Bank marks third stage of its Turkey Sustainable Energy Financing Facility (TurSEFF)
Supporting Turkey’s continuous drive towards a low-carbon economy, the European Bank for Reconstruction and Development (EBRD) is providing a new €400 million financing package for small-scale renewable energy and resource efficiency projects in the country.
The funds will be extended under the Bank’s Turkey Sustainable Energy Financing Facility (TurSEFF), a dedicated facility originally aimed at financing small and medium-sized enterprises (SMEs) seeking to enhance their energy efficiency.
The launch builds on the success of the first two phases of the facility, with €600 million already provided by the EBRD, the European Investment Bank and the Japan Bank for International Cooperation to Turkish partner banks. The second extension will include, for the first time, leasing companies in addition to banks and will also be available for municipal projects.
TurSEFF is a credit line developed by the EBRD in 2010 to support investment in energy efficiency or renewable energy projects.
The European Union is supporting the facility with funding 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 leasing companies as well as to private companies and cities or municipal service providers for renewable energy and resource efficiency projects.
Terry McCallion, EBRD Director for Energy Efficiency and Climate Change, said: “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.”
Mr McCallion adds: “It has also opened the way for sustainable energy financing in the form of two other EBRD facilities: the Mid-size Sustainable Energy Financing Facility (MidSEFF), for projects up to €50 million, and the Turkey Residential Energy Efficiency Financing Facility (TuREEFF) for projects in the residential sector. An initial commitment in 2010 from the Clean Technology Fund of €44 million and €6.7 million from the EU has led to €2.6 billion of financing available through Turkish banks. As such, climate and donor finance has helped to create a green economy market, which is good for business and the planet.”
Vakifbank is the first bank to receive funds under the third phase of TurSEFF.
M. Lütfü Çelebi, Executive Vice President at Vakifbank said: “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.”
The new financing was announced at a conference in Istanbul today. The event also celebrated the best renewable energy and energy efficiency projects financed through the programme’s second phase (2013-16). Almost 500 projects were financed during this period for a total of €254 million. Since the launch of TurSEFF in 2010, more than 860 projects have been financed through six local banks.
Almost half of the EBRD’s projects in Turkey promote the use of sustainable energy.
Since 2009 the Bank has invested over €3.5 billion in more than 90 such projects, including two of Turkey’s largest wind farms and its largest geothermal power plant (which is also the second largest in Europe).
The EBRD has also helped develop Turkey’s first National Renewable Energy Action Plan to attract more investment in renewable energy projects. In addition, it has 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.
The EBRD started investing in Turkey in 2009. To date, the Bank has invested over €8.5 billion in the country through over 200 projects in infrastructure, energy, agribusiness, industry and finance. Nearly 98 per cent of its investments in the country are in the private sector.