the Negev, it is the country’s first large-scale WtE facility, designed to process up to 300 thousand tons per annum of municipal solid waste while generating electricity from the combustion process. This plant represents a shift toward sustainable waste solutions in a market that has historically relied heavily on landfilling, with over 80% of Israel’s waste being dumped in landfills. As the country seeks to meet its environmental targets, projects like Neot Hovav aim to reduce landfill dependence, increase energy recovery, and encourage a circular economy approach.
B&K’s Services:
B&K served as the financial advisor for the Ministry of Finance and the Ministry of Environmental Protection inter-committee which are responsible for the Neot Hovav WtE PPP tender. As part of the services B&K conducted market research and development of first of its kind business and financial model for WtE project within the Israeli wate market.
Work Process:
B&K has established a team of experts with vast experience in PPP tenders and in the Israeli waste and energy markets. The team built a financial model which simulates the financial results of the project including identification of main cost and revenue drivers and recommendations on allocation of risks between the owner and concessionaire.
B&K developed advanced financial models, analyzed market dynamics of supply and demand, and designed contractual mechanisms, including KPIs, payment mechanisms and tender strategies.
The tender process included a PQ phase in which 6 groups had been announced as qualified bidders.
The work is carried out in cooperation with the Ministry of Finance, the Ministry of Environmental Protection and various consultants to the Government.