ORMAT TECHNOLOGIES INC.

SUSTAINABILITY REPORT 2019

Our Economic, Environmental and Social Performance Highlights

Tungsten Mountain complex – 27 MW geothermal and 7AC solar - Nevada, U.S.

1 TABLE OF CONTENTS

I. A MESSAGE FOR OUR STAKEHOLDERS ...... 4 V. OUR HOLISTIC APPROACH TO CORPORATE GOVERNANCE...... 52 II. HOW ORMAT POWERS OUR RENEWABLE ENERGY FUTURE...... 8 Making Sound Corporate Governance a Priority...... 54 Ormat: What We Do...... 14 Ormat’s Corporate Governance Structure...... 54 About Our Renewable Energy Business...... 14 Our Corporate Governance Policies and Guidelines...... 59 Ormat’s Geothermal and Recovered Energy Power Plants in Operation...... 16 Ensuring a Corruption-Free Work Environment...... 59 Our History and Key Experience...... 20 Communication and Training on Anti-Corruption Commitments...... 60 Our Customers...... 20 Insider Trading Policy...... 60 Ownership Structure...... 22 Major ongoing litigation...... 60 Beneficial Ownership...... 22 Ethical Conduct at Ormat...... 60 An Organization Shaped by Values...... 24 Whistleblower Policy...... 61 Our Five Core Values...... 24 VI. GENERATING ENVIRONMENTAL VALUE AND MEASURING OUR IMPACTS...... 62 Knowing Our Impacts – Stakeholder Engagement Strategy...... 26 Mitigating Climate Change Risks and Working to Realize New Opportunities...... 64 Stakeholder Groups Engaged by the Organization...... 26 Emissions from Our Power Plants and Operations...... 64 Our Approach to Stakeholder Engagement...... 26 Energy Use, Efficiency and Fuel Resource Management at Ormat ...... 69 Our Sustainability Strategy - Defining What’s Material to Ormat...... 29 Management of the Geothermal Resource and its By-Products...... 71 Results of the materiality survey...... 30 Management of Water Resources in Our Operations...... 71 Our Strategic Commitments and Sustainability Plan...... 32 Waste, Management of Materials and Biodiversity Conservation...... 73 External Initiatives...... 32 Waste, Material Management and Recycling...... 73 Ormat’s Memberships of Association...... 33 Biodiversity...... 76 Ormat and the Sustainable Development Goals (SDGs)...... 33 VII. OUR IMPACT AND ENGAGEMENT WITH OUR EMPLOYEES, SOCIETY & LOCAL COMMUNITIES...... 80 Risk Management Strategy – Sustainability and Climate Change-Related Risks...... 38 Our People: Employment and Skill Development at Ormat...... 82 Our Risk Management Approach...... 38 Our Outlook on Employment...... 82 III. ABOUT THIS REPORT...... 40 Our Employment Framework...... 82 Information Boundaries of This Report...... 42 Training & Educational Opportunities...... 94 Contact Point for Questions Regarding This Report...... 43 Ensuring a Safe & Healthy Work Environment – Occupational Health and Safety at Ormat...... 98 Forward-Looking Statements...... 43 Our Occupational Health and Safety Program – Striving to Go Beyond Compliance...... 98 IV. OUR BUSINESS, FINANCIAL PERFORMANCE AND ECONOMIC IMPACTS...... 44 Measuring Our Health and Safety Performance...... 100 About Our Business...... 46 Health & Safety in Our Work with Subcontractors...... 103 Our Business Strategy...... 46 Safe Dealing with Hazardous Materials and Emergency Response Plans...... 103 Management of Economics and Finance at Ormat...... 47 Supporting and Shaping Sustainable Communities and Futures...... 105 Economic Performance in 2019...... 47 Our Goals and Guideposts...... 105 Loans and Financial Assistance Received from Governments and Development Banks...... 48 Understanding and Uniqueness...... 105 Developing Renewable Energy and Critical Infrastructure...... 49 Social Action Plans...... 105 Environmental Regulations Supporting Our Business...... 49 Listening Means Learning...... 105 Ormat’s Supply Chain & Procurement Practices...... 50 VIII. GRI INDEX...... 114 Providing Excellent and Reliable Customer Service...... 50 Data Privacy and Cybersecurity for Our Stakeholders...... 51

2 3 CHAPTER I. A MESSAGE FOR OUR STAKEHOLDERS

Steamboat geothermal complex, NV, U.S., 65 MW

4 5 tal impacts and mitigating climate over-year gains. I’d like to extend our deep gratitude ADVANCING OUR ESG Thank you for your continued interest change, renewable energy is proven to Mr. Isaac Angel, who exhibited FRAMEWORKS & COMMITMENTS in Ormat and our sustainability to exert a positive and often profound Looking ahead, our business model extraordinary commitment to Ormat performance. Despite the climate influence on economic and societal emphasizes expanding our Electric- during his six years as the Company’s Ormat is committed to continuous, change and human health challenges well-being. ity segment and becoming a signif- CEO. His energetic vision steered our transparent communication. This we face today, I’m confident that our icant player in the Storage market. path wisely, leading to consistent 2019 Sustainability Report is our employees and key stakeholders will As we publish Ormat’s 2019 Sustain- Our focus will be on the addition of growth and profitability. We are very second published in alignment with continue to deliver breakthrough ability Report, we remain committed capacity to existing power plants, pleased Mr. Angel will continue to the GRI’s reporting standards CORE renewable energy solutions at a to the pivotal role we play in building building new power plants, and support our efforts as the appointed option. This enables us to expand global scale. At Ormat, we envision a a safe and secure energy future for making acquisitions while devel- Chairman of Ormat’s Board of coverage on sector-relevant envi- vibrant renewable energy future and all. In the seven years I’ve served the oping new renewable power plants Directors. ronmental, social and economic we invite you to learn more about how Company, I have seen firsthand how and infrastructure and establishing a impacts across our value chain. we are making it happen by reading Ormat’s executive leadership and strong market position in the Storage Another important appointment that this report. employees across the globe bring market. We believe this expansive took place on May 10, 2020 is that of In addition to this comprehensive creativity, breakthrough thinking, approach broadens the access to Mr. Assaf Ginzburg, who now serves reporting effort, Ormat is actively stability, technological knowledge, renewable energy for our customers as Ormat’s Chief Financial Officer. We engaged in adopting and reporting STEERING A SUSTAINABLE PATH talent and commitment to work with and is a vital economic and social welcome him to this vital role and look on other recognized sustainability Sincerely, FORWARD them every day. Inside this report, we enabler. Increased access to clean, forward to his strategic stewardship disclosure initiatives. These include provide a detailed overview of how reliable renewable power enhances and financial guidance. the Carbon Disclosure Project To our Stakeholders, this collective effort is improving and living standards, fuels local enterprise (CDP) and initial adoption of certain empowering our world in achieving a and offers a myriad of possibilities to I’m extremely enthused about what aspects of risk management frame- I’m honored to be leading Ormat as its sustainable energy future. developing economies. Ormat will continue to contribute works such as the Task Force on new Chief Executive Officer (“CEO”) to the renewable energy sector. Our Climate-Related Financial Disclo- and to have the pleasure of reporting EXPANDING OUR MARKET REACH In 2019 Ormat’s portfolio of renewable sustainability track record is strong, sures (TCFD). We also continue to to you, our valued stakeholders, on energy assets, which include geother- as is our commitment to pioneering report on the direct and indirect Doron Blachar Ormat’s sustainable activities, achieve- The growing global demand for mal, recovered energy generation research, collaborating to develop contributions of our business activ- Chief Executive Officer ments and challenges. This report renewable energy is a significant and solar, generated an aggregate new technologies, and promoting ities and community engagement highlights our efforts and initiatives cornerstone of Ormat’s continued 6,238,272 MWh (net) of electricity, industry expansion. on achieving the United Nations’ in supporting sound environmental, expansion and success to date. It while producing 7.1 million tons less2 Sustainable Development Goals social and governance activities and has enabled us to serve additional of greenhouse gases in comparison to RESPONDING TO COVID-19 (SDGs), as we now enter the decade the progress in our global company. markets, notably in the Americas, non-renewable technologies, such as of action for the 2030 Agenda for Eurasia, and Southeast Asia, and is the coal. In this way, Ormat can minimize I must acknowledge the unprece- Sustainable Development. We Ormat’s more than 1,400 employees basis upon which we plan our future the harmful environmental impacts dented challenges brought by the recognize the value these efforts worldwide1 see a shared path forward growth. This increased demand is associated with carbon combustion COVID-19 virus, which arrived late in offer for our stakeholders, and as we continue our mission of leading also a major driver of our continuous for ourselves, our customers, and 2019 and has impacted our society Ormat’s business itself, as well as the geothermal energy market technological and operational innova- their end users. on both a personal and professional the importance of being open and and becoming provider of scalable tions that are implemented in our own level. The health and safety of Ormat honest about our successes, as renewable energy solutions around power plants and which we deliver to TRANSITIONING SENIOR employees, our contractors, constit- well as our challenges. In our view, the world. Renewable energy resides our worldwide customers. LEADERSHIP uents and the communities in which transparency supports learning and at the core of our business model, and we live, work and do business, are of continuous improvement. developing reliable, environmentally In the past five years we’ve supplied I am delighted to serve Ormat as CEO, utmost importance to us. You’ll find and socially responsible solutions has almost 50 new power plants, totaling an appointment that took effect on more on how our team has risen to Further important advances that fit been a central tenant of our value approximately 1,200 MW. These July 1, 2020. Prior to joining Ormat in this challenge and persevered in the into Ormat’s sustainability reporting proposition since Ormat was estab- additions push our Ormat-manufac- 2013 as Chief Financial Officer, I held content of this report. Throughout framework includes our new Envi- lished in 1965. tured renewable facilities to include executive financial roles in several this global pandemic, Ormat will ronmental and Climate Change more than 190 plants that have a leading infrastructure, real estate and continue following stringent protective Policy, which, as of the publication At Ormat, we not only believe, but act combined generating capacity of software development firms. measures necessary to safeguard the of this report, is available on Ormat’s on our belief, that renewable energy 3,200 MW. health, and safety of every stakeholder. website at the following link.3 Ormat is the most reliable and resilient way This recent management transition This includes adhering to all govern- has also taken actions to implement to secure the world’s energy future. In 2019, Ormat earned record total was the result of long-term planning ment regulations and maintaining clear, a new Human Rights and Labor Every person, community, country and revenues of $746 million, a 3.7% and collaboration with Ormat’s comprehensive plans and protective Policy, Stakeholder Engagement geography can be positively impacted increase over 2018 total revenues. Senior Management Team and Board measures for employees who work in Policy, as well as to adopt measures when renewable energy options are Our Electricity segment and our of Directors. We worked to ensure our energy plants, manufacturing facil- to improve the diversity of our introduced into the energy mix. In Energy Storage & Management that the process was transparently ities, offices and elsewhere. management team. addition to reducing environmen- segment are key drivers of these year- communicated to our stakeholders.

1 Refers to the number of employees noted in Ormat’s 2019 10K statement. For coverage of the GRI Disclosures, we present data for those locations included in the scope of the information 3 https://www.ormat.com/Warehouse/userUploadFiles/Image/Ormat_Environment%20and%20Climate%20Change%20Policy-August%20%2020.pdf boundaries of this report, as noted in the context of Disclosures 102-46 in the “Information Boundaries of this Report” section, located on page 42. Employees located in Indonesia, the 6 Philippines, Chile and New Zealand are outside the scope of this report. 7 2 This figure is calculated in comparison to an equivalent amount of electricity generated using coal-burning technologies. CHAPTER II. HOW ORMAT POWERS A RENEWABLE ENERGY FUTURE

Ormat’s turbine

8 9 ORMAT AT A GLANCE IN 2019 Present in 100% +US$3.3B US$746M US$384M 33 Local Total Assets FY 2019 FY 2019 Countries 3 Electricity, Revenues Adjusted EBITDA Employment Product & Other Confirmed US$3.2B in total assets

Headquartered in RENO, Nevada +1,400 U.S. Employees Largest 4 worldwide Geothermal 55 power producer in the U.S. Years of 914 MW Experience Generating Capacity Over in 25 Power Plants owned & operated 6 180 Power Plants 17 Years ORA traded Over Installed 5 Weighted on NYSE 2,900 MW Average PPA since 2004 supplied 6

4 For Reconciliation to U.S. GAAP Financial Information see page 138. 5 Coverage for GRI Disclosures 102-8 is provided only for the employees that are included in the locations noted in the “Information Boundaries of This Report,” and does not include 10 employees based in Indonesia, the Philippines, Chile and New Zealand. 11 6 As of year end 2019. The current portfolio, as of the publication of this report, is 933 MW and as of the date of the report we supplied 3200 MW and 190 power plants ORMAT PRESENCE

U.S.* 629 TURKEY ISRAEL

GUATEMALA GUADELOUPE 40 HONDURAS 15 38 KENYA 150

INDONESIA** 42

Ormat power plants Capacity (MW) Ormat manufactoring facilities Countries in which Ormat supplied services and equipment over the years

* As of the publication of the report we have 648 MW in the U.S. **Ormat owns 12.75% interest in the 330 MW Sarulla Complex

12 13 7 ORMAT: Net Revenues by geographical location and business segments: Segment Contribution to Revenue WHAT WE DO Geographic Breakdown of Electricity Segment Revenue 1% 2% Segment Contribution to Revenue Geographic Breakdown of Electricity Ormat Technologies, Inc. (“Ormat” and recovered energy power plants. We design, develop, build, sell, own, Segment Contribution to Revenue GeographicSegment Breakdown Revenue of Electricity Segment Revenue or the “Company”) is a leading We are also expanding into the solar and operate our clean, environ- renewable energy Company with over Photovoltaic (“PV”) and energy mentally friendly geothermal and 28%1%1% 2%26%2% five decades of experience. Ormat is storage and management services recovered energy-based power 40% 38% vertically integrated – engaged in business and provide integration plants, usually using equipment that 28% 26% the execution of all stages of devel- services for our energy storage sector we design and manufacture in-house. 28% 26% 40%40% 38%38% opment and energy generation – at clients. Our Ormat Energy Converter – Our objective is to become a leading our geothermal and recovered energy a power generation unit that converts global provider of renewable energy power plants. These stages include heat into electricity – is the basis for and we have adopted a strategic plan exploration, development, drilling, the solutions and services that we to focus on several key initiatives to 72% 71% design, manufacturing, construction, offer our diverse array of customers. expand our business. 60% 62% 72% 71% and operation of our geothermal 60% 62% 72% 71% 60% 62%

2018 2019 2018 2019 20182018 20192019

ElectricityElectricity ProductProduct United States International 2018 2019 2018United States International2019 ProductProduct Storage Storage Management Services Services

Electricity Product United States International Product Storage Management Services Exploration Development Drilling Design Manufacturing Construction Operation Geographic Breakdown of Products Geographic Breakdown of Energy Storage Segment Revenue Management Services Segment Revenue Geographic Breakdown of Products Geographic Breakdown of Energy Storage GeographicSegment Breakdown Revenue of Products ManagementGeographic Breakdown Services Segmentof Energy Storage Revenue Segment Revenue Management Services Segment7% Revenue

ABOUT OUR RENEWABLE 2. Product Segment – In the Product 3. Energy Storage and Manage- 7%7% ENERGY BUSINESS segment, which contributed 26% ment Services Segment - In our new of our total revenues, we design, Energy Storage and Management Our business is divided into three manufacture and sell equipment Services segment, which contrib- 93% 84% main segments: for geothermal and recovered ener- uted 2% of our total revenues in 2019, 100% 93% 93% 84% gy-based electricity generation and we provide energy storage, demand 93% 84% 100% 93% 1. Electricity Segment – In the Elec- provide services relating to the engi- response and energy management 100% 93% tricity segment, which contributed neering, procurement and construc- related services as well as services 72% of our total revenues in 2019, tion of geothermal and recovered relating to the engineering, procure- we develop, build, own and operate energy-based power plants. In ment, construction, operation and geothermal, solar PV and recovered 2019, we derived 16% of our Product maintenance of energy storage units, 16% 7% 16% energy-based power plants in the segment revenues from our opera- mainly through our Viridity business. 7% United States and geothermal power tions in the United States and 84% In 2019, we derived 93% of our Energy 2018 2019 2018 2019 2018 201916% 2018 2019 plants in other countries around the from the rest of the world. Storage and Management Services 7% world and then sell the electricity that segment business from our opera- United States International 2018United States International2019 they generate. In 2019, we derived 62% tions in the United States. 2018United States 2019International United States International of our Electricity segment revenues from our operations in the U.S. and United States International United States International 38% from the rest of the world.

7 Presented in US$ thousands. Presented in Ormat’s Form 10-K as “Geographic Breakdown of Results of Operations”.

14 15 GEOTHERMAL POWER PLANTS Geothermal energy power plants all year-long and all day-long and can Binary Systems

harness a natural and locally available therefore provide base-load electric- Consender Ormat is a global leader in the energy source and enables providing ity services. Geothermal power plants world geothermal energy market. baseload electricity 24/7. Most impor- can also be custom built to provide a Generator Turbine Geothermal energy is produced by tantly, geothermal energy offers an range of electricity services such as heat energy derived from the earth’s environmentally friendly energy alter- baseload, voltage regulation, reserve Vaporizer Fan molten core and transported to the native. Furthermore, unlike electric- and flexible capacity. Geothermal

Geothermal Fluid Preheater surface by movements of crustal ity produced by burning fossil fuels, energy is also an attractive alter- Motive Fluid Pump plates, intrusion of molten magma electricity produced from geothermal native to other sources of energy, Motive Fluid (Liquid)

Motive Fluid (Vapor) and deep circulation of groundwa- energy sources is produced without and supportive of a diversification Injection Pump ter. Reservoirs of hot water under emissions of certain pollutants such strategy to avoid dependence on pressure result from these forces, and as nitrogen oxide, and with little any one energy source or politically it is these underground reservoirs that emissions of other pollutants such as sensitive supply sources. Production Pump we identify, develop and from which carbon dioxide. As a result, electricity Hot Geothermal Fluid Cooled Geothermal Fluid we harness energy. Drilling wells produced from geothermal energy In July 2019, we launched our first into geothermal reservoirs enables sources contributes significantly geothermal and solar PV hybrid the steam and high-pressure hot less to climate change than energy project, in which the electricity Flash systems – where generally, the outlet of the separator is flashed of the steam condenser. The resulting water to be captured and directed to produced by burning fossil fuels. In generated from a solar PV power geothermal fluid is extracted from a second time (dual flash), providing condensate is used to provide drive turbines in power plants. This addition, compared to power plants plant is used to serve the equipment’s the underground reservoir and additional steam at lower pressure make-up water for the cooling tower. converts earth-bound energy into that utilize other renewable energy energy use at the geothermal facility, flows from the wellhead through a used in the low-pressure section of Usually hot brine remaining after electrical energy. sources, such as wind or solar, thus increasing the renewable energy gathering system to flash tanks and/ the steam turbine to produce addi- separation of steam is injected (either geothermal power plants are available delivered by the project to the grid8. or separators. There, the steam is tional power. Steam exhausted from directly or after passing through separated from the brine and sent the steam turbine is condensed in a a binary plant to produce addi- to a demister, where any remaining surface or direct contact condenser tional power from the residual heat water droplets are removed. This cooled by cold water from a cooling remaining in the brine) back into the produces a stream of dry saturated tower. The non-condensable gases geothermal resource through a series Geothermal Power steam, which powers a steam turbine (such as carbon dioxide) are removed of injection wells. coupled to a generator to produce by means of a vacuum system in electricity. In some cases, the brine at order to maintain the performance

Steam

Steam Cooling Tower Steam Systems Turbine Generator

Condenser

Cooling Water Pump

Vacuum Pump Muffler Blow Down

Ejector M Motor Production Well Non Condensable Gas Removable System

Hot Geothermal Fluid Cooled Geothermal Fluid There are two main types of geothermal power plants:

Binary systems - where generally, butane) that is vaporized and is used fluid is then reinjected back into the Binary geothermal power plants mal systems and reducing produc- tional details on amount of water geothermal fluid is extracted from the to power the turbine. The organic fluid reservoir. Binary technology can be carry several environmental advan- tion-related pressure drawdowns, used in different geothermal plants underground reservoir and flows from is then condensed in a condenser, utilized on a wide range of resources tages over flash geothermal steam binary geothermal power plants see the water use table presented in the wellhead through a gathering which may be cooled directly by air from low enthalpy to high. Multiple turbine plants. First, reinjection of help maintain the overall geother- the environmental chapter). Finally, system to a vaporizer that heats a or by water from a cooling tower and high enthalpy binary facilities are in the geothermal resources exploited mal reservoir pressure. In addition, air-cooled binary power plants have a secondary working fluid (typically sent back to the vaporizer through service around the world. promotes superior efficiency. By air-cooled binary plants do not low profile with minimal visual impact, an organic fluid, such as pentane or a pump. The cooled geothermal continuously recharging geother- consume water for cooling (for addi- as they do not emit a plume.

8 https://investor.ormat.com/news-events/news/news-details/2019/Ormat-Announces-First-Geothermal-and-Solar-Hybrid-Power-Plant/default.aspx 16 17 Exploration and Evaluation of surveys, surface water analyses, soil We construct, own, and operate Neal Hot Springs Oregon, U.S. Geothermal 201212 22 Geothermal Resources surveys and geologic mapping. We recovered energy-based power plants. begin design and construction of We have built all of the recovered 2000, 2009, Our vertically integrated structure the plant once the exploration and energy-based plants that we operate. Olkaria III Complex Kenya Geothermal 150 2013, 2014, 2016, 2018 allows us to engage in every part drilling phases are completed, and The residual heat is captured in the OREG I – CS7, CS9, CS10, North Dakota and South Recovered Energy on Gas of the geothermal energy process, it is determined that the geothermal recovery process using a similar power 2006 22 from start to finish. Before we resource is worth pursuing in terms plant to Ormat’s binary geothermal CS11 Dakota, U.S. Turbine engage in a geothermal power of resource accessibility and cost. power plant, which is used to generate OREG II – CS3, CS5, CS8, North Dakota, Minnesota Recovered Energy on Gas 2009 22 project, we carry out exploratory electricity without burning additional CS12 and Montana, U.S. Turbine and evaluation activities to ensure RECOVERED ENERGY POWER fuel. The market for the recovery of Recovered Energy on Gas that the geothermal resource is PLANTS waste heat is present in locations OREG III – GRE - CS13 Minnesota, U.S. 2010 5.5 significant and sustainable for the where available electricity resources Turbine generation of renewable power Our recovered energy power plants are expensive or where the regulatory Recovered Energy on Gas OREG IV – Peetz Colorado, U.S. 2009 3.5 over time. produce electricity from “waste heat”. environment facilitates construction Turbines Recovered energy power plants utilize and marketing of power generated Starting from the initial evaluation residual heat that is generated as a from these sources. However, typical Ormesa Complex California, U.S. Geothermal 1987-1989, 2005-2007 39 phase in the exploration of geother- by-product from a variety of industrial recovered energy projects tend to be mal resources, we map the natural processes (cement manufacturing, smaller than 10 MW. Platanares13 Honduras Geothermal 2017 38 features of the potential geothermal gas compression turbines, etc.), which site, such as springs or lakes in close would otherwise be wasted to generate 14 proximity, as well as other relevant electricity without burning additional Puna Complex Hawaii, U.S. Geothermal 1993, 2011, 2012 38 elements of the natural habitat. fuel or generating emissions. We also conduct surveys of the Raft River Idaho, U.S. Geothermal 200815 11 surrounding area including geolog- ical, geochemical and geophysical San Emidio Nevada, U.S. Geothermal 201216 11

330 (Ormat’s share Sarulla Indonesia Geothermal 2017, 2018 Ormat’s Geothermal, Recovered Energy, and Solar Power Plants in Operation as of December 2019 represents 42 MW) The table below summarizes the portfolio of power plants and complexes that Ormat 9 owns and operates, whether developed by Ormat or acquired : Steamboat Complex Nevada, U.S. Geothermal 1992, 2005, 2007-2008 65

Project Location Application Operational Since10 Capacity (MW)11 Tungsten Mountain Nevada, U.S. Geothermal 2017 27

Amatitlan Guatemala Geothermal 2007 20 Tuscarora Nevada, U.S. Geothermal 2012 18

Bouillante Guadeloupe Island Geothermal 1995, 2004 15 Zunil Guatemala Geothermal 1999 20

Brady Nevada, U.S. Geothermal 1992, 2004, 2007 26 Tungsten Mountain Nevada, U.S. solar PV System 2019 7AC (Solar)

Brawley Complex California, U.S. Geothermal 2011 13

9 We indirectly own and operate all of our power plants, although financial institutions hold equity interests in three of our subsidiaries: (i) Opal Geo subsidiaries, which own the McGinness Hills Phases 1 and 2 geothermal power plants, the Tuscarora and Jersey Valley power plants and the second phase of the Don A. Campbell power plant, all located in Nevada; (ii) ORNI 41, which owns the McGinness Hills Don A. Campbell Phase 3 located in Nevada; and (iii) ORNI 47, which owns the Tungsten Mountain geothermal power plant located in Nevada. The nature of the equity interests held by the financial institution is described Nevada, U.S. Geothermal 2014, 2015 36 in our 2019 Annual Report under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” under the headings “Opal Transaction”, “McGinness Hills 3 Tax Monetization Complex Transaction” and “Tungsten Mountain Tax Monetization Transaction. Notwithstanding our 63.75% equity interest in the Bouillante power plant, 60% equity interest in the Neal Hot Spring power plant and 63.25% direct equity interest in the Puna plant, the first phase of Don 1985, 1993, 2005, 2006, A. Campbell, OREG 1, OREG 2 and OREG 3 power plants as well as the indirect interest in the second phase of the Don A. Campbell complex owned by our subsidiary, ORPD, we list 100% of the generating Heber Complex California, U.S. Geothermal 81 capacity of the Bouillante power plant, the Neal Hot Springs power plant and the power plants in the ORPD portfolio in the power plant table because we control their operations. We list our 12.75% share 2008 of the generating capacity of the Sarulla complex as we own a 12.75% minority interest. Revenues from the Sarulla complex are not consolidated and are presented under “Equity in earnings (losses) of investees, net” in our financial statements. 10 In power plants that were built in phases, the year of each new phase is indicated Jersey Valley Nevada, U.S. Geothermal 2011 10 11 In power plants owned by Ormat the capacity figure given is the net generating capacity to the grid, which is defined in Ormat’s 10K reports. In solar power plants the MWdc is indicated 12 The Neal Hot Springs power plant was acquired by Ormat in April 24, 2018. 13 Ormat holds the assets under a Build, Operate and Transfer (BOT) structure for approximately 15 years Mammoth Complex California, U.S. Geothermal 1984, 1990 29 14 Puna was shut down following a volcanic eruption in May 2018. The power plant was back in operation in November 2020 15 The Raft River power plant was acquired by Ormat in April 24, 2018. Ormat provided EPC services and installed its proprietary technology in Raft River to its former owner U.S. Geothermal in 2007 16 The San Emidio power plant was acquired by Ormat in April 24, 2018 McGinness Hills Complex Nevada, U.S. Geothermal 2012, 2015, 2018 143

18 19 STORAGE & ENERGY MANAGEMENT into the development, ownership niques and other computer aided engaged energy intensive industrial The target customers for our energy and operation of our own power design software as well as our test processes such as cement and glass storage business are grid operators, Energy storage systems use a variety plants. Today, we continue to grow facilities, we continuously seek to production as well as gas processing retail energy providers and large of technologies, such as large- our business by building power improve power plant components, and other companies engaged in other commercial and industrial customers. scale batteries to utilize surplus or plants to ourselves and selling power reduce operations and maintenance energy-intensive industrial processes. available electricity. This enables plants to developers worldwide and costs, and increase the range of the optimization of electricity grid through acquisition of additional our equipment and applications. operations, to run generators closer geothermal power plants in the U.S. We are continuously examining to full capacity for longer periods, and internationally. ways to increase the output of our and to operate the grid more effi- plants. In the geothermal as well as The Company sells electricity, products and energy storage and other related services ciently and effectively. Common Since our establishment, Ormat has the recovered energy (waste heat) mainly to the geographical areas set forth below based on the location of the customer. The following tables present certain data by geographical areas: applications for energy storage built close to 180 geothermal and areas, we are examining two-level systems involve management of recovered energy power plants and three-level energy systems and local capacity, frequency regulation, totaling 2,900 MW in a number of other thermodynamic cycle alter- ramping, reactive power, black start countries. As of December 31, 2019, ations along with new motive fluids. 2019 (US$ 2018 (US$ 2017 (US$ Revenues from external customers attributable to19: and movement of energy from times Ormat owned and operated 914 thousands) thousands) thousands) of excess supply to times of high MW of geothermal and recovered Our Customers demand and more.17 energy-based power plants, and United States 377,956 328,606 301,132 53 MW/56 MWh of operating Ormat has two major customer Indonesia20 — 4,379 28,968 Our History and Key Experience storage projects - predominantly categories: those who buy electric- using equipment that we design ity and those who buy power plants Kenya 121,661 119,094 110,243 Ormat was established in 1965 18 for and manufacture. The growth and services. Turkey 88,938 168,699 125,166 the principal purpose of developing in our owned power plants was equipment for the production of largely concentrated in the U.S., Ormat provides electricity from Chile 25,540 980 8,895 energy from clean, renewable and New Zealand and Latin America. renewable energy solutions to Guatemala 28,624 27,975 27,991 inherently sustainable sources. We We contributed significantly to the customers worldwide. Most of the have a total of 54 years of experi- growth of the Turkish geothermal Company’s revenues arise from fully New Zealand 31,222 10,451 33,395 ence in the renewable energy sector power industry, the world’s fastest contracted energy and/or capacity Honduras 34,446 34,355 10,151 pertaining to both technological growing geothermal market in the payments under long-term power development and the provision of last decade. purchase agreements (“PPAs”). In Other foreign countries 37,657 24,728 46,871 products and services. the U.S., the purchasers of power Consolidated Total 746,044 719,267 692,812 Our headquarters is located in Reno, from our power plants are typically Our first product, developed in Nevada and our major manufactur- investor-owned electric utility 1966 and installed in the African ing facility is located in Yavne, Israel companies or electric cooperatives country of Mali, was a solar pump, with others in the US and Turkey. including publicly owned utilities. directly connected to a turbine As of the date of this report, Ormat Outside of the U.S., our purchas- that is rotated by vapor generated operates power plants located in the ers are either state-owned utilities through solar panel heat. This pump U.S., Honduras, Indonesia, Kenya, or privately owned entities and was used to pump water from a well Guatemala and Guadeloupe (French we typically operate our facilities to provide members of the local Caribbean). pursuant to rights granted to us community with access to water by governmental agencies under resources. Later, we engaged in Our Proprietary Technology agreements. the manufacturing, ownership and operation of solar ponds for energy Our proprietary technology can In the sale of power plants and generation in Israel and the United be used with a variety of thermal services, our customer base and States (U.S.). Eventually, we ceased energy sources, such as geothermal, contract scope differ. The scope production of both products, but the recovered energy, biomass, solar varies from the supply of equipment technology and operational models energy and fossil fuels. Specifically, to full, turn-key solutions. We serve are the basis for current day Ormat. our technology involves original as an EPC contractor for geother- designs of turbines, pumps, and mal and recovered energy power In 1983, Ormat began to set up its heat exchangers, as well as formu- plants on a turnkey basis, using first geothermal power plants in the lation of organic motive fluids (all power units we design and manufac- U.S. state of Nevada. We began by of which are non-ozone-depleting ture. The customers, both existing selling our power plants to geother- substances). By using advanced and targeted, for our recovered mal developers, which later evolved computational fluid dynamics tech- energy solutions include companies

19 revenues as reported in the geographic area in which they originated 17 For more information on energy storage and related terminology, refer to the following link: https://www.ormat.com/en/renewables/storage/main/ 20 Revenues in Indonesia include only products sale. Revenues from sell of electricity from Sarulla are accounted on an equity basis 18 Ormat Technologies Inc. was initially established as a subsidiary of Ormat Industries in 1994. On February 12, 2015, Ormat Technologies Inc. completed the acquisition of Ormat Industries 20 in an all-stock merger, eliminating its majority ownership and control of Ormat Technologies. 21 OWNERSHIP STRUCTURE The Company’s common stock is The Company Board of Directors is dually listed on the New York Stock made up of ten members as of the Ormat Technologies, Inc. was formed Exchange (NYSE) under the ticker date of this report. More information as a Delaware corporation in 1994, by “ORA” since 2004 and the Tel Aviv on our Board of Directors can be our former parent Company Ormat Stock Exchange (TASE) since 2015.22 found in the Corporate Governance Industries, Ltd.21 In February 2015, section of this report. Ormat Technologies, Inc. completed In 2017, ORIX (a Japan-based financial the acquisition of Ormat Industries, services group) acquired approxi- BENEFICIAL OWNERSHIP Ltd. in an all-stock merger, eliminating mately 11 million shares, representing its majority ownership and control of approximately 22% ownership stake No shareholder holds a controlling Ormat Technologies, Inc. (purchased from FIMI ENRG limited interest in the equity structure of partnership, FIMI ENRG and L.P. the Company. Ormat is a publicly traded company. Bronicki Investments Ltd.).

The below table presents our twelve largest shareholders as of December 31st, 201923.

Significant Shareholders Percentage of Institutional Ownership

ORIX Corporation 21.53%

The Vanguard Group 7.80%

BlackRock, Inc. 6.96%

Clal Insurance Entreprises Holdings Ltd. 6.21%

Migdal Insurance & Financial Holdings Ltd 5.49%

Menora Mivtachim Insurance Ltd. 4.50%

Impax Asset Management Ltd. 3.50%

Harel Insurance Investments and Financial Services Ltd. 3.45%

Delek Group Ltd. 3.17%

Amitim 3.16%

Dimensional Fund Advisors, L.P. 2.69%

Psagot 2.66%

21 Ormat Industries, Ltd. was originally established in 1965 as Ormat Turbines Ltd. The entity was later renamed Ormat Industries. 22 Ormat Industries, Ltd. was listed on the Tel Aviv Stock Exchange in 1991, but in February 2015, it was delisted and Ormat Technologies’ common stock began trading on the TASE under the ticker “ORA”. 23 For more information on our ownership structure see: https://investor.ormat.com/stock-information/ownership/default.aspx the geothermal resource on it’s way to the Ormat plant

22 23 AN ORGANIZATION purpose is to continually renew the and services that we offer. This way of Earth’s energy future, a goal that life is also demonstrated in our core FULL COMMITMENT SHAPED BY VALUES Ormat strives to achieve in the spirit of values as detailed below. Together, environmental and social responsibil- these values sustain our organization ity. Sustainability has been part of our and propel Ormat forward as we seek At Ormat, sustainability is not just corporate DNA since our inception an even larger platform and position another target we aim to achieve; it and continues to be the inspiration in the global renewable energy sector is at the core of our business and our for the growing number of renewable of tomorrow. way of life. Ormat was founded and energy sectors that we participate in has flourished as a Company whose and for the diverse array of products

Full commitment to our stakeholders and a sustainable future is a value central to our brand’s promise. That means that Our Five Core Values wherever we operate, we are fully committed to delivering safe, reliable, clean renewable energy products and services that minimize environmental impacts and promote a clean energy future for generations to come. CONSTANT RENEWAL COURAGE

Constant renewal has kept Ormat at the forefront of renewable energy development since our first turbine design back in 1965. It’s a promise that we fulfill by continually seeking out new challenges, by advancing new technologies, entering new Courage comes from leveraging our collective knowledge, experience, prudent risk management and unwavering focus to fields and testing out new business models - a promise that is the basis for our sustainable value proposition. continually delivering the very best results for our customers.

STABILITY CREATIVITY

Finally, creativity is a core value that reflects our appreciation for the uniqueness of our stakeholders and our understanding Stability is a core value that has helped establish and sustain our Company over the years. We strive to implement long- that creativity is vital to delivering robust solutions that can address their expectations and needs. term action plans and to advocate for thoughtful, well-planned renewable energy developments supported by firm financial foundations. In addition, we believe that a stable workforce, technology, product and operations are all hallmarks of an Ormat is built on these core values, which are reflected in the way we conduct business each day, in all our locations. We believe organization with well-integrated sustainable management systems. that our employees, managers, and directors must consistently demonstrate honesty, openness, and fairness in their dealings with each other, with our customers and with our community.

24 25 KNOWING OUR OUR MAIN CHANNELS OF STAKEHOLDER ENGAGEMENT

IMPACTS – Stakeholder Group Methods of Communication STAKEHOLDER The main stakeholder groups that were identified as relevant for the organization are the following: Employee communication portal and newsletters, periodic career and ENGAGEMENT professional performance reviews, participation in employee health and APPROACH Employees safety committees, organized employee evaluations and open dialogue between employees, managers and human resources representatives, events and conferences for employees25.

As a global company that under- stands the inherent value of sustain- Communication through our website, customer service framework, and on- Customers ability as a business strategy, we work going sales and business development relationships. to assess our impacts on the environ- Social & ment, society and local communities, Employees Financing Entities Environmental as well as relevant impacts for our NGOS Communication and updates delivered through the Investor Relations key stakeholder groups. As a result, arm, investors conferences and non-deal road shows, general shareholder Investors we have developed processes for meetings, earnings calls and relevant updates, through the ‘Investor & Shareholders identifying, communicating with and Relations’ page on Ormat’s website26, annual and quarterly reports, SEC addressing grievances from our key filings and press releases. groups of stakeholders. As part of this engagement strategy, and to better understand these risks and opportu- Engagement through environmental and social impact assessments, nities, we engage in on-going stake- Customers Public Authorities, Media Financing Entities compliance reviews and action plans, annual and quarterly reports and SEC holder dialogue and have developed Policy Makers & Regulators filings, and on-going communication through our finance department. an organization-wide Stakeholder Engagement Policy that can be accessed at the following link.24 Public Authorities, Engagement through industry organizations, lobbying activities, STAKEHOLDER GROUPS ENGAGED Policy Makers participation in workshops, conferences and events, compliance reviews and BY THE ORGANIZATION & Regulators action plans, and on-going communication.

Ormat regularly engages with various groups of internal and external stake- Communication through our global Stakeholder Engagement Policy and Investors & Local Communities Academia holders in the context of our business Shareholders Local Communities relevant local communication strategies, tours and meetings at Ormat’s operations. Ormat’s management local facilities. and relevant representatives from our various business units who engage Active participation in relevant events and conferences, donations, directly with stakeholder groups – for Social & contributions and volunteering activities and cooperation in social and example representatives from the Environmental NGOs Human Resources Department and OUR APPROACH TO STAKEHOLDER Our approach to stakeholder engage- environmental projects and industry initiatives. from the Legal Department - initially ENGAGEMENT ment is demonstrated in our Stake- identified the stakeholder groups listed holder Engagement Policy which sets Communication through Ormat’s website, press releases and informational below. However, in order to better assess Ormat has developed a business out our promise of productive, trans- Media the methods of engagement and the strategy that places both environ- parent and equitable relationships with notes, tours at Ormat’s various facilities, and on-going communication. material interests of these stakeholders, mental sustainability and social stakeholders. and as part of the Company’s materi- responsibility at the forefront of our Cooperation with Ormat in conducting research and development activities ality assessment that we conducted activities. Our stakeholders play a specifically with our Resource Department, providing support for scientific according to the best practice recom- central role in the realization of our Academia initiatives and expansion of educational opportunities, and tours at Ormat’s mendations of the Global Reporting sustainability strategy and it is our various facilities. Initiative (“GRI”), Ormat surveyed intent is to develop productive and stakeholder groups to verify manage- fruitful relationships with these stake- ment’s and the various departmental holder groups while also expanding In addition to these methods of communication, all stakeholders can submit their grievances, questions or comments representatives’ assessments of relevant on the opportunities available for concerning the Company’s activities to [email protected]. stakeholder groups for Ormat. engagement with Ormat.

24 https://www.ormat.com/Warehouse/userUploadFiles/Image/Ormat%20Stakeholder%20Engagement%20Policy.pdf 25 This list is not exhaustive and is presented as an example of employment engagement activities which may vary across jurisdictions. 26 26 https://investor.ormat.com/ 27 OUR STAKEHOLDERS’ KEY In 2019, we reviewed our stakeholder in our on-going business activities. OUR SUSTAINABILITY two aspects: the groups of stake- information from the news media and INTERESTS AND CONCERNS engagement mechanisms by consult- We consistently seek out opportu- holders that are relevant to Ormat’s from benchmark studies on relevant ing with investors, board members, nities for active engagement with STRATEGY - business and the issues that are of issues for our business sector. We believe that an adequate and clear community members and executive our stakeholders and embrace every DEFINING WHAT’S critical interest or concern to the understanding of our stakeholders’ managers. The survey aimed to gain opportunity to hear their opinions and stakeholder group within the context The materiality results presented interests and concerns encourages a better understanding of our sustain- concerns regarding our organization MATERIAL TO ORMAT of their specific relationship to the below show the relative correla- closer and more productive relation- ability reporting practices and the and our business activities. organization. With regards to the tion between matters of interest to ships with our stakeholders. Feedback degree to which it matches and meets Ormat began working to identify our latter, stakeholders were asked to rank Ormat’s stakeholders and manage- from our stakeholders enables us to our stakeholders’ expectations for material issues in 2018 by conduct- a range of material issues according ment in accordance with their signif- refine our business strategy in order disclosure and transparency. Issues ing a materiality assessment. Both to the level of importance of the issue icance to the Company’s impacts to meet these needs and concerns. identified for focus in the course of the stakeholder survey (described to their specific stakeholder group. on the one hand and our business the survey included: diversity, equal above) and the materiality assess- strategy on the other. These issues – As part of our stakeholder and opportunity and employment, and ment were conducted with the assis- The list of issues presented to our addressed in the scope of this report materiality assessment conducted disclosure of key environmental tance of independent consultants. stakeholders was compiled based on - reflect the significant economic, in 2018, we surveyed our employees, data, including our greenhouse gas This approach enabled us to maintain our understanding of relevant best environmental and social impacts of customers, investors, shareholders, emissions. objectivity in recording and analyzing practices and recommendations the organization together with their financing bodies, public authorities, the answers from our various groups for compiling material issues for degree of influence on the assess- policy makers and regulators, and The topics identified by our stake- of stakeholders. presentation to stakeholders, such ments and decisions of our groups of finally, the local communities in which holders are addressed in the scope as those indicated in the Sustainabil- stakeholders. we operate. of this report, in our existing policies Ormat’s internal and external stake- ity Accounting Standards Board’s and engagement frameworks and holders were surveyed for their (“SASB”) standards for Electric opinions and viewpoints regarding Utilities and Power Generators27,

RESULTS OF THE MATERIALITY SURVEY

The results of the materiality survey in 2019 are presented below in two ways. In the first, the table where the material issues are presented according to their level of significance to both our stakeholders and the Company, and are classified according to Economics & Governance, Environment and Social. In the second, the material issues are presented in a graph matrix which groups all material issues together.

Economics & Governance Evironment Social • Ethical Business Conduct • Brine & Steam Management • Safety and Emergency Planning • Legal & Regulatory Compliance • Encouraging Green Energy • Occupational Health and Safety • Operational Efficiency • Climate Change Mitigation • Reliability of Ormat's Service • Innovation (Products & Services) • Water Management • Ormat’s Labor Relations • Corporate Governance • Waste & By-Product Management • Customer Service • Executive Compensation • Site Biodiversity, Restoration & • Local Employment & Development Preservation • Employee Training & Development • Energy Efficiency • Workplace Diversity • Greenhouse Gas Emissions from • Data Privacy & Security Operations • Local Community Engagement • Climate Change Risk & and Support Opportunity Management • Employees’ Well-Being • Air Quality • Philanthropy and Volunteering Stakeholders visiting an Ormat plant

27 As per the “Electric Utilities & Power Generators Sustainability Accounting Standard,” Industry Standard Version 2018-10. 28 29 Legal & Regulatory Compliance

Safety & Emergency Planning Ethical Business Conduct 5.0 Brine & Steam Occupational Health & Safety Management

Climate Change Mitigation Encouraging Green Energy Ormat’s Labor Relations

Local Employment and Development 4.0 Ormat Operations Water Management Efficiency

Corporate Governance Customer Service

Risk Management Innovation Reliability Human Rights in Supply Chain (Products & of Ormat’s 3.0 Services) Service Employee Training Development Waste Management

Biodiversity Executive Workspace Diversity Compensation 2.0 Air Quality Climate Change Risk

Employees’ Well-Being

1.0 Local Community Engagement Community’s Support Energy Efficiency Site Restore & Preserve Relative Importance to Ormat's Management Ormat's to Importance Relative Data Privacy & Security

0 Philanthropy and Volunteering Operations GHG Emissions 0 1.0 2.0 3.0 4.0 5.0

Relative Importance to Ormat's Stakeholders

Social Economics & Governance Environment

30 31 OUR STRATEGIC plants. We work to better understand to the Israeli Ministry of Environmen- ORMAT'S MEMBERSHIPS OF ASSOCIATION the specific properties of a geother- tal Protection’s voluntary business COMMITMENTS AND mal reservoir and add new energy reporting initiative, a practice that we SUSTAINABILITY PLAN generation capacities progressively have engaged in since 2011. in stages. As such, we strive to deliver The table below outlines the main organizations of which Ormat is a more renewable energy while main- In addition, Ormat was part of the member and that are related to our various business and ESG activities. taining substantially the same devel- Frontier Observatory for Research opmental footprint. Similarly, when it in Geothermal Energy (“FORGE”) Ormat is committed to principles of comes to developing new renewable initiative (in partnership with Sandia Type of Organization Relevant Memberships Environmental, Social and Gover- energy plants, we work to fully under- National Laboratory and others) nance-related (“ESG”) responsibility stand the needs and concerns of the initiated by the U.S. Department of • Geothermal Resources Council (GRC) – U.S. - commitments that are achieved local stakeholder community and to Energy. FORGE yielded new insights 1 | Geothermal Organizations • International Geothermal Association (IGA) through our business activities, build lasting relationships and specific and techniques for characterizing • Indonesia Geothermal Association policies, frameworks for stake- community engagement programs potential enhanced geothermal holder engagement and strategic designed to meet those needs system (“EGS”) sites as well as tested objectives. and concerns. new techniques and tools in the field • California Energy Markets of geothermal drilling technologies. • California Energy Storage Alliance (CESA) We pursue sustainable innovation and Ormat applies these and other Currently, Ormat is partnering on • Energy Storage Association – U.S. leadership in renewable energy across sustainability principles to the way we several proposals to the Depart- 2 | Energy Organizations • Society of Petroleum Engineers – U.S. several areas – namely geothermal evaluate opportunities and develop, ment of Energy for federally funded • Utah Clean Energy energy, recovered energy gener- manufacture and operate renewable research on drilling technology and • Green Energy Association of Israel ation and energy storage. Each of energy facilities around the world. machine learning. • World Energy Council these directions allows our Company to advance existing practices EXTERNAL INITIATIVES We sponsored the Women in Geother- • The American Society of Mechanical Engineers (ASME) and push forward to improve our mal Program (Wing Program), a • National Safety Council – U.S. performance in ways that minimize We endorse several external initia- global network that supports the role • National Fire Protection Association (NFPA) – U.S. material and energy inputs, maximize tives that assist us in realizing our of women in the geothermal industry 3 | Health and Safety Organizations • Alliance for Industrial Efficiency energy output and our operational environmental, social and corporate and works to promote gender • American Society of Safety Professionals (ASSP) efficiency. governance commitments. equality in the sector. We shared • CA OPC Engineers Board information on the organization with • California Community Choice Association (CalCCA) For example, one of our established We have reported on our Greenhouse our relevant groups of stakeholders development practices involves Gas (“GHG”) emissions to the CDP and supported the organization’s the incremental increase of energy since 2010. We also report data on our mission at the 2018 Geothermal • CalChamber – California, U.S. production capacity for geothermal carbon dioxide and GHG emissions Resources Council Annual Meeting. • Churchill Economic Development Authority – Nevada, U.S. • Hawaii Island Chamber of Commerce • Elko Chamber of Commerce – Nevada, U.S. 4 | Chambers of Commerce • Israel Export Institute • Manufacturers Association of Israel • Israel Latin America Association • Israel Turkey Business Council

ORMAT AND THE SUSTAINABLE to address the world’s most pressing stakeholders – including governments, DEVELOPMENT GOALS social and economic issues. The goals local communities and business. were designed to tackle some of the The Member States of the United Nations biggest challenges facing the planet, As a leading global renewable energy adopted 17 Sustainable Development society and economies, such as poverty, company, we believe that Ormat has Goals (SDGs) as part of the 2030 inequalities, injustice and climate change. an important leadership role to play in Agenda for Sustainable Development However, it is widely believed that the UN’s helping to achieve these SDGs. (the 2030 Agenda).28 The 17 SDGs and Agenda can only be achieved through the related 169 targets were designed collaboration between all major

28 https://sustainabledevelopment.un.org/ 32 33 The following table details the most relevant SDGs and targets that we address through our business activities and social and environmental engagement plans:

Sustainable Development Goal Relevant Targets GRI Disclosures Relevant Business Activities

No Poverty • 1.4: Equal rights to economic resources, access to basic services, ownership and control GRI Disclosure 413-2 • We assess the relative economic impact on the communities in which it operates through stakeholder over land and other forms of property, inheritance, natural resources, appropriate new engagement and economic impact assessments. End poverty in all technology and financial services, including microfinance • We engage with local communities and work to alleviate poverty through our philanthropic activity forms, everywhere and employment creation as part of our agenda for 100% local employment

Good Health and • 3.8 Achieve universal health coverage, including financial risk protection, access to GRI Disclosure 401-2 • Healthcare and safety are key aspects of the benefits that we provide our employees, including paid quality essential health-care services and access to safe, effective, quality and affordable sick leave and access to healthcare packages at or beyond the local labor and regulatory requirements Well-Being essential medicines andv vaccines for all.

Ensure healthy lives and promote well-being for all at all ages

Quality Education • 4.3: Ensure equal access for all women and men to affordable and quality technical, GRI Disclosure 404-1 • Our philanthropic activity world-wide is education focused. vocational and tertiary education, including university. • Employees are offered opportunities to expand their technical and professional skills and knowledge, Ensure inclusive and • 4.5: Eliminate gender disparities in education and ensure equal access to all levels of and to engage in personal development courses and degrees, which we work to sponsor at our inter- education and vocational training for the vulnerable, including persons with disabilities, national power plants and facilities. On average, Ormat employees received 7 hours of training in 2019. equitable quality indigenous peoples and children in vulnerable situations • We provide equal academic and training opportunities for employees, regardless of their gender. education and We sponsor the Women in Geothermal (WING) Program to promote gender equality in the geothermal promote lifelong sector. Lastly, we set up a school for girls in our Kenya communities learning opportuni- ties for all

Clean Water and • 6.3: Improve water quality by reducing pollution, eliminating dumping and minimizing GRI Disclosure 303-1-a • Our power plants are air cooled, in comparison to the majority of geothermal plants which are release of hazardous chemicals and materials, halving the proportion of untreated water-cooled. Thus, we greatly minimize the use of water. Sanitation GRI Disclosure 303-1-c wastewater and substantially increasing recycling and safe reuse globally. • We work to minimize the use of water in our power plants and conduct environmental impact • Support and strengthen the participation of local communities in improving water and assessments to test local aquifer and groundwater quality surrounding our power plants. We also work Ensure access to sanitation management. to minimize the amount of water used in the manufacturing process. water and sanita- tion for all

Affordable and • 7.2: Increase substantially the share of renewable energy in the global energy mix GRI Disclosure 302-1 • As a leading provider of renewable energy solutions worldwide, we are helping countries and commu- nities meet their renewable energy targets. Clean Energy • 7.A: Enhance international cooperation to facilitate access to clean energy research GRI Disclosure 302-2 and technology, including renewable energy, energy efficiency and advanced and GRI Disclosure 302-3 • We provide recovered energy generation and energy storage, which help a variety of renewable cleaner fossil-fuel technology, and promote investment in energy infrastructure and energy solutions to work to scale. Ensure access to clean energy technology • We work with governments and through international frameworks to promote our renewable energy affordable, reliable, • 7.B: Expand infrastructure and upgrade technology for supplying modern and solutions, including support for research and development in the geothermal and energy storage fields, sustainable and sustainable energy services for all in developing countries, in particular least developed collaborations with relevant industry organizations and with leading renewable energy companies. modern energy countries, small island developing States, and land-locked developing countries, in • We introduce our renewable energy technologies in the developing world to support national accordance with their respective programs of support renewable energy goals and international commitments in those countries.

34 35 Decent Work and • 8.2: Achieve higher levels of economic productivity through diversification, technological GRI Disclosure 201-1 • We are committed to local employment at all of our operational facilities and power plants. Economic Growth upgrading and innovation, including through a focus on high-value added and labor-in- GRI Disclosure 203-2 • We work to develop the skills and knowledge of our employees, including at our manufacturing tensive sectors GRI Disclosure 102-8 facilities thus encouraging the upgrading of skills for labor-intensive sectors. Promote inclusive • 8.5: Achieve full and productive employment and decent work for all women and men, GRI Disclosure 202-2 including for young people and persons with disabilities, and equal pay for work of • Through our renewable energy solutions, we seek to help countries decouple economic growth from and sustainable GRI Disclosure 401-1 environmental degradation caused due to the burning of fossil fuels and from the use of non-renewable equal value GRI Disclosure 401-2 economic growth, resources for energy generation. • 8.8: Protect labor rights and promote safe and secure working environments for all GRI Disclosure 401-3 employment and • We promote equality in employment for all of our employees regardless of gender, race, cultural workers, including migrant workers, in particular women migrants, and those in precarious GRI Disclosure 102-41 background, religion, physical disposition, or other irrelevant factors. decent work for all employment. GRI Disclosure 403-1-a GRI Disclosure 403- 1-b • We implement an advanced health and safety framework that is implemented through our Quality, Environment, Health and Safety policy. We support the labor rights of all our employees and honor their GRI Disclosure 403-4-a basic rights to decent work and fair pay. We manage human resources with employees’ rights in mind. GRI Disclosure 403- 4-b GRI Disclosure 403-5 GRI Disclosure 406-1

Affordable and • 9.1: Develop quality, reliable, sustainable and resilient infrastructure, including regional • Our power plants contribute to the existing energy generation infrastructure in the countries where Clean Energy and trans-border infrastructure, to support economic development and human well-being, we operate. The nature of renewable energy infrastructure works to increase the overall level of resilience with a focus on affordable and equitable access for all. in the country of operation. Promote inclusive • 9.4: Upgrade infrastructure and retrofit industries to make them sustainable, with • Through our power plants and renewable energy solutions, we actively encourage the adoption of increased resource-use efficiency and greater adoption of clean and environmentally clean and environmentally-sound technologies, mainly in developing countries that may have limited and sustainable sound technologies. GRI Disclosure 201-1 access to such solutions. economic growth, GRI Disclosure 203-1 • 9.A: Facilitate sustainable and resilient infrastructure development in developing employment and countries through enhanced financial, technological and technical support to African decent work for all countries, least developed countries, landlocked developing countries and small island developing States

Responsible • 12.2: Achieve the sustainable management and efficient use of natural resources GRI Disclosure 301-1 • We encourage the sustainable use of materials and resources, including natural geothermal resources. Consumption and • 12.4: Achieve the environmentally sound management of chemicals and all wastes GRI Disclosure 302-1 • We encourage and track the generation of waste products and the use of materials (namely non-re- Production throughout their life cycle, in accordance with agreed international frameworks, and GRI Disclosure 302-2 newable materials) at our operational sites. GRI Disclosure 302-3 significantly reduce their release to air, water and soil in order to minimize their adverse • We actively promote and enforce practices for recycling, reclamation and reuse of materials at our impacts on human health and the environment GRI Disclosure 303-1-a Ensure sustainable operational sites, with a specific emphasis on our manufacturing facilities. • 12.5: Substantially reduce waste generation through prevention, reduction, recycling GRI Disclosure 303-1-c consumption and and reuse. GRI Disclosure 305-1 production patterns GRI Disclosure 305-2 GRI Disclosure 305-3 GRI Disclosure 306-1 GRI Disclosure 306-2

Climate Action • 13.1: Strengthen resilience and adaptive capacity to climate-related hazards and natural • We analyze our risks and opportunities in terms of climate change impacts, and work to assess how disasters in all countries our business and operational activities impact the likelihood of climate change and other environmental impact scenarios. This includes reporting on our own energy use and CO2 production. Take urgent action • Our core offering – geothermal energy – is renewable, thus reducing use and concomitant burdens to combat climate GRI Disclosure 201-2 of non-renewable energy use among our customers. change and its impacts

Life on Land • 15.1: Ensure the conservation, restoration and sustainable use of terrestrial and inland • We conduct environmental impact assessments to ensure that we have an adequate understanding freshwater ecosystems and their services, in particular forests, wetlands, mountains and GRI Disclosure 304-1 of our impacts. drylands, in line with obligations under international agreements GRI Disclosure 304-2 • We actively engage our stakeholders and consult with local communities and local government • 15.9: Integrate ecosystem and biodiversity values into national and local planning, GRI Disclosure 304-3 administrators. development processes, poverty reduction strategies and accounts. GRI Disclosure 304-4

36 37 RISK MANAGEMENT are further ranked and validated by revenues in the fourth quarter of the the process owners and relevant year. To the extent weather conditions STRATEGY – members of management, resulting continue to be impacted by climate SUSTAINABILITY AND in a risk profile and priorities, and change, the generating capacity eventually culminating in our plan for of certain of our facilities may be CLIMATE CHANGE- management of those risks. adversely impacted in a manner that RELATED RISKS we could not predict which may in Relevant Risks turn adversely impact our opera- tions. Additionally, Recovered Energy We consider potential risks from units may be affected when winter OUR RISK MANAGEMENT climate change according to the temperatures are higher than average APPROACH precautionary approach for risk as it reduces the gas flow and, like all management with regards to our structures, power plants are likely As a global Company and publicly products and services.29 In iden- to be affected by extreme weather traded entity, we place equal weight tifying relevant risks from climate occurrences such as hurricanes and on the management of pertinent change that could potentially result tornadoes, which are unavoidable. risks and the pursuit of relevant in substantive changes to our oper- Almost all of our power plants are revenue generation opportunities. ations, revenue, and expenditures, located in areas that are not expected Our management team works in close we seek to minimize these risks and to be affected by rising sea levels. cooperation with all our major oper- address them either through our ational locations to identify and deal model of engagement, physical infra- In terms of risk management in the with relevant risks and to implement structure and operations, or in the geothermal exploration process, appropriate methodologies for on-going management and opera- Ormat’s Resource Department is addressing such risks. tions of our plants and our Company. comprised of an experienced team of geologists, geophysicists and As such, our risk management process Based on our risk assessment, engineers who are dedicated to has several key levels of analysis: by Ormat is not exposed to any special assessing, exploring, developing and our project teams and major oper- material risk from climate change. Our managing geothermal reservoirs ations; by Company management equipment is designed to withstand in the context of our projects or and through assignment of respon- extreme weather events and is potential projects. The risk manage- sibilities; through our management largely independent and isolated ment process for the exploration of know-how and skills relevant to from weather-related impacts. With phase begins with in-depth research the various disciplines that help us this, daily and seasonal fluctuations on the geothermal reservoir, including achieve our targets as a vertically-in- in temperature generally have a more its location in the potential plant tegrated company; and through other significant impact on the generat- area, in order to identify and assess relevant controls and measures for ing capacity of geothermal energy potential physical, social or environ- our business, such as audit and regu- plants than they do on conventional mental risks early in the process. If latory functions. power plants. Some of our power a site is deemed to be relevant, the plants experience reduced genera- Resource Department begins the Our methodology for identifying tion in warm periods due to the lower surface exploration process at the relevant risks involves mapping the heat differential between geothermal site whereby they initiate drilling in control environment of our corporate fluid and the ambient surroundings. slim holes to determine the exact and business infrastructure including While we generally account for the location of the geothermal reservoir the main activities that we pursue. projected impact of seasonal fluc- and where to locate the plant. Our business units are categorized tuations in temperature based on and mapped, and within these we our historic experience, the impact map relevant business processes. In of climate change on traditional order to understand relevant risks for weather patterns has become more each of these processes, we develop pronounced. This has reduced the risk ranking criteria that look at both certainty of our modelling efforts. the level of impact and the likelihood For example, in 2019, we experienced of occurrence. Based on this system, prolonged elevated temperatures we conduct our risk assessment in the Western United States which among the various business units impacted generating capacity at our and operations. The identified risks facilities and adversely impacted our

29 The precautionary approach was introduced by the United Nations in Principle 15 of ‘The Rio Declaration on Environment and Development’. It states: ‘In order to protect the environment, the precautionary approach shall be widely applied by States according to their capabilities. Where there are threats of serious or irreversible damage, lack of full scientific certainty shall not 38 be used as a reason for postponing cost-effective measures to prevent environmental degradation.’ 39 CHAPTER III. ABOUT THIS REPORT

Tuzla West geothermal plant, supplied by Ormat. Turkey, 12 MW

40 41 ABOUT THIS REPORT In compiling this report, Ormat has INFORMATION BOUNDARIES OF Changes to this year’s report include FORWARD-LOOKING STATEMENTS followed the GRI’s requirements and THIS REPORT a more prominent role for material recommendations in defining the topics, such as Diversity and Corporate Information provided in this report may reporting Boundaries, as outlined in Unless otherwise noted, this report Governance. We have also included contain statements relating to current Ormat’s 2019 sustainability report the section below. We have consid- includes environmental and social information related to our recently expectations, estimates, forecasts highlights our environmental, social ered our material entities over which data from internal systems and acquired Energy Storage & Manage- and projections about future events and governance (ESG)-related the Company has control, including information from January 1, 2019 ment segment. Lastly, in order to that are “forward-looking statements” measures, initiatives and activities for those in which we have significant through December 31, 2019 and is provide a fuller representation of as defined in the Private Securities the reporting period of January through influence over the activities that are focused on our material operations our total emissions, we have added Litigation Reform Act of 1995. These December, 2019. This is the Company’s material for the Company according in the United States, Israel, Turkey, the emissions from our production, forward-looking statements include second sustainability report. This report to their economic, environmental and Honduras, Guatemala, Guadeloupe although it is included in our customers’ statements concerning the completion has been prepared in accordance with social aspects. (French Caribbean) and Kenya. Ormat emissions disclosure. of the offering and the use of proceeds the GRI Standards: Core option.30 has operations or holdings in other therefrom. Actual future results may Our inaugural sustainability report was For the purposes of this report locations such as Indonesia, which as of CONTACT POINT FOR QUESTIONS differ materially from those projected published in 2018; prior to this time “Ormat” (or the definitions presented 2019 are not operationally material and REGARDING THIS REPORT as a result of certain risks and uncer- we generated sustainability briefs herein on page 14 of this report) refer hence the data/detailed analysis is not tainties. For a discussion of such risks and updates for stakeholders based to: the U.S.-based Company Ormat included in this report unless otherwise We have strived to provide all the and uncertainties, see “Risk Factors,” in in principle on the GRI standards. All Technologies Inc. and its controlled mentioned. All financial or economic relevant data and information each case, included in Ormat’s Annual previous sustainability publications are entities that are included in the information presented in this report is regarding our sustainability perfor- Report on Form 10-K for the year available on the Company’s website.31 Company’s consolidated financial disclosed according to our 2019 Annual mance and activities in 2019 that fall ended December 31, 2019 filed with the statements. Details regarding the Report which should be referred to in within the scope of this report. Stake- Securities and Exchange Commission Following the publication of our 2018 entities included in our consolidated case of any discrepancies. holders who are interested in under- (“SEC”) on March 2, 2020, as amended report, which represented a significant financial statements can be found standing or clarifying the information by Amendment No. 1 on Form 10-K/A milestone for Ormat, we conducted an in our Annual Report on Form 10-K This sustainability report focuses on the presented, or who have questions filed with the SEC on March 3, 2020, extensive dialogue with key stakehold- for the year ended December 31, environmental and social topics that regarding the content of the report, and Ormat’s Quarterly Report on ers. This report represents the results 2019 filed with the SEC and can be are material and relevant to Ormat’s can contact us through one of the Form 10-Q for the quarterly period of this process and includes additions reached at the following link.33 All of operations and business, and which are following channels: ended September 30, 2020 filed with and improvements to last year’s report the entities included in our consoli- of greatest interest to our stakeholders. the SEC on November 5, 2020 and that are based on the feedback that dated financial statements or equiv- The content presented in the report Mail requests other risk factors detailed from time we received. It is our intention to alent documents are covered by this was prioritized through a process of to time in filings with the SEC. These continually refine our sustainability report, unless otherwise noted. research and consideration of a variety Ormat Technologies, Inc. forward-looking statements are made reporting in the years ahead. To assist of sources including feedback from 6140 Plumas Street only as of the date hereof, and the readers in locating relevant informa- Ormat obtains independent external groups of our stakeholders, the GRI Reno, NV 89519-6075 Company undertakes no obligation tion throughout the report, we provide assurance of its annual financial Standards, including its Reporting U.S. to update or revise the forward-look- a GRI content index on page 114 of information, the annual accounts Principles for defining report content, ing statements, whether as a result this report. and management reports (individ- which include: Stakeholder Inclu- Requests for general information: of new information, future events or ual and consolidated with those siveness, Sustainability Context, [email protected] otherwise, except as required by law. There are no restatements of informa- of its controlled entities). We did Materiality and Completeness, and tion that have to do with mergers or not receive external assurance for the Reporting Principles for defining Requests for sustainability-related acquisitions, or changes in the nature this report but we are considering report quality, which include: Accuracy, information: of our business. The only notable securing external assurance for the Balance, Clarity, Comparability, Reli- [email protected] development from previous reporting data reported in our forthcoming ability and Timeliness. In addition, it is periods is that, following significant sustainability reports. informed by the SASB sector-relevant Online form: changes in our systems and data collec- standards, alongside other relevant www.ormat.com/en/company/ tion processes, we have decided to third-party frameworks for sustainabil- contact/main/ establish this year as our base year for ity reporting. We expect the content calculating Ormat’s carbon footprint and data quality of our reporting to moving forward. improve and evolve moving forward as we further develop our sustain- We have not changed our list of ability strategy and as we continue material topics and topic Boundaries to receive relevant and valuable from our 2018 report and we intend feedback from our stakeholders. to continue to publish a sustainability report on an annual basis.

30 According to the Global Reporting Initiative, “Consolidated Set of GRI Sustainability Reporting Standards 2016.” The Standard is issued by the Global Sustainability Standards Board (GSSB). The Standard applied is effective for reports or other materials published on or after 1 July 2018. 42 31 https://www.ormat.com/en/company/engagement/view/?ContentID=140 43 32 https://investor.ormat.com/Cache/1001250792.PDF?O=PDF&T=&Y=&D=&FID=1001250792&iid=4087066 CHAPTER IV. OUR BUSINESS, FINANCIAL PERFORMANCE AND ECONOMIC IMPACTS

Olkaria III geothermal complex, Kenya, 150 MW

44 45 ABOUT OUR works and policies, and providing solutions. The Company’s first real step financial issues. Furthermore, and and interaction with shareholders, we capacity. The growth in the electricity incentives to develop the sector, which into the energy storage and manage- together with management, these indi- aim to provide top-of-the-line service segment is due to a number of factors, BUSINESS Ormat views as a positive opportunity ment market was the acquisition of viduals are responsible for preparing while adequately and appropriately namely the completion of a number for its business. In addition, and partic- Viridity Energy Inc. Ormat’s annual, quarterly and periodic addressing their requests. of expansion projects in our existing ularly in the United States, a number of financial and annual reports that are geothermal power plants, such as a Ormat staunchly believes that as a states and territories have renewable As a central player in the geothermal filed with the Securities and Exchange ECONOMIC PERFORMANCE IN 2019 major expansion of the third phase at provider of energy solutions, and portfolio goals or laws that encourage and renewable energy markets through Commission (SEC). All of our SEC our McGinness Hills complex, increas- namely renewable energy solutions, or require utilities to generate or our diverse global presence, we plan filings, including the Company’s 10K, In 2019, Ormat continued to experi- ing the complex capacity by 48 MW we have a central role in the global buy a percentage of their electricity to continue to develop our business 10Q and other relevant documents ence strong revenues and operational to a total of 140 MW; expansion at economy and in ensuring the sustain- from renewable energy or recovered and seek out relevant opportunities to are available to the public both on the growth. Overall, total revenues from all our Olkaria III complex in Kenya that able development of communities. The energy sources. improve our economic performance SEC website34 and on our Investor segments increased by approximately increased the generating capacity energy market is one of the most signif- for shareholders, while also making Relations page.35 US$27 million. by 11 MW to a total of 150 MW; and icant factors within the global economy In addition to our geothermal power meaningful and effective contributions the completion of the third phase at as it enables economic growth and generation activities, we pursue to the renewable energy market. Our Our shareholders are consistently Pursuant to our dividend policy we the Sarulla complex in Indonesia that development, creates jobs, develops relevant recovered energy-based business strategy is outlined below. provided with current and exact expect to distribute at least 20% of our allowed the plant to reach a gener- critical infrastructure, generates power generation opportunities in information on our economic and annual profits available for distribution ating capacity of 330 MW. Also, in long-term value and enables the very North America and other locations. We OUR BUSINESS STRATEGY financial performance. We regularly by way of quarterly dividends Conse- 2019 we added the first hybrid solar nature of our modern society. believe recovered energy-based power hold earnings calls that all our global quently, in 2019 Ormat paid a total of and geothermal power plant, in the generation (known as “REG” in other Our strategy is to continue building shareholders can access online along $22.38 million USD ($.44 per share) in Tungsten project in Nevada. The As a leading vertically integrated Company publications) will ultimately a geographically balanced portfolio with the Company’s earnings call dividends to its shareholders. expansion and improvement of our company primarily engaged in the benefit from the efforts to reduce GHG of geothermal and recovered energy presentation. In addition, our Investor existing power plants contributes to geothermal and recovered energy emissions. We have built over 20 power assets, and to continue to be a leader in Relations team issues email notifi- During 2018 and 2019, our electrical helping us achieve our strategic goals, business, Ormat plays a significant plants that generate electricity utilizing the geothermal energy market with the cations, alerts and news regarding generating capacity of our operating but also significantly contributes to role within the global renewable energy “waste heat” from gas turbine-driven objective of becoming a leading global Ormat’s financial performance or any portfolio expanded by approximately our revenues and economic success market generally, and the geothermal compressor stations along interstate provider of renewable energy. Since 2015, major Company events on a regular 119 MW from 795 MW at YE 2017 to over time. energy market particularly. Renewable natural gas pipelines, from midstream we have implemented a number of the basis through a list of registered 914 MW at year-end 2019, represent- energy is sustainable and, clean, leading and gas processing facilities, and from elements of a new multi-year strategic subscribers. In all our communication ing a CAGR of 7.2% in our generating major countries to focus their efforts on other applications. Several U.S. states, plan. The strategic plan was approved the development of renewable energy and to a certain extent the federal and is consistently reviewed in consul- The data presented in the table below details the direct economic value generated, distributed and retained by the sources, and geothermal energy, specif- government, have recognized the tation with Ormat’s senior management Company in 2017-2019. More information and data regarding our financial performance can be found in our 2019 ically. As such, Ormat has and continues environmental benefits of recovered team. The strategic plan is developed Annual Report, which can be accessed at the following link.36 to see significant economic benefits energy-based power generation, with based on an understanding of our risks from its business activities, allowing a number of states allowing utilities to and opportunities – an assessment Direct economic value generated, distributed and retained 2019 2018 2017 the Company to become a publicly include recovered energy-based power that is conducted with assistance from (US$ thousands) (US$) (US$) (US$) traded Company on leading stock generation in calculating their compli- external consultants – and our profes- exchanges, such as the Tel Aviv Stock ance with renewable portfolio goals sional expertise and knowledge about Revenue37 (sales and other income) 746,044 719,267 692,812 Exchange (TASE) and the New York and incentives. the renewable energy market. We expect Stock Exchange (NYSE).33 In addition, the plan to evolve over time in response Operating costs38 (excluding employee–related expenses) 271,493 269,323 260,383 Ormat is part of the following indices: Generally, there is an increase in the to market conditions and other factors. 39 CRSP, Dow Jones, FTSE, Morningstar, use of renewable energy solutions due Employee wages and benefits 137,513 113,343 108,043 MSCI, NASDAQ, Russell 2000, 2500 to various tax incentives for utilities, MANAGEMENT OF ECONOMICS Payments to providers of capital40 84,014 80,698 60,995 and 3000, S&P, TASE, Wilshire 5000, as well as the decline in the price of AND FINANCE AT ORMAT WisdomTree and WisdomTree U.S. renewable solutions, such as for Solar Payments to governments, by country41 1,649 18,023 21,878 PV. However, one of the biggest chal- The topics of economics and finance at Our electricity segment is the core of lenges in the deployment of effective Ormat are managed by the Company’s Community investments 929 726 236 our business, accounting for 72.4% of renewable energy solutions is that the Chief Executive Officer, Chief Finance our total revenues for the year 2019. supply can be unstable (due to envi- Officer and the Finance Depart- Economic Value Distributed 495,598 482,118 451,535 The vast majority of revenue from this ronmental or atmospheric conditions). ment’s managers and employees. segment originates in the United States As a result, energy management, and These individuals are responsible for Economic Value Retained 250,446 237,149 241,277 – 61.8%, with the remaining 38.2% especially energy storage, is becoming reporting to the Board of Directors coming from the rest of the world. a key component in the future elec- and shareholders, through our filings, Having realized the importance of trical grid, which one of the main reports and press releases and by 34 https://www.sec.gov/ 35 https://investor.ormat.com/Docs renewable energy, including geother- reasons Ormat is actively investing our Investor Relations department, 36 https://investor.ormat.com/Cache/1001250792.PDF?O=PDF&T=&Y=&D=&FID=1001250792&iid=4087066 mal alternatives, various governments in the deployment and development regarding Ormat’s economic perfor- 37 “Revenue” is defined as net sales plus revenues from financial investments and sales of assets. For Ormat, revenues are generated from our electricity, product and other segments. Net sales is calculated as gross sales from products and services minus returns, discounts and allowances. have been preparing regulatory frame- of energy storage and management mance and regarding any relevant 38 “Operating costs” refers to operating expenses including cost of revenues, research and development (R&D), selling and marketing, and general and administrative expenses. 39 “Employee wages and benefits” refers to total payroll and social benefits less non-operating expenses such as the amortization of employees’ stock options. 40 “Payments to providers of capital” refers to interest net of interest capitalized and cash dividends paid. 33 Under the ticker “ORA”. 41 “Payments to governments, by country” refers to income taxes, net paid by Ormat. Ormat has not reported this data according to country in the current report, but plans to do so in forthcoming reports. Ormat did not pay any penalties in 2018 or 2017. 46 47 The following presents our net revenues for 2017-2019, comparatively, according to geographical location. Ormat does not directly receive govern- energy sector by helping to diversify its level of critical infrastructure – including ment grants and benefits from govern- energy sources and move away from roads and electricity transmission lines Location 2019 (US$ thousand) 2018 (US$ thousands) 2017 (US$ thousands) ments, but the subsidiary companies fossil-fuel to renewable energy and – needed in order to implement the (US$ thousands) established in order to operate our non-renewable domestic sources. project. This infrastructure remains a power plants are eligible in certain valuable resource for local communi- cases to receive governmental incen- Furthermore, and as outlined in the ties regardless of the existence of the United States 377,956 328,606 301,132 tives. More information on the relevant “Supporting and Shaping Sustainable project, such as is the case with the incentives received by our subsidiary Communities and Futures” Chapter development of local roads, water and Kenya 121,661 119,094 110,243 companies can be found in the 2019 of this report, in every location where electricity distribution systems. Annual Report at the following link.44 Ormat operates, our presence has Turkey 88,938 168,699 125,166 generated positive impacts through In addition to these significant indirect Overall, governments and governmental the creation of economic opportunities, economic impacts, we play an active Guatemala 28,624 27,975 27,991 entities are not part of Ormat’s share- development and employment benefits. role in communities local to all our holding structure. As of 2019, there For instance, geothermal energy operations, including through phil- Other foreign countries 128,865 74,893 128,280 was one exceptional case: the national provides numerous benefits to the U.S. anthropic contributions and various electric company of Guatemala, Instituto economy, as was outlined in a report community development activities as Consolidated Total 746,044 719,267 692,812 Nacional de Electrificación (INDE), by the Geothermal Energy Association detailed above in the “Supporting and owned 3% of our Zunil power plant. (GEA).45 According to such report, the Shaping Sustainable Communities and economic benefits of a typical 30 MW Futures” Chapter. LOANS AND FINANCIAL regulatory framework in the relevant Aside from tax benefits, a number Developing Renewable Energy and geothermal plant can provide about ASSISTANCE RECEIVED country, as well as the economic of Ormat’s projects are funded with Critical Infrastructure US$150-225 million in inbound capital Environmental Regulations FROM GOVERNMENTS AND structure of the electricity generation financial incentives and loans from investment, create about 50 long-term Supporting Our Business DEVELOPMENT BANKS market in that country. prominent government and multilateral The presence of Ormat’s operations jobs in order to operate the plant, backed development financial institu- around the world, including in various resulting in surpluses in property taxes As a renewable energy company, Ormat interacts directly with There are several governmental incen- tions, such as the Development Finance developing countries, has an inherently and royalties to the land owners as well Ormat adheres to and benefits from governments, their agencies and tives, such as tax benefits or subsidies Corporation (”DFC”), the German Invest- positive impact on environmental, as other social and economic benefits a number of regulations that promote development banks in the context for renewable energy generation, that ment Corporation (DEG)43, the Clean economic and social levels. This is due for the local community. renewable energy through different of constructing and operating our contribute to the attractiveness of Technology Fund (“CTF”), Japan Bank to the fact that the projects provide a incentive models, and increasingly, by power plants around the world. Our our solutions. More information and of International Cooperation (“JBIC”) and valuable source of renewable energy to Furthermore, and starting from the requiring the use of renewable energy methods and types of communication assessment of relevant tax benefits is the Asian Development Bank. Details on support a country’s infrastructure devel- exploration phase for geothermal in countries’ energy mixes. and engagement with government available in our 2019 Annual Report at the projects and the loans received are opment, create jobs and strengthen its resources, Ormat attempts to assess the entities vary based on the legal and the following link.42 detailed in the following table. Some of the relevant environmental laws, regulations and incentives Details on selected projects and loans: in our countries of operation are outlined in the below table.46

Name of Entity Type of Financing Project Location Relevant Environmental Regulations and/or Incentives

DFC Project finance loan Platanares, Honduras • National Environmental Policy Act (NEPA) • Public Utility Regulatory Policies Act (PURPA) United States • Public Utility Holding Company Act (PUHCA) • Federal Power Act (FPA) DFC Senior secured project Olkaria III, Kenya • California Environmental Quality Act finance loan • General Electricity Law of 1996, Decree 93-96 • Technical Norms for the Connection, Operation, Control and Commercial- DEG Credit agreement Olkaria III, Kenya Guatemala Credit agreement ization of the Renewable Distributed Generation and Self-producers Users with Exceeding Amounts of Energy

U.S. DOE Project finance loan - Neal Hot Springs, Oregon, U.S. ARRA Section 1603 Kenya • Kenyan Energy Act U.S. DOE and Project finance loan - OFC-2 Geothermal Portfolio, Nevada, U.S. John Hancock ARRA Section 1705 • Law of Electrical Industry (Decree 404-2013) Honduras • Law of Incentives for Renewable Energy Projects

42 https://investor.ormat.com/Cache/1001250792.PDF?O=PDF&T=&Y=&D=&FID=1001250792&iid=4087066 44 https://investor.ormat.com/Cache/1001250792.PDF?O=PDF&T=&Y=&D=&FID=1001250792&iid=4087066 48 43 Deutsche Investitions- und Entwicklungsgesellschaft. 45 Source: http://www.geo-energy.org/reports/2017/GEOTHERMAL%20IS%20GOOD%20FOR%20AMERICA.pdf 49 46 More information on the environmental regulations that Ormat adheres to are outlined in our Annual Report (Form 10-K). ORMAT’S are inherent in the construction of Rule, i.e. tin, tantalum, tungsten in our power plants. We acquire any to maintain ongoing dialog. DATA PRIVACY AND complex geothermal and Recovered and gold, in the components and equipment we do not build ourselves SUPPLY CHAIN & Energy power plants, we are often materials supplied to us and which from selected, top-quality, trusted • Newsletters – we publish newslet- CYBERSECURITY FOR PROCUREMENT required to import materials, parts are necessary to the production or suppliers. Ormat is ISO 9001 and ters in which we suggest recommen- OUR STAKEHOLDERS and supplies that are not typically functionality of our products. Our ISO14001 certified, with our manu- dations for different types of improve- PRACTICES manufactured locally. policy supports the intention of the facturing facilities also meeting the ments to products and services (for Conflict Minerals Rule, which is not to standards of the American Society example, for increasing the effi- We categorize our work with suppliers economically disadvantage areas of of Mechanical Engineers (ASME) and ciency and generating capacity of Ormat is committed to ensuring the As a global Company with operations according to the level of spend with conflict in the Democratic Republic the European Pressure Equipment our plants). data privacy of its directors, officers, in a number of different countries, the supplier over the fiscal year. As of Congo and surrounding countries, Directive (PED). Many electric utilities employees, customers and other Ormat has a diverse and dispersed such, Ormat encourages work with but rather to significantly reduce or around the world have also recog- • Workshops – Ormat organizes relevant stakeholders. We have an supply chain that we responsibly smaller suppliers that are categorized eliminate funding of armed groups nized Ormat as an approved supplier. and hosts several different client “Electronic Communication Policy” manage through our Procurement by the Procurement Department that have a record of human rights Ormat’s design and manufacturing workshops in different countries that sets security procedures for Department. The Procurement according to the level of spend and abuses in the region. As such, we standard meets the requirements of periodically. The workshop aims Ormat’s internal stakeholders. The Department is responsible for volume of business. have an expressed commitment to the applicable European Commis- to address different issues such as referred to policy includes our expec- selecting, managing and assessing human rights and our understand- sion directives and therefore we are improvements in operations, project tations of employees regarding use our supply chain as well as determin- Our “Code of Business Conduct and ing of the impact of our activities entitled to carry the CE marking management, construction and of Company equipment, authorized ing the conditions for working with Ethics” outlines our guidelines for is realized in our continued efforts that denotes conformity with health, trends and innovations in Ormat’s use of identification information, various suppliers. directors, officers and employees that to perform effective due diligence safety and environmental protection technology. password policies, and how elec- deal with or come into direct contact on the sourcing practices within standards for products sold within tronic messaging and documents Ormat engages with suppliers with suppliers. Some of the condi- our supply chain. Our due diligence the European Economic Area.Due to • General customer service requests should be properly handled. The and subcontractors for two main tions that we outline include avoiding processes are materially based on the Ormat’s nature as a vertically-inte- – we answer general requests policy is managed by our Informa- purposes: for provision of materials, conflicts of interest in dealing with internationally-recognized Conflict grated Company, we have a number submitted through other channels tion Technology department and all parts and services in manufacturing suppliers, relevant anti-trust consid- Minerals due diligence framework of points of contact with our various such as ones directed to our interna- internal stakeholders are requested to through our Procurement Department erations and maintaining the confi- introduced by the Organization for customers and we work to provide tional Customer Service department acknowledge the policy in the context and for the construction, operation dentiality of our terms and conditions Economic Cooperation and Devel- them at all times with excellent and through our website on the “Contact of their employment with Ormat. and maintenance of our power plants with suppliers and our expectation opment (OECD). A full description reliable customer service. Us” page which offers an online form around the world. In addition, Ormat of directors, officers and employees of our Conflict Minerals due diligence and other forms of contact:: In addition, we work to ensure that engages a small amount of service to deal fairly with suppliers. Further- activities can be found at our website Customer service at the Company is all our information technology providers – such as lawyers, consul- more, in our “Integrated Quality, at the following link48. managed by our Customer Service Address: Ormat Technologies Inc., systems are secured in terms of their tants and accountants – who advise Environment, Health & Safety System Group, which is part of the Business 6140 Plumas Street, Reno, NV cybersecurity aspects. Ormat has an Company management and the Policy”, we outline our commitment PROVIDING Development and Sales Group. 89519-6075, U.S. advanced policy for managing cyber- Board of Directors on certain issues. to treating our suppliers, subcontrac- Our Customer Service department security risks that is overseen by the tors and business partners with the EXCELLENT AND collects, addresses and manages Tel: +1-775-356-9029 Company’s Information Technology As such, Ormat’s supply chain consists utmost respect, while also assessing, relevant requests from our various department. In our risk management of four different types of suppliers: in general, that those suppliers, RELIABLE CUSTOMER customers around the world. It is Fax: +1-775-356-9039 processes, we consider threats and electrical parts suppliers, suppliers subcontractors and business partners SERVICE important to note that Ormat prides vulnerabilities in information, informa- of materials, suppliers of parts and uphold relevant social, environmental itself on its strong base of repeat Email: [email protected] tion technology and communications service providers. As of 2019, Ormat and health and safety standards for customers, which is due to the systems that we use on a regular basis worked with approximately 5,000 their employees. strength of our energy solutions and Ormat’s policy is to address all our to deliver our products and services, different suppliers. Ormat did not Ormat is the world’s only vertically-in- technology and the quality of our customer service requests in a timely facilities or other assets that are a part experience any significant changes Ormat has adopted a Conflict Minerals tegrated geothermal company, and customer service relations that is and suitable manner in order to of our cyber-infrastructure. Ormat did to the organization that affected its Policy, in compliance with the SEC’s we usually are responsible for explo- characterized by regular and produc- ensure the continued satisfaction of not experience any material breaches supply chain in 2019. There were no Dodd-Frank Wall Street Reform and ration, development, drilling, design, tive communications with customers. our global customer base. or cybersecurity events, nor did the significant changes to Ormat’s supply Consumer Protection Act (known manufacturing, construction, and organization receive any substanti- chain in 2019. as “the Conflict Minerals Rule”). Our operation of our geothermal power Some of these methods of ated complaints regarding breaches Conflict Minerals Policy, available plants. Our customers benefit from communication include: of customer data or privacy, in 2019. Furthermore, our Company has at the following on our website,47 our modular, flexible approach and operations in over ten different defines principles, commitments our extensive experience in applying • Continuous contact with direct countries, and as a result, we work and expectations that extend to a variety of different products and customer service representatives with suppliers from around the world. Ormat’s partners, subcontractors and solutions – all designed for simple - each customer has direct contact Where possible, Ormat encourages suppliers, with the intention of iden- transportation, installation, operation to the team which they can contact and seeks out opportunities to work tifying, to the best of our ability and and ongoing maintenance. We manu- for any issue that might arise. Also, with local suppliers. However, due knowledge, sources of the relevant facture most of the power generating team members periodically initiate to the technical specifications that minerals under the Conflict Minerals unit equipment componentry used contact with each of their customers

47 https://www.ormat.com/Warehouse/userUploadFiles/Image/Ormat%20Conflict%20Minerals%20Policy.pdf 50 48 https://investor.ormat.com/Doc/Index?did=52115999 51 CHAPTER V. OUR HOLISTIC APPROACH TO CORPORATE GOVERNANCE

McGinness Hills geothermal complex, NV, U.S., 143 MW

52 53 In terms of our corporate values, direction and oversees the performance Position on Ormat's Committee MAKING SOUND Director member Nationality Gender Date Joined our corporate governance practice of its business and management of Board of Directors membership CORPORATE is defined by honesty, openness any relevant economic, environmental Audit, Nominating and fairness, and we expect all our and social impacts.49 50 The Chairman and Corporate GOVERNANCE A David Granot Independent Director Governance, Israeli Male May 2012 employees, and especially our leaders of the Board of Directors does not Investment (Chair) PRIORITY to exhibit these qualities at all times. By hold any additional executive roles in integrating these values and more into the company. Stan H. Koyanagi Independent Director Compensation American Male July 2017 our corporate governance practices, we Sound corporate governance is a top work towards ensuring the stability of We strive to promote diversity of repre- priority for Ormat, in light of our nature our company as well as expressing our sentation at all levels of our company. Compensation, as a publicly traded and global company full commitment towards transparency, At present, our Board has two Director Dafna Shafrir Independent Director Investment Israeli Female May 2018 with operations and activities across the fairness and good business practices members who are female, while three globe. At Ormat, not only do we believe with our stakeholders. Furthermore, Director members are of racially diverse Audit, Nominating that transparent corporate governance and as outlined below, we have several backgrounds. As an American company Stanley B. Stern Independent Director and Corporate American Male November 2015 Governance (Chair) practices contribute to the financial corporate governance mechanisms for with significant business operations success of our business, they ensure management and oversight that ensure based in Israel, most of our Board of Nominating that our Company remains resilient and that these values and our integrity are Directors’ members are of American or Hidatake Takahashi Independent Director and Corporate Japanese Male June 2020 strong in the face of challenges, while upheld on an on-going basis. Israeli nationality. Additionally, the Board Governance also creating space for new business of Directors has members of Japanese opportunities and engagement. Further- ORMAT’S CORPORATE and Dutch nationality. Byron G. Wong Independent Director Audit American Male July 2017 more, corporate governance has been GOVERNANCE STRUCTURE identified as one of our key sustainability issues by our stakeholders, and therefore, Ormat’s Board of Directors we remain steadfast in our commitment Ormat’s Board of Directors’ of at least three directors who meet or other relevant plans maintained to devoting resources to and improving Ormat is a publicly traded company. Committees the appropriate independence and by the Company, and for overseeing our governance performance and our experience considerations as outlined the company’s compliance with SEC level of disclosure on related topics, such The Board of Directors’ main responsibil- Our Board of Directors conducts by the standards of the NYSE and rules and regulations regarding share- as anti-corruption, executive remunera- ity is to provide direction and oversight. its business and affairs through the SEC.53 holder approval of certain executive tion and regulatory compliance. The Board establishes Ormat’s strategic meetings of the Board and through compensation matters, among other the four standing committees: Audit, The Compensation Committee’s topics. The committee is made up Compensation, Investment, and purpose is to be responsible for our of at least three directors who meet Nominating and Corporate Gover- overall compensation philosophy the relevant independence consider- Presented below is the list of our Board of Directors’ members, as of the nance. As of the publication of this and assists the Board of Directors ations, as outlined per the NYSE and date of this report, and the committees in which they are members: report, Ormat did not have a desig- in its oversight responsibilities with SEC regulations mentioned above.54 nated Corporate Social Responsibility respect to the compensation of Position on Ormat's Committee or Sustainability Committee on the Ormat’s Chief Executive Officer The purpose of the Nominating and Director member Nationality Gender Date Joined 51 52 Board of Directors membership Board of Directors. and other executive officers and Corporate Governance Committee directors, including all compensation is to assist the Board of Directors The purpose of the Audit Committee plans, policies and programs that in identifying qualified individuals Chairman of the Board Israeli Male June 2020 Isaac Angel of Directors is to assist the Board in fulfilling are subject to Board approval. The to become members of the Board, its oversight responsibilities with Compensation Committee is also for selecting or recommending the Audit, Compensation respect to: the integrity of Ormat’s responsible for annually reviewing Board director nominees, developing (Chair), Nominating Ravit Barniv Independent Director and Corporate Israeli Female November 2015 financial statements; the effective- and approving corporate goals and recommending to the Board’s Governance ness of internal controls over financial and objectives relevant to the CEO corporate governance guidelines reporting; Ormat’s compliance with and executive officers, for making and for overseeing the evaluation Bert Bruggink Independent Director Investment Dutch Male June 2020 legal and regulatory requirements; recommendations to the Board with of the Board and management. The the independence and qualifications respect to the adoption, amendment, Nominating committee provides the of Ormat’s independent auditor; and termination or replacement of Board with guidance reviewing the Audit (Chair), performance of the internal audit incentive-compensation plans, equi- Company’s Corporate Governance Dan Falk Independent Director Compensation Israeli Male November 2004 functions. Each committee is made up ty-based plans, revenue sharing plans Guidelines and monitoring compli-

49 As of our Annual Meeting of Stockholders in June 2020, and at the recommendation of the Nominating and Corporate Governance Committee, the Board of Directors considered and 51 More information on the committees that make up Ormat’s Board of Directors can be found in our Annual Report at the following link: https://investor.ormat.com/Cache/1001250792. nominated (based on the proxy vote of stockholders) an additional Board of Directors member, resulting in ten Director members in total. The decision to expand the size of the Board of Directors PDF?O=PDF&T=&Y=&D=&FID=1001250792&iid=4087066 was made subsequent to the Chief Executive Officer Isaac Angel’s announcement in February 2020 that he will be retiring from the company, effective as of July 1, 2020. The Board determined 52 On May 4, 2017, the Company entered into a governance agreement with ORIX in connection with an agreement between ORIX. More details are provided on the Governance Agreement that it is in the best interest of the company to nominate Mr. Angel to be a nominee and to expand the size of the Board of Directors accordingly, if he is elected by the company’s stockholders. below. 50 On July 26, 2017, ORIX purchased approximately 22% of our shares of common stock outstanding. Pursuant to the Governance Agreement between us and ORIX entered into in connection 53 More information on the Audit Committee is available in the Company’s Audit Committee Charter at the following link: https://www.ormat.com/Warehouse/userUploadFiles/Image/ with this stock purchase transaction, ORIX has the right to designate three directors to our Board for as long as ORIX and its affiliates collectively hold at least 18% of the voting power of all of our Audit%20Committee%20Charter_February%202020.pdf: outstanding voting securities, the right to representation on certain committees of our Board as well as preemptive rights pursuant to the Governance Agreement. 54 More information on the Compensation Committee is available in the Company’s Compensation Committee Charter at the following link: https://www.ormat.com/Warehouse/ userUploadFiles/Image/ORA%20--%20Compensation%20Committee%20Charter.pdf 54 55 ance with the guidelines, among time. Our Board believes that, at this economic, environmental or social if and to the extent needed.59 The goal In addition, the Board of Directors is Ormat’s Management other responsibilities. The committee time, this structure best encourages matters. Furthermore, relevant of making the Annual Meeting accessi- responsible for reviewing strategies is made up of at least three directors the free and open dialogue of employees are involved and consulted ble to all stockholders via the Internet and material goals relating to corporate As of the date of this report, Ormat who meet the relevant indepen- competing views and provides for in strategic thinking on the manage- is to enable full and equal participation governance, economic, environmental prides itself on assembling a highly dence considerations, as outlined strong checks and balances. Addi- ment of economic, environmental and by all stockholders at all locations in the and social issues and for setting the level qualified and experienced senior per the NYSE and SEC regulations tionally, the Chairman’s attention to social risks and opportunities that we world at little to no cost.60 We worked of expectation from the Company and management team of nine members, detailed above. 55 Board and committee matters allows identify as key focus areas. to enhance stockholder access, partic- its employees regarding these issues. four of whom joined our team during the CEO to focus more specifically ipation and communication through 2020. Each position on the manage- The Board is responsible for periodi- on overseeing the Company’s day-to- We consult with relevant stakeholders online tools, so that our stockholders ment team is designed to serve a cally, and at least annually, conducting day operations as well as strategic regarding the proper management did not have to compensate the rights designated function that addresses a self-evaluation. The Board and the opportunities and planning.57 of key economic, environmental and opportunities afforded to them in Ormat’s business needs and the Nominating and Corporate Gover- and social risks and opportunities, in-person meetings. 61 needs of our key stakeholders. nance Committee are responsible for Ormat’s Board of Directors members including: our financial auditors, establishing the evaluation criteria have relevant education and profes- corporate sustainability consultants, The following table shows the members of our current senior management team, as of the writing of this report. and overseeing the implementation sional experience in the following legal advisors, employees and others. of the process for such evaluation. areas and regarding the following Ormat is committed to upholding Date Current If needed, actions are periodically topics: economics, business, our Stakeholder Engagement Policy Senior Manager Position Assumed Position taken in response to evaluation of the banking, construction, infrastructure, expressing our commitment to main- Board of Director’s performance with renewable energy, telecommuni- taining systematic and proactive Doron Blachar Chief Executive Officer (CEO) June 2020 respect to governance of economic, cations, international law, regula- channels of dialogue in order to take environmental, and social topics. tory compliance, and governance key interests, concerns and needs matters.58 into account. Assi Ginsburg Chief Financial Officer (CFO) May 2020 According to the aforementioned Corporate Governance Guidelines, As Ormat’s delegating authority, the In 2019, no material actions were Zvi Krieger Executive Vice President – Electricity Segment July 2014 and the NYSE rules, we have estab- Board of Directors assigns responsi- taken in response to evaluations of lished guidelines for director indepen- bilities for economic, environmental the Board of Director’s performance, Bob Sullivan Executive Vice President – Business Development July 2015 dence, according to which the Board and social topics to various senior nor those pertaining to governance of Directors considers all relevant executives according to the relevance of economic, environmental and Executive Vice President – facts and circumstances in making of the topic to the nature of their social topics. Shlomi Argas January 2018 Product Segment and Operations an independence determination role. For instance, our Executive Vice regarding a current or future director President of Business Development COVID-19 Outbreak Hezi Kattan General Counsel & Chief Compliance Officer February 2018 member. The Board of Directors is responsible for assessing related reviews the independence status of risks and opportunities arising While this report covers our activities each of the directors annually.56 from Ormat’s engagement with during 2019, we nevertheless believe Ofer Ben Yosef Executive Vice President - Business Development, Sales and Marketing April 2020 economic, environmental and social it is relevant to address our strategy The Board maintains the flexibility topics while developing projects. In in coping with the COVID-19 crisis of Shimon Hatzir General Manager of Energy Storage and Solution October 2018 to determine whether the roles of addition, some senior roles are mainly 2020, a worldwide pandemic of a scope Chairman of the Board and CEO devoted to relevant risk manage- not seen in over a century. In order to Liat Inbar Arad Senior Vice President – Human Resources July 2020 should be combined or separated, ment issues, such as our Global VP address the business and operational based on what it believes is in the best Quality, Health, Environment & Safety, impacts of COVID-19 on the Company, interests of the Company at a given who is responsible for shaping our the management worked to maintain point in time. The Board believes that global health, safety and emergency and enhance business activity during Ormat’s management team is led by experience and knowledge that is To that end, we are committed to this flexibility is in the best interest of preparedness processes, and our this global crisis. Our Board of Directors the Chief Executive Officer. Together needed to fully perform their role. ensuring that all employees at our the Company and that a one-size-fits- Sustainability Manager, who reports worked to support key management with the Board of Directors, the Similarly, all executive managers worldwide locations including all approach to corporate gover- directly to our General Counsel and decisions – in areas of supply chain, management team is responsible for undergo performance reviews and are the senior management of those nance, with a mandated indepen- Chief Compliance Officer on issues human capital and financial manage- setting Ormat’s business strategy and provided with training or access to locations, are hired locally. Our dent Chairman, would not result of environmental, social and gover- ment –with the goal of ensuring that, as direction, for setting the Company’s educational opportunities on topics commitment to diverse hiring and in better governance or oversight. nance performance. These senior a company, we emerge from the crisis performance goals and KPIs, and that are most relevant to their profes- employment practices are discussed Currently, the CEO position is executives and relevant managers stronger and more resilient. for the general management of the sional role. in greater detail in Section VI: Our separate from the Chairman of the report to the management and/or the Company’s employees, stakeholder Impact and Engagement with Our Board position. We believe that Board of Directors and its committees The Board of Directors transitioned to matters and other business affairs. Ormat is committed to achieving a Employees. the separation of the Chairman on a periodic basis and as needed, virtual meetings for our Annual Meeting diverse management team that is and CEO positions is appropriate based on their determination on the of Stockholders, as well as for the Board Each member of the management representative of our workforce and Ormat’s senior management is corporate governance for us at this necessity of such updates regarding of Directors and committee meetings team is screened for the relevant of the communities that we serve. responsible, among others, for the

55 More information on the Nominating and Corporate Governance Committee is available in the Company’s Nominating and Corporate Governance Committee Charter at the following link: 59 More information can be found in Ormat’s 2020 Proxy Statement at the following link: http://d18rn0p25nwr6d.cloudfront.net/CIK-0001296445/5a906a1b-66cc-4cd2-892d-db5e1032b447.pdf https://www.ormat.com/Warehouse/userUploadFiles/Image/ORA%20--%20Nominating%20and%20Corporate%20Governance%20Committee%20Charter.pdf 56 More information can be found in Ormat’s 2020 Proxy Statement at the following link: http://d18rn0p25nwr6d.cloudfront.net/CIK-0001296445/5a906a1b-66cc-4cd2-892d-db5e1032b447.pdf 60 More information can be found in Ormat’s 2020 Proxy Statement at the following link: http://d18rn0p25nwr6d.cloudfront.net/CIK-0001296445/5a906a1b-66cc-4cd2-892d-db5e1032b447.pdf 57 More information can be found in Ormat’s 2020 Proxy Statement at the following link: http://d18rn0p25nwr6d.cloudfront.net/CIK-0001296445/5a906a1b-66cc-4cd2-892d-db5e1032b447.pdf 61 More information can be found in Ormat’s 2020 Proxy Statement at the following link: http://d18rn0p25nwr6d.cloudfront.net/CIK-0001296445/5a906a1b-66cc-4cd2-892d-db5e1032b447.pdf. 56 58 a complete description of director member experience can be found in Ormat’s 2020 Proxy Statement at the following link: 57 http://d18rn0p25nwr6d.cloudfront.net/CIK-0001296445/5a906a1b-66cc-4cd2-892d-db5e1032b447.pdf 59 More information can be found in Ormat’s 2020 Proxy Statement at the following link: http://d18rn0p25nwr6d.cloudfront.net/CIK-0001296445/5a906a1b-66cc-4cd2-892d-db5e1032b447.pdf development, approval, and updating Exchange. At least two members and severance agreements, change- bonuses and other possible related the policy describes certain respon- ENSURING A of Ormat’s purpose, policies, and of the Compensation Committee in-control agreements, severance dividend payments to employees of sibilities of the Board of Directors, goals related to economic, envi- will also qualify as “non-employee protection plans and change-in-con- the Company, directors and inde- which include: evaluation of the CEO, CORRUPTION- ronmental, and social topics. For directors” within under the Securities trol provisions affecting the level of pendent contractors. Under the 2018 succession planning, reviewing and FREE WORK instance, management is responsible Exchange Act of 1934, as amended. compensation and benefits, and any Incentive Plan, a total of 5,000,000 approving significant transactions for approving Ormat’s corporate-level Members of the Compensation special supplementary compensa- shares of Ormat’s common stock were and analysis of shareholder proposals, ENVIRONMENT policies and periodically reviews Committee, including its Chair, are tion and benefits for the CEO and authorized and reserved for issuance, among other responsibilities. environmental and social impact appointed by the Board based upon executive officers. Furthermore, the all of which could be issued as options assessments and action plans for our the recommendations of the Nomi- Compensation Committee reviews or as other forms of awards. In addition, Ormat’s Board of As part of Ormat’s commitments to power plants. nating and Corporate Governance and discusses the Compensation Directors adopted a Code of Ethics sound corporate governance and its Committee. Discussion and Analysis (CD&A) that Our Corporate Governance Policies applicable to Senior Executives, as values of Stability and Full Commit- Management Transition is included in the Company’s annual and Guidelines required by the Sarbanes-Oxley Act of ment, which are a central part of our In making its recommendations, the proxy statement and 2019 Annual 2002 and out of the belief that proper, mission, we work to ensure that all of In February 2020, we announced a Compensation Committee seeks Report at the following link.63 Our Corporate Governance Guide- honest and ethical employee conduct our activities are free from corrupt transition of its senior management. to fairly compensate directors at lines, which are publicly available is essential to the success of our practices and that our employees are Mr. Isaac Angel has decided to retire levels that are competitive with Finally, Ormat strives to provide on our website at the following Company. The Code can be accessed well-informed of our expectations from his position as Chief Executive other companies in the industries in a competitive compensation link64, outline the expectations from on our website at the following link.66 regarding ethical behavior. Officer, effective July 1, 2020, after which Ormat competes and to align and benefits package to all our senior management and the Board The Code applies to all of Ormat’s six years of successful service to the directors’ interests with the long-term employees, including our executive of Directors to monitor and measure senior executives including the Ormat’s Corporate Governance Company, its employees and its share- interests of our stockholders. In its managers. Benefits are tailored to the effectiveness of policy and deci- Chairman of the Board of Directors, Guidelines, our Code of Business holders. Mr. Angel became a member deliberations, the Compensation the needs of our employees and their sion-making in order to enhance the Chief Executive Officer, the Conduct and Ethics, Code of Ethics for of Ormat’s Board of Directors before Committee and the Board of Directors families at our global locations and stockholder value for the long-term. Controller, the Company’s Secretary Senior Executives, and Anti-Corrup- his retirement as Chief Executive consider whether the levels of may vary from country to country, but The Guidelines are periodically and the Chief Operating Officer. The tion and Anti-Bribery Policy outline Officer and continues to be employed director compensation could impair may include: reviewed by the Nominating and Code outlines our expectations of our relevant corporate governance by the Company through December independence and critically evaluate Corporate Governance Committee senior executives including a commit- practices regarding anti-corruption 31, 2020 in order to assist with the any consulting, charitable contri- • Health, Dental and of the Board of Directors and by the ment to honest and ethical conduct and the expectations our Company management transition. Ormat’s bution or other potentially indirect Vision Insurance Board of Directors. and handling of affairs, to advance has for good governance and business Board of Directors has appointed Mr. compensation arrangements. the Company’s business by legitimate practices. All of Ormat’s corporate Blachar, the Company’s President and • Retirement The Guidelines manage and outline means, to refrain from fraudulent governance policy documents can Chief Financial Officer, to succeed Mr. In addition, the Compensation Ormat’s procedures on the following or corrupt activities and to provide be found on our website on the Angel. Mr. Blachar assumed the role Committee is responsible for setting • Short-Term and Long-Term topics: board composition including full disclosure regarding any of the “Governance” page.67 Relevant of Chief Executive Officer on July 1, corporate goals and objectives Disability guidelines for the selection, respon- Company’s reports or documents. new Ormat employees and officers 2020 upon Mr. Angel’s retirement relevant to the CEO’s and executive sibilities and remuneration deter- Senior executives are requested to must sign a compliance certificate from the position. managers’ compensation, including • Life Insurance mination for the board members; report any violations of the Code to stating their intention to uphold these the responsibility of assessing their guidelines for board meetings; the Secretary, the Chairman of the standards. Mr. Blachar was succeeded in his role performance considering the set goals • Wellness programs management of committee matters; Audit Committee or the Board of as Chief Financial Officer by Assaf and objectives. In determining their board responsibilities; and expec- Directors, and violations of the Code Ormat conducts business around the Ginzburg, effective May 10, 2020. level of compensation, the Compen- More information on employee tations from directors. The policy are subject to disciplinary action up to world. To that end, Ormat is obligated sation Committee considers a number benefits is outlined in the “ Our People: outlines Ormat’s criteria for deter- and including termination of service. to comply with all applicable anti-cor- Remuneration Policies of factors such as the Company’s Employment and Skill Development mining director independence and Any revisions, changes or waivers to ruption and anti-bribery laws, such performance and relative shareholder at Ormat” chapter of this report. the Company’s commitment to, at the Code must be approved by the as the U.S. Foreign Corrupt Practices he responsibility of reviewing and return, the value of similar incentive minimum, a majority of independent Board of Directors or the Nominating Act. Beyond this, we have instituted recommending to the full Board of awards to the CEO and executive Stock-based Awards directors on the Board. The policy Corporate Governance Committee. a corporate Anti-Corruption and Anti Directors the form and amounts officers at comparable companies describes the responsibilities of the Senior executives are required to sign Bribery Policy68 which seeks to ensure of compensation and benefits for and the awards bestowed by the Ormat offers some employees various Board of Directors’ commit- and formally acknowledge the Code that our Company will uphold not board of director’s members (which Company to the CEO and executive stock-based awards according to its tees: Audit Committees, the Compen- as part of their employment contract. only the letter, but also the spirit, of all may include equity-based rewards62, offices in past years. In addition, the Incentive Compensation Plan. In May sation Committee and the Nomi- Senior executives are also expected relevant legal and ethical standards in retainers, committee chair fees, stock Compensation Committee is respon- 2018, Ormat’s shareholders adopted nating and Corporate Governance to follow Ormat’s Code of Business place for the conduct of transnational options and similar items), lies with sible for periodically reviewing and the 2018 Incentive Plan, which Committee. Each of these committees Conduct and Ethics, which is applica- business activities. Ormat’s Compensation Committee. approving aspects of the CEO and provides for grants of certain kinds has their own separate charter that ble to all employees. The Compensation Committee is executive officers’ compensation of awards including incentive stock governs the topics and procedures The standard that we set is clear: Ormat comprised of at least three directors, based on incentive awards and options, non-qualified stock options, of each of the committees as well as persons (and associated third-par- each of whom meets the indepen- opportunities, including cash-based restricted stock, stock appreciation our Investment Committee, and which ties conducting business on Ormat’s dence requirements under the listing and equity-based awards and oppor- rights, stock units, performance are publicly available on the “Gover- behalf) are forbidden to promise, standards of the New York Stock tunities, any employment agreements awards, phantom stock, incentive nance” page65 of our website. Finally, provide, or authorize provision of

64 https://www.ormat.com/Warehouse/userUploadFiles/Image/Corporate%20Governance%20Guidelines.pdf 62 Including pursuant to the Company’s equity-based plans. 65 https://www.ormat.com/en/company/welcome/governance/ 63 https://investor.ormat.com/Cache/1001250792.PDF?O=PDF&T=&Y=&D=&FID=1001250792&iid=4087066 58 66 www.ormat.com/Warehouse/userUploadFiles/Image/CODE%20OF%20ETHICS%20APPLICABLE%20TO%20SENIOR%20EXECUTIVES.pdf 59 67 https://www.ormat.com/en/company/welcome/governance/ 68 https://www.ormat.com/Warehouse/userUploadFiles/Image/ABAC%20Revised%20Policy%20-%20final%20July%2021%202020%20-%20English.pdf anything of value to anyone at any time policy violations. Ormat is committed to clearly defines what kinds of informa- In the Code, Ormat outlines its expec- WHISTLEBLOWER POLICY serious disciplinary action or sanctions. for the purpose of retaining business, investigating and reporting all concerns tion can be considered material and tations regarding honest and candid However, Ormat does seek to ensure obtaining business, or gaining business according to the outlined grievance non-public, as well as the activities that conduct, which are cornerstones of the The contact person for ethical that all reports are made in good faith. advantage. The supposed cultural management mechanism. In addition, are prohibited to those that have been way that Ormat conducts its business concerns varies for different employees We also maintain an anonymous whis- prevalence of such corrupt practices we offer a range of reporting tools for potentially exposed to such information. around the world. The Code outlines according to their position within the tleblower ethics hotline for reporting in a location is never a valid excuse or employees including escalating issues Employees, directors and officers are guidelines for handling of conflicts Company. The contact person for concerns or real breaches of the Code defense. Our policy clearly defines key through management, whistleblowing required to sign and acknowledge the of interest in the context of loans or directors and senior executives is the at a toll-free number (in the U.S.): terms so that they are easily under- mechanisms, and a dedicated telephone policy as a condition of their employ- corporate opportunities, compliance Chairman of the Audit Committee of the 1-866-294-5535 and at the Company’s standable to employees, `and provides line and website for confidential ment with Ormat, alongside other types with the law, as well as regulations Board of Directors. For all other officers third-party whistleblower website at guidelines for the reporting of relevant reporting of concerns about unethical of confidentiality agreements in use by and laws that govern Ormat’s internal and employees, the Code of Ethics www.ethicspoint.com. concerns and for coping with potential behavior (see below). the Company. business practices, such as details on Contact person is Ormat’s Secretary, hazards. the Foreign Corrupt Practices Act. The except in cases when it is deemed Based on the information collected COMMUNICATION AND TRAINING Nearly all of our employees and Code also outlines how Ormat expects inappropriate to involve the Secretary, through these communications The policy also describes Ormat’s ON ANTI-CORRUPTION managers, and all of our new hires, have its employees, directors and officers at which time employees may file their channels, we received only a few griev- procedures for providing training to COMMITMENTS received focused training on relevant to handle the disclosure of sensitive requests with the Chairman of the Audit ances during 2019. However, following employees on topics of anti-corruption, corporate governance practices, such Company information, engage in Committee. Employees and officers are internal investigation into the nature the ways that Ormat employees and Ormat communicates its Anti-Corrup- as our Code of Business Conduct and record-keeping and maintain an internal encouraged to consult with their direct of these grievances, it was deter- leaders can be certified for anti-cor- tion Policy clearly to its employees as Ethics,71 Anti-bribery and Anti-corrup- control structure, uphold restrictions on manager regarding the appropriate mined that they were nonmaterial and ruption compliance, and relevant part of their employment contract and tion Policy72 and more. Ormat intends the receipt of gifts, gratuities and enter- course of action to address an ethical required no further action. methods for conducting due diligence in dealings with the organization, and for 100% of our employees to receive tainment, as well as relevant aspects dilemma or in addressing an instance on anti-corruption measures with the policy is publicly communicated on training on relevant corporate gover- relating to ethical conduct that are of potential misconduct. Employees, third parties. Ormat’s website at the following link.69 nance practices. considered during the employment and directors and officers who fail to report hiring processes. unethical conduct are in violation of the Ormat has an Anti-Corruption Ormat’s relevant employees are MAJOR ONGOING LITIGATION Code and consequences may be taken Committee composed of senior required to undergo periodic ethics Ormat’s full Code of Business Conduct by Ormat as a result, depending on the management representatives from and corporate governance training The Company is involved in several and Ethics and the requirements and severity of the incident. various disciplines who oversee imple- sessions that are targeted at iden- ongoing legal proceedings both in and expectations of employees and senior mentation of the Anti-Corruption Policy tifying and dealing with potential out of court, which relate to corporate management outlined therein can be Ormat upholds a policy of no retaliation including the General Counsel and Chief bribery. The goal is to ensure that all governance matters. The material legal found at the following link.74 on any director, officer, or employee Compliance Officer, Executive Vice Ormat’s employees fully understand proceedings are described in our 2019 by any other actor at the Company President of Business Development what constitutes a corrupt practice Annual Report and other reports. for reporting existing or potential and Sales and other members that or a bribe and to become aware of violations of the Code. Any director, are designated by Company manage- how they are expected to behave or ETHICAL CONDUCT AT ORMAT officer or employee who is involved ment from time to time. Ormat’s Chief handle ethical dilemmas according to in retaliation or who makes deliber- Compliance Officer reports directly to the Company’s guidelines and policies. Ormat upholds a Code of Business ately false reports may be subject to the CEO and Audit Committee of the Conduct and Ethics that was last Board of Directors for certain matters, amended in January 2013.73 The including those that pertain to anti-cor- INSIDER TRADING POLICY purpose of our Code of Business ruption. Ormat’s Anti-Corruption Policy Conduct and Ethics is to promote and was initially adopted by the Board of Ormat’s Insider Trading Policy, publicly encourage honest and ethical conduct, Directors in 2016 and was last updated available on our website,70 was estab- to promote the protection and proper in 2020 and executive officers hold lished in order to promote compliance use of Ormat’s assets, to maintain the responsibility for daily implementation with laws that prohibit a company’s confidentiality of information that is of the policy. securities from being traded on the basis acquired in the course of business, to of material, non-public information. promote compliance with applicable Directors, executive managers, laws and regulations and to encourage employees, contractors or other stake- Our Policy is applicable to all Ormat timely reporting of any illegal or holders are requested to report any employees, officers, directors, family ethical behavior. All Ormat employees, suspected violations of the Anti-Cor- members and their controlled entities, directors and officers are subject to ruption Policy and failure to do so could as well as consultants, advisors, agents, the Code, and are expected to adhere result in termination of employment contractors, temporary, loaned, and comply with the Code and are or of other contractual relationships. contracted or seconded employees required to sign a compliance certifi- Retaliation is not taken against any actor or other persons who enter into a cate confirming they have understood who, in good faith, reports suspected contractual agreement with Ormat. It all of Ormat’s expectations.

69 https://www.ormat.com/Warehouse/userUploadFiles/Image/Anti-Corruption%20Policy.pdf 74 www.ormat.com/Warehouse/userUploadFiles/Image/CODE%20OF%20BUSINESS%20CONDUCT%20AND%20ETHICS.pdf 70 https://www.ormat.com/Warehouse/userUploadFiles/Image/Insider%20Trading%20Policy.pdf 71 https://www.ormat.com/Warehouse/userUploadFiles/Image/CODE%20OF%20BUSINESS%20CONDUCT%20AND%20ETHICS.pdf 60 72 https://www.ormat.com/Warehouse/userUploadFiles/Image/Anti-Bribery%20and%20Anti-Corruption%20Policy.pdf 61 73 The guidelines for ethical conduct were originally set when Ormat was established in 1965 as Ormat Turbines Ltd. (later renamed Ormat Industries). They were formalized in 2004 when Ormat was officially listed for trading on the New York Stock Exchange. CHAPTER VI. GENERATING ENVIRONMENTAL VALUE AND MEASURING OUR IMPACTS

Sarulla geothermal complex, 330 MW, Indonesia

62 63 MITIGATING CLIMATE approach for the calculation of our Our Carbon Footprint and GHG the use of diesel backup generators to carbon footprint is financial and oper- Emissions Mitigated provide power for ongoing operations CHANGE RISKS ational control. In order to improve in the event of planned or unplanned AND WORKING the internal measurement of our GHG Ormat’s operating activities from outages or maintenance shutdowns, emissions, we have expanded our owned facilities and purchased elec- and from air conditioning units used in TO REALIZE NEW methods for data collection from our tricity (Scope 1 and 2)78 emissions, our factories and offices.82 OPPORTUNITIES relevant operational sites this year, which include manufacturing facil- with the goal of estimating our level of ities and machinery, offices, power The total Scope 2 emissions83 for 2019 impact and generated emissions. We plants, corporate automobile fleet, from purchased electricity consump- make concerted efforts to both track drilling rigs and electricity consump- tion off the grid at our operational Ormat is a global leader in the verti- and minimize all of our emissions tion at our facilities, among other sites, offices, and manufacturing cally integrated delivery of renewable including our direct (Scope 1) and sources, generated 156,962 tons CO2 facilities, was 35,748 tons CO2(e). At energy solutions: geothermal energy, indirect (Scope 2 and Scope 3) GHG (equivalent) (e) in 2019. This year we our manufacturing facility in Yavne, recovered energy and energy storage emissions from our power plants and have expanded our calculations to Israel, we generate solar electricity and management. We have developed operations, and to regularly report include employee transportation and using rooftop Photovoltaic (PV) panels. and manufactured geothermal and on our progress to the CDP and the business travel as part of our Scope 3 The relevant emissions are calculated recovered energy power plants with Israeli Ministry of Environmental emissions, which totaled 3,802 tons according to an emissions factor of a cumulative collective capacity of Protection.77 CO2(e).79 More information on the zero. The electricity that we generate 2900 MW75 since our Company was breakdown of our carbon footprint through the solar panels is used for established over 50 years ago and We selected 2019 as our new base calculations for 2019 is provided in the self-consumption or is sold back to the we are proud to note that all of our year for calculating Ormat’s carbon graphs and charts below.80 local electrical utility. In 2019, self-con- power plants operate without fossil footprint, following a process of sumption of solar energy at our manu- fuel consumption as a general rule. re-evaluation of our methodology. The Scope 1 emissions for 2019 totaled facturing facility totaled 1,725,172 kWh. However, some of our power plants We re-examined our total production 121,214 tons CO2(e). MMost Scope 1 The energy generated sold to the local may indirectly use fossil fuels as part reporting and concluded we would emissions arise from the generation of electrical utility was 388,664 kWh and of their grid electricity consump- also report on our net production this our geothermal energy, which is sold resulted in the avoidance of emissions tion. At Ormat, we are motivated year. Additionally, 2019 marks the first to our clients and consumed internally totaling 210 tons of CO2 (e) in 2019.84 to mitigate climate change risks, year that Ormat calculates Scope 3 as the auxiliary power of our geother- reduce our greenhouse gas emissions, emissions generated from employee mal power plants. All of our recovered We continue to make efforts to improve advance energy efficiency and personal and business travel. energy plants, and the majority of our the energy efficiency of our facilities, in promote the use of renewable energy geothermal power plants operate line with our overarching mission and sources. These aims lie at the heart of with 100% reinjection of the geother- commitment to renewable energy. our business and represent our key mal resource and therefore do not value proposition for our customers. generate emissions. A small number Our GHG emissions intensity calcu- They also have been identified as of our steam and binary plants, which lation, i.e. the relative intensity of our highest priority by the stakeholders are unable to conduct 100% reinjec- Scope 1 and Scope 2 emissions divided who participated in our materiality tion of the geothermal resource (due by our revenues in FY201985 was assessment and the ongoing stake- to operational and other constraints), 0.0002104 CO2 (e) / FY2019 revenues. holder engagement. do generate GHG emissions to a Including Scopes 1, 2 and 3, our certain extent. These emissions were emissions intensity was 0.0002155 CO2 EMISSIONS FROM OUR POWER We have established a calculated either through actually (e) / FY2019 revenues. This calculation, PLANTS AND OPERATIONS target for a 5% reduction monitored emissions levels, or which marks 2019 as the base year for per revenue in Scope 1 and computed according to established comparison in future calculations, acts Our geothermal and recovered 2 emissions by the end of US Department of Energy guidelines as a point of comparison for us to track energy power plants have little 2021, measured against the for steam power plants.81 Additional the intensity of our emissions over time, emissions. That said, we actively work 2019 base levels discussed emissions under Scope 1 derived from assisting us in accurately accounting towards the reduction of the GHG above. Our progress the operation of drilling rigs used in for the extent of our environmen- emissions76 generated through our towards this goal will be the geothermal exploration and power tal impacts. Nature around an Ormat plant operations and business practices, reviewed annually, and will plant construction phases, from our which includes commitments to be reported in the 2020 use of vehicles at our various facilities, mitigate any subsequent climate Sustainability Report. which are employed for travel, mainte- change effects. The consolidation nance, and logistics at our various sites,

75 As of the publication of this report. 82 These data were obtained from the majority of Ormat’s relevant sites; our Yavne (Israel) manufacturing facility is the primary producer of Ormat’s worldwide air conditioner related emissions. 76 “Greenhouse gases” are defined by the U.S. EPA as “gases that trap heat in the atmosphere. These gases include carbon dioxide(CO2), 83 Scope 2 emissions were calculated using the “market” based approach where possible by using the coefficient of utility used. When not possible, The “location” based calculation was done by using methane (CH4), nitrous oxide (N2O) and fluorinated gases, or high global warming potential gases. the coefficient based on the EPA’s ‘Emission Factors for Greenhouse Gas Inventories’ (March 2020) document. 77 Through the voluntary GHG reporting framework. 84 The presented data was not considered in the calculations of Ormat’s total Scope 2 CO2 emissions, i.e. deduction of the solar offset of 210 tons CO2 equivalents. 78 Scope 1 is direct GHG emissions from sources that are owned or controlled by the Company. S Scope 2 is indirect GHG emissions from the consumption of purchased electricity, heat or steam. Scope 3 is indirect other GHG emissions 85 Ormat’s revenues in RY2019 total approximately USD $746,000,000, which was used as the basis for the energy intensity calculation. 79 The source of the emission factors and global warming potential is the United Kingdom’s Department for Environment, Food & 64 Rural Affairs (DEFRA). As such, the gases included in our carbon footprint calculation are CO2, CH4, and NH4. 65 80 All calculations include storage facilities data. 81 As published by the Office of ENERGY EFFICIENCY & RENEWABLE ENERGY, in: https://www.energy.gov/eere/geothermal/geothermal-power-plants-meeting-clean-air-standards#:~:text=When%20geothermal%20power%20plants%20do,than%20fossil%20fuel%20power%20plants. Scopes Breakdown

Total Emission by Source Scope 3 Scopes Breakdown 3,802 2%

Scope 3 Scope 2 3,802 2% 35,748 ~0.1% 22% 2% Scope 2 2% 35,748 3% 22% Geothermal plant emission- Net - sold to clients Scope 1 3% 121,214 Electrical Energy Consumption 76% Scope 1 121,214 Geothermal plant emission- Aux - internal use 76% Drilling Rigs

Scope 1 | Emissions by Country Vehicles - others (used for company work)

Machinery Owned & Leased by Company - Scope 1 | Emissions by Country Israel Guadeloupe 0.6% (France), Used in Factory (forklifts, cranes, welding machine etc.) Guatemala Honduras, 7.0% Turkey 17% Business flights Israel Guadeloupe ~0.1% 0.6% (France), 50% Guatemala Honduras, 7.0% Turkey A/C - Used in Oces and Factories ~0.1% Kenya 30.3% Heating

Kenya 30.3% USA Generators 61.9%

USA Gas Used in Company Kitchen (LPG) 61.9% 22% ~0.1% 2% 2% Vehicles - Heavy Duty Truck (used for company work) 3% Geothermal plant emission- Net - sold to clients 3% Scope 2 | Emissions by Country Electrical Energy Consumption Solar Energy Consumption Geothermal plant emission- Aux - internal use Employee Transportation Scope 2 | Emissions by Country Kenya, Guatemala, Drilling Rigs Turkey Guadeloupe Vehicles - others (used for company work) Kenya, 1% (France), Guatemala, Israel Honduras Turkey Machinery Owned & Leased by Company - Guadeloupe 4% ~0.1% USA 1% (France), Used in Factory (forklifts, cranes, welding machine etc.) 95% ~0.1% Israel Honduras 4% ~0.1% 17% Business flights 2% USA 50% 2% 95% 3% Geothermal plant emission- Net - sold to clients A/C - Used in Oces and Factories 3% Electrical Energy Consumption Heating Geothermal plant emission- Aux - internal use Generators Drilling Rigs 22% Gas Used in Company Kitchen (LPG) Vehicles - others (used for company work) Vehicles - Heavy Duty Truck (used for company work) Machinery Owned & Leased by Company - Solar Energy Consumption Used in Factory (forklifts, cranes, welding machine etc.) Employee Transportation 17% Business flights 50% A/C - Used in Oces and Factories

Heating 66 Generators 67

22% Gas Used in Company Kitchen (LPG) Vehicles - Heavy Duty Truck (used for company work)

Solar Energy Consumption Employee Transportation EMISSIONS FROM in our calculations, though this avoided through the generation ENERGY USE, The table below reflects our internal energy consumption, which information is also included in our of renewable power at Ormat’s includes the energy resources used in our global operations: OPERATIONS customers’ emissions disclosures. owned power plants in 2019. EFFICIENCY AND The chart below shows the renewable Ormat’s contribution to global GHG Energy consumption in the FUEL RESOURCE 2018 2019 In 2019, Ormat-owned power plant electricity offset recorded by Ormat mitigation is strengthened through organization (GJ) facilities generated 6,238,272 MWh in 2019 conceptually compared with the avoidance of emissions in the MANAGEMENT AT (net) of electricity. As mentioned other common methods of base geothermal and recovered energy ORMAT Fuel Consumption in the Organization89 above, in order to provide a load electricity generation, such power plants that Ormat has sold to fuller representation of our total as conventional fossil fuel-based power producers and utilities over Gasoline 119,784 78,127 emissions, we have included the methods. These figures present the years, which have an installed We strive to ensure optimization Diesel 29,333 46,085 emissions from our production only the emissions that were capacity of more than 2,900 MW. and ultimate efficiency in our use Red Diesel 35,419 74,135 of energy resources throughout Kerosene 477 090 our value chain and in our internal operations. As an energy generator, FOD 484 479 The below table compares the CO2 generated by Ormat plants with the amount we seek to improve our efficiency LPG 461 892 86 87 generated by other technologies for an equivalent amount of power . by using advanced technologies Natural Gas - 3,02891 and equipment in order to optimize the energy generated by our power Electricity Purchased for Consumption in the Organization plants. As an energy consumer, 92 we work to improve performance Electricity 88,835 315,991 through designated action plans and by raising employee awareness TOTAL ENERGY CONSUMP- 7.55 million TION IN THE ORGANI- 274,793 518,736 regarding the use of energy in our ZATION (GJ) tons of CO2 operations; offices, buildings, facilities and transportation.

ENERGY CONSUMPTION IN THE The table below reflects the electricity and heating purchased, ORGANIZATION generated and consumed by the organization: 5.40 million The fuel consumption figure in terms of energy (GJ) is obtained from direct Total Electricity and Heating Consumption (GJ) tons of CO2 measurement of the fuel used at each 2018 2019 facility based on its net calorific value (NCV), and applying the accepted Electricity Consump- units of fuel conversion from the “UK tion (purchased and 5,872,53293 6,679,461 Government GHG Conversion Factors self-generated) for Company Reporting”88. 3.20 million Heating Consumption94 3,090 tons of CO2 The internal electricity consump- tion within the organization and the total amount of electricity generated and sold by the organization was The table below reflects the electricity generated in our power plants calculated using inputs on energy and sold by the organization: purchased or generated, and using the following formula: electricity (GJ) = electricity (MWh) x 3.6 GJ/MWh Electricity Sold by the Organization (GJ) 95 0.16 million 2018 2019 tons of CO2 Electricity Sold by the 21,090,315 22,459,179 Organization

ORMAT PLANTS NATURAL GAS PLANTS FUEL OIL PLANTS COAL PLANTS 88 https://www.gov.uk/government/publications/greenhouse-gas-reporting-conversion-factors-2019 89 As of 2019, Ormat did not consume any renewable fuel, and therefore this metric is not reported. 90 Kerosene is used in the United States for drilling operations; none was necessary in 2019. 91 28,675 therms Natural Gas are included in the below figure, where it is used for heating in the United States. This figure reflects improved collection of data. 86 The emissions from Ormat’s power plants and the relevant calculation are explained above. The other electricity sources are from “CO2 Emissions from Fuel 92 As above, the main drivers of this increase are Ormat’s improved collection of heating data, and our reconstruction efforts in our Puna plant and concomitant Combustion Highlights 2019” International Energy Agency (IEA), 2019. consumption of energy from the grid there. 87 The electricity output from these products represents more than 1% of electricity output in the average of OECD member countries for the years 2011-2015. 93 2018 data has been updated and corrected since the 2018 report 94 Ormat does not generate and/or consume cooling or steam energy resources, and therefore only data on the electricity and heating consumption 68 by the organization is reported. 69 95 Ormat does not sell heating, cooling or steam energy resources, and therefore only data on the electricity sold by the organization through generation in our power plants is reported. ENERGY INTENSITY entities. This is a continual, collab- Other initiatives promoting sustain- MANAGEMENT OF underground to the geothermal power and domestic purposes (cleaning, orative, and often iterative process able practices: At our Amatitlan, plant on the earth’s surface. toilets, etc.). This provides a significant We calculated the energy intensity in which all our stakeholders must Israel, and Mammoth locations, we GEOTHERMAL BY- advantage in our plants that are located for our organization, or the measure take part. Ultimately, we believe that worked to reduce energy waste from PRODUCTS AND We strive to develop geothermal in areas of water scarcity, such as Nevada of the efficiency or inefficiency in the reductions in organizational energy unnecessary illumination. Strategies power plants that involve reinjection and Kenya,. Our water cooled plants are use of energy resources in the orga- consumption can have a significant included staff education to turn off WATER RESOURCES and recirculation of the geothermal mostly in locations where that is the only nization, by dividing the absolute positive downstream effect on the lights when not in use, and the instal- resource in what are known as “closed option, mostly due to local weather and energy consumption by our organi- environmental and economic sustain- lation of photoelectric movement loop” systems. This method continu- atmospheric conditions. There water is zation as presented above – 521,826 ability of our operations. detection sensors. The management of water resources ously recharges geothermal systems used for the cooling of the plant. GJ96 by our revenues for 2019, i.e. are of key importance to Ormat and by maintaining consistent geothermal USD $746,000,000, to reach an The following are examples of initia- At our manufacturing facility in our stakeholders. This includes first, fluid flow and pressures. Reinjection • MANUFACTURING FACILITY: Water energy intensity ratio of 0.000699 tives taken in 2019 to reduce the Israel, we have initiated a system for the geothermal water (or the geother- of brine and condensate help reduce resources are used for various applica- GJ/US$. This is our organization-spe- Company’s energy consumption: measuring energy consumption in mal resources, which is composed of production-related pressure drawdown tions by the factory staff and to facilitate cific metric that we plan to report on different parts of the factory. Findings water, salts and minerals) required for and promote enhanced thermal energy the manufacturing process. The main use in a comparative fashion in forthcom- Migration to energy-efficient light are analyzed to identify opportunities geothermal energy generation, and extraction from the heated rocks within for water in our manufacturing facility ing reports. bulbs: We have continued the process for increasing energy efficiency. This water resources which are used in other the reservoir. Importantly, reinjection is for testing the viability of our plants of replacing conventional incandes- analysis led to an initiative to reorga- processes. We work to manage our also avoids by-products from emitted in the factory setting, wherein we use EFFORTS TO IMPROVE ENERGY cent light bulbs with energy-efficient nize working shifts so that the daylight impacts on the local hydrology and geothermal steam, mainly greenhouse recycled water. EFFICIENCY LED bulbs in our power plants. hours are maximized, resulting in natural environment both through our gases, and the need for disposal of reduced electricity consumption commitments to various regulatory wastewater as well as visual impacts in • EXPLORATION AND DRILLING: We make concerted efforts to Consumption of self-produced during the evening surge hours. requirements and in our environmental the form of an emitted plumes from the Water is used in drilling activities mainly monitor and reduce our energy energy: In 2019, we completed action plans. Geothermal by-products cooling process. to generate the mud that is necessary for consumption. Most of these efforts building a solar plant generating Our largest vehicle fleet is in the and water impacts are managed by the drilling a geothermal well, for environ- are implemented at our manufac- 7 MWh of power at our Tungsten United States, where most of our power plant managers at our operational Management of Water Resources in mental dust control and to maintain fluid turing facilities through measures location, which will support the plant’s power plants are located. Our oper- sites, while the nature of their activities Our Operations for well control. The source of water used such as switching out outdated parasitic load (standby power). In ational locations there are taking and initiatives is inspired by our commit- for drilling is different at each location equipment and machinery for newer October 2019, we reduced the energy strides to reduce the carbon footprint ment to minimizing environmental and We engage with water resources and tanks are usually brought onto models with better energy efficiency consumption of a Well Pad at the from vehicle use, while also decreas- health-related impacts as detailed in our from diverse sources to operate our the drilling site. The water used meets and fuel consumption, among other Amatitlan location by migrating from ing our fleet expenses. To achieve Integrated Quality, Environment, Health power plants, manufacturing facilities relevant regulatory and environmental initiatives. Each factory or workshop energy sourced from the local electri- this goal, Ormat has partnered with and Safety Policy. and offices. requirements that are enforced as condi- manager is responsible for assessing cal company to electricity generated a third party fleet management tions of our drilling permits97. and mapping potential areas for by the plant itself. company to not only manage the Management of the Geothermal We use water resources for various energy efficiency improvements and purchase and sale of vehicles, but Resource and its By-Products purposes, such as: As of 2019, we did not discover any then implementing the identified Improving air quality: In our Heber to manage vehicle maintenance and material negative impacts on the local projects at their operational location. location, we took steps to mitigate fuel expenses by creating a system of A key sustainability driver for geother- • OPERATION OF OUR POWER hydrology in the vicinity of our power This is added to our Company-wide fugitive dust emissions from unpaved “Green Scores” that rate the drivers in mal power generation is the conserva- PLANTS: In our air-cooled plants water plants and manufacturing facilities as a commitment to encouraging the roads at our plant and wellfields. each group according to their average tion and recycling of the geothermal resources are used only for mainte- direct result from our operations. responsible use of energy resources mileage per gallon and the number of resources that carry the heat from deep nance activities and for administrative at all levels of the Company. Some of Improving energy efficiency of “unfavorable” events on the road such the Company-wide initiatives we have equipment: In our Israel location, as hard braking, hard acceleration, The following table details the volume of water consumption implemented in recent years include we replaced older air conditioning or speeding. according to its role in various aspects of our operations. refurbishing our manufacturing facil- units with newer ones bearing a ities with LED lighting, installing more Class A energy rating and replaced In addition, Ormat’s drilling depart- efficient air conditioning and cooling older water heaters that suffered ment works to improve optimization Total Volume Total Volume Use of Water Resource98 units and setting goals for improving from excess mineral deposits that and increase energy efficiency by (m3) in 2018 (m3) in 2019 the energy efficiency of our manufac- harmed their efficiency. Similarly, replacing aging semi-trucks with turing facilities. we conducted a program of annual more efficient and safer vehicles. Air cooled power plant 35,39599 24,409 preventative maintenance of HVAC Operation of power plant As a leading provider of clean equipment at our Mammoth location, Water cooled power plant 14,593,118100 14,630,984 geothermal energy, the Company to ensure continued efficient func- Manufacturing facilities 21,028101 18,813 prioritizes the reduction of energy tioning, and replaced older motors consumption by our employees, at our Kenya location with newer and Drilling activities 43,527 8,082 plants, facilities, and associated more energy efficient models. Total water consumed 14,693,067 14,682,288

96 This increase was mainly driven by improved collection of data, our Puna plant reconstruction efforts, and the concomitant purchase of 97 The quantity of water utilized in exploration and drilling activities varies year to year. In 2019, the notable decrease in water consumption is explained because there energy purchased from the grid in that location. was much less drilling carried out overall this year and most of the drilling was in existing plants so the water used is counted in the plant’s water consumption. Additionally, our Puna operation did not report its water use data for 2019. 98 Most of our water usage data for 2019 (amount of water consumed) was derived from utility invoices paid at our various locations. 70 99 Reclassified 71 100 Reclassified 101 Reclassified Impacts of Our Operations on the ations on government-owned or the water resources that we consume. Total Volume Country Plant or Location Name Source Local Hydrology and Aquifers naturally protected lands. These We consume water resources at our Withdrawn (m3) leases legally require us to conduct operational sites mainly through the Guadeloupe Bouillante 110 7,900 Bay of Bouillante We conduct the necessary studies operations in a manner that minimizes local water utility, but in other cases - including environmental impact impacts on water and the geothermal we consume groundwater and well Honduras Platanares 2,378 Bufa River assessments - to uncover and mitigate resources. water resources. In very rare circum- Israel manufacturing facility Israel and offices 14,187 Israel Water Authority any potentially negative impacts stances, we consume water resources Lake Naivasha through the Lake Laivasha on local hydrology and groundwa- In 2019, our stakeholders did not directly from local water sources. Kenya Olkaria III Complex 19,479 Water Resource Authority Turkey manufacturing facility ter systems. submit any material grievances or However, our interaction with such Turkey and offices 0.6 Izmir Water Company (IZSU) concerns regarding the management water sources is usually managed Drilling opera- Different locations worldwide 8,082 Various sources111 Ormat has entered into geother- of water resources in the vicinity of directly through our engagement tions worldwide mal resources leases with govern- our power plants. with a local water utility. ment entities, such as the Bureau of Land Management (BLM) in the In addition, and as part of our envi- WASTE, biodiversity, and these standards are Our waste management efforts are U.S., entailing the right to conduct ronmental monitoring efforts, we MANAGEMENT OF continually mapped and monitored at constantly improving, as the topic geothermal development and oper- track the sources of withdrawal for local and international levels. is managed at a global scale in our MATERIALS AND Company through the Integrated BIODIVERSITY We uphold ISO 14001 at our main Quality, Environment, Health & The following details the sources for various water resources used at our power manufacturing facility and the Safety System Policy that outlines our plants and at our manufacturing sites in 2019: CONSERVATION standard is used as a guideline for commitments to standards such as other activities worldwide. In addition, ISO 14001 and relevant environmen- Total Volume we engage in thorough dialogue with tal and health and safety standards Country Plant or Location Name Source Withdrawn (m3) stakeholders, environmental NGOs for the management of hazardous We actively work to improve our rela- and local communities to under- waste. Our VP of Quality, Health, Envi- Brady102 81 City of Reno tionship with the natural environment stand their concerns regarding the ronment and Safety oversees corpo- Don A. Campbell Complex 190 Gabbs, Nevada in the process of our business activ- natural environment and biodiversity rate-level policies for the management Heber Complex 103 7,145,314 Colorado River through the Imperial ities and beyond. We work towards surrounding our facilities. We have of waste, materials and recycling. At Irrigation District responsible waste and material established grievance mechanisms in the local level, safe management of Jersey Valley 77 Battle Mountain management at all our global facili- most of the communities in our areas waste, including hazardous waste, Mammoth Complex 194 Mammoth Community Water District ties and have put in place ambitious of operation, enabling the local popu- materials and recycling efforts are programs, based on the results of lation to directly submit any issues managed on an ongoing basis by the McGinness Hills Complex 887 Callahan Pond environmental impact assessments of concern regarding also waste plant managers, who establish the Neal Hot Springs 211 Groundwater and on-site water well and feedback from stakeholders, to management or biodiversity impacts relevant procedures for waste and better control the impact of our activ- directly to responsible individuals or material management in order to Brawly Complex 104 1,507,191 Colorado River through the Imperial Irrigation District ities on local biodiversity. to the Company at large. We attempt comply with local regulations. OREG 0.76 Different sources 105 to address any relevant such concerns Colorado River through the Imperial We strive to continuously improve our in a timely and thorough manner. Waste management at our manu- United States Ormesa Complex 106 3,406,507 Irrigation District environmental performance, focusing facturing facilities and geothermal Puna 31 Hawaii County Water Supply on waste management and biodiver- WASTE, MATERIAL MANAGEMENT power plants is managed through our Raft River 107 1,270,372 Groundwater and on-site water well sity impacts. We actively monitor AND RECYCLING material compliance with ISO 14001 facility performance and encourage and through the establishment of an Reno offices 4,357 City of Reno our employees and other stakeholders We seek to responsibly manage our Environmental Management System. Reno workshop 269 City of Reno to report on incidents as they occur. waste and material streams and to Every aspect of the waste manage- In the context of the plan, we take reuse and reclaim materials in order ment process must be planned, 108 San Emidio 933,168 Groundwater and on-site water well into consideration relevant legal and to minimize our impact on the natural implemented, measured, monitored Steamboat Complex 203 City of Reno regulatory requirements governing environment and ensure the sustain- and continuously improved through the topics of waste management and ability of our business over time. strategic objectives. This includes Storage facilities Not available Not tracked

Tungsten Mountain 58 Well water 102 Partially or fully water-cooled facility. 109 103 Partially or fully water-cooled facility. Tuscarora 360,452 Spanish Springs Ranch 104 Partially or fully water-cooled facility. 105 Each REG plant uses a small amount of water, none for plant operation, each plant purchases from its own local utility Amatitlan 245 Well water 106 Partially or fully water-cooled facility. Guatemala 107 Partially or fully water-cooled facility. Zunil 454 Water purchased from a third party 108 Partially or fully water-cooled facility. 109 Partially or fully water-cooled facility. 110 Partially or fully water-cooled facility. 111 The drilling work frequently changes locations and we did not record the different water sources that were used. If there is drilling in an existing plant then typically the water comes from the local utility from which the plant purchases water but in new locations water is usually trucked in containers and brought to the drilling site.

72 73 properly handling, storing, labelling, and are outlined in our list of Environ- ciency and minimize our impact on The operation of geothermal power A by-product of the utilization of we are not able to prevent the scale transporting and disposing of waste mental Compliance Responsibilities. the environment. We provide our plants requires the use of some geothermal resource is scale, a build-up we must remove and dispose – namely hazardous waste products employees with access to recycling sensitive and hazardous materials, non-hazardous material which we are of it. This disposal is in alignment with or materials – through our health and At Our Manufacturing Facilities, receptacles across our operational including flammable materials such responsible for treating and disposing. regulatory requirements and our safety guidelines and Emergency Workshops and Offices locations, and actively encourage as industrial lubricants and organic Scale is commonly found to include expectations for sound environmental Action plans, training of our personnel the preservation of resources by motive fluids. These are treated calcium carbonate, amorphous silica management. and employees on issues related to Our manufacturing facilities, offices promoting recycling and the respon- according to local regulations and silicates, and mixed metal oxides waste and the handling of materials and workshops generate different sible use of materials. Where possible, governing storage and disposal of and sulfides. We actively monitor the and by keeping records of our waste types of hazardous and non-hazard- we encourage the reuse of materials these materials in the relevant country level of scale in our systems and if management efforts. ous waste. Most of the hazardous such as paper and cardboard, and of operation. waste arises from manufacturing our manufacturing facilities strive to The following table details the types of hazardous and non-hazardous waste that were generated at our We also have expectations of practices, in which case we follow recycle and reuse materials such as power plants in 2019 and how the waste products and materials were disposed of or treated: our subcontractors for the sound and adhere to local regulations. In wood that can be used for packaging management of waste generated our offices, we work to recycle, reuse and shipping our products. Waste Classifica- Weight Weight through their activities, which are set and repurpose waste and materials Type of Waste tion (Hazardous or (kilograms) (kilograms) Disposal Method out in our contractual agreements in order to increase our level of effi- Non-Hazardous)115 2018113 2019114 Used Oils, Petroleum Solids, Oily Landfill, Recycling, Authorized The following table details the major categories of hazardous and non-hazardous waste that were Rags, Pads, Used Filters and Other Oil Hazardous 3,284,469 255,034 Disposal Methods, Recovery generated at our manufacturing facilities, offices and workshops in 2019, including details on how Contaminated Products & Reuse116 the waste products were disposed of or treated. Motive Fluid 117 Hazardous 984,744 632,250 Authorized Disposal Methods Waste Classifica- Weight Weight Type of Waste tion (Hazardous or (kilograms) (kilograms) Disposal Method Metal - General, Aluminum, Non-Hazardous 119,550 157,819 Recycling Non-Hazardous)115 2018113 2019114 Scrap and Carbon Steel General Waste Streams and Non-Hazardous 500,240 499,320 Landfill Construction Waste General Waste Streams and Non-Hazardous 81,000 380,945 Landfill & Incineration Construction Waste Metal - General, Aluminum, Scrap Non-Hazardous 942,290 1,184,370 Recycling and Carbon Steel Wood Non-Hazardous 5,700 5,063 Landfill, Recycling & Reuse Nylon/Plastic Waste Non-Hazardous 829,920 829,920 Recycling

Wood Non-Hazardous 720,359 920,460 Recycling Paper and Cardboard Non-Hazardous 569 8,233 Landfill, Recycling & Reuse

Dichlorbenzene Hazardous 16,000 0 Authorized Disposal Methods Acid (Nitric Acid, Sulfuric Acid), Anti- Not Freeze, Antiseize, Organic Dissolv- Hazardous reported in 2018 10,317 Authorized Disposal Methods Used Paint Containers and Hazardous 26,400 14,112 Authorized Disposal Methods ing Material Paint Thinners Batteries, Electronic Waste and Non-Hazardous Not 1,332 Recycling Used Oils Hazardous 5,700 2,900 Authorized Disposal Methods Lightbulbs reported in 2018

112 Lacquer Hazardous 1,000 0 Authorized Disposal Methods Geothermal Drilling Mud Non-Hazardous Not 650,703 Landfill (Liquid & Solid) reported in 2018 Radiographic films Non-Hazardous 250 300 Recycling Not Sand Non-Hazardous reported in 2018 925,183 Landfill Paper and Cardboard Non-Hazardous 501,712 501,592 Recycling Not Nylon/Plastic Waste Non-Hazardous 459 Landfill Acid (Nitric Acid, Sulfuric Acid), Not reported reported in 2018 Anti-Freeze, Antiseize, Organic Hazardous in 2018 9,156 Authorized Disposal Methods Dissolving Material Used Paint Containers and Hazardous Not 1,822 Authorized Disposal Methods Paint Thinners reported in 2018 & Recycling Batteries, Electronic Waste and Non-Hazardous Not reported 71,980 Recycling Lightbulbs in 2018 Significant changes from 2018 bishment projects that began in pipes. In the United States, two sites At Our Global Power Plants providing renewable energy solutions In order to fulfill these objectives, we As can be seen in the above table, 2019. For example, at our Amatitlan underwent refurbishment projects is to ensure that material and waste uphold environmental action plans at there were several instances of location we produced approximately which produced cooling tower debris. At our various geothermal power management at our projects adheres nearly all our power plants, working changes in 2019 from the quanti- 2,000 kg more non-hazardous In other cases, an increase in reported plants, there are relevant local regula- to our values, which means zero to meet stringent local and interna- ties of waste produced in 2018. In waste (metal products) due to our amount of paper and wood waste was tions and requirements governing the tolerance for leakages and other tional standards and regulations – a nearly all cases, increases in waste ongoing Amatitlan Enhancement the result of improved monitoring and management, disposal and storage potentially harmful environmen- process that is managed through local produced were the result of refur- Project and the resultant gathering of more precise record keeping. of waste. Part of our commitment in tal events. know-how by our plant managers. 113 Some of the weights of the waste provided are estimated based on data received from our operational sites. 114 Some of the weights of the waste provided are estimated based on data received from our operational sites. 112 “Authorized Disposal Methods” refers to authorized third parties that assist Ormat in disposing of certain types of hazardous waste according to relevant local regulations. 115 The classification of hazardous waste depends on the location of the operations and the legal or environmental regulations that govern the topic in that country and/or locality. Therefore, waste is indicated as ‘Hazardous’ when it is considered as such in at least one of the locations of operation included in the scope of this report. 116 The disposal methods for the oils and solids varies depending on the country of operation. 74 117 The categorization of ‘hazardous’ and ‘non-hazardous’ in the context of motive fluids depends on the nature of local regulations that govern the topic. The majority of the hazardous waste 75 classifications pertain to state-level waste and by product regulations that govern the nature of our operations in the state of California. BIODIVERSITY During the construction of our ENVIRONMENTAL IMPACT Though we conduct ESIAs for geothermal power plants phase, ASSESSMENTS AND we require the site manager and ENVIRONMENTAL AUDITS each of the power plants that Our renewable energy solutions are construction team to fulfil a list of derived from nature itself, and as a specified environmental compliance At each of the sites where Ormat we construct, own and those result we place utmost significance responsibilities regarding biodiver- decides to construct a new power on assessing the potential impacts on sity preservation at various stages plant, we conduct environmental and for which we have turn-key the local biodiversity and the natural of the construction process. These social impact assessments (ESIAs) or and cultural environments surround- responsibilities vary from site to site, regular environmental audits of our contracts, below we present ing our power plants. Maintaining the but in general include: attending a activities as mandated by relevant natural biodiversity around our plants pre-construction meeting with Ormat and local regulatory requirements. a detailed description of the is important to a number of our key to review the environmental manage- stakeholder groups, such as local ment expectations; preparation of Impacts analyzed in the context of impact assessments and action communities, environmental NGOs emergency response plans with the environmental and social impact Olkaria III, Kenya and financing bodies, among others. contingencies for hazardous material assessments are classified as those plans that we generated for our Accordingly, we strive to design our spills and disposal; monitoring of dust related to ecology and nature conser- power generation facilities to blend conditions on site during construc- vation, landscape and visual impacts, fully-owned plants in 2019. into the surrounding landscape, taking tion; ensuring the proper storage traffic and transport, noise, socio-eco- into consideration the actual physical of waste; recontouring of impacted nomic impacts, health, safety and (with preference for the Tarchon- Impact Assessments of proposed location of each facility, the configu- areas to match the surrounding public nuisance, ground, water and air Kenya anthus camphoratus species) in reinjection and production wells, ration of units that are used to build terrain; providing a buffer around emissions, archaeology and cultural order to enhance the Park’s natural and that the project itself contrib- it, landscaping, and the surround- eligible and unevaluated cultural heritage, electric and magnetic fields Our Olkaria III power plant, located features. As required by law, annual utes to economic development at ing natural habitat, among other sites that are close to project activ- and electromagnetic interference. in Hells Gate National Park, was environmental audits have been the national and local level through elements. ities; salvaging and stockpiling soils Identified impacts are managed and built in stages, starting with a 13 undertaken for Olkaria III Geother- the supply of cheaper renewable for use later in the construction mitigated by Ormat in accordance MW plant in 2000. Since then it mal Power Project (the Project) energy and the creation of direct MAINTAINING THE NATURAL process; and ensuring that there is with best commercial practices. The has grown incrementally, and now since 2006, with environmental and indirect employment and ENVIRONMENT IN THE no use of construction paint on the measures adopted include informing holds a total generation capacity audit reports being submitted to business opportunities. CONSTRUCTION AND OPERATION natural surface. the local population in a timely of 150 MW. Hells Gate National NEMA for review of performance OF OUR POWER PLANTS manner about construction activities Park is managed by the Kenya and for recordkeeping. In the few circumstances where the In addition, ongoing research into new and repairing any damage to local Wildlife Service, and is catego- audit found potentially problem- Before we develop a new geothermal equipment helps minimize the envi- access roads, as well as restoring any rized as an International Union for The 2019 environmental and social atic practices and impacts, we have facility, we create a detailed environ- ronmental impacts from the operation disturbed lands. Conservation of Nature (IUCN) audit of Olkaria III was undertaken developed a program to mitigate mental plan to minimize impacts to the of our facilities. For example, several Category II national park118 and a over the period between January to such concerns, and will continue to surrounding natural lands and wildlife facilities have been reconfigured to Our local site management team is tentative UNESCO World Heritage February 2020 and encompassed seek ways of improving our sustain- ecosystems. Our aim is to control and accommodate larger pumps that can usually tasked with developing and site. Furthermore, the geothermal a review of activities and opera- ability at the Olkaria III site in the reduce the level of disruption to the more efficiently extract and process implementing an environmental field is near Lake Naivasha and local tions across all areas utilized within future. For example, our audits surrounding natural environment in fluids from geothermal reservoirs. action or management plan that flower-growing farms, all of which the Olkaria Geothermal Field and found that, while Ormat provides the development of the plant. Our This, in turn, may reduce the number addresses the actual and potential necessitate careful examination of its surroundings. The adequacy colored waste segregation bins care for the environment around our of wells that are required to properly impacts on an ongoing basis for regu- the potential environmental impact of existing management controls within the plant, employees were plants extends to the operation and exploit a geothermal reservoir, lators and/or the local community. of our operations. Last year (2018), to protect the environment within not using them effectively. We maintenance phases of their lifecycle, thereby reducing our overall land Ormat entered into an environ- Hells Gate National Park and other will implement a program of staff keeping in mind our commitment to use while simultaneously enhancing mental management agreement surroundings was also assessed. The education to increase effectiveness minimizing operational costs without overall facility operational capacity. with the Kenyan Wildlife Service audit observed Ormat’s commit- of this effort and ensure that the compromising on meeting the highest The installation of more efficient, (KWS) to effectively manage envi- ment to good environmental, health, bins are clearly labelled. In another safety and environmental standards. air-cooling equipment in angled ronmental resources in the Park and safety practices (including case, our audit discovered R22 Furthermore, we seek to maintain the positions is another compelling and to enhance conversation activ- noise management), alongside (an ozone-depleting substance) in sustainable characteristics of geother- improvement that has significantly ities. The agreement mandates a variety of ongoing initiatives to use as a refrigerant in our facility’s mal resources through the intensive reduced energy consumption and the that all installed infrastructure will promote the social, economic, older air conditioning units. This geologic and hydrologic studies that level of impact on the natural environ- not obstruct wildlife movements, and environmental welfare of the problem will be mitigated through we conduct during the exploration and ment surrounding our facilities. breeding or migratory patterns, that surrounding communities. It noted the decommissioning of older units drilling phases. In some cases, Ormat is no exotic animals or plants will be that all staff (including contrac- and replacement of R22 refrigerant required to conduct additional studies introduced, that all rules and regu- tors) are regularly trained on EHS with ozone-friendly types, such as regarding potential impacts on the lations of the Park will be followed, issues, that investment decisions are R410A and R407C. natural environment as part of its land and that local trees will be planted guided by regular Environmental and mineral rights lease agreements.

118 International Union for Conservation of Nature (IUCN) Category II national park refers to large protected areas that play a role in the connectivity of the landscape or seascape in that they are the home to large ecological processes and are complemented with species and ecosystems that are characteristic of the natural area. 76 77 United States preventing unnecessary negative specific emphasis on the greater environmental impacts during the sage-grouse population. We have Our McGinness Hills (Nevada) site construction, operation, and recla- developed and now implement is characterized by unique biodiver- mation phases. These measures an Integrated Weed Management sity factors that must be accounted have been in place over the lifetime Plan to ensure that our materials for when conducting our opera- of the project and are periodically do not promote the spread of tions. Significantly, it is home to a reviewed in order to determine invasive species of weeds, work to population of greater sage-grouse, if they can be expanded upon. mitigate noise pollution through the which inhabits a limited geographic Requirements include coordina- installation of sound dampening range in the American Northwest tion of a Wildlife Working Group, barriers, and follow the guidelines and Canada and has been char- the development of a Bird and Bat of the Avian Power Line Interaction acterized as a “Near Threatened” Conservation Strategy, and the Committee when conducting our species by the IUCN. implementation of an Adaptive transmission lines.119 Employees Management Plan, which aims and contractors are instructed Ormat has committed to carrying to mitigate the impact of our to avoid disturbing local wildlife, out measures that are aimed at operations on local fauna with especially during the greater sage grouse breeding season. Other measures include the planting of native species according to BLM Amatitlan, Guatemala, annual reforestation guidelines, and painting equipment to blend better with the surrounding natural landscape.

Additionally, In Nevada, where we are developing plans for a new power plant in the Dixie Valley Playa, local conservation groups have brought to our attention their concerns regarding the Dixie Valley toad, a rare type of toad which was only described by scientists in 2017. We have taken these concerns into account in our planning process and will work to mitigate the harmful effects of our geothermal plant on the toad’s habitat.

Olkaria III, Kenya Guatemala

In our Zunil and Amatitlan locations (Guatemala), as elsewhere, identi- fied areas of concern are paired with detailed action plans to mitigate them. Our efforts in this field are informed by legal requirements, our Amatitlan site, which was ered negative impacts resulting a dozen local schools to promote but also by the expressed needs found to be well within accept- from our operations on local flora awareness of the importance of of the surrounding community and able parameters. For instance, no and fauna, and no noise pollution local environmental conserva- Ormat’s wider corporate standards negative impacts were detected in complaints were received from tion efforts. for ensuring environmentally terms of pH level, and no nitrates the local community over the last sustainable operations.120 were found. year. At Ormat’s power plant in Amatitlan, the staff hosts an annual For example, in 2019 we conducted With regards to other environmen- reforestation program for local a water quality assessment at tal factors, we have not discov- school children, which involves over

119 “Avian Power Line Interaction Committee” leads the electric utility industry in protecting avian resources while enhancing reliable energy delivery. 120 Per resolution number 156-2002-AB/ADB.

78 79 CHAPTER VII. OUR IMPACT AND ENGAGEMENT WITH OUR EMPLOYEES, SOCIETY & LOCAL COMMUNITIES

Plumsted storage facility, New Jersey, USA, 20 MW / 20 MWh

80 81 OUR PEOPLE: OUR OUTLOOK ON EMPLOYMENT at fostering a sense of togetherness and sponsorship of learning oppor- including for leadership positions. In and well-being of our employees and among our employees. We work to tunities, among others. 126 Ormat addition, we outline our commitments other key stakeholders. The Policy EMPLOYMENT AND From Kenya to California, we work cultivate a transparent and diverse offers equitable and competitive to employees and various other also recognizes our commitment to SKILL DEVELOPMENT to uphold our obligation to provide work environment that offers equal pay and benefits, health insurance stakeholder groups in upholding a providing our employees with educa- our employees with a workplace that and fair opportunities for employees and retirement savings plans to all transparent and fair workplace, that tional opportunities and training to AT ORMAT is fair, open and free from discrim- of all races, cultures, ethnic back- of our employees, details of which also looks to promote social and enhance their skills. Furthermore, ination or harassment, and that grounds, genders and gender asso- are reported in the “Employee environmental value creation for our the Policy outlines our commitment encourages engagement and the ciations, and we encourage our Benefits” section. stakeholders. to providing our employees with the As a global renewable energy development of employee potential. employees to support our mission appropriate resources for implemen- company, we are proud to employ We place the highest value on the of generating positive social and Labor and Employment 2. The Human Rights and Labor tation of our expectations, which and work closely with the commu- diversity of our employees, and we environmental value in their profes- Policies at Ormat Policy, adopted in 2018 by Ormat’s include, among other resources, nities that we serve, knowing we strive to hire a diverse workforce that sional opportunities and within their management, expresses our commit- written guides and training on contribute to local economies and includes individuals from all sectors communities. Indeed, we involve our In addition to the outstanding ment to upholding international relevant health & safety, environment social well-being. With nearly one of society, while also providing equal local employees in most of our stake- conditions that are outlined in our human rights and labor standards and quality-related issues. power plant on every continent, we opportunities in the hiring process holder engagement mechanisms employment agreements, our Human for all of our employees, suppliers, have a commitment to generating a and in providing access to career for local communities around our Resources Department works to business partners and stakeholders. 4. Certain aspects of the Stakeholder stable and secure economic future for growth opportunities. This is clearly power plants. implement and ensure that all stake- We recognize our employees’ rights Engagement Policy, namely on issues all, based on sharing our knowledge expressed in our commitment to holders uphold four key policies: to the freedom of association and that pertain to employees, subcon- and expertise regarding sustainable anti-discrimination, minimizing Respect for diversity, transpar- collective bargaining, all relevant and tractors and other stakeholders. energy solutions. The promise of gender pay gap, and enabling free ent communication and enriching 1. The Code of Business Conduct essential employment rights in our These principles include our commit- renewable energy that we deliver to association by labor organizations professional and personal opportu- and Ethics outlines commitments countries of operation, their rights to ment to open communication and our customers and stakeholders goes that are engaged with our Company. nities are the principles central to our to our employees regarding equal a workplace based on equal oppor- dialogue and sharing information to hand in hand with our commitment to As a vertically integrated company employment outlook, and we look to employment opportunity, diversity tunities based on individual merit, better instill our corporate values. local employment and skill develop- providing myriad solutions in the hire individuals who exemplify and in employment and anti-harassment, and which is free of harassment and ment wherever we work. energy industry, our employees implement these values in their work. and the ethical and behavioral expec- discrimination in all forms. In addition, Implementation of Employment come equipped with and acquire in tations of employees in the workplace. we express our commitments to elim- Framework and Employee Feedback In 2019, we employed 1408 people the course of employment an array OUR EMPLOYMENT FRAMEWORK The Code outlines, among others, inating human rights abuses through- on Employment Practices worldwide121. This number includes of professional skills and capabilities, our staunch insistence on equality out our value chain, such as child and both those in locations included which we consider in the hiring and Our employment framework, policies and fairness in the hiring, promotion, forced labor practices. Ormat’s management, Human within the Boundaries of this report employment process, in addition to and initiatives are managed by and termination processes, as well Resources department and the local (United States, Israel, Turkey, other factors, such as geographical Ormat’s Human Resources Depart- as our policies to attract and retain 3. The Integrated Quality, Environ- employment managers at each of Honduras, Guatemala, Guadeloupe location and ties to the local commu- ment that is headed by the SVP of diverse talent within our organi- ment, Health & Safety Policy that our operational sites ensure that and Kenya), as well as a smaller nities around our power plants. Human Resources, Ms. Liat Inbar- zation. It expresses our commit- outlines our compliance with relevant these frameworks, policies and their number of employees located in We view engagement with local Arad. Our Human Resources depart- ment to continue hiring appropri- standards and regulations, as well as relevant conditions are upheld in our territories outside the Boundaries communities around our facilities to ment sets the tone for employee ately qualified diverse candidates, our commitment to the health, safety dealings with employees, and that (Indonesia, the Philippines, Chile and be a central tenant of our business management and opportunity-cre- New Zealand).122 123 policy and important to our success. ation processes in the Company, but That’s why we created and maintain a the hiring, termination, and training Wherever we work, we strive for policy of 100% local employment and areas are managed at each power Vice President, equal opportunity employment114 management of our power plants and plant, facility or office by a local Human Resources and to engage the skills, know-how manufacturing facilities, in addition manager who either reports directly and abilities of residents in our host to the majority of our administra- to the Human Resources department, communities. This means encourag- tive offices. or to a member of senior manage- ing a workspace where our employees ment on a regular basis. are motivated to contribute their Although our employees are spread Global Power Plant, Ormat’s Executive Workshop & best, strive for creativity, and, in the across the globe, our Human All of our employment contracts are Managment process, make strides in achieving Resources Department and the VP drafted in accordance with regula- Office Managers their professional or personal goals. of Human Resources125, implement tory requirements in the country of Therefore, we rely highly on employee initiatives to encourage connection operation, providing the benefits that feedback, ideas and enthusiasm to between individuals of different are afforded by the law as well as create authentic, relevant methods cultures and professional experience additional benefits and employment Administrative Offices of engagement, while working more within our Company. These initiatives, considerations based on employees’ & Manufacturing proactively, safely and in tune with offered on several platforms and needs, such as flexible working hours, Facilities in Israel local communities. which are outlined below, are aimed paid maternity or paternity leave,

121 Exact figures on the number of our employees is provided in continuation of this report, and data is provided in reference to GRI Standard 102-8: Information on employees and other workers. 122 1385 employees are included within the Boundaries of this report. 123 Exact figures on the number of our employees is provided in continuation of this report, and data is provided in reference to GRI Standard 102-8: Information on employees and other workers. 126 Information on special conditions of employment agreements for our Executive Officers and information on Executive Compensation are provided in the “Corporate Governance” section of this report. 124 In general reference and in adherence to the U.S. Department of Labor’s Equal Employment Opportunity (EEO) law. https://www.dol.gov/general/topic/discrimination 82 125 Appointed to the position in mid-2020. More information is available in Ormat’s 2020 Proxy statement: http://d18rn0p25nwr6d.cloudfront.net/CIK-0001296445/5a906a1b-66cc-4cd2-892d-db5e1032b447.pdf 83 Employees with questions or griev- to our whistleblower ethics hotline at encouraging environment for our 2019 2018 ances regarding employment contrac- the third-party managed website at employees to share their unique tors, any of the abovementioned www.ethicspoint.com cultures with us, further promoting Total number of employees (by employment type and gender) YE policies or our general employment or via telephone at 1-866-294-5535. their open feedback on our levels framework have a number of avenues of corporate engagement with their Full Time Part Time Full Time Part Time available to them for reporting their We also garner employee feedback communities. feedback or concerns. Employees through performance reviews and Male Female Male Female Male Female Male Female can report to their direct manager, one-on-one meetings with our 30 or younger 175 27 2 2 180 26 3 1 the Human Resources department, employees. Through these methods, the Secretary of the Corporation or we seek to create an open and 31-50 649 131 3 3 628 117 3 4

51 or older 314 69 7 3 306 64 9 5 Employment Data for Ormat127 Total 1,138 227 12 8 1,114 207 15 10 2019 2018

Number Percentage of Of Of Number Percentage of Of Of Location of Employees Total Employees Which Permanent Which Temporary of Employees Total Employees Which Permanent Which Temporary

United States 578 41% 566 12 584 43% 577 7 In 2019, nearly 99% of our employees SUBCONTRACTORS AND THIRD of our power plants, subcontrac- Israel 584 42% 574 10 556 41% 545 11 worked with us in a full-time capacity. PARTIES tors also play a key role in on-going According to our employment plant operation and maintenance. Kenya 64 5% 64 0 58 4% 58 0 framework and out of our commit- Power Plant Design and We not only view engagement with ment to creating meaningful employ- Construction local subcontractors in our areas of Honduras 52 4% 48 4 45 3% 45 0 ment opportunities, we rely as much operation as an opportunity to support as possible on our own employees As a global renewable energy company, local economies; the maintenance of Guatemala 57 4% 56 1 54 4% 54 0 for all aspects of conducting our we work with a variety of contractors, our power plants tends to involve the Turkey 25 2% 25 0 23 2% 23 0 business. Our employees play a subcontractors and other third parties development of key infrastructure, central role in the design, manufac- to design, construct and operate our such as roads and transportation routes Guadeloupe 25 2% 22 3 26 2% 20 6 turing and on-going operations and power plants and facilities. Typically, around the plant site. maintenance of our power plants third parties and subcontractors are TOTAL 1,385 100% 1,355 30 1,346 100% 1,322 24 and other facilities. Most part-time engaged in the design and devel- At our global power plants, subcon- functions are based on addressing opment process depending on the tractors and third parties are engaged specific business needs, performance complexity of the location and their to perform various jobs and deliver Most of our employees (98%) in 2019 employment in our operational locations. service providers, who are employed of skill-oriented work, professional knowledge of the physical environment services that contribute to the nature were permanent employees, i.e. those Our Human Resources department is according to a specific employment functions or available organizational and terrain.In addition, we work with of our operations and the reliability employees with standard employment also responsible for engaging with or engagement contract which may knowledge and capabilities. Further- subcontractors and third parties to of our service to stakeholders. At the agreements managed by the Human our temporary employees, which are be considered as employees. In 2019, more, and when applicable, we carry out some of our manufacturing majority of our sites in Africa and Resources department, local facili- defined as those employees who are 2% of our employees were classified provide our employees with options activities. For example, when construct- Latin America, we employ security ty-based HR teams, and the local laws of third parties, freelancers, and other as temporary. for part-time positions based on ing new power plants, we work with service contractors to guard the their personal or professional needs. subcontractors on a temporary, yet premises, offices and infrastructure of In addition, temporary employees mainly full-time basis for the comple- our power plants, including residen- 2019 2018 are often offered opportunities to tion of implementation-based projects tial facilities for on-site staff, where become full-time Ormat employees, at various operational locations. relevant. We engage with subcontrac- Total number of employees (by employment contract and gender) YE and we treat our temporary These subcontractors usually fulfill tors in our US facilities to physically employees and subcontractors as various roles such as site grading, road operate our plants, and at the vast Permanent Temporary Permanent Temporary full-fledged members of our organi- construction, civil, mechanical and elec- majority of sites, local contractors Male Female Male Female Male Female Male Female zation for the purposes of stakeholder trical work, among others. are hired for transportation services engagement. and routine maintenance work, such 30 or younger 166 25 11 4 169 24 14 3 Power Plant Maintenance and as road repair and pipe cleaning. Administrative Support At our offices in Israel, some of our 31-50 641 132 11 2 628 120 3 1 Information Technology, information In addition to our engagement with security and data protection systems 51 or older 320 71 1 1 314 67 1 2 subcontractors, contractors and third are managed by subcontractors that parties in the construction and design report to us. Total 1,127 228 23 7 1,112 211 18 6

127 This includes only those locations included within the Boundaries of this report, and excludes personnel located in Chile, Indonesia, New Zealand, and the Philippines. 84 85 Our geothermal power plants in extended employment opportu- Employee Retention Total number of employees to Total number of employees to Guatemala, at Zunil and Amatitlan, nities for the local community, we end employment in 2019 end employment in 2019 employ local community members offer temporary plant maintenance At Ormat, we view one of the indica- to carry out maintenance work, such employees the opportunity to work tors to the strength and stability of Permanent Temporary Full Time Part Time as pipe cleaning and road repair. periodically during the months of the our Company as a whole. to be in the The agreement to work with local year, thereby creating more overall long-term commitment and dedi- Male Female Male Female Male Female Male Female contractors and laborers was estab- opportunities for employment in cation exhibited by our employees. 30 or younger 29 0 12 5 40 5 1 0 lished as a result of stakeholder the local community. In addition, Despite the global spread of our dialogue and focus groups that were construction contractors are often company that would seemingly 31-50 80 17 3 4 83 20 0 1 conducted between Ormat and the consulted when reaching decisions create dissonance, our organizational local community in the 2000s, when on where to build access roads and values and commitment to employee 51 or older 36 9 1 3 34 9 3 3 the plants entered development. surrounding routes. growth, education and skillsets allow The goals of the agreement are to us to maintain workforce stability. Total 145 26 16 12 157 34 4 4 provide economic opportunities Information on our engagement with This is exhibited in our high global for employment at our plants and Suppliers and other Third Parties, not employee retention rate, which in to instill pride for the infrastructure referenced in this section, is outlined 2019 was 86%. they develop and maintain in and in the “Supplier Relations” section of around the plants. In order to provide this report. Total number of employees to Total number of employees to end employment in 2018 end employment in 2018

Permanent Temporary Full Time Part Time

Male Female Male Female Male Female Male Female

30 or younger 28 3 31 3 57 5 2 1 Total number of employees (by employment Total number of employees (by employment contract and gender) hired in 2019 type and gender) hired in 2019 31-50 79 12 4 0 83 11 0 1

Permanent Temporary Full Time Part Time 51 or older 47 14 2 0 45 14 4 0

Male Female Male Female Male Female Male Female Total 154 29 37 3 185 30 6 2

30 or younger 50 8 21 6 68 13 3 1

31-50 83 23 12 5 95 28 0 0 Our Hiring & Termination Policies Our hiring processes are managed and In cases of employment termination, end designed by the Human Resources of employment, or retirement, Ormat 51 or older 11 8 0 2 11 9 0 1 As an equal opportunity employer, we department, in full consultation, has an organized framework in place Total 144 39 33 13 174 50 3 2 consider each applicant according to implementation and management by for providing these employees with their level of fit, knowledge and skills the various power plant and facility their rights and benefits. The Company that are appropriate for the position, managers. The Human Resources adheres to all relevant legal obligations while also focusing on hiring such department and plant managers assess according to the relevant country of appropriately qualified candidates new employees’ professional capabili- operation where the employee is ending Total number of employees (by employment Total number of employees (by employment from various gender, ethnic and ties and experience and in terms of their their employment or retiring. contract and gender) hired in 2018 type and gender) hired in 2018 cultural backgrounds. This includes fit with the relevant position. In addition, for management and Company lead- the team considers the employees’ fit Permanent Temporary Full Time Part Time ership positions. Our organizational in our organizational culture, such as values and the frameworks, policies and with our workplace values, ethical and Male Female Male Female Male Female Male Female directives noted above guide our hiring behavioral expectations according 30 or younger 48 8 19 2 67 10 0 0 and employment practices. We are to the Company’s Code of Business committed to treating each applicant Conduct and Ethics, and personal and 31-50 101 21 2 1 103 22 0 0 and employee fairly and equitably professional goals regarding the oppor- throughout their engagement with tunity to work with us. Employment with 51 or older 33 9 1 2 34 9 0 2 our Company, and we are committed Ormat is based solely on an unbiased to eliminating discrimination in hiring analysis of our labor requirements and Total 182 38 22 5 204 41 0 2 and termination decisions. the individual applicant’s qualifications.

86 87 Below is our 2019 year-end headcount by management category and gender: Diversity & Equality in Employment grounds into our employee base at of the gender and ethnicity ratios, at Ormat all levels of the organization. Our to present how we are doing in our Senior Mid-management employees, including our executive efforts to meet Ormat’s diversity Category % of total VPs % of total % of Total management (reporting to VPs) All qualified applicants for employ- managers and director members, goals, as well as goals as advised ment with Ormat receive consider- come from diverse backgrounds, by the US. federal government. In Total Female 0 0% 9 39% 14 13% ation for employment without regard enriching our organization with their addition, we work with several organi- to race, sex, age, color, religion, unique experience. As noted, we are zations in the U.S. helping us to open Total Male 7 100% 14 61% 90 87% marital status, sexual orientation, an organization with a commitment to positions to job boards that target gender identity, veteran status, status 100% local employment in the belief ethnic minorities and veterans. Overall Total 7 23 104 with regard to public assistance, that local knowledge is a critical asset source of income, national origin, to the success of our business. That said, it is important to stress that citizenship status, disability, or any Ormat first and foremost considers protected status. As noted above and regarding the a potential candidate’s professional Below is our U.S. 2019 year-end management headcount by ethnicity/race: Company policies that govern our skills and their overall qualifica- We are committed to diversity and human resources framework, we tions for the position, and only then Senior Mid-management Category % of total VPs % of total % of Total equal employment opportunities adhere to all relevant legal frame- hires the most qualified candidate management (reporting to VPs) for all genders, racial, cultural and works governing equality in employ- for the said position. This is in line ethnic minorities as a key part of ment, such as through the Affirma- with our commitment to complete Total Minorities130 0 0% 0 0% 6 15% our employment framework, which tive Action directives issued by the professionalism paired with zero also applies to management and the U.S. Department of Labor through tolerance for discrimination, harass- Total Non- Minorities 1 100% 8 100% 35 85% Board of Directors. While we do not which we seek to hire individuals ment and inequality of treatment in Overall Total 1 8 41 have specific organizational goals from underrepresented gender, the workplace. Furthermore, we are or quotas for hiring individuals from and/or ethnic, national, cultural and committed to eliminating discrimi- specific gender, racial, cultural, ethnic, religious minority groups. Our Human nation in our hiring and employment national or religious groups, we Resources department in the U.S. has termination practices and ensuring work to integrate as many different partnered with a consulting firm that that all employees are adequately perspectives, experiences and back- provides us with statistical analysis accommodated and treated equally. Collective Bargaining Agreements & conditions since September 2005131. Employee Benefits, Healthcare & Employee Unions Furthermore, we currently provide Welfare Frameworks Below is our 2019 year-end new Below is our U.S. 2019 year-end such employees with benefits and hires headcount by gender new hires headcount by ethnicity/race128: While we support the right to freely working conditions that are at Our experience in working with a associate and establish employee least as favorable as the conditions large group of diverse employees Gender Count % of Total Category Count % of Total unions as a basic human and labor specified in the collective bargain- has taught us that the success of our 132 Total Female 62 22% Total Minorities129 50 27% right that should be afforded to ing agreement. These workers and business depends on employee satis- workers (as noted in our Human skilled laborers are predominately faction and stability. We therefore Total Male 215 78% Total Non-Minorities 132 73% Rights and Labor Policy), most of employed in our major manufactur- strive to provide employees at all Total Overall 277 Overall Total 182 our employees were not covered by ing facility in Yavne. levels with benefits and access to collective bargaining agreements welfare frameworks that clearly As of 2019, 17% of our employees were are between the ages of 31-50, but administrative facilities. As such, and in 2019. As of December 2019 1.8% In our over 50 years of operation, we express our level of appreciation and female. There are six female members we also have a significant number of due to the wide geographical spread of our employees were covered by are proud to report that we have never care for employee well-being. We of our broader management team who employees who are age 51 and older of our locations, we employ individu- collective bargaining agreements, experienced a major labor dispute, ensure this by providing basic and fill positions such as the Senior Vice as well as 30 and younger. As an equal als on nearly every continent and of namely the employees of our Bouil- strike or work stoppage. As noted competitive employment benefits, President and Corporate Secretary; opportunity employer, we do not many different races – in the continen- lante power plant in Guadeloupe, above and evident from our high growth opportunities and a warm VP, Human Resources; VP, Informa- discriminate against employees based tal United States, in the Middle East, where employees are represented by employee retention rate, we consider and positive work atmosphere for our tion Technology; VP, Engineering; on their age. As outlined in the section Southeast Asia, Central America, Africa the national union, the Confédération our relations with our employees to be full-time, part-time and temporary VP, Corporate Finance and Investor below, we afford all of our employees and the Caribbean. We are committed Générale du Travail de Guadeloupe. one of our key success factors. Indeed, employees at our significant locations Relations; and several female legal full retirement benefits and flexible to allowing the specific racial, ethnic we believe that our current stability of operation.133 managers. We actively seek oppor- employment conditions according and religious groups among our In Israel, while all employees are hired and future growth depend on our tunities to hire and promote female to the relevant conditions of employ- employees the appropriate freedoms, according to personal employment continued ability to hire, integrate and employees and managers across ment in the country of operation, as including freedom of expression and contracts, those skilled workers in the retain qualified personnel with fair, our Company. detailed below. worship, in the workplace and strive to metallurgy and electronics industry equal and transparent employment create an open and welcoming environ- have been covered by specific union practices everywhere we operate. In addition, we work to ensure that Furthermore, and as noted, we are ment to bridge cultural, communicative our employees come from diverse committed to local employment at all and national borders. age groups. Most of our employees our operational, manufacturing and 130 Includes the following minority groups: Black or African American; Native American and Alaskan Natives; Asian Americans; Native Hawaiians and other Pacific Islanders; Hispanics and Latinos of all races, and people of two or more races. 131 By order of the Israeli Ministry of Economy and Industry, the provisions of a collective bargaining agreement between the Histadrut (the General Federation of Labor in Israel) 128 We do not track the specific diversity of our workforce in our locations outside of the US. With this, all overseas employees are locally hired and thus are representative of the and the Coordination Bureau of Economic Organizations (which includes the Industrialists Association) may apply to some of our Israeli non-managerial, finance and administrative, and sales communities in which we operate. and marketing personnel. This collective bargaining agreement principally concerns cost of living pay increases, length of the workday, minimum wages and insurance for work related accidents, 129 Includes the following minority groups: Black or African American; Native American and Alaskan Natives; Asian Americans; Native Hawaiians and other Pacific Islanders; Hispanics and annual and other vacation, sick pay, and determination of severance pay, pension contributions, and other conditions of employment. Latinos of all races, and people of two or more races. 88 132 2019 Annual Report. 89 133 These include the operational locations included in the scope of the Information Boundaries of this report, i.e.: Guadeloupe, Guatemala, Honduras, Israel, Kenya, Turkey, and the United States. In total, the percentages presented in the benefits table refer to seven significant locations of operation for our activities in 2019. Most of our employees receive in the calculation of the benefit obli- enter into retirement in phases. Due could be issued as options or as other mothers. Typically, parental leave employees are happy and closer with parental leave benefits, health care gation. The Company has an obliga- to our high employee retention rate, forms of awards. The term of stock- is granted within the regulatory their families, their quality of work insurance134,sick leave benefits, tion to partially fund the liabilities many of our retiring employees have based awards typically ranges from framework in the country of operation, and appreciation for the opportuni- coverage in the event of disabil- through regular deposits in pension worked with Ormat for years, if not six to ten years from the grant date. and in many cases, we encourage our ties that Ormat has to offer grow, and ity and/or infirmity, and vacation funds and severance pay funds. The decades, and we appreciate the employees to embrace our flexibility we can build stronger relationships days135. Additionally, at our significant amounts funded amounted to $10.8 potential difficulties to be felt in such In addition, we afford our employees in returning to work with comfortable with the newest members of our local locations of operation136, our full-time million and $10.6 million at December a transition. As such, we usually work access to gender-neutral family working hours so that they are able communities. employees are provided benefits that 31, 2019 and 2018, respectively. to include retirees and alumni in some support programs, including parental to accommodate for their growing may include life insurance, health- Severance pay expenses for the years of our employee events and continue leave for both new fathers and families. We believe that when our care, dental care coverage, disability ended December 31, 2019, 2018 and to consult and engage with them on and invalidity coverage, retirement 2017 were $3.5 million, $3.0 million a regular basis. provision, optical care and others. and $3.2 million, respectively, which In some localities, benefits are made are net of income (including loss) We also offer some of our employees available to part-time and temporary amounting to $1.0 million, $(1.1) access to stock options and stock- employees137 . million, and $1.8 million, respectively, based awards. Stock options and generated from the regular deposits stock-based awards are available All our global employees are entitled and amounts accrued in severance only to full-time employees and some to retirement and pension benefits138 funds. Accordingly, the following table independent contractors who work at or beyond the legally required sets forth our contractual obligations with our company. Described in the 2019 level of employer contribution in to employees in paying their benefits “Corporate Governance” section the relevant country of operation, (or relevant assets) upon retirement: of this report, our 2018 Incentive Male Female including access to 401(k)139 pension Compensation Plan142, adopted in schemes in the U.S. We fully cover Our retirement commitments are May 2018 by the Company’s share- Total number of employees entitled to parental leave 1,150 235 retirement and pension plan liabili- for both voluntary and mandatory holders, provides the granting of the Total number of employees that took parental leave 22 12 ties in relevant countries of operation frameworks, according to the regional following types of awards: incentive with our general resources. All current or country-based schemes in our stock options, non-qualified stock Total number of employees that returned to work in the reporting period after parental leave ended 22 11 employees in Israel who are entitled countries of operation. In Israel, and options, restricted stock units Total number of employees that returned to work after parental leave ended that were still employed 26 5 to benefits in the event of termina- according to the law, all employees (“RSUs”), stock appreciation rights 12 months after their return to work tion or retirement in accordance with receive pension plan coverage, with (“SARs”), stock units, performance 100% 92% the Israeli Government sponsored the employer contributing 7.5% or awards, phantom stock, incentive Return to work rate following parental leave programs are provided with limited more, depending on the personal bonuses, and other possible related non pension benefits. These plans employment contract with the dividend equivalents to employees of generally obligate the Company to employee141. the company, directors and indepen- pay one month’s salary per year of dent contractors. According to the service to employees in the event of At several locations, we offer retiring Plan, a total of 5,000,000 shares of involuntary termination. There is no employees the option to continue the Company’s common stock were limit on the number of years of service work after the retirement age or to reserved for issuance, all of which

In order to facilitate a healthy and milestones, such as personal days, healthcare needs, but we actively work-life balance for our employees, wedding vacations and compassion- seek employee feedback in develop- Year ending 2020 we encourage them to take vacation ate leave upon the death of a relative. ing these benefits and offerings. (in thousands of USD) days and, at some locations, we Benefits upon retirement140 4,780 provide special holidays to mark the In addition to the healthcare benefits Due to the dynamic nature of energy observance of religious holidays, noted above, we also offer many of generation processes, some of our and cultural events. Our approach our employees access to supplemen- employees and contractors reside towards vacation time is flexible, tary health benefits such as coverage for certain periods of time at our sites allowing employees to choose their for dental care payments, optical in housing facilities. We do our best

133 These include the operational locations included in the scope of the Information Boundaries of this report, i.e.: Guadeloupe, Guatemala, Honduras, Israel, Kenya, vacation period and to divide the care payments, and, in some cases, to ensure that the facilities are up Turkey, and the United States. In total, the percentages presented in the benefits table refer to seven significant locations of operation for our activities in 2019. period into intervals throughout the support for mental health issues and to their standards and that they are 134 According to the relevant nationally mandatory or voluntary healthcare frameworks in the relevant significant location of operation. 135 According to the relevant national framework for vacation days or the personal employment contract of the employee. The indication here is to the possibility for year, of course in consultation with personal care. The health and well-be- afforded a reasonable level of comfort employees to take vacation days, as well as the possibility for extended vacation periods, based on requests and individual employee needs. their managers. At some of our oper- ing of our employees is important to and accessibility. According to our 136 Coverage for GRI Disclosures 401-2b is provided for the employees that are included in the ‘significant locations of operation’ noted in the “Information Boundaries of This Report,” and does not include employees based in Indonesia, the Philippines, Chile and New Zealand. ational locations, we offer employees us, which is why we not only work to Human Rights and Labor Policy, at 137 Benefits are not provided to part-time or temporary employees at our significant locations of operation in the United States. holidays for major personal events ensure they are supported in their all of our facilities we work to uphold 138 At the national retirement or pension issuance age in the significant location of operation. 139 In the United States, a 401(k) plan is the tax-qualified, defined-contribution pension account defined in subsection 401(k) of the Internal Revenue Code. 140 The above amount was determined based on employees’ current salary rates and the number of years’ service that will have been accumulated at their expected retirement date. These amounts do not include amounts that might be paid to employees that will cease working with us before reaching their expected retirement age. 141 Through Ormat Systems, we provide limited non-pension benefits to all current employees in Israel who are entitled to benefits in the event of termination or retirement in accordance with the Israeli Government sponsored programs. These plans generally obligate the Company to pay one month’s salary per year of service 90 to employees in the event of involuntary termination. There is no limit on the number of years of service in the calculation of the benefit of obligation. 91 142 The 2012 Incentive Plan expired in May 2018 upon adoption of the 2018 Incentive Compensation Plan (“2018 Incentive Plan”), except as to stock-based awards outstanding under the 2012 Incentive Plan on that date. basic human rights, and we apply this dining options for our employees – Employee Performance Reviews & in our approach to employee housing namely at our manufacturing facili- Satisfaction Surveys and residential facilities as well. In ties. Finally, our manufacturing and Collaboration in Ormat some cases, when we are not able to power plant employees are proudly As part of our commitment to physically construct housing facilities, fitted with workplace uniforms, and in providing our employees with a better we provide employees with funds to various locations we support replace- employment experience, we invest support their living expenses while ment for necessary work items, such significant time and resources in our working for Ormat. At other locations, as shoes and protective gear, and program for performance reviews. we provide our employees with access provide laundry services. to transportation options, such as As of 2019, 87% of our permanent bussing to and from the power plants and temporary employees received to facilitate a smoother work experi- regular career performance reviews, ence. We offer healthy and fulfilling i.e. on an annual or biannual basis.

Percent of employees who received performance review in 2019

2019 Male Female

Permanent employees 90% 87% Temporary employees 29% 0%

Through career performance reviews, of the Code of Business Conduct and Employee Engagement and which occur between the employee Ethics nor their overall employment Promoting Well-Being in the and their direct manager, depending experience at Ormat. Workplace on the nature of the position and if the employee works on a permanent In addition, and as employees are a Our employees are spread across or temporary basis, employees are key stakeholder group for our orga- the globe, which would seemingly able to provide their feedback on nization, we have begun to regularly create a challenge in connecting their position, share their career survey employees on their level of them. However, our Human Resources goals and receive feedback from satisfaction in employment by Ormat, Department, together with various their direct managers on their as well as the programs for personal, business units in the company, work performance. Through these career professional and educational devel- together on initiatives to create a performance reviews the employee opment that we offer. In 2019, we sense of community and together- easy and accessible communication, and ensure that they are fulfilling ities together with their local team and the manager can set goals and surveyed nearly 10% of our employees ness among our employees no matter providing employees with opportu- both their personal and professional and members of the community. milestones for assessing future at various global locations on their their location. We actively facilitate nities to connect and get more done goals. We allow some flexibility in Finally, we encourage our employees performance and the employee can employment experience. Currently, community events, employee gath- on-the-go. In addition, we regularly work schedules for parents, and to remain active and support request a salary review, if desired. We our Human Resources Department erings (including virtual gatherings), distribute an employee newsletter in some cases we allow for regular lectures on fitness, weight loss, view employee performance reviews and the various power plant and or company trips to facilitate open with key updates and alerts and in remote work or work from home, yoga practice and running groups. as an important avenue for engage- facility managers are working to communication and healthy connec- 2019 released our intra-organizational depending on the circumstances and In some locations, we sponsor ment with our employees, and work develop an organized mechanism tions between employees, and other communication platform “OrMeet” the specific needs of the employee. summer camps and recreational to obtain key insights from the for surveying a greater number of stakeholders across the globe. In that allows employees in some of We encourage our staff to enjoy activities for employees’ children content of their reviews to improve employees and relevant stakeholders addition, we actively engage our our locations to create professional the nature around our power plants and family members. We invite all our employment and workplace (such as temporary employees and employees through online portals, and personal groups to share expe- and facilitate joint staff lunches and of our part-time employees and experience. subcontractors) moving forward. social media networks and on-line riences, insights and provide profes- events outdoors, as well as holiday many of our temporary employees platforms. We have dedicated sional support. and team milestone celebrations. and subcontractors to participate In 2019, we did not receive any Instagram pages that document Bonding activities are a big hit, and and enjoy the health and well-being substantive complaints or grievances factory and power plant activities, We offer employees several options some sites provide employees with activities that we offer. from employees regarding violations and have WhatsApp groups for to improve their work-life balance opportunities for volunteering activ-

92 93 Technical, Professional & Safety Training TRAINING & EDUCATIONAL where there are regulated emergency holders to inform them of potential OPPORTUNITIES procedures in place depending on risks and modes of operation. Other Below you will find a table with some examples of the hundreds of courses we offer every year: the location of the plant, we often relevant training opportunities are We express our commitment to the provide guided instruction on the professionally and administratively Type of Training Relevant Courses Offered to Employees professional and personal develop- geographical specifications and managed by the Human Resources Operator Qualification Program ment of our employees out of the local points of reference for each department or the plant managers, belief that it contributes to their potential emergency. These are skills or are initiated by managers and Vice Mechanic Qualification Program career growth and trajectory in the that employees apply in their work for Presidents of various business units. Company, but also that it expands Ormat, but which also can be applied Finally, employees are welcome to Electrical Instrumentation & Controls Qualification Program our company’s knowledge base. throughout their path towards career suggest additional areas of expertise Flammable and Combustible Liquids Safety Therefore, we offer our employees development path. and coursework that are deemed with a wide array of training and necessary for the fulfillment of their First Aid educational programs regarding In addition, for business and admin- position and we are open to consider- Health & Safety relevant professional and soft skills to istrative professionals, we provide ing integrating their suggestions into Work at Height Courses and Certifications help them improve their performance access to courses on corporate gover- our training program and framework. and expand their horizons. These nance and ethics topics – in addition Safety Officer Competency opportunities help foster a creative to ethics training on our Code of Expanding Educational Horizons for Emergency and Fire Safety Preparedness Courses mindset among our employees that Business Conduct and Ethics– as Our Employees & Their Families is conducive to our company’s inno- well as soft skills instruction to help Safety in the Operation of Mechanical Equipment vative and dynamic nature. improve their value offerings for The professional and educational Ormat and within their professional development assistance we offer Accident Investigation Procedure We believe that quality education networks. We believe that these skills varies from in-house training courses Mandatory training on Ormat's Code of Conduct and Business Ethics and access to new economic, social contribute to the atmosphere of to subsidies for higher education and environmental opportunities creativity and innovation that we seek programs, covering a range of topics Anti-Bribery and Corruption enrich our employees’ experience to encourage among all Company or skills depending on individual while working for Ormat and, in turn, employees – no matter their educa- needs and aptitudes. We believe Harassment Training contribute to the development and tional background or geographi- that by investing in employee skill Corporate Governance & growth of the communities where we cal location. development through provision of Project Management Human Resources work. As a result, and in many cases, educational assistance we can meet Effective Communication Skills Training we also support our employees and Each area of training and course- our strategic business targets while their families in the pursuit of educa- work is managed according to the adequately preparing our employees Leadership Training tional opportunities through various relevant business unit, i.e. Quality, for a rapidly evolving professional subsidy and scholarship packages Environment, Health & Safety for environment. Team Building that are aimed at updating employee relevant Health & Safety training, or skills and developing a devoted the Company’s management for legal We offer our employees access American Society of Mechanical Engineers Course and experienced workforce in the and corporate governance training. to educational grants and partial Welding Course countries where we operate. In addition to necessary technical, or full scholarship opportunities professional and safety skills, our in the belief that the best way to Calibration Course In 2019, Ormat employees received nature as a renewable energy project innovate our company is through an average of 7 hours of training and developer and operator bestows employee knowledge. For instance, ISO CAT 111, ISO 45001, ISO 14001 education. upon us a commitment that we are at our power plants in Guatemala, we proud to implement educational implement an Educational Assistance Technical Sketching for production workers The diverse nature of our operations programs for our employees and Program for local employees that is Professional and Technica Training Exploration and Development of Geothermal Resources that span from the factory floor other relevant stakeholders, such as based on workforce planning and to the power plant site require our contractors and business partners, development. Employees are asked Information System Security Certification employees to remain in-the-know who are involved in the construction, to submit a proposal with the courses regarding relevant technical and operation and maintenance of our or degree that they wish to pursue English Training professional skills, health & safety global power plants, on the impor- as well as the name of the relevant requirements and best business tance of managing environmental, academic institution, and the plant MS Office Excel Essential Training practices. At all of our manufacturing health and safety risks on site and managers make considerations Procurement and Supply Chain Best Practices facilities, we provide our employees in the course of plant development. based on the employees’ overall with access to training regarding We factor management of health & performance and career trajectory equipment use and emergency safety risks into our site management at the plant. Other locations, like our procedures. At our power plants, policies and work with relevant stake- power plant in Honduras, awards

94 95 educational scholarships based on department, participate in soft skills Employees who are transitioning the amount of time the employee courses and exchange experiences to a different position, ending or has worked for the Company, and with managers in other business terminating their employment with all employees in Honduras (as well units in order to help them grow as Ormat, or who are in the process of as at various other locations) are managers. Due to the diverse nature retirement are also offered access to provided with English language of our operations, and the tendency reskilling and upskilling opportunities courses to better facilitate their of our employees to develop to ensure that they have the correct work and communication within the specific areas of expertise, we knowledge and tools to meet their organization. highly encourage intraorganizational next challenge. communication in our management In addition, we encourage our development programs. However, employees to develop their career it should be noted that manage- horizons within our company rial training is not a condition for through management development employee promotion and is instead learning platforms. At our adminis- an offering to employees interested trative offices in Israel, employees in exploring their opportunities for Ormat’s team in Honduras can “shadow” managers in their career growth within Ormat.

An Organization Shaped by Local economy and enables community time-set “shifts”. This method enables Employment development in that Ormat’s local to increases the rate of local employ- employees become part of a larger ment and Ormat’s economic impact Ormat is an organization that prides global organization and learn skills on local communities. itself on full local employment at all that contribute to their professional levels of our organization and in all career and personal goals. This is the case not only in the our facilities, power plants and oper- developing countries where Ormat ational locations. In countries like Kenya, Guatemala, operates, but also in the U.S., where Honduras and Guadeloupe where Ormat has operations in some areas In 2019, the proportion of manage- local employment options are limited, with traditionally high unemployment ment hired from the local commu- Ormat offers our employees access rates. Therefore, we not only hire nities in our plants was 100%.143 We to different professional employment qualified local staff where available, believe that local employment is opportunities such as plant managers, but also invest in creating oppor- essential to the success and vitality local sustainability managers, power tunities for qualified local staff. For of our business because local plant operators, maintenance example, Ormat has power plants employees, residents and community workers, engineers, mechanics and in the Imperial Valley, a region that members possess a keen understand- more. Individuals retained for these has one of the highest unemploy- ing of the local geography, environ- positions are hired by the local Human ment rates in California, and our local ment, social fabric, community and Resources manager based on their employment policy there has made stakeholders. This places them in a relevant experience, knowledge and Ormat the region’s second largest position to knowledgeably provide education. In some locations where employer. the superb degree of service that employment options are limited in Ormat strives for. In addition, we the vicinity of the power plant our In addition, as outlined above, we believe that cultivating the skills plants have also agreements with provide all of our employees with of the local workforce is important local community councils and repre- access to educational opportunities. Training in Ormat’s in fostering knowledge regarding sentatives to create additional job Furthermore, Ormat has written manufacturing facility renewable energy solutions, with opportunities for the communities curricula for local community colleges the goal of ensuring the long-term nearby. For example, In Guatemala, and universities in Nevada focusing sustainability of our power plants both the Amatitlan and Zunil have on technical subjects such as plant and energy solutions. Furthermore, agreements which provide preference operation and relevant academic we believe that investment in the to the employment in certain profes- subjects such as geoscience, which local workforce supports the local sions, of local employees, to work in has helped promote a talented local

143 ‘Senior management’ is defined as employees who manage operations and implementation of our projects and business targets at our power plants and in our offices. ‘Local’ is defined as the immediate communities surrounding our operations. ‘Significant locations of operation’ are those operational locations that are included in the Boundaries of this report, as defined in the “Information Boundaries of This Report” section. 96 97 ENSURING A SAFE health and safety rules and work and power plants are accountable for Ormat’s employees have represen- at Ormat’s power plants and offices. employee involvement, the employee regulations at each of our oper- implementing relevant Company-level tation on Company’s health and The committees organize and assess representatives are rotated each & HEALTHY WORK ational locations, but we also go and local health and safety regulations safety committees. Ormat has two Ormat’s health and safety program year. Overall in 2019, 20% of Ormat’s ENVIRONMENT – beyond compliance at the corporate and initiatives through the appointed types of safety committees: one at the corporate level. An employee employees took part in the safety level to ensure that the appropriate Environmental Health and Safety for the management of health and from each department is nominated committees. Whether participating OCCUPATIONAL policies and initiatives are imple- (EHS) coordinator. On-site EHS coor- safety aspects at our factories and to participate in the committees and as an employee representative or not, HEALTH AND SAFETY mented wherever we operate. The dinators are additionally responsible manufacturing facilities and one employees from all Ormat’s global all of Ormat’s employees are encour- goal of these efforts is to create an for upholding the local conditions, for the management of health and locations are encouraged to volunteer aged to communicate their concerns AT ORMAT overall culture of safety for Ormat’s regulations or other agreements, for safety aspects in other operations, i.e. their participation. In order to expand or recommendations to the relevant employees at all of our locations. In ongoing record-keeping and reporting addition, we have an advanced online and for the training and certification of The health and safety of our platform for recording, reporting and employees. These EHS coordinators employees, subcontractors, the tracking safety and environmental report to the plant and/or power plant public and the environment is an incidents at our power plants and manager and conduct work according overarching priority at Ormat. We operational sites. to Company-wide EHS initiatives that manage risks by identifying, assessing are set by the Global VP QEHS. and controlling risks in every facility, Ormat’s occupational health and office and workplace that we own safety program is focused on four Ormat has an Integrated Quality, Envi- and operate. We promote safety main components: ronment, Health and Safety Policy awareness and values and our goal is that sets out our general commit- to report, analyze, learn and improve 1. Everyone, Everyday – All Ormat ments towards health and safety performance following every event employees are integral to safe opera- principles at our sites and for all our in order to reduce the number of tions, each charged with the respon- stakeholders. The policy is enforced incidents. We also work to continu- sibility to work safely and create and by the Company’s Global VP QEHS ously improve our safety performance maintain a safe work environment. and adherence with the policy, or and to instill a strong workplace the need for relevant revisions, is safety culture. The countries where 2. Management of Hazards – Ormat consistently monitored and assessed Ormat operates have local laws strives to systematically identify together with Company manage- regulating the topics of health and hazards, and then manage them by ment. The policy is publicly available safety that the Company follows, elimination, isolation or minimization. on Ormat’s website144 and outlines and where possible and practical, we our commitments to providing high strive to go beyond the requirements 3. Safety as a Core Value – Safety is quality products, conducting our of the legal regulations to promote a core value at Ormat. business with care for the environ- the utmost level of health and safety ment and for integrating our QEHS for our employees and other relevant 4. Continual Vigilance - Our goal is system into our business strategy stakeholders. These include safety to learn and improve our performance and work processes. In addition, requirements such as ventilation, fire following every event in order to our Human Rights and Labor Policy, protection, work at height regulations, reduce the number of incidents. This which is also available publicly on our personal protection and gear, railings, requires that all employees maintain website145, outlines our commitments electric protection and employee constant vigilance to ensure that to ensuring that essential health and training on pertinent issues, among unsafe acts or work conditions are safety standards and practices are other topics that are outlined in the identified, addressed, regulated and enforced in the workplace, to devel- following chapter. prevented, wherever possible. oping risk awareness and to encour- aging responsible health and safety OUR OCCUPATIONAL HEALTH AND The topic of Quality, Environment, behavior among employees. The SAFETY PROGRAM – STRIVING TO Health and Safety (QEHS) was policy was updated in 2018 to add GO BEYOND COMPLIANCE managed during the relevant period more comprehensive information by Ormat’s appointed Global VP on our health and safety policies, Safety is a key area of concern to of QEHS. The Global VP of QEHS is initiatives and expectations, such as us. We believe that the optimal, responsible for oversight and manage- our full commitment to meet and most efficient and profitable perfor- ment of the health and safety budget go beyond all legal and regulatory Working safely in Ormat mance of our power plants can only and relevant policies, processes, health and safety requirements in be achieved by fostering a safe and training and work practices across our countries of operation and infor- healthy working environment. First the organization. Plant managers mation on the industry standards to and foremost, we follow the relevant at each of Ormat’s operational sites which we adhere.

144 HTTPS://WWW.ORMAT.COM/WAREHOUSE/USERUPLOADFILES/IMAGE/ORMAT%20INTERGRATED%20QUALITY%20ENVIORNMET%20HEALTH%20AND%20SAFETY%20(QEHS)%20POLICY.PDF 145 HTTPS://WWW.ORMAT.COM/WAREHOUSE/USERUPLOADFILES/IMAGE/ORMAT%20HUMAN%20RIGHTS%20POLICY.PDF 98 99 committees. In 2019, we received health and safety standards on a Department of Labor, according to In 2019, we recorded the following reportable injuries at our operational sites: over 7,400 health and safety observa- continual basis. internationally accepted reporting tions and hundreds of safety sugges- standards such the Occupational Type of Injury Number of Occurrences tions from our employees through In 2019, we continued our Safety Safety and Health Administration’s 146 our health and safety management Leadership Training, also known as (OSHA) forms for recording Struck 7 platform (detailed below). the ProAct safety training program, work-related injuries and illnesses. as well as to expand employee partic- Ormat’s manufacturing and office Exertion 6 Furthermore, Ormat facilities have ipation in our SafeStart® health and facilities in Israel operate in all material safety training programs, under the safety training and implementation respects according to OHSAS 18001, Slip 4 responsibility of each plant manager program, including integration of but the facilities do not have certifica- and the local EHS manager, and the SafeStart® philosophies and tion from the local Standards Institute Falls 5 which is directed by our Company’s practices into our health and safety of Israel. Pinch Point 3 joint employee and management key performance indicators (KPIs). health and safety committees. The In addition, we increased employee Ormat works to ensure that its Eye Injury 1 program seeks to ensure that safety participation in our behavior-based employees who unfortunately expe- expectations are clearly commu- safety programs, which contributes rience an injury or illness as a result Chemical Contact 1 nicated and understood by all greatly to maturing and advancing a of their work for the Company receive employees and subcontractors, and culture of safety at our organization. the utmost treatment and care for Environmental 1 that comprehensive safety plans are their ailment or affliction and that all maintained across all Company oper- MEASURING OUR HEALTH AND of their expectations of the Company Misstep 2 ations. We provide regular training SAFETY PERFORMANCE with regards to the matter are met. Repetitive Motion 1 in health and safety regulations and procedures at all our locations and Ormat reports its health and safety Ormat conducts Quality, Environ- have detailed guidelines in place data to the Bureau of Labor Statis- ment, Health and Safety audits of in case of emergency to monitor tics (BLS), which is part of the U.S. our plants and facilities every three

years. In 2019, internal audits were Ormat manages and monitors our pational Safety and Health Associa- completed for several sites in the QEHS performance at a global level tion (OSHA) of the U.S. Department U.S. including Mammoth, Steamboat, for all sites. Reports are catego- of Labor. Tuscarora and Neal Hot Springs, and rized according to the criteria and The following table details Ormat’s performance with regards to accepted workplace health and safety indicators in 2019. at our Yavne facility in Israel. performance metrics of the Occu-

Parameter147 Female Male All

Injury Rate148 0 3.56 2.13 track and compare performance Pre-Job Safety Meetings (PJSM) Occupational Disease Rate149 0 0 0 regarding our existing Safety Partici- Number of documented pation Program and will report on the PJSMs per month 150 Lost Day Rate 0 1.31 1.10 following indicators: Safety Inspections Absentee Rate 0.05 0.03 0.03 Safety Suggestion Number of safety Work-Related Fatalities 151 0 0 0 Number of safety sugges- inspections per month tions generated Ormat has Company-wide KPIs for Safety Work Orders (and/or the implementation of our health Safety Observations Completion of Safety Tasks) and safety program for employees. Number of safety observations Number of safety work orders Through adoption of the KPI, we performed by employees generated or safety seek to emphasize the importance tasks completed of sound health and safety activi- Job Hazard Analysis (JHA) ties at all sites, as well as express Number of JHAs completed or Safety Committee Meetings 146 The Occupational Safety and Health Administration (OSHA) is an agency of the United States Department of Labor. our commitment to learning and revised per quarter Number of safety committee 147 Each of the health and safety parameters are reported according to the relevant disclosures set out in 403-2 of the GRI’s SRS standards. improving our health and safety meetings conducted per quarter 148 Frequency of injuries, relative to the total time worked by all workers during the reporting period. Ormat uses the total recordable injury rate, TRIR which is calculated as the number of medical treatment injuries per 200,000 employee hours. performance. The KPIs measure, 149 Frequency of occupational diseases relative to the total time worked by all workers during the reporting period. Calculated as the number of medical treatment occupational diseases per 200,000 employee hours. 150 Time (‘days’) that cannot be worked (and are thus ‘lost’) as a consequence of a worker or workers being unable to perform their usual work because of an occupational disease or accident. Calculated as the number of lost day cases per 200,000 employee hours. 151 Death of a worker occurring in the current reporting period, arising from an occupational disease or injury sustained or contracted while performing work that is controlled 100 by the organization or that is being performed in workplaces that the organization controls. Calculated as the number of fatalities per 200,000 employee hours. 101 The following table represents our health and safety performance regarding the abovementioned indicators in 2019: In forthcoming reports, we plan and safety regulations as they the rules and regulations outlined to report on our health and safety pertain to our operations, including in the Hazardous Materials Law indicator performance to show our our own rules, where relevant. In (1993). Details on our treatment and 2019 2019 Indicator Business Unit progress year-over-year. Ormat’s standard contract for work dealing with hazardous materials Performance Total with subcontractors, the Company is provided in the “Measuring and United States Operations 317 Based on these indicators, we reserves the right to indemnify the Controlling Environmental Impacts: operate a proactive safety plan for services of the subcontractor if the Waste, Management of Materials and Israel Operations 244 Safety our employees, who are required subcontractor violates or infringes Biodiversity Conservation “ chapter 791 Suggestions to complete several different types upon any relevant laws, rules, regu- of this report. Other International Operations 155 of activities and to report on their lations or standards pertaining to “Safety KPI Scorecard”. Each of our occupational health and safety Ormat upholds detailed and Drilling Operations 75 sites is required to set goals regarding of employees. Ormat expects its well-communicated emergency United States Operations 2249 the KPIs and to report on their perfor- subcontractors to strictly adhere to response plans at each of its sites for mance regarding the following param- local health and safety regulations, evacuation in cases of emergency, Israel Operations 2539 eters: safety training of employees, together with Ormat’s own expecta- natural disaster or other hazards, such Safety 6872 number and frequency of actionable tions, whichever are more stringent. as chemical or pollutant spills and Other International Operations 1426 safety suggestions made, number We also require all subcontractors to leakages. In general, the Emergency and frequency of safety observations adhere to our checklist of “Environ- Action Plans (EAPs) are developed Drilling Operations 658 made, job hazard analyses (JHAs) mental Compliance Responsibilities”, and adopted by each of the offices, United States Operations 133 performed, pre-job safety meetings which is a list of tasks and necessary operational facilities and power (PJSMs) held and at which frequency, milestones that should be regularly plants on a local and case-to-case Israel Operations 53 number of safety inspections, number reported on to Ormat by the subcon- basis. EAPs in the U.S. are based on JHAs 432 of safety work orders and number of tractor. Some of these requirements the RMP-PSM, which governs all U.S. Other International Operations 186 safety committee meetings. include: attending pre-construction state regulations, such as Chemical Drilling Operations 19 conferences to review health and Accident Prevention Program (CAPP) Employees are encouraged to safety expectations, preparing an in Nevada and the California Acci- United States Operations 950 take an active role in improving emergency response plan, maintain- dental Release Prevention (CalARP) our health and safety performance ing a speed limit of 10 miles-per-hour Program. However, there is some Israel Operations 514 through the global Safety Partic- in the construction area and other general guidance from the global PJSMs 2169 ipation Program. The program is environmental controls, such as occupational health and safety team Other International Operations 454 designed to encourage and recognize developing a Storm Water Pollution on the general guidelines for gener- Drilling Operations 251 employees who are actively involved Plan (SWPP). ating an EAP. In our office spaces, in all aspects of maintaining a safe the EAP requirement is triggered by United States Operations 1564 and healthy work environment. SAFE DEALING WITH HAZARDOUS our fire detection systems (OSHA Employees can earn “Ormat Bucks” MATERIALS AND EMERGENCY Standard 29 CFR 1910.164) and by Israel Operations 10 Safety by completing and participating in RESPONSE PLANS the fixed fire extinguishing system 1895 health and safety activities, such as (sprinklers; OSHA Standard 29 CFR Inspections Other International Operations 158 safety work, taking proactive safety When it comes to hazardous materials, 1910.160). Drilling Operations 63 measures, demonstrating safety U.S. plants are subject to the Compre- leadership, or by increasing safety hensive Environmental Response, United States Operations 1212 engagement. By submitting safety Compensation, and Liability Act Safety reports, reporting unsafe conditions, (CERCLA), the Emergency Planning Israel Operations 317 Work participating in JHAs or acting as a and Community Right-to-Know Act 1638 safety committee member, Ormat (EPCRA), and Federal Risk Manage- Orders Other International Operations 61 (Tasks) employees can collect their “Ormat ment Plan/Process Safety Manage- Drilling Operations 48 Bucks” at the end of the month and ment (RMP-PSM). In all cases, the select a prize. regulated substance is the motive United States Operations 163 fluid in our power plants; pentane, HEALTH & SAFETY IN OUR WORK isopentane, butane, isobutane152 . Safety Israel Operations 70 WITH SUBCONTRACTORS We typically have small quantities 289 Committee of other regulated substances like Other International Operations 52 Meetings In addition to implementing stringent solvents, but most do not reach the Drilling Operations 4 health and safety measures for our quantity relevant under the regula- employees, we require our subcon- tion for official treatment. In Israel, tractors comply with relevant health our manufacturing facility follows

152 More information on our treatment of these regulated substances can be found in the “Waste and Materials” chapter. 102 103 SUPPORTING from country to local community. the local community. The social In all cases and locations, Ormat is part of the impact assessment first AND SHAPING committed to being open, transpar- collects data through dialogue with SUSTAINABLE ent, consistent and focused on deliv- the local community, then maps the ering sustainable renewable energy needs of the local community and COMMUNITIES AND solutions that generate inherently finally provides a framework for both FUTURES positive impact, for the environment, addressing stakeholder grievances society and the economy. and for generating positive impact through investment (philanthropic UNDERSTANDING AND or otherwise) in programs and/or UNIQUENESS funds. Often these assessments are OUR GOALS AND GUIDEPOSTS reviewed by relevant public authori- Ormat knows each community ties or by funding bodies, like institu- As a leading global provider of reflects a constellation of unique tional investors, development banks renewable energy solutions, Ormat stakeholders and that no two and other relevant parties, and are recognizes the vital role that local communities are identical. Each has often conducted prior to permitting people, communities and positive, its specific needs, characteristics, processes. The initial ESIA is the long-term relationships play in constraints and challenges. We seek basis to our relationship with the advancing the adoption, uptake first to understand and assess the community but we maintain ongoing and long-term viability of renewable local conditions through our Stake- dialog and change according to their energy. Ormat sees an imperative to holder Engagement Policy. Our changing needs. act, operate and engage with local approach is responsive and respect- people and communities in a manner ful to local customs, in full alignment In 2019, of all the social and envi- that is consistent both with globally with all local regulations and laws and ronmental impact assessments we recognized social, environmental and sensitive to the specific needs and conducted, Ormat did not discover economic development standards requests for contributions and assis- any notable negative impacts to local and Ormat’s corporate values – of tance voiced by each community. This communities. stability, constant renewal, full approach highlights an essential truth commitment, courage and creativ- – each community has deep insights LISTENING MEANS LEARNING ity. We view this as a fundamental into the ways it can be improved. pathway to success and are inspired Seeking this input typically leads to Community Engagement and by the standards of various leading the most proactive and potentially Handling Grievances sustainability frameworks, including uplifting outcomes. Ormat’s commit- those of the Global Reporting ment to community typically begins Ormat recognizes that for successful Initiative (GRI), the United Nations well before we start development in a interactions to occur, there must be a Sustainability Development Goals new region. Every part of our connec- basis for meaningful communication, (SDGs), and other principles such as tion with stakeholders – from pre-de- mutual respect and trust. That’s why we the OECD Guidance on Sustainabil- velopment and planning through to create processes and feedback mech- ity Impact Assessments and the ISO operations – is characterized by our anisms to encourage all community 26000 guidelines for social respon- “open door” policy. members to speak openly and honestly sibility. These are the guideposts for about any concerns that our develop- the behavioral expectations Ormat SOCIAL ACTION PLANS ment activities may raise. Ensuring upholds for all employees as we work both positive and negative input is towards fulfilling our mission and At Ormat, we take the impacts reported, listened to, and, most impor- engaging with local communities. from the construction of our power tantly, acted upon, keeps communica- plants seriously and work diligently tion channels clear, quickly identifies Another essential principle that we to reduce them. We are usually pressing issues and promotes a spirit seek to implement in our activities guided by Environmental and Social of cooperation and proactivity. and policies is that of equality. Ormat Impact Assessments (ESIA), which Community event near Amatitlan applies the same high standards to are conducted according to local Ormat’s stakeholders are encouraged plant in Guatemala the way we interact, engage and standards and requirements. We view to file their grievances directly with develop our business wherever we this as an important way to reduce local plant managers and/or with operate, across the globe. We under- negative impacts and conducting appointed representatives in their stand and perceive the unique cultural such assessments is the first stage municipal or community council who needs of each location on every level, in establishing our relationship with regularly liaise with Ormat.

76 More information on our treatment of these regulated substances can be found in the “Waste and Materials” chapter.

104 105 Stakeholders may also contact Ormat dialogue and seeking to address While a significant component of In addition to extensive outreach Guatemala relationship and assistance to the through the ‘Contact Us’ page153 on relevant issues and concerns. community engagement is focused activities in our host communities, community in Amatitlan is handled Ormat’s corporate website which on the economic benefits of building Ormat takes every opportunity to Ormat’s community engagement through the Orpacaya Trust (“Fide- lists the mail, telephone, fax or email As an example of the in-depth a geothermal power plant, Ormat is increase education and awareness efforts and action plans for the largely icomiso Orpacaya”) that enables through which they may connect and engagement activities initiated by also deeply committed to looking for policy makers and government agrarian areas around Zunil and Ormat to advance relationships with communicate with the Company. All Ormat in communities that host our beyond economic factors to enhance representatives, including tours and Amatitlan are designed to support the local community by furnishing concerns and grievances received are power plants, in 2019 Ormat began the quality of life in our host commu- educational presentations to local positive value creation and improved economic and educational opportu- addressed by Ormat’s Marketing and work on a Steamboat Hills geother- nities. In May of 2018, Kilauea, a and national delegations. In 2019, quality of life. nities. The Orpacaya Trust works to Communications department and are mal enhancement project near Reno, volcano active since 1983, began the geothermal energy space saw a develop social projects on education, systematically reviewed and directed Nevada. The enhancement project a months-long eruption in Puna, flurry of activity in Washington D.C., To develop our community engage- health, infrastructure and environ- to the relevant corporate department entails the replacement of old Hawaii, transforming the landscape as Nevada Senator Cortez Masto ment plans in Amatitlan, Ormat mental mitigation. Financial support for review and any necessary action power plant equipment to improve and devastating the community. and Oregon Senator Ron Wyden communicates directly with five local for the trust is allocated annually from and/or follow-up. performance and efficiency. With In the wake of the eruption, Puna introduced the Geothermal Energy communities: San Francisco de Sales, Ormat’s power plant budget. As there the aim of being a good neighbor Geothermal Venture (PGV) and 700 Opportunities Act. Following this El Cedro, El Bejucal, El Pepinal and San is one small community near Zunil the In 2019, Ormat did not receive any in our community, staff attended surrounding homes in the community and based on increased interest Jose Calderas. This is done through a relationship is less formal and there major stakeholder grievances nor a neighborhood advisory board were entirely surrounded by lava. in geothermal technology on a committee, known as a “COCODES” is direct contact between residents were any other issues raised regarding meeting, provided a workshop at Ormat immediately committed to national level, Ormat presented the that organizes and manages relevant of the local community and the plant vulnerable community groups in our the Reno City Council, and met with bringing the PGV plant back online clean energy potential of geother- stakeholder requests. Local officials management. areas of operation. We are committed the City Planning Commission and to provide power to the community. mal energy to the Energy and from the municipality, regulators to achieving our goal of addressing the Regional Planning Committee Working closely with oversight Mineral Resources Subcommittee and local community members are In 2019, we donated a computer and and responding to 100% of stake- to proactively address questions partners, Ormat worked quickly to in September of that same year. all represented on the COCODES. a printer for the COCODE of San holder requests received through and concerns regarding the project. design, engineer and clear a new Ormat then answers the requests Francisco de Sales, so that they could our various channels of stakeholder Following these meetings, the Reno path to the facility. And with the help through relevant activities, initiatives write letters to the community and engagement, as outlined in the “Our City Council approved the Steamboat of the Kapoho Land Development or messages to the community. The the Municipality updating them of Strategy for Stakeholder Engage- Hills geothermal enhancement Company, we were able to create ment” section. project, based on its adherence to access for our neighbors whose relevant regulations, including those homes had become inaccessible due Beyond local and national platforms, governing Ormat’s environmental to the eruption. Ormat has also found a voice on the and social engagement. global stage to discuss the benefits Following the eruption, as Puna of geothermal energy. In 2019, Vice Since 2019, Ormat has continued banded together to heal, Ormat President of Business Development to address relevant concerns and was honored to contribute funds Paul Thomsen presented on Ormat’s provide community education on to the Hawaii Island Chamber of efforts to implement sustainable geothermal energy in the Reno, Commerce, the Imiloa Astronomy development goals in the geothermal Nevada area, including communi- Center, the local Hawaii chapter energy arena to the United Nations in ty-wide presentations on renewable of the Boy Scouts of America, and New York, NY. energy hosted by the Great Basin several other community groups and Institute, the Nevada Petroleum causes as their journey to overcome United States and Geothermal Society, and local the tragedy commenced. Abiding by Chambers of Commerce. These the philosophy that a rising tide lifts In the United States, Ormat works to well-attended presentations were all boats, Ormat seeks similar phil- increase awareness of renewable and highlighted by the local news and led anthropic and sponsorship opportu- geothermal energy in the general to heightened community interest in nities in all of our host communities public as well as for policy makers tours of our geothermal facilities. We to encourage those communities and government representatives. continue to provide these tours and to thrive and flourish through arts, We regularly share information presentations, attend community education, health and wellness. In with these groups regarding the meetings, and implement feedback 2019, we donated funds to the AVA multiple benefits of geothermal as a mechanisms from the public in all Ballet Theater and the Pioneer Center School girls from a school for the viable, steady, and reliable source of of our host communities to sustain for Performing Arts in Reno, NV and community near Olkaria III renewable energy that has minimal community engagement and in both 2018 and 2019 we sponsored impacts on the surrounding environ- interest. Regarding the initiatives a summer youth education program ment. Ormat employs several mech- identified throughout the course for the Yomba Shoshone tribe in anisms to engage with local commu- of these outreach activities, Ormat Austin, NV centered around culture, nities near our power plants in the publishes an annual progress report community, and wellness. United States, encouraging open accessible to the public.

153 https://www.ormat.com/en/company/contact/main/ 77 https://www.ormat.com/en/company/contact/main/ 106 107 their progress. Also, in that city we a more stable, affordable electricity protect pedestrians and motorists Guatemala financed a road paving project which grid. To that end, in 2019 hundreds alike. Throughout the region we is set to be completed in 2020. In of people from across Honduras – serve, we conducted a program of In 2019, Ormat supported early Calderas, we financed the replace- students, local government members, reforestation, together with students childhood and elementary school ment of the water pump that had service organizations, environmen- of the communities, which resulted education in five target communities served the community with a modern tal groups, and others – visited our in the planting of over 12,000 trees, served by Amatitlan. We funded the 20-horsepower pump system. In El facility for tours. and a recycling education program, salary costs of two teachers serving Cedro, we completed the third phase which made available recycling kits schools in Calderas and Pepinal of constructing a community recre- Ormat recognizes that for successful for solid residues. and provided scholarships for four ation park, including a playground for interactions with the community to students in San Francisco de Sales. In children. Last, but not least, Ormat occur, there must be a basis for mean- Kenya the latter city, we also donated musical was a sponsor of the 2019 Pepinal ingful communication, mutual respect instruments for the school band. In community soccer championship. and trust. That’s why we create mech- In compliance with Ormat’s stake- Bejucal, we built new bathrooms anisms to encourage all community holder engagement strategy, and for a community school in an effort Honduras members to speak openly and to address requests from project to improve the overall sanitary and honestly about any concerns that our funders - the German Investment health conditions experienced by The mission of Ormat’s geothermal development activities may raise. The Corporation (DEG) and the Envi- schoolchildren. In El Cedro, we project in Honduras, Geotérmica Grievance Mechanism ensures that ronmental Resources Management donated stoves to the town’s primary Platanares (GPS), is to be a leading both positive and negative input is (ERM) East Africa Environmental school, to enable them to provide hot regional provider of renewable reported, listened to, and, most impor- and Social Due Diligence (ESDD), breakfasts for their students. Also in energy while building a balanced tantly, acted upon, keeps communica- Ormat’s Olkaria III facility developed a new school near Zunil El Cedro, we purchased a refrigerator portfolio of geothermal assets. tion channels clear, quickly identifies a number of mechanisms to engage for the local nursery school to help GPS also recognizes the vital role pressing issues and promotes a spirit with the local communities, to handle preserve the food that they receive that local people, communities and of cooperation and pro-activity. In grievances, and to provide support from the Ministry of Education. positive, long-term relationships play 2019, GPS did not receive any major to disadvantaged members. These in advancing the adoption, uptake stakeholder grievances nor were any mechanisms include: a Stakeholder In La Calera, the village near Zunil, and long-term viability of renewable other issues raised regarding vulner- Engagement Plan (SEP), a Grievance and with association management to equality of opportunity in education. which is home to a population of energy. We see an imperative to able community groups in our area Mechanism (GM), a Corporate Social discuss and address the concerns of In 2019, Ormat provided support around 600 people, our efforts act, operate and engage with local of operation. We are committed to Responsibility (CSR) Policy and a stakeholders. In 2019, as in previous to the Central Union High School focus on supporting the communi- people and communities in a manner achieving our goal of addressing CSR Strategy. The local sustainabil- years, we worked to support the District in El Centro, California, ty’s elementary school, because we that is consistent both with globally and responding to 100% of stake- ity manager reports annually on the social improvement of the neighbor- towards their youth softball league. believe that education can serve as recognized social, environmental and holder requests received through status of each of these policies and hood and the city at large, as well as We are now in the second year of our a springboard for the advancement economic development standards our various channels of stakeholder implementation plans, while setting for other nearby communities. three-year commitment (begun in of the whole community. Currently, and our corporate values – of stability, engagement. goals and recommending projects for 2018) to the Mammoth Lakes Foun- around 70 students from 5 to 13 years constant renewal, full commitment, future engagement. EDUCATIONAL EMPOWERMENT dation, which funds full scholarships of age attend, and it is therefore courage and creativity. As in previous years, in 2019 we for every Mono County senior high critical that the school will be able conducted a robust program of In 2019, we continued our activities to United States school student planning on attending to adequately serve their needs. To Geotérmica Platanares applies the community outreach in Honduras. support local communities. We worked the Cerro Coso Community College. that end, in 2019 Ormat sponsored same high standards to the way we We underwrote improvements to the together with the Kenya Wildlife Ormat aims to educate as many In 2019, we also began a scholar- the construction of a second-floor interact, engage and develop our main roadway, enabling residents to Service to help restore the Hell’s Gate people as possible about renewable ship program for students of the addition to the existing building, business, while also understanding safely make their way to work at the National Park, financed the construc- energy – specifically geothermal Eureka County High School, which adding five new classrooms, complete and perceiving the unique cultural San Andres Mines. We remodeled tion of water and electrical infrastruc- energy – and its concomitant benefits offers competitive scholarships with new desks and whiteboards, needs of each community on every the San Andres Social Center, a ture, opened and graded community for people, their communities, and to graduating seniors planning on together with a renovation of the level. In all cases, GPS is committed long-awaited improvement, which roads, and supported farming projects, the environment It is with this aim continuing to college or vocational entire school. The inauguration to being open, transparent, consistent will enable it to serve as a venue for alongside other activities to support in mind that we generally provide studies, with an emphasis on Engi- was a big community event, with and focused on delivering sustain- town meetings and the celebration vulnerable persons. tours and workshops for students neering, Electrical Instrumentation the students receiving new school able renewable energy solutions that of social occasions. In El Cedro, one and educators at several of our facil- & Controls (through Great Basin supplies and uniform. generate inherently positive impact, of the poorest communities in the Guadeloupe ities, emphasizing the types of skills Community College in Elko) or other for the environment, society and region, we provided the materials and education needed to work in the scientific fields. Similarly, in 2019 Honduras the economy. to build new roofs for the town’s In Guadeloupe, our power plant is in renewable energy space. Ormat also committed funds to fund neediest residents. When it comes to the center of the city of Bouillante. scholarships for students attending In 2019, we began a project in collab- Our goal is to inform and engage our community safety, our focus this year For this reason, we view community In addition to reaching school Hawaii Community College and the oration with the Honduras Ministry visitors and provide a first-hand look was Traffic Safety. To this end, we engagement as being especially students of all ages, we also under- University of Hawaii, Hilo as the of Education, which will transform at how geothermal energy is contrib- placed road signs, traffic lights, and important. To this end, we hold stand the importance of fostering local community recovered from the a community public school into uting to a cleaner energy future and crosswalks in critical places to help periodic meetings with residents developing minds and providing trauma of the 2018 Kilauea eruption. Honduras’ first public bilingual

108 109 school, teaching English as a Second ing water tanks, transporting teachers special needs, and socio-economically Committed to health during Language. This year, we started with to schools, building classrooms, disadvantaged youth. Among these students at the kindergarten level, donating classroom furniture and are the Nirim Youth Village, which the global pandemic and will expand to the first-grade equipment, supporting extracurricu- provides a ‘second chance’ to at-risk level in 2020. Though the program is lar activities, and in some cases hiring youth to become fulfilled, contrib- new, it has already created an impact school guards and funding teacher uting members of society. We also – enrollment in the community school salaries. provided computers to a youth club, Ormat is committed to the health has doubled since we began. “Kadima,” serving low-income children, and well-being of our employees Guadeloupe and donated to an organization which and all the individuals living in our In 2019, we also provided 50 scholar- provides employment opportunities to host communities across the globe. ships to students at the high school In 2019, we continued our support artists with special needs. Never before has that commitment and university level to enable them to for extracurricular activities, such as been tested as it was in the latter access quality educational opportuni- sports and music, which consists of HEALTHCARE DELIVERS HOPE part of 2019, and through 2020, ties that would otherwise be unavail- providing grants to purchase supplies. when the COVID-19 pandemic able to them. We provide essential school tutoring Improving access to healthcare is one swept across the globe. The virus for students in need, and provide of the most profound ways a company infected hundreds of thousands of We believe that hunger is a major prize incentives (computers, mobile can exert a positive influence on indi- people in every country, leading to barrier to the ability of children to phones, and travel tickets) for the 10 viduals and communities. Access to the shutdown of economic activity learn. For this reason, we continue best students in the city. As Safety is a healthcare improves the most funda- and the breakdown of essential to provide the ingredients to provide core Ormat value, we have continued mental human conditions, prevents global supply chains. meals to all the children in the five our ongoing program to support disease, supports families and is a educational centers within our safe bicycle and scooter driving for major pillar of our community invest- In the early days of this crisis, Ormat communities. We also donated young people. ment program. Similarly, initiatives acted quickly to put strict social appliances, water tanks, food storage that work to reduce poverty and distancing mechanisms in place to containers, and other materials to Israel provide nutritional food, especially protect all of our employees. While ensure that the food can remain fresh for younger, growing children, are their safety was our top priority, it and nutritious before being served. While Ormat actively engages in among the priority areas Ormat was clear that more was needed many philanthropic endeavors in targets with our community invest- from us in many of the commu- Kenya Israel, our focus is on supporting the ment programming nities that host our power plants. “ORT Ormat” technical and vocational Quick work was needed to launch To realize our Community Investment secondary school, which was estab- United States an extensive outreach plan to Policy in Kenya, Ormat has a well-es- lished in 1970 at Ormat’s Yavne factory support these communities where tablished record of funding education in cooperation with Israel’s Ministry of Ormat is involved in a wide variety of we do business. One of the largest programs in Kenyan communities Labor, Social Affairs and Social services partnerships designed to promote impacts to individuals that we near our operations, emphasizing and the ORT network.154 The ORT health, well-being, dignity, and self-suffi- sought to address was the reduced scholarship opportunities for bright Ormat school teaches students, many ciency in our host communities. In 2019, availability of food to vulnera- young girls. By doing so, we provide from socio-economically disadvantaged Ormat was a sponsor at the American ble populations. Because of this higher education pathways for backgrounds, essential industrial and Heart Association’s (AHA) annual Heart dangerous food insecurity, Ormat female students which open doors technical subjects, such as electrical and Stroke Ball and employees also devised a plan to supply food to 17 to careers as a viable alternative to manufacturing, metalworking, and participated in the AHA’s annual Heart different communities, ultimately early marriage. In 2019, we granted computer programming and opera- and Stroke Walk. We also continue providing 2,795 food packages mid-level and tertiary sponsorships to tions. This long-term initiative provides to proudly support the Food Bank of to support 11,411 people in Kenya, over 40 students from our six served added value for Ormat as well – most Northern Nevada through donations Guatemala and Honduras. communities (Narasha, Olomunyak, long-term manufacturing employees and volunteered staff time. Kenya, Guatemala, Honduras and continue to seek opportunities Olmara, Nkaampani, Oltepesi, and at Ormat’s Yavne facility are graduates In addition to providing needed the United States. In Nevada, we in our communities to make a Olmaiyana), alongside over 50 of the program. In 2019, as in previous Guatemala sustenance to these communities, donated 1,200 unused N95 masks positive impact on our neighbors, secondary school bursaries. years, Ormat financed school activi- there was an outcry from health- from our power plant operations to and we hold onto the hope that ties, including meals for students and During 2019, Ormat supported the care workers across the globe for Renown Hospital and the Veterans as the world recovers, we will all We also carried out a mentor- teachers and a class trip to Poland, and salary costs of a doctor for three days medical and personal protective Administration Hospital. emerge from this crisis stronger ship program in partnership with several of Ormat’s engineers served per week at the Cedro Health Post. equipment (PPE). Ormat heard and more connected, resilient and the National Organization of Peer as tutors. Additionally, we supported the salary the call and joined the hundreds While the world isn’t out of the prepared than ever before. Educators to 8th grade girls. In all our costs of a nurse who provided weekend of international companies who woods yet, we understand the communities, we supported schools In 2019, Ormat provided funding to services at the San Vincente Health stepped up to donate necessary need to come together as a global by providing hot meal services, install- additional programs serving high-risk, Center, two days a week. This initiative supplies and personal protective community to meet the needs equipment (PPE) to hospitals in of our most vulnerable. We will

154 The ORT network is a global initiative which provides critical science and technology skills to over 300,000 people worldwide, with a special focus on communities facing socio-economic challenges. See https://en.ort.org.il/

110 111 is a continuation of the support that Ormat was able to provide hundreds LOCAL LIVELIHOOD we provided in 2018. Additionally, we of medical treatments such as dental supported the ongoing renovation of care treatments for children between One of the prime directives that sets the Pepinal Health Post, including the the ages of 7 and 16, mammography Ormat apart is our Company-wide construction of a new roof, and facili- screening to women older than 35 promotion of local employment; tated the donation of medical supplies. years of age, and cytology exams. everyone who works at a plant is from the country in which the plant is located. Honduras Kenya We believe every renewable energy facility we develop, own and/or operate This year, Ormat continued to collab- In 2019, Ormat continued many of our should be staffed by people who live in orate with the Central American initiatives begun in previous years, or close to the local community. This Medical Outreach (CAMO)155 including providing a community HIV/ reflects Ormat’s responsibility to return Brigades, a foundation that provides AIDS peer educator to help reduce benefits and generate positive impact essential medical services to disad- the prevalence of the disease in the for the local communities in proximity vantaged communities. In 2019, region that we serve. This year, we to our operations. We believe that being Dental care to the community near Platanares we worked with them to provide also operated a free medical clinic, in a good neighbor is the right thing to do plant in Honduras medical services year-round to our partnership with the government-run and that hiring locally is the right way communities. Through this initiative, Naivasha District Hospital. to operate.

United States Desert Research Institute (DRI), a value throughout our local commu- Honduras – Mitigating the work for 90% of the residents in our From the outset of this crisis, GPS non-profit environmental research nities. This has taken the form of communities. worked to help alleviate the new For many communities, geother- arm of the Nevada System of Higher approximately dozens of positions Impact of COVID-19 in our hardships that arose. We created a mal power plants provide ongoing Education. Ormat also wrote curricula (about half in Amatitlan and half in Honduras, like many other Central special social project to help each employment and financial produc- for a geothermal energy course Zunil) which provide an income well communities American countries, was especially and every family of our communities tivity, particularly in areas that are for the U.S. public school STEM above the local average. Employees hard-hit by the economic conse- through the monthly provision of remote or have limited employment program156 and sponsors a geother- hold these positions for two months As an electric power generation quences of these closures. Many food, directly aiding 2,500 people in opportunities. Ormat’s Ormesa mal energy program for geoscientists a year, following which another local company, GPS was required to depend on informal work for their our communities. We also donated Geothermal Complex, built in Cali- at the University of Nevada. resident is offered the opportunity. continue operations upon the livelihoods, which has been severely food supplies to the municipality of fornia’s Imperial Valley in 1988, outbreak of COVID-19 in early impacted by social distancing La Unión, which was able to serve an became the second largest employer Guatemala 2020, even though most Honduras measures. Moreover, public health additional 8,000 people, and provided in an area that is impacted by severe Kenya companies were forced to shut down. centers and hospitals were not medical supplies to hospitals through- unemployment. Members of our local communities Enterprises that were closed included equipped to cope with the medical out western Honduras. in Guatemala have expressed their Ormat continues to provide training the mining company which provides emergency. Part of Ormat’s commitment to desire that Ormat create more oppor- and capacity building opportunities job creation and quality education tunities for local employment to help for youth, as an engine for broader involves working in local U.S. commu- alleviate the prevalent conditions of economic development and job nities to train students in high-de- economic hardship. Unfortunately, creation in our communities. This mand fields and instill technical skills in many cases this is not possible includes vocational skill training that translate into career-building as our plants only require a limited (driving, operating construction opportunities. For example, Ormat amount of employees once they equipment, and business manage- developed curricula for a power are constructed and operational. ment and administration. We also operator course at a local community In order to partially address these provide essential skills training and college, which provided a successful needs, we have embarked upon a mentorship to small and medium pool of employees for our local plant. program in our Amatitlan and Zunil sized enterprises (SMEs) in the area Ormat also sponsored a program to locations, which creates temporary and prioritize hiring community educate local teachers on renewable employment for local residents, thus members to work within our facility. and geothermal energy through the generating significant economic

155 See https://www.camo.org/ 112 156 STEM is a curriculum based on the idea of educating students in four specific disciplines — science, technology, engineering and mathematics — in an interdisciplinary and applied approach. 113 CHAPTER VIII. GRI CONTENT INDEX

For the GRI Content Index Service, GRI Services reviewed that the GRI content index is clearly presented and the refer- ences for all of the disclosures included align with the appro- priate sections in the body of the report.

Don A. Campbell geothermal complex, NV, U.S., 36 MW

114 115 Omission and Reason Omission and Reason GRI Standards Disclosure Page Number/Chapter Name/Link GRI Standards Disclosure Page Number/Chapter Name/Link for Omission for Omission

GRI 101: Foundation 2016 How Ormat Powers Our Renewable Energy Future' (pg. 8), General Disclosures 'Ormat At A Glance' (pgs. 10-11), 'Ormat Presence' (pg. 12-13), Organizational Profile 'About Our Renewable Energy Business' (pgs. 14-15), 'Our History 102-1: Name of the 102-7: Scale of the and Key Experience' (pg. 20), ' Our ‘Ormat: What We Do’ (pg. 14) organization organization Customers' (pgs. 20-21), 'About Our Business' (pg. 46), 'Economic Performance in 2019' (pgs. 47-48), 'How Ormat Powers our 'Our People: Employment and Skill Renewable Energy Future' (pg. Development at Ormat' (pg. 82), 8), 'Ormat: What We Do' (pg. 14), 'Our Employment Framework' 'About Our Renewable Energy (pgs. 82-83) Business' (pgs. 14-15), 'Geothermal Power Plants' (pg. 16), 'Recovered 'Employment Data for Ormat 102-2: Activities, brands, Energy Power Plants' (pgs. 18-19), in 2019' (pgs. 84-85), 'Subcon- products and services 'Storage & Energy Management' 102-8: Information tractors and Third Parties' (pgs. (pgs. 20-21), 'Our History and on employees and 85-86), 'Employee Retention' Key Experience' (pg. 20), 'Our other workers (pgs. 86-87), 'Diversity & Equality Proprietary Technology (pg. 20), GRI 102: General in Employment at Ormat' 'Mitigating Climate Change Risks Disclosures 2016 (pgs. 88-89) and Working to Realize New Opportunities' (pg. 64) 'Ormat's Supply Chain & Procurement Practices' (pg. 50), 102-9: Supply chain 102-3: Location of 'Our History and Key Experi- 'Subcontractors and Third Parties' headquarters ence' (pg. 20) (pgs. 85-86)

102-10: Significant changes GRI 102: General 'Ormat's Supply Chain & Procure- 'Ormat At A Glance' (pgs. to the organization and its Disclosures 2016 ment Practices' (pg. 50) 10-11), 'Ormat Presence' (pg. supply chain 12-13), 'Ormat's Geothermal and Recovered Energy Power Plants in 102-4: Location of Operation as of December 2019' 102-11: Precautionary 'Our Risk Management Approach' operations (pgs. 18-19) 'Our History and Key principle or approach (pg. 38), ' Relevant Risks' (pg. 38) Experience' (pg. 20), 'Informa- tion Boundaries of This Report' 102-12: External initiatives 'External Initiatives' (pg. 32) (pg. 42-43)

102-13: Membership of 'Ormat's Memberships of Associa- associations tion' (pg. 33) 102-5: Ownership and 'Ownership Structure' (pg. 22), legal form 'Beneficial Ownership' (pg. 22) Strategy

How Ormat Powers Our 102-14: Statement from 'A Message for Our Stakehold- Renewable Energy Future' (pg. senior decision-maker ers' (pg. 4) 8), 'Ormat: What We Do' (pg.14), 'About Our Renewable Energy Business' (pgs. 14-15, 'Geothermal 102-6: Markets served GRI 102: General 'Knowing Our Impacts – Stake- Power Plants' (pg. 16), 'Our History Disclosures 2016 holder Engagement Strategy' and Key Experience' (pg. 20), Our 102-15: Key impacts, risks, (pgs. 26-28), 'Risk Management Customers' (pgs. 20-21), 'About and opportunities Strategy – Sustainability and Our Business' (pg. 46), 'Our Climate Change-Related Risks' Business Strategy' (pg. 46) (pgs. 38-39)

116 117 Omission and Reason Omission and Reason GRI Standards Disclosure Page Number/Chapter Name/Link GRI Standards Disclosure Page Number/Chapter Name/Link for Omission for Omission

Ethics and Integrity 102-23: Chair 'Ormat's Board of of the highest Directors' (pg. 54) 'An Organization Shaped by governance body 102-16: Values, principles, Values' (pgs. 24-25), 'Our Five standards and norms Core Values' (pgs. 24-25), 'Making of behavior Sound Corporate Governance a 102-26: Role of the 'Ormat's Corporate Governance Priority' (pg. 54) highest governance Structure' (pg.54), 'Ormat's Board body in setting purpose, of Directors' (pg. 54), 'Ormat's 'An Organization Shaped by values and strategy Management' (pgs. 57-58) GRI 102: General Values' (pgs. 24-25), 'Ensuring a Disclosures 2016 Corruption-Free Work Environ- 102-29: Identifying and 'Our Strategic Commitments ment' (pgs. 59-61), 'Communi- 102-17: Mechanisms for and Sustainability Plan' (pg. cation and Training on Anti-Cor- managing economic, advice and concerns ruption Commitments' (pg. 60), GRI 102: General environmental, and 32), 'Ormat's Board of Directors about ethics 'Whistleblower Policy' (pg. 61), Disclosures 2016 social impacts Committees' (pgs. 55-56) 'Our Outlook on Employment' (pg. 82), 'Our Employment Framework' 102-30: Effectiveness (pgs. 82-83) 'Our Risk Management of risk manage- Approach' (pg. 38) ment processes Governance

'Ensuring a Corruption-free Work 'Our Holistic Approach to 102-33: Communicating Environment' (pg. 59), 'Whis- Corporate Governance' (pg. critical concerns 52), 'Ormat's Corporate Gover- tleblower Policy' (pg. 61) nance Structure' (pgs. 54-55), 102-18: Gover- 'Ormat's Board of Directors' nance structure 'Remuneration Policies' (pg. 58), (pg. 54), 'Ormat's Board of 102-35: Remunera- 'Stock-based Awards' (pgs. 59) Directors Committees' (pgs. tion policies 55-56), 'Ormat's Management' (pgs. 57-58) Stakeholder Engagement

102-19: Delegat- 'Ormat's Board of Directors 102-40: List of stake- 'Stakeholder Groups Engaged by ing authority Committees' (pgs. 5-56) holder groups the Organization' (pg.26)

102-20: Executive-level 102-41: Collective bargain- 'Collective Bargaining Agreements responsibility for 'Ormat's Board of Directors ing agreements & Employee Unions' (pg. 89) GRI 102: General economic, environmen- Committees' (pgs. 55-56) Disclosures 2016 tal, and social topics 'Knowing Our Impacts – Stake- 102-42: Identifying and holder Engagement Strategy' 'Knowing Our Impacts – Stake- selecting stakeholders (pgs. 26-28) holder Engagement Strategy' (pgs. GRI 102: General 26-28), 'Our Approach to Stake- 102-21: Consulting stake- Disclosures 2016 holders on economic, holder Engagement' (pgs. 26-27), 'Our Approach to Stakeholder environmental, and 'Our Main Channels of Stakeholder Engagement' (pgs. 26-27), 'Our social topics Engagement' (pg. 27), 'Ormat's Main Channels of Stakeholder Board of Directors Committees' Engagement' (pg. 27), 'Our Stakeholders' Key Interests (pgs. 55-56) 102-43: Approach to stake- and Concerns' (pg. 28), 'Our holder engagement Sustainability Strategy – Defining 'Ormat's Corporate Governance What's Material to Ormat' (pgs. 102-22: Composition of Structure' (pgs. 54), 'Ormat's 29-31), 'Supporting and Shaping the highest governance Board of Directors' (pgs. 54), Sustainable Communities and body and its committees 'Ormat's Management' (pgs. 57-58) Futures' (pg. 105)

118 119 Omission and Reason Omission and Reason GRI Standards Disclosure Page Number/Chapter Name/Link GRI Standards Disclosure Page Number/Chapter Name/Link for Omission for Omission

'Our Stakeholders' Key Interests Material Topics and Concerns' (pg. 28)), 'Our Sustainability Strategy – Defining GRI 200 Economic Standards Series What's Material to Ormat'(pgs. GRI 102: General 102-44: Key topics and 29-31), 'Our Strategic Commit- Economic Performance Disclosures 2016 concerns raised ments and Sustainability Plan' (pg. 32), 'Supporting and Shaping 'Our Business, Financial 103-1: Explanation of the Sustainable Communities and Performance and Economic material topic and its Futures' (pg. 105) Impacts' (pg. 44), 'About Our Boundaries Business' (pg. 46) Reporting Practice

103-2: The manage- 'About Our Business' (pg. 46), 102-45: Entities included in 'About This Report' (pg. 42), GRI 103: Management the consolidated financial 'Information Boundaries of This ment approach and its 'Management of Economics and Approach 2016 components Finance at Ormat' (pgs. 46-47) statements Report' (pg. 42-43)

102-46: Defining report 'About This Report' (pg. 42, 'Infor- 'Our Risk Management content and topic mation Boundaries of This Report' 103-3: Evaluation of the Approach' (pg. 38), 'About Our Boundaries (pg. 42-43) management approach Business' (pg. 46), 'Our Business Strategy' (pg. 46) 'Our Sustainability Strategy – 102-47: List of Defining What's Material to Ormat' material topics 201-1: Direct economic (pgs. 29-31) 'Economic Performance in 2019' value generated and (pgs. 47-48) distributed 'About This Report' (pg. 42), 102-48: Restatements of 'Information Boundaries of This information Report' (pg. 42-43) When compiling the infor- mation specified in Disclo- sure 201-2, if the reporting 'About This Report' (pg. 42), 102-49: Changes organization does not 'Information Boundaries of This have a system in place in reporting Report' (pg. 42-43) to calculate the financial GRI 102: General implications or costs, or to Disclosures 2016 make revenue projections, 102-50: Reporting period 'About This Report' (pg. 42) 201-2: Financial Impli- it shall report its plans and cations and other risks timeline to develop the 'Relevant Risks' (pg. 38) necessary systems. and opportunities due to 102-51: Date of most Omission of 201-2 iii. the 'About This Report' (pg. 42) climate change financial implications of recent report GRI 201: Economic the risk or opportunity Performance 2016 before action is taken; iv. the methods used to 102-52: Reporting cycle 'About This Report' (pg. 42) manage the risk or oppor- tunity; v. the costs of actions taken to manage 102-53: Contact person 'Contact Point for Questions the risk or opportunity. for questions regarding Regarding This Report' (pg. 43) the report

102-54: Claims of reporting in accordance with the 'About This Report' (pg. 42) GRI Standards 201-3: Defined benefit 'Employee Benefit, Healthcare & plan obligations and Welfare Frameworks' (pgs. 89-92) 102-55: GRI content index 'GRI Content Index' (pgs.114-130) other retirement plans

102-56: External assurance 'About This Report' (pg. 42)

120 121 Omission and Reason Omission and Reason GRI Standards Disclosure Page Number/Chapter Name/Link GRI Standards Disclosure Page Number/Chapter Name/Link for Omission for Omission

103-2: The manage- 201-4a – Total monetary 'Providing Excellent and Reliable ment approach and its value of financial assis- Customer Service' (pgs. 50-51) tance received by the GRI 103: Management components 201-4: Financial assis- 'Loans and Financial Assistance organization from any GRI 201: Economic Approach 2016 tance received from Received from Governments and government during the Performance 2016 government Development Banks' (pgs. 48-49) reporting period. This 103-3: Evaluation of the 'Providing Excellent and Reliable information is omitted management approach Customer Service' (pgs. 50-51) due to confidentiality constraints. 'Our Approach to Stakeholder Engagement' (pgs. 26-27), ' Our Innovation in Products & Services Main Channels of Stakeholder Non-GRI Engagement' (pg. 27), 'Our 103-1: Explanation of the Customer Service 'Our Strategic Commitments and Material Topic Stakeholders' Key Interests and material topic and its Sustainability Plan' (pg. 32) Concerns' (pg. 28), 'Providing Boundaries Excellent and Reliable Customer Service' (pgs. 50-51) GRI 103: Management 103-2: The manage- 'Our Strategic Commitments and ment approach and its Approach 2016 Sustainability Plan' (pg. 32) Market Presence components

103-1: Explanation of the 'An Organization Shaped by Local 103-3: Evaluation of the 'Our Strategic Commitments and material topic and its Employment' (pgs. 97) management approach Sustainability Plan' (pg. 32) Boundaries

Ensuring innovation in Non-GRI 'Our Strategic Commitments and GRI 103: Management 103-2 The manage- products & services that 'An Organization Shaped by Local Material Topic Sustainability Plan' (pg. 32) Approach 2016 ment approach and its Ormat offers its customers Employment' (pgs. 97) components

Reliability of Ormat’s Service 103-3 Evaluation of the 'An Organization Shaped by Local 103-1: Explanation of the management approach Employment' (pgs. 97) 'Providing Excellent and Reliable material topic and its Customer Service' (pgs. 50-51) Boundaries 202-2: Proportion of senior GRI 202: Market 'An Organization Shaped by Local management hired from Presence 2016 Employment' (pgs. 97) GRI 103: Management 103-2: The manage- the local community 'Providing Excellent and Reliable Approach 2016 ment approach and its Customer Service' (pgs. 50-51) components Indirect Economic Impacts

103-3: Evaluation of the 'Providing Excellent and Reliable 'Developing Renewable Energy management approach Customer Service' (pgs. 50-51) and Critical Infrastructure' (pg. 49), 'Our People: Employment 103-1: Explanation of the and Skill Development at Ormat' 'About Our Renewable Energy material topic and its (pg. 82), 'Supporting and Shaping Business' (pgs. 14-15), ' About Our Boundaries Sustainable Communities and Geothermal Solutions' (pgs. 16-17), Non-GRI Reliability of Futures' (pg. 105), 'Our Goals and 'Storage and Energy Management' Material Topic Ormat's Service Guideposts' (pg. 105) (pgs. 20-21), 'Providing Excellent GRI 103: Management and Reliable Customer Service' Approach 2016 (pgs. 50-51) 'Our Goals and Guideposts' (pg. 103-2: The manage- 105), 'Understanding and Unique- ment approach and its ness' (pg. 105), 'Social Action Customer Service components Plans' (pg. 105) 103-1: Explanation of the GRI 103: Management 'Providing Excellent and Reliable material topic and its 103-3: Evaluation of the 'Listening Means Learning' Approach 2016 Customer Service' (pgs. 50-51) Boundaries management approach (pgs. 105-109)

122 123 Omission and Reason Omission and Reason GRI Standards Disclosure Page Number/Chapter Name/Link GRI Standards Disclosure Page Number/Chapter Name/Link for Omission for Omission

GRI 300 Environmental Standards Series 'Ormat: What We Do' (pg. 14), 'About Our Renewable Energy The organization does not disclose specific informa- Materials Business' (pgs. 14-15), 'Developing tion regarding the size, 203-1: Infrastructure Renewable Energy and Critical cost and duration of each 'Waste, Management of Materials investments and Infrastructure' (pg. 49), Ormat of its significant infrastruc- and Biodiversity Conservation' services supported and The Sustainable Development ture investment projects (pg. 73), 'Waste, Material Manage- Goals' (pgs. 33-37), 'Supporting or services provided 103-1: Explanation of the due to confidentiality ment and Recycling ' (pgs. 73-75), GRI 203: Indirect and Shaping Sustainable Commu- material topic and its constraints. 'At Our Global Power Plants' Economic nities and Futures' (pg. 105) Boundaries Impacts 2016 (pg. 74), 'At Our Manufacturing Facilities, Workshops and Offices' (pgs. 74-75) 'Developing Renewable Energy 203-2: Signif- and Critical Infrastructure' (pg. 'Waste, Management of Materials icant indirect 49), 'Supporting and Shaping GRI 103: Management and Biodiversity Conservation' economic impacts Sustainable Communities and Approach 2016 (pg. 73, 'Waste, Material Manage- 103-2: The manage- Futures' (pg. 105) ment and Recycling' (pgs. 73-75), ment approach and its 'At Our Global Power Plants' components Anti-Corruption (pg. 74), 'At Our Manufacturing Facilities, Workshops and Offices' (pgs. 74-75) 'Our Holistic Approach to 103-1: Explanation of the Corporate Governance' (pg. 52), material topic and its 'Waste, Management of Materials 'Ensuring a Corruption-Free Work Boundaries 103-3: Evaluation of the and Biodiversity Conservation' Environment' (pg.59) management approach (pg. 73, 'Waste, Material Manage- ment and Recycling ' (pgs. 73-75) GRI 103: 'Our Holistic Approach to Management 103-2: The manage- 'Waste, Management of Materials Corporate Governance' (pg. 52), Approach 2016 ment approach and its and Biodiversity Conservation' 'Ensuring a Corruption-Free Work components (pg. 73, 'Waste, Material Manage- Environment' (pg. 59) GRI 301: 301-1: Materials used by ment and Recycling' (pgs. 73-75), Materials 2016 weight or volume 'At Our Global Power Plants' (pg. 74), 'At Our Manufacturing 103-3: Evaluation of the 'Ensuring a Corruption-Free Work Facilities Workshops and Offices' management approach Environment' (pg. 59) (pgs. 74-75)

Brine & Steam Management ‘Our Holistic Approach to 205-1: Operations Corporate Governance’ (pg. 50), assessed for risks related ' About Our Renewable Energy ‘Ensuring a Corruption-Free Work Business' (pgs. 14-15), 'About Our to corruption Geothermal Solutions' (pgs. 16-17), Environment’ (pg. 59) 103-1: Explanation of the 'Management of Geothermal material topic and its By-Products and Water Resources' Boundaries (pg. 71), 'Management of the 205-2: Communication ‘Ensuring a Corruption-Free Work Geothermal Resource and its GRI 205: Anti- and training about Environment’ (pg. 59), ‘Commu- By-Products' (pg. 71) corruption 2016 anti-corruption policies nication and Training on Anti-Cor- GRI 103: Management ruption Commitments’ (pg. 60) Approach 2016 and procedures ' About Our Renewable Energy Business' (pgs. 14-15)'About Our Geothermal Solutions' (pgs. 16-17), 103-2: The manage- ‘Our Holistic Approach to 'Management of the Geothermal ment approach and its 205-3: Confirmed By-Products and Water Resources' Corporate Governance’ (pg. 52), components incidents of corruption (pg. 71), 'Management of the ‘Ensuring a Corruption-Free Work and actions taken Geothermal Resource and its Environment’ (pg. 59) By-Products' (pg. 71)

124 125 Omission and Reason Omission and Reason GRI Standards Disclosure Page Number/Chapter Name/Link GRI Standards Disclosure Page Number/Chapter Name/Link for Omission for Omission

'About Our Geothermal Solutions' (pgs. 16-17), 'Management of the Geothermal By-Products GRI 103: Management 103-3: Evaluation of the and Water Resources' (pg. 71), As the organization Approach 2016 management approach 'Management of the Geothermal does not consume fuel Resource and its By-Prod- 302-1: Energy consumption ‘Energy Consumption in the from renewable sources as of 2019, the data for ucts' (pg. 71) within the organization Organization’ (pg. 69) 302-1b was omitted as the requirement is not applicable.

'Ormat: What We Do' (pg. 14), 'About Our Renewable Energy Business' (pgs. 14-15), 'About Our Geothermal Solutions' (pgs. 16-17), 'Management of the Geother- The organization does not report information for Non-GRI Brine & Steam mal By-Products and Water GRI 302: Energy 2016 Material Topic Management Resources' (pg. 71), 'Management parameters 302-1c iii-iv as the information is unavail- of the Geothermal Resource and able – the organization its By-Products' (pg. 71), 'Safe does consume energy for Dealing with Hazardous Materials cooling, or steam. These and Emergency Response energy expenditures Plans' (pg. 103) are included in the total 302-1: Energy consumption ‘Energy Consumption in the electricity consumption in within the organization Organization’ (pg. 69) the organization, reported in 302-1e.

Energy Information for 302-1d ii-iv is omitted as it is not applicable as Ormat does not produce and therefore 'Mitigating Climate Change Risks does not sell heating, and Working to Realize New cooling or steam energy 103-1: Explanation of the Opportunities' (pg. 64), 'Energy resources as of 2019. material topic and its Use, Efficiency and Fuel Resource Boundaries Management at Ormat' (pg. 302-3: Energy intensity 'Energy Intensity' (pg. 70) 69), 'Efforts to Improve Energy Efficiency' (pg. 70) Encouraging Green Energy GRI 103: Management Approach 2016 'About Our Renewable Energy Business' (pgs. 14-15), 'Geothermal 'Mitigating Climate Change Risks Power Plants' (pg. 16), 'About and Working to Realize New Our Geothermal Solutions' (pgs. 103-2: The manage- Opportunities' (pg. 64), 'Energy 16-17), 'Recovered Energy Power ment approach and its Use, Efficiency and Fuel Resource Plants' (pgs. 18-19), 'Our History components Management at Ormat' (pg. and Key Experience' (pg. 20), 103-1: Explanation of the 'Our Customers' (pgs. 20-21), 'Our 69), 'Efforts to Improve Energy GRI 103: Management material topic and its Five Core Values' (pgs. 24-25), Efficiency' (pg. 70) Approach 2016 Boundaries 'Our Strategic Commitments and Sustainability Plan' (pg. 32), 'About Our Business' (pg. 46), 'Environmental Regulations Supporting Our Business' (pg. GRI 103: Management 103-3: Evaluation of the 'Efforts to Improve Energy Effi- 49), 'Mitigating Climate Change Approach 2016 management approach ciency' (pg. 70) Risks and Working to Realize New Opportunities' (pg. 64)

126 127 Omission and Reason Omission and Reason GRI Standards Disclosure Page Number/Chapter Name/Link GRI Standards Disclosure Page Number/Chapter Name/Link for Omission for Omission

'About Our Renewable Energy Water Business' (pgs. 14-15), 'Geothermal Power Plants' (pg. 16), 'About Our Geothermal Solutions' (pgs. 16-17), 'Recovered Energy Power Plants' (pgs. 18-19), 'Our History and Key Experience' (pg. 20), 103-2: The manage- 'Our Customers' (pgs. 20-21), 'Our 'Our Risk Management Approach' ment approach and its Five Core Values' (pgs. 24-25), 103-1: Explanation of the (pg. 38), 'Management of components 'Our Strategic Commitments material topic and its Geothermal By-Products ' (pg. 71), and Sustainability Plan' (pg. Boundaries 'Management of Water Resources 32), 'About Our Business' (pg. in Our Operations' (pg. 71) 46), 'Environmental Regulations Supporting Our Business' (pg. 49), 'Mitigating Climate Change Risks and Working to Realize New GRI 103: Management Opportunities' (pg. 64) Approach 2016 'About Our Renewable Energy Business' (pgs. 14-15), 'Geothermal Power Plants' (pg. 16), 'About Our Geothermal Solutions' (pgs. 16-17), 'Recovered Energy Power 'Our Risk Management Approach' Plants' (pgs. 18-19), 'Our History (pg. 38), 'Management of Geother- 103-2: The manage- and Key Experience' (pg. 20), mal By-Products and Water 'Our Customers' (pgs. 20-21), 'Our GRI 103: Management ment approach and its 103-3: Evaluation of the Resources' ((pg. 71), 'Management Five Core Values' (pgs. 24-25), Approach 2016 components management approach of Water Resources in Our Opera- 'Our Strategic Commitments tions' (pg. 71) and Sustainability Plan' (pg. 32), 'About Our Business' (pg. 46), 'Environmental Regulations Supporting Our Business' (pg. 49), 'Mitigating Climate Change Risks and Working to Realize New Opportunities' (pg. 64) 'About Our Renewable Energy Business' (pgs. 14-15), 'Our History and Key Experience' (pg. 20), 'Our Risk Management Approach' 'Our Customers' (pgs. 20-21)), 'An (pg. 38), 'Management of Geother- Organization Shaped by Values 103-3: Evaluation of the mal By-Products and Water (pgs. 24-25), 'Our Sustainability management approach Resources' (pg. 71), 'Management Strategy – Defining What's of Water Resources in Our Opera- Material to Ormat ' (pgs. 29-31), tions' (pg. 71) 'Ormat and the and the Sustain- able Development Goals' (pgs. 33-37), 'About Our Business' (pg. 46) 'Our Business Strategy' (pg. Non-GRI Encouraging Green Energy 46), 'Economic Performance in Material Topic 2019' (pgs. 47-48), 'Developing Renewable Energy and Critical Infrastructure' (pg. 49), 'Environ- mental Regulations Supporting 'Management of Water Resources Our Business' (pg. 49), 'Mitigat- in Our Operations' (pg. 71), 303-1: Water withdrawal ing Climate Change Risks and GRI 303: Water 2016 'Impacts of Our Operations on the by source Working to Realize New Opportu- Local Hydrology and Aquifers' nities ' (pg. 64), 'Emissions from (pgs. 72-73) Our Power Plants and Operations' (pgs. 64-67), 'Supporting and Shaping Sustainable Communities and Futures' (pg. 105)

128 129 Omission and Reason Omission and Reason GRI Standards Disclosure Page Number/Chapter Name/Link for Omission GRI Standards Disclosure Page Number/Chapter Name/Link for Omission

Biodiversity 'Mitigating Climate Change 103-1: Explanation of the 103-2: The manage- Risks and Working to Realize 'Our Risk Management Approach' material topic and its ment approach and its New Opportunities' (pg. 64), (pg. 38)), 'Biodiversity' (pg. 76), Boundaries components 'Emissions from Our Power Plants and Operations' (pgs. 64-67) 103-2: The manage- 'Our Risk Management Approach' ment approach and its GRI 103: Management (pg. 38), 'Biodiversity' (pg. 76), GRI 103: Management components Approach 2016 Approach 2016 'Mitigating Climate Change Risks and Working to Realize 'Our Risk Management Approach' New Opportunities' (pg. 64), (pg. 38), 'Biodiversity' (pg. 76), 103-3: Evaluation of the 103-3: Evaluation of the 'Emissions from Our Power ' Environmental Impact Assess- management approach management approach Plants and Operations' (pgs. ments and Environmental Audits' 64-67), 'Emissions from Opera- (pg. 76), tions' (pg. 68)

‘Waste, Management of Materials 304-1: Operational sites and Biodiversity Conservation’ owned, leased, managed (pg. 73), ‘Biodiversity’ (pg. 76), in, or adjacent to, The organization omitted ‘Maintaining the Natural Envi- protected areas and areas 305-1c because it is not ronment in the Construction of high biodiversity value 'Emissions from Our Power Plants applicable, i.e. it was not and Operation of Our Power included in our Scope 1 outside protected areas 305-1: Direct (Scope 1) and Operations' (pgs. 64-67), Plants’ (pg. 76) calculations as our activi- GHG emissions 'Our Carbon Footprint and GHG ties do not involve the use Emissions Mitigated' (pg. 64) of biomass and therefore there are no biogenic ‘Biodiversity’ (pg. 76), ‘Main- emissions. taining the Natural Environ- 304-2: Significant ment in the Construction and impacts of activities, Operation of Our Power Plants’ products, and services GRI 304: (pg. 76), ‘Environmental Impact on biodiversity Biodiversity 2016 Assessments and Environmen- ‘Emissions from Our Power Plants 305-2: Energy indirect and Operations’ (pgs. 64-67), tal Audits’ (pg. 76) (Scope 2) GHG emissions ‘Our Carbon Footprint and GHG Emissions Mitigated’ (pg. 64) ‘Environmental Impact Assess- 304-3: Habitats protected ments and Environmental GRI 305: or restored Audits’ (pg. 76) Emissions 2016

The organization omitted 304-4: IUCN Red List ‘Emissions from Our Power 305-3c because it is not applicable, i.e. it was not species and national 'Environmental Impact Assess- 305-3: Other Plants and Operations’ included in our Scope 1 conservation list species ments and Environmental indirect (Scope 3) (pgs. 64-67), ‘Our Carbon calculations as our activi- with habitats in areas Audits' (pg. 76) GHG emissions Footprint and GHG Emissions ties do not involve the use of biomass and therefore affected by operations Mitigated’ (pg. 64) there are no biogenic emissions. Emissions

'Mitigating Climate Change Risks and Working to Realize 103-1: Explanation of the 'Emissions from Our Power Plants GRI 103: Management New Opportunities' (pg. 64), material topic and its 305-4: GHG and Operations' (pgs. 39-42), Approach 2016 'Emissions from Our Power Plants Boundaries emissions intensity 'Our Carbon Footprint and GHG and Operations and Operations' Emissions Avoided' (pgs. 39-42) (pgs. 64-67)

130 131 GRI Standards Disclosure Page Number/Chapter Name/Link Omission and Reason Omission and Reason for Omission GRI Standards Disclosure Page Number/Chapter Name/Link for Omission

Effluents and Waste 'Waste, Material Management and Recycling' (pgs. 73-75), 'Impacts of Our Operations on the 'Maintaining the Natural Envi- Local Hydrology and Aquifers' 103-2: The manage- ronment in the Construction (pg. 72), 'Waste, Management of ment approach and its Materials and Biodiversity Conser- and Operation of Our Power 103-1: Explanation of the components vation' (pg. 73), 'Waste, Material Plants' (pg. 76), 'Health & material topic and its Management and Recycling ' Safety in Our Work with Boundaries (pgs. 73-75), At Our Global Power Subcontractors' (pg. 103) Plants' (pg. 74), ' At Our Manufac- GRI 103: Management Approach 2016 turing Facilities, Workshops and 'Waste, Material Management Offices' (pgs. 74-75) and Recycling' (pgs. 73-75), 'Maintaining the Natural Envi- 'Impacts of Our Operations on the 103-3: Evaluation of the ronment in the Construction Local Hydrology and Aquifers' management approach and Operation of Our Power (pg. 72), 'Waste, Management of Plants' (pg. 76), 'Health & Materials and Biodiversity Conser- 103-2: The manage- GRI 103: Management vation' (pg. 73), 'Waste, Material Safety in Our Work with ment approach and its Approach 2016 Management and Recycling ' Subcontractors' (pg. 103) components (pgs. 73-75), At Our Global Power Plants' (pg. 74), ' At Our Manufac- GRI 307: 307-1: Non-compliance ‘Environmental Regu- turing Facilities, Workshops and Environmental with environmental laws lations Supporting Our Offices' (pgs. 74-75) Compliance 2016 and regulations Business’ (pg. 49)

'Impacts of Our Operations on the GRI 400 Social Standards Series Local Hydrology and Aquifers' (pg. 72), 'Waste, Management of Employment Materials and Biodiversity Conser- 103-3: Evaluation of the vation' (pg. 73), 'Waste, Material 103-1: Explanation of the management approach Management and Recycling ' 'Our People: Employment and Skill material topic and its (pgs. 73-75), At Our Global Power Development at Ormat' (pg. 82) Boundaries Plants' (pg. 74), 'At Our Manufac- turing Facilities, Workshops and Offices' (pgs. 74-75) 103-2: The manage- 'Our People: Employment and Skill GRI 103: Management ment approach and its Development at Ormat' (pg. 82) 'Waste, Management of Materials Approach 2016 components and Biodiversity Conservation' (pg. 73), 'Waste, Material Manage- 'Our People: Employment and Skill GRI 306: Effluents 306-2: Waste by type and ment and Recycling ' (pgs. 73-75), 103-3: Evaluation of the Development at Ormat' (pg. 82), and Waste 2016 disposal method At Our Global Power Plants' (pg. 74), 'At Our Manufacturing management approach 'Our Employment Framework' Facilities, Workshops and Offices' (pgs. 82-83) (pgs. 74-75) 401-1: New employee hires 'Our Employment Framework' Environmental Compliance and employee turnover (pgs. 82-83)

'Waste, Material Management and Recycling' (pgs. 73-75), As of the publication of GRI 401: this report, the organiza- 'Maintaining the Natural Envi- 401-2: Benefits provided 103-1: Explanation of the Employment 2016 tion is unable to disclose GRI 103: Management ronment in the Construction to full-time employees information regarding all material topic and its 'Employee Benefit, Healthcare & Approach 2016 and Operation of Our Power that are not provided of the relevant benefits Boundaries Welfare Frameworks' (pgs. 89-92) outlined in 401-2 due to Plants' (pg. 76), 'Health & to temporary or part-time employees confidentiality constraints Safety in Our Work with associated with employ- Subcontractors' (pg. 103) ment contracts.

132 133 Omission and Reason Omission and Reason GRI Standards Disclosure Page Number/Chapter Name/Link for Omission GRI Standards Disclosure Page Number/Chapter Name/Link for Omission

403-1: Workers repre- Omission of 401-3e. sentation in formal joint 'Our Occupational Health and retention rates of management-worker Safety Program – Striving to Go employees that took parental leave, by gender health and safety Beyond Compliance' (pgs. 98-100) committees Information unavailable GRI 403: 'Employee Benefit, Health- due to difficulties in data GRI 401: Occupational Health 401-3: Parental Leave care & Welfare Frameworks' collection. We have Employment 2016 subsequently provided and Safety 2016 403-2: Types of injury and (pgs. 87-90) guidance to human rates of injury, occupational resources managers on 'Measuring Our Health and Safety diseases, lost days, and how they can obtain this Performance' (pgs. 100-102) data, and anticipate being absenteeism, and number able to provide it in our of work-related fatalities next report.

Training and Education Occupational Health and Safety 103-1: Explanation of the 'Training and Educational Oppor- material topic and its tunities' (pgs. 95), 'Educational Boundaries Empowerment' (pgs. 109-110) 'Ensuring a Safe & Healthy Work Environment – Occupational Health and Safety at Ormat' (pg. 103-2: The manage- ''Training and Educational Oppor- 98), 'Our Occupational Health GRI 103: Management ment approach and its tunities' (pgs. 95), 'Educational 103-1: Explanation of the and Safety Program – Striving Approach 2016 components Empowerment' (pgs. 109-110) material topic and its to Go Beyond Compliance' (pgs. Boundaries 98-100), 'Measuring Our Health and Safety Performance' (pgs. 'Training and Educational Oppor- 103-3: Evaluation of the 100-102), 'Health and Safety in tunities' (pgs. 95), 'Educational management approach Our Work With Subcontrac- Empowerment' (pgs. 109-110) tors' (pg. 103)

Omission of 404-1ii. Division by employee 404-1: Average hours category Information ‘Training & Educational Opportuni- unavailable, we are imple- 'Ensuring a Safe & Healthy Work of training per year Environment – Occupational ties’ (pgs. 95) menting data collection per employee and anticipate to be Health and Safety at Ormat' (pg. GRI 103: Management able to provide it on our 103-2: The manage- 98), 'Our Occupational Health Approach 2016 next report. ment approach and its and Safety Program – Striving components to Go Beyond Compliance' (pgs. 98-100), 'Health and Safety in 404-2: Programs for ‘Training and Educational Oppor- Our Work With Subcontrac- upgrading employee skills tunities’ (pgs. 95), ‘Educational tors' (pg. 103) and transition assis- Empowerment’ (pgs. 109-110) GRI 404: Training and tance programs Education 2016

The organization does 'Ensuring a Safe & Healthy Work not track the percentage Environment – Occupational of employees that receive Health and Safety at Ormat' (pg. 404-3: Percentage of regular performance and career development 98), 'Our Occupational Health employees receiving 'Employee Performance 103-3: Evaluation of the reviews by employee and Safety Program – Striving management approach regular performance Reviews & Satisfaction category and therefore to Go Beyond Compliance' (pgs. and career develop- Surveys' (pg. 92) this information is unavail- 98-100), 'Health and Safety in able. The organization has ment reviews begun to implement steps Our Work With Subcontrac- to track this number and tors' (pg. 103) expects to implement it in the next report.

134 135 Omission and Reason Omission and Reason GRI Standards Disclosure Page Number/Chapter Name/Link for Omission GRI Standards Disclosure Page Number/Chapter Name/Link for Omission

Diversity and Equal Opportunity 'Supporting and Shaping Sustain- 'Information Boundaries of This GRI 103: Management 103-3: Evaluation of the able Communities and Futures' Report' (pg. 42-43), 'Ormat's Approach 2016 management approach (pg. 105), 'Our Goals and Guide- Board of Directors' (pg. 54), posts' (pg. 105) 103-1: Explanation of the 'Our Outlook on Employment' material topic and its (pg. 82), 'Our Employment Boundaries Framework' (pgs. 82-83), 'Diversity & Equality in Employ- 'Supporting and Shaping ment at Ormat' (pgs. 88-89) Sustainable Communities and Futures' (pg. 105), 'Our Goals 'Information Boundaries of This and Guideposts' (pg. 105), Report' (pg. 42-43), 'Ormat's 413-1: Operations with local 'Social Action Plans' (pg. 105), Board of Directors' (pg. 54), GRI 413: Local community engagement, 'Community Engagement GRI 103: 103-2: The manage- 'Our Outlook on Employment' Communities 2016 impact assessments, and and Handling Grievances' Management ment approach and its (pg. 82), 'Our Employment development programs (pgs. 105-109), 'Educational Approach 2016 components Framework' (pgs. 82-83), Empowerment' (pgs. 109-110), 'Diversity & Equality in Employ- 'Healthcare Delivers Hope' ment at Ormat' (pgs. 88-89) (pgs. 110-112), 'Local Livelihood' (pg. 113)

'Information Boundaries of This Report' (pg. 42-43), 'Ormat's Customer Privacy Board of Directors' (pg. 54), 103-3: Evaluation of the 'Our Outlook on Employment' management approach (pg. 82), 'Our Employment 103-1: Explanation of the 'Data Privacy and Cyberse- Framework' (pgs. 82-83), material topic and its curity for Our Stakehold- 'Diversity & Equality in Employ- Boundaries ers' (pg. 51) ment at Ormat' (pgs. 88-89)

‘Information Boundaries of This Report’ (pg. 42-43), ‘Ormat’s GRI 103: 103-2: The manage- 'Data Privacy and Cyberse- Board of Directors’ (pg. 54), GRI 405: Diversity 405-1: Diversity of Management ment approach and its curity for Our Stakehold- ‘Our Outlook on Employment’ and Equal governance bodies Approach 2016 components ers' (pg. 51) (pg. 82), ‘Our Employment Opportunity 2016 and employees Framework’ (pgs. 82-83), ‘Diversity & Equality in Employ- ment at Ormat’ (pgs. 88-89) 'Data Privacy and Cyberse- 103-3: Evaluation of the curity for Our Stakehold- Local Communities management approach ers' (pg. 51) 'Supporting and Shaping Sustain- 103-1: Explanation of the able Communities and Futures' material topic and its (pg. 105), 'Our Goals and Guide- Boundaries posts' (pg. 105) 418-1: Substantiated GRI 103: Management complaints concerning 'Data Privacy and Cyberse- Approach 2016 GRI 418: Customer 'Supporting and Shaping Sustain- breaches of customer curity for Our Stakehold- 103-2: The manage- Privacy 2016 able Communities and Futures' privacy and losses of ers' (pg. 51) ment approach and its (pg. 105), 'Our Goals and Guide- customer data components posts' (pg. 105)

136 137 Reconciliation of EBITDA and Adjusted EBITDA

We calculate EBITDA as net income before interest, taxes, depreciation and amortization. We calculate Adjusted EBITDA as net income before interest, taxes, depreciation and amortization, adjusted for (i) termination fees, (ii) impairment of long-lived assets, (iii) write-off of unsuccessful exploration activities, (iv) any mark-to market gains or losses from accounting for derivatives, (v) merger and acquisition transaction costs, (vi) stock-based compensation, (vii) gains or losses from extinguishment of liabilities, (viii) gains or losses on sale of subsidiaries and property, plant and equipment and (ix) other unusual or non-recurring items. EBITDA and Adjusted EBITDA are not measurements of financial performance or liquidity under accounting principles generally accepted in the U.S. (U.S. GAAP) and should not be considered as an alternative to cash flow from operating activities or as a measure of liquidity or as an alternative to net earnings as indicators of our operating performance or any other measures of performance derived in accordance with U.S. GAAP. Our Board of Directors and senior management use EBITDA and Adjusted EBITDA to evaluate our financial performance. However, other companies in our industry may calculate EBITDA and Adjusted EBITDA differently than we do.

The following table reconciles net income to EBITDA and Adjusted EBITDA for the twelve-month periods ended December 31, 2019.

(In thousands $) Year Ended December 31, 2019

Net Income ...... 93,543

Adjusted for:

Interest expense, net (including amortization of deferred financing costs) ...... 78,869

Income tax provision ...... 45,613

Adjustment to investment in an unconsolidated company: our proportionate share in interest expense, tax and depreciation and amortization in Sarulla ...... 13,089

Depreciation and amortization ...... 143,242

EBITDA ...... 374,356

Mark-to-market on derivative instruments...... (1,402)

Stock-based compensation ...... 9,358

Gain on sale of subsidiary and property, plant and equipment...... -

Insurance proceeds in excess of assets carrying value...... -

Loss from extinguishment of liability ...... 468

Impairment of goodwill, net of reversal of a contingent liability...... -

Termination fee...... -

Merger and acquisition transaction costs ...... 1,483

Settlement expenses ...... -

Write-off unsuccessful exploration activities ...... -

Adjusted EBITDA ...... 384,263

Copyright © 2019 Ormat Technologies, Inc. All Rights Reserved. This document contains information proprietary to Ormat Technologies, Inc. Reproduction in any form without prior written permission is strictly prohibited.

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