The FINANCIAL — In response to growing demand, the European Bank for Reconstruction and Development (EBRD) is expanding its support for sustainable energy financing in Turkey with an additional €500 million, the Bank has announced at a high-level conference organised by the EBRD in Istanbul on February 10.
Under the Mid-size Sustainable Energy Financing Facility (MidSEFF), now totalling €1.5 billion, funds are provided to Turkish banks in the form of loans and capital market instruments for on-lending to private sector companies, according to EBRD.
The financing – supported by the European Union and the Turkish Ministry of Energy and Natural Resources – 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.
Akbank is the first bank to join this extension of the programme with US$ 110 million in financing in addition to US$ 100 million received in 2011. So far, Akbank has successfully allocated these funds to six projects, ranging from industrial energy efficiency measures to hydropower and waste-to-energy projects.
One of the largest lenders in Turkey, Akbank is a longstanding partner of the EBRD.
Akbank’s Executive Vice President in charge of Treasury, Kerim Rota, said: “We are the first Turkish bank to join the third stage of financing for MidSEFF. Akbank continues to be a pioneering force in the Turkish banking sector, providing fresh funding to the private sector for renewable energy and resource efficiency projects in our country. Looking ahead, Akbank will continue this support, further contributing to Turkey’s goal of increasing the share of renewable energy sources in total production.
In addition to launching the expansion of MidSEFF, the EBRD conference in Istanbul today celebrated the Facility’s achievements to date and awarded the best sustainable energy projects financed since the programme was launched in 2011.
The event brought together senior representatives from Turkey’s Ministry of Energy and Natural Resources, the European Union and EBRD partner banks as well as investors who have received financing under MidSEFF.
Terry McCallion, EBRD Director, Energy Efficiency and Climate Change, said: “The highly successful MidSEFF programme has already financed 43 projects through seven Turkish banks and has helped build over 800 MW of additional renewable energy capacity. This represents a major step for Turkey towards its goal of developing 30 per cent of total installed capacity from renewable sources by 2023.”
The European Union is supporting the programme with a €6.8 million grant for technical assistance through its Instrument for Pre-Accession in close collaboration with the Turkish Treasury and the Ministry of Energy and Natural Resources. This grant funding enables the EBRD to provide expert advice to its partner banks and to private sector companies seeking finance for their renewable energy and resource efficiency projects.
Investing in sustainable energy is a strategic priority for the EBRD in Turkey, as the country is working to meet growing demand for electricity and aims to diversify away from expensive imported fuel. Almost half of the Bank’s total portfolio in Turkey is in sustainable energy and since 2009 the EBRD has invested about €3 billion in over 70 such projects, including two of the country’s largest wind farms – Bares and Rotor – and the largest geothermal power plant in Turkey (and second largest in Europe), Efeler.
The Bank is also working closely with the Turkish Ministry of Energy and Natural Resources and has helped develop the country’s first National Renewable Energy Action Plan to attract more investment in renewable energy projects. It is currently working on a National Energy Efficiency Action Plan to help Turkish industry become less energy-intensive.
The EBRD is a leading investor in Turkey and currently operates from offices in Istanbul, Ankara and Gaziantep. To date, it has invested over €7 billion in the country through 180 projects in infrastructure, energy, agribusiness, industry and finance.
In 2015, Turkey was the top destination for EBRD financing, with €1.9 billion invested in that year alone.