Data Centers in Israel

Israel – Mediterranean Hub for High-Performance Tech

Executive Summary

Israel is a premier digital crossroads for enterprises targeting the high-growth markets of the Mediterranean and Middle East. With its concentration of research centers and specialized subsea infrastructure, the region provides the low-latency foundations required for secure global scaling and high-stakes data sovereignty.

Israel: At A Glance

Network & Connectivity Ecosystem

Carrier Density & Carrier Neutrality: The market supports a growing ecosystem with a carrier count of over 6 as of December 2025. Major corridors in Petah Tikva and Tel Aviv typically host 15–20 local and international providers, ensuring resilient routing and neutral access for complex enterprise requirements.

Direct Cloud On-Ramps: There are over 3 on-ramps providing access to 3 cloud regions as of December 2025. Organizations can establish direct, private links to AWS and Oracle Cloud, which helps manage egress costs and significantly reduces latency for critical production workloads.

Internet Exchange Points (IXPs): The Israel Internet Exchange (IIX) acts as the central peering hub, facilitating efficient local traffic exchange and keeping domestic data off international long-haul routes to improve speed.

Bare Metal: High-performance dedicated hardware is readily available through global providers like Hivelocity, offering a sturdy alternative to virtualized environments for compute-heavy requirements.

Power Analysis

Average Cost Of Power: Industrial electricity rates are approximately $0.13/kWh as of December 2025. This pricing provides a stable foundation for high-density deployments, especially for companies managing large-scale compute clusters that require predictable operational costs.

Power Grid Reliability: The national grid is well-engineered with multi-substation support feeding the primary clusters in Petah Tikva and Tel Aviv. Significant reliance on domestic natural gas generation ensures a consistent energy supply for mission-critical facilities that cannot afford downtime.

Market Access, Business & Tax Climate

Proximity To Key Business Districts: Data centers are strategically located near Silicon Wadi, the epicenter of Israel’s cybersecurity, financial services, and software development sectors. This ensures minimal latency for the massive concentration of tech talent and enterprise headquarters in Tel Aviv, Herzliya, and Petah Tikva.

Regional Market Reach: Israel serves as a vital bridge between Europe, Asia, and Africa. Its geographical position makes it an ideal landing point for transcontinental fiber, allowing businesses to reach a broad population for the Mediterranean basin with high-speed connectivity.

Tax Advantage For Data Centers: Government policies provide exemptions for the temporary importation of technical equipment, which drastically lowers the initial capital requirements for infrastructure deployment. These incentives help manage project budgets by offering relief on VAT and import duties for specialized server and networking hardware.

Natural Disaster Risk

Israel maintains a Moderate (3.2/10) risk profile as of December 2025. While the overall exposure is manageable, infrastructure is built to specific seismic and environmental standards to ensure continuous service.

• Earthquake (6.9): This is the primary natural concern; modern facilities utilize advanced seismic dampening and engineering standards to protect equipment.
• Drought (5.3): A significant environmental factor that leads many operators to prioritize water-efficient or closed-loop cooling systems.
• Epidemic (4.8): Managed through national health infrastructure and resilient site operational planning.
• Tsunami (2.7): Identified as an indirect regional risk for facilities located near the Mediterranean coastline; most major hubs are situated to mitigate this.
• Coastal Flood (2.4): A minor regional risk; primary data center clusters are generally located sufficiently inland to minimize impact.

Other natural hazards are considered minor or not material to the data center sector in this region.