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.
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").
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.
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
Total Project Cost
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
Company Contact Information
Barbaros Mah., My Office Is Merkezi, Cigdem Sok., No:1/16, Atasehir/Istanbul
PSD last updated
23 Mar 2023
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