EBRD extends support to renewable energy projects in Turkey

The European Bank for Reconstruction and Development (EBRD) is financing small-scale renewable energy and resource efficiency projects in Turkey with an extension of EUR 400 million.

The funds will be extended under the EBRD’s Turkey Sustainable Energy Financing Facility (TurSEFF), a program originally designed to finance small and medium-sized enterprises (SMEs) seeking to improve their energy efficiency, the EBRD reported.

As a measure of supporting Turkey’s transition towards a low-carbon economy, this is the third phase of the TurSEFF credit line which was launched earlier this year. The credit line is based on the success of the previous two phases during which EUR 600 million was provided by the EBRD, the European Investment Bank and the Japan Bank for International Cooperation to Turkish partner banks.

Through the Instrument for Pre-Accession the European Union supports the facility by funding technical assistance while collaborating closely with the Turkish Treasury and the Ministry of Energy and Natural Resources.

“TurSEFF is a great product that delivers value-added services to enable such investments. TurSEFF is also a unique facility as an incubator of partnerships. Partnerships among IFIs, local partner banks, the Clean Technology Fund (CTF), the European Union (EU), as well as experts in green financing in order to achieve financially beneficial environmental impact. The programme is also evolving as it had an initial focus on SMEs and now targets the corporate and commercial sectors, leasing companies and municipal clients,” said Terry McCallion, EBRD director for Energy Efficiency and Climate Change at a conference held in Istanbul.

The first bank to receive funds under the third phase of TurSEFF is Vakifbank.

“In order to further expand energy efficiency financing, we have developed two green products. The Vakifbank Commercial Building Energy Efficiency Loan and Vakifbank Electric Motors Improvement Loan are expected to further drive sustainable energy financing while supporting market growth by increasing awareness. The additional EBRD financing will support the extension of these green products in the market as well as financing other resource efficiency and small-scale renewable energy projects,” executive vice president at Vakifbank M. Lütfü Çelebi stressed.

More than 860 projects financed so far

From 2010 when TurSEFF was launched more than 860 projects have been financed through six local banks. During the programme’s second phase from 2013 to 2016, almost 500 projects were financed in a total of EUR 254 million.

The program has also opened the way for other EBRD facilities like the Mid-size Sustainable Energy Financing Facility (MidSEFF), designed for projects worth up to EUR 50 million, and the Turkey Residential Energy Efficiency Financing Facility (TuREEFF) for projects in the residential sector.

We're announcing a new €400m financing package for small-scale #renewable energy & resource efficiency projects in #Turkey. pic.twitter.com/kWZPJ5nX90

— The EBRD (@EBRD) December 7, 2016

Since 2009 when it started investing in Turkey, the EBRD has invested over EUR 3.5 billion in more than 90 renewable energy projects, including two largest wind farms and the largest geothermal power plant.

This financial institution has also helped Turkey develop its first National Renewable Energy Action Plan to attract more investments in renewable energy projects and supported the preparation of a National Energy Efficiency Action Plan which includes a wide range of sector-based resource efficiency measures aimed at achieving Turkey’s 2023 energy efficiency targets.