Alpaslan II dam hydro project

Location:

Turkey

Project number:

45474

Business sector:

Power and energy

Notice type:

Private

Environmental category:

A

Target board date:

25 Jun 2014

Status:

Cancelled

PSD disclosed:

09 Apr 2014

Translated version of this PSD: Turkish

Project Description

The EBRD is considering providing a senior loan to Enerjisa Enerji Üretim A.Ş. (the "Company” or “Enerjisa”) for the development and construction of the greenfield Alpaslan II dam and Hydro Electric Power Plant (Alpaslan II HPP) located on the Murat River, a tributary of the Euphrates River, in the Mus Province, in the Eastern Anatolian region of Turkey (Alpaslan II or the Project). Alpaslan II will have an installed capacity of 280 MW and is expected to be operational by Q2 2017.

Transition Impact

The Project’s transition impact stems from two factors: (i) increasing competition in the market through the sale of electricity through a combination of private off take agreements, to eligible customers and to the balancing market, where market dynamics dictate the price; and (ii) more widespread private ownership through supporting a privately developed project in Turkey, where the state still holds a significant share in electricity generation.

The Client

Enerjisa is a leading Turkish energy company, jointly owned Haci Omer Sabanci Holding A.S. (Sabanci) and DD Turkey Holdings s.a.r.l. (DD Turkey), registered in Luxembourg (jointly referred to as the Sponsors) with 50 per cent of the shares each. Sabanci is incorporated in Turkey and is one of the country’s largest industrial and financial conglomerates. DD Turkey is 100% owned by E.ON SE, incorporated in Germany, where it is the largest utility company, as well as one of the largest power and gas companies in Europe.

EBRD Finance

TL 550 million senior secured loan to Enerjisa, constituting half of the TL 1.1 billion financing, to be provided jointly with Turkiye Garanti Bankasi A.S. (Garanti Bank). The rest of the Project cost of up to TL 590 million will be financed by equity and/or shareholder loans.

Project Cost

TL 1.69 billion.

Environmental Impact

Categorised A. The Project, located 34 km north of Mus on the Murat River, involves the construction of a large dam (116m in height) and hydroelectric power plant (280MW), an electric transmission line (50 km), the relocation of an existing provincial road (54 km) as well as supporting infrastructure. The reservoir will extend over an area of up to 55 km2 and affect directly or indirectly 22 villages. A large dam (height from foundation over 15m), as defined by the International Commission on Large Dams (ICOLD), requires that an Environmental and Social Impact Assessment (ESIA) is undertaken and disclosed in line with the Bank’ s Environmental and Social Policy. The Bank has retained an independent consultant to undertake Environmental and Social Due Diligence (ESDD) of the Project.

The Project was permitted by the Turkish Competent Authorities in August 2012 following a local Environmental Impact Assessment (EIA) procedure and works have since commenced on the site. These have been limited to excavation and construction of the diversion tunnels and construction of the spillway and water intake structures. Works on the dam body are due to commence later in 2014 following diversion of the river.
In line with best international practice, Enerjisa has prepared a Project Environmental and Social Impact Assessment (ESIA) disclosure package to be disclosed for public review and comment. The ESIA includes the local EIA prepared and approved in 2012 as well as supplementary ESIA documents developed by Enerjisa to meet the EBRD’s Performance Requirements and best international practices. These supplementary documents include:

  • An interim EIA for the electric transmission line. The transmission line will be built by Enerjisa but owned and operated by the Turkish Electricity Transmission Company (TEIAS). TEIAS will be required by Turkish legislation to conduct a full EIA for permitting purposes at a later date.
  • An EIA for the relocation of existing roads. The road relocation is not required to go through a local EIA permitting process following the issuing of an ‘EIA Exempt’ letter by the Ministry of Environment and Urbanization in June 2013.
  • A description of the Project, the alternatives considered and the Project’s area of influence.
  • An assessment of the potential transboundary impacts associated with the Project.
  • An assessment of the potential cumulative impacts associated with the Project.
  • An assessment of the Project’s downstream impacts.
  • A preliminary Resettlement Action Plan (RAP).
  • A preliminary social impact assessment including cultural heritage.
  • A greenhouse gas assessment.
  • A Stakeholder Engagement Action Plan (SEAP).
  • Environmental and social management plans.
  • A Non-Technical Summary (NTS).
  • A draft Environmental and Social Action Plan (ESAP).

The NTS presents a summary of the Project ESIA.

ESDD undertaken by an independent consultant confirmed that the Project ESIA is fit for purpose to allow for meaningful consultation on the Project prior to the consideration of the Project by the Bank’s Board. The Project ESIA is disclosed for 60 days as required for a private sector project under the EBRD’s Public Information Policy, during which all comments received will be reviewed and considered. This disclosure will be complemented with company-led meetings with stakeholders in the Project area. Based on the ESDD, an Environmental and Social Action Plan (ESAP) has been developed and agreed in principal with Enerjisa. Based on the ESAP, Enerjisa will continue to develop certain elements of the Project ESIA during the disclosure period. This ongoing work together with the implementation of other actions listed in the ESAP will enable the Project to meet the Bank’s Performance Requirements. Some actions are to be undertaken prior to Board consideration, such as further development of the RAP and social impact assessment. These actions will allow for the finalisation of the ESAP prior to Board consideration. Other important actions in the ESAP include the development of a detailed hydraulic model for the Project and associated risk assessments (including dam failure risk assessment) and emergency planning, the development of various plans including a biodiversity action plan, water quality and aquatic fauna monitoring, regular reporting to the Lenders, as well as implementation of the SEAP and public awareness raising.

Following the 60-day public review and comment period all concerns raised will be summarised and responded to by Enerjisa. The ESAP may also be amended if new information obtained during the due diligence or public consultations would improve the environmental and social performance of the Project. This Project Summary Document will be updated once the public consultation process is completed (i.e. ESDD complete) and/or new or material issues are identified. Enerjisa will disclose the Project ESIA in accordance with the Stakeholder Engagement Action Plan (SEAP) and update information as required and appropriate.

There is an Environmental and Social Impact Assessment available for this project.

Company Contact

Cem Gokkaya, Finance Manager, Enerjisa Enerji Uretim A.S.
Tel: + 90 212 385 88 91

Email: cem.gokkaya@enerjisa.com

 

Business opportunities

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