Project Description
Up to USD 110 million senior loan with 7-year tenor (the "Loan") to Enerjisa Enerji Uretim A.S. (the "Company" or "Enerjisa"), one of the largest independent power producers in Turkiye, with 3.7GW installed capacity.
Project Objectives
The proceeds of the Loan will be used for the financing of wind capacity extension projects with 51.6MW installed capacity and acquisition of an operational wind power plant with 55.0MW installed capacity (the "Project").
Transition Impact
ETI score: 64
The Transition Impact arises from the Green and Inclusive qualities:
Green: (i) the Project supports climate mitigation activities by displacing c. 52,000 tonnes of CO2 emission per annum from Turkish power system by leading to renewable electricity generation of 149 GWh through development and construction of wind power plants with 51.6MW installed capacity in total.
Inclusive: (ii) The project is expected to enhance access to green and market-relevant skills and employment opportunities for women and young people by strengthening the capacity of the Company.
Client Information
ENERJISA ENERJI URETIM AS
Enerjisa Enerji Uretim A.S. is a power producer, 100% owned by Enerjisa Uretim Santralleri A.S. which operates as a JV between Sabanci Holding and E.ON (together with "the Shareholders"), each holding c. 50%. Enerjisa's portfolio consists of three CCGTs (1.6 GW), 12 HPPs (1.4 GW), a coal-fired power plant (450 MW), 4 WPPs (277 MW) and 2 SPP (9 MW).
EBRD Finance Summary
USD 110,000,000.00
Total Project Cost
USD 110,000,000.00
Additionality
The Bank's additionality stems from supporting a market player with strong ambition to substantially increase its renewable energy capacity through bridging a financing gap and providing a financing package currently not available in full from other financiers.
Environmental and Social Summary
Categorised B (2019 ESP) and high-medium risk due to the nature of the Enerjisa's operations, and the proposed project including a pipeline of new renewable projects consisting of (i) four wind power extension projects next to existing power plants with 51.6 MW installed capacity and (ii) acquisition of an operational wind power plant with 55MW installed capacity ("Project"). The Bank has undertaken an independent E&S due diligence of Project's E&S impacts and Company's E&S management systems and the capacity to implement the Bank PRs including supply chain management system for wind projects. ESDD shows that the Company has established an integrated quality, health and safety, environment and energy management systems and obtained the independently verified ISO certifications covering its headquarters and all 22 power plants except four facilities and has the institutional capacity to implement Bank PRs.
The Company is a signatory of UN Global Compact and discloses GRI G4 linked sustainability reports since 2019. Enerjisa conducted a climate risk transition assessment and has a sound decarbonisation strategy which is the initial step towards their publicly announced commitment on Net-Zero by 2045. The Company has a "sustainability committee" and implement the Company's sustainability policies and strategies; identify and track risks, opportunities and take actions as necessary. HSE targets and associated actions are identified and monitored on annual basis.
The ESDD concluded that none of the extension projects are located in environmentally or socially sensitive areas and would fall under Cat A as per PR 1. The company has appropriate permits issued by local competent authorises. In addition to local EIA permitting process, the Company will undertake E&S impact assessment for all extension projects in line with Bank requirements and any newly identified adverse E&S impacts will be addressed under ESMS of Enerjisa. This will include cumulative assessments and potential impacts on critical habitat. Additional monitoring and operational measures will be agreed as part of ESAP to address any potential risks to critical habitat and to local communities. E&S impacts of associated facilities (OHTLs) including cumulative impacts for Erciyes and Akhisar WPPs will be coordinated with TEIAS in line with the ESAP. No cultural heritage is identified in the extension project regions. However, a chance find procedure to be implemented throughout the planned foundation works in line with the ESAP.
Company has developed HR policy and procedures in line with the Universal Declaration of Human Rights and the ILO Core Conventions. Although no trade union operate in the Company, the workers can freely elect their representatives to represent them at management meetings. The Company has an effective worker grievance mechanism in place; including an ethics online, employee committees; open door policy with management and suggestion boxes at all sites. Enerjisa currently employs 993 direct employees (16% female) and has a target to increase female workforce to 20% by 2025. They however required to develop and implement a formal GBVH policy and cascade these down to all contractors and primary suppliers per ESAP.
The assessment on the Wind Turbine Supplier (EU based) contracted by Enerjisa shows that the supplier has strong environmental and social policies, supplier code of conduct and implements supplier audits to their core suppliers on regular basis and there is no evidence of child or forced labour in their supply chain. However, the Company is required to improve their current supply chain management system (SCMS) to be fully aligned with the Bank requirements including ensuring full traceability of all suppliers in their supply chain and improvement of the procurement policy, procedure, and contract conditions to held suppliers accountable for their own suppliers as part of ESAP.
In addition, the Company is required to strengthen its HSES team's capacity through recruitment of additional experts, improve its social monitoring through defining clear social KPIs and regular labour audits to contractors' and sub-contractors' employees in line with the PR 2, and improvement of the incident reporting from contractors through additional trainings as part of ESAP.
The Company has a corporate SEP which will be disclosed including a grievance mechanism for stakeholder concerns. The Company will be required to develop site specific SEPs for the proposed projects as part of the ESAP. The Company will continue to implement various environmental and social investment programmes targeting protection of biodiversity and supporting income generation and capacity building programmes in communities close to their facilities and provide updates on these programmes through sustainability reports with clear links to SDGs.
The ESAP has been developed and will be agreed with the Company prior to Board. The Bank will continue to monitor the implementation of the ESAP and the Project through annual reports provided by the Companies and monitoring visits.
The project is considered Paris aligned for climate mitigation as it features in the joint MDB "aligned list" (generation of renewable energy with negligible lifecycle GHG emissions). The project is also considered aligned for climate adaptation as no material climate risks are identified at the project locations. The PC score of the Project is 3. The project is consistent with the GET approach as it contributes to generation of renewable energy to supply electricity to the national grid of which lifecycle GHG emissions are to be lowered as a result of the project. The GET share is 55%.
Technical Cooperation and Grant Financing
N/A
Company Contact Information
Veli Yumuk
02165124000
www.enerjisauretim.com.tr
Barbaros Mah., My Office Is Merkezi, Cigdem Sok., No:1/16, Atasehir/Istanbul
PSD last updated
23 Mar 2023
Understanding Transition
Further information regarding the EBRD’s approach to measuring transition impact is available here.
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Environmental and Social Policy (ESP)
The ESP and the associated Performance Requirements (PRs) set out the ways in which the EBRD implements its commitment to promoting “environmentally sound and sustainable development”. The ESP and the PRs include specific provisions for clients to comply with the applicable requirements of national laws on public information and consultation as well as to establish a grievance mechanism to receive and facilitate resolution of stakeholders’ concerns and grievances, in particular, about environmental and social performance of the client and the project. Proportionate to the nature and scale of a project’s environmental and social risks and impacts, the EBRD additionally requires its clients to disclose information, as appropriate, about the risks and impacts arising from projects or to undertake meaningful consultation with stakeholders and consider and respond to their feedback.
More information on the EBRD’s practices in this regard is set out in the ESP.
Integrity and Compliance
The EBRD's Office of the Chief Compliance Officer (OCCO) promotes good governance and ensures that the highest standards of integrity are applied to all activities of the Bank in accordance with international best practice. Integrity due diligence is conducted on all Bank clients to ensure that projects do not present unacceptable integrity or reputational risks to the Bank. The Bank believes that identifying and resolving issues at the project assessment approval stages is the most effective means of ensuring the integrity of Bank transactions. OCCO plays a key role in these protective efforts, and also helps to monitor integrity risks in projects post-investment.
OCCO is also responsible for investigating allegations of fraud, corruption and misconduct in EBRD-financed projects. Anyone, both within or outside the Bank, who suspects fraud or corruption should submit a written report to the Chief Compliance Officer by email to compliance@ebrd.com. All matters reported will be handled by OCCO for follow-up. All reports, including anonymous ones, will be reviewed. Reports can be made in any language of the Bank or of the Bank's countries of operation. The information provided must be made in good faith.
Access to Information Policy (AIP)
The AIP sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations following its entry into force on 1 January 2020. Please visit the Access to Information Policy page to find out what information is available from the EBRD website.
Specific requests for information can be made using the EBRD Enquiries form.
Independent Project Accountability Mechanism (IPAM)
If efforts to address environmental, social or public disclosure concerns with the Client or the Bank are unsuccessful (e.g. through the Client’s Project-level grievance mechanism or through direct engagement with Bank management), individuals and organisations may seek to address their concerns through the EBRD’s Independent Project Accountability Mechanism (IPAM).
IPAM independently reviews Project issues that are believed to have caused (or to be likely to cause) harm. The purpose of the Mechanism is: to support dialogue between Project stakeholders to resolve environmental, social and public disclosure issues; to determine whether the Bank has complied with its Environmental and Social Policy or Project-specific provisions of its Access to Information Policy; and where applicable, to address any existing non-compliance with these policies, while preventing future non-compliance by the Bank.
Please visit the Independent Project Accountability Mechanism webpage to find out more about IPAM and its mandate; how to submit a Request for review; or contact IPAM via email ipam@ebrd.com to get guidance and more information on IPAM and how to submit a request.
