EBRD backs Turkey’s Akfen Renewables with loans of over US$ 100 million

By Svitlana Pyrkalo and Olga Rosca

EBRD backs Turkey’s Akfen Renewables with loans of over US$ 100 million

  • EBRD backs Akfen Holding’s renewables portfolio, one of the largest in Turkey
  • US$ 50 million for four wind farms, US$ 52 million for nine solar projects
  • Bank reinforces commitment to the Turkish economy

The EBRD, a leading financier of renewable energy in Turkey and its other regions of operations, is providing a financing package of up to US$ 102 million to the renewable energy arm of the Turkish conglomerate Akfen Holding. Akfen is contributing with US$ 167 million, while foreign and domestic commercial banks are extending parallel financing of around US$ 260 million.  The total funds of up to US$ 530 million will be invested in building four new wind farms and nine solar PV plants with a combined capacity of 327MW.

The new financing demonstrates the EBRD’s commitment to the Turkish economy and confidence in the fundamental momentum behind the global shift to renewable energy.

Akfen Renewables, or Akfen Yenilenebilir Enerji as it is known in Turkey, owns and operates wind, solar and hydro power plants. The EBRD and the IFC, a private sector arm of the World Bank, are minority shareholders in the company with a 15.98 per cent stake each.

The company is investing in four new wind farms with a total capacity of 242 MW: Ucpinar (99 MW), Kocalar (26 MW) and Hasanoba (51 MW) in Çanakkale, a province in north-western Turkey on the Dardanelles Strait, and Denizli (66 MW) in the eponymous province in the south west of the country.

The wind farms will be rated and certified annually with regards to their environmental, social and governance performance by Vigeo-Eiris rating agency. Once operational they are expected to save around 340,000 tonnes of greenhouse gas emissions per year.

Reinforcing its commitment to attracting foreign financing to the Turkish economy, the EBRD has also helped mobilise a US$ 210 million loan from KfW IPEX Bank covered by Eksport Kredit Fonden (EKF), Denmark’s export agency. The EKF-covered facility is guaranteed by four leading Turkish commercial banks, Garanti Bank, IsBank, Vakıfbank and Yapı Kredi.

For nine new solar photovoltaic plants in five locations across Turkey, the EBRD is lending up to US$ 52 million and Turkey’s IsBank is lending another US$ 52 million. The combined capacity of the new solar PV plants will be 85MW.

Kayrıl Karabeyoğlu, CEO of Akfen Renewables, said: “With the projects that we will realise, we are taking firm steps towards our aim to reach a total installed capacity of 1,000 MW in clean energy generation by 2020. We will continue to make new investments and potential acquisitions, especially in the wind power sector, in the forthcoming period.”

Arvid Tuerkner, EBRD Managing Director in Turkey, said: “Renewable energy remains an attractive investment in Turkey.  Our new financing supports Akfen Holding’s ambition to become one of the largest producers of renewable energy in the country. It is yet another boost to the sector as Turkey is switching to domestically sourced power generation.”

Harry Boyd-Carpenter, EBRD Director, Head of Power and Energy Utilities, said: “We are delighted to support Akfen in these important projects.  Their size and the speed of their implementation highlight the scale of the energy transition which is bringing secure, clean and affordable energy to Turkey.”

Supporting this project is part of the EBRD’s larger efforts to help Turkey increase its share of renewables in the energy mix. In line with its renewable energy action plan developed by the country’s Ministry of Energy and Natural Resources with the support of the EBRD, Turkey aims to install 27 GW of non-hydro renewable generation capacity by 2023, 20 GW of which is expected to be wind and 5 GW licenced solar.

The EBRD is a major investor in Turkey. Since 2009 it has invested nearly €11 billion in various sectors of the Turkish economy, with almost all investment in the private sector. Half of the Bank’s portfolio in Turkey constitutes investments that promote sustainable energy and resource use.