New EBRD support for renewable energy investments in Turkey
The European Bank for Reconstruction and Development (EBRD) is providing USD 55 million to Turkish lender Isbank to finance private investments in renewable energy and resource efficiency projects.
The new agreement comes as a “part of the EBRD’s strategy to help Turkey meet a growing demand for electricity and diversify away from expensive imported fuel, while addressing the challenges of climate change”, according to the following release on EBRD website.
“The EBRD funds are extended through an investment in “A-” rated senior notes issued under Isbank’s Diversified Payment Rights (DPR) securitisation programme, an established market instrument used by Turkish banks to raise long-term funding. The financing – supported by a EUR 1.9 million grant from the European Union – will benefit renewable energy and resource efficiency projects in Turkey including solar, hydropower, wind, geothermal, waste-to-energy and energy efficiency as well as water saving and waste minimisation projects”, notes the statement.
The investment comes under the EBRD’s recently expanded Mid-size Sustainable Energy Financing Facility (MidSEFF) now totaling €1.5 billion. Facility has already financed 50 projects with a total of 900 MW of renewable energy capacity. Financing was delivered through seven Turkish banks including Ișbank, the largest private lender in Turkey.
“The response to the previous round of financing we offered to Ișbank under our MidSEFF programme was impressive. The lender has financed nine projects helping to create over 200 MW in additional renewable capacity and its pipeline for further successful investments by Turkish corporates remains strong”, said Noel Edison, Director of Financial Institutions at the EBRD.
Sustainable energy makes almost half of the EBRD’s total portfolio in Turkey. For the past eight years, since 2009, the EBRD has invested over EUR 3 billion in more than 75 such projects, including two large wind farms – Bares and Rotor – and the second largest geothermal power plant in Europe, Efeler.
The EBRD also helped the Turkish Ministry of Energy and Natural Resources to develop National Renewable Energy Action Plan, and supported the preparation of a National Energy Efficiency Action Plan, which should help Turkey to achieve 2023 energy efficiency targets.