Global Biomass Project

Location:

Turkey

Project number:

49681

Business sector:

Energy

Notice type:

Private

Environmental category:

B

Target board date:

17 Jan 2019

Status:

Cancelled

PSD disclosed:

15 Oct 2018

Translated version of this PSD: Turkish

Project Description

A senior loan of up to circa USD 18 million to a special purpose vehicle fully owned by Global Investment Holding ('GIH') for the construction and operation of Soke Extension, a biomass power plant with 12 MW installed capacity located in Aydin province of Turkey. The project will be a part of a circa USD 50 million total debt financing alongside commercial banks also involved in the financing of  the construction of an existing 12 MW biomass plant in Soke and a 12 MW biomass plant in Mardin.

Project Objectives

Support the development and construction of renewable power generation in Turkey.

Turkey’s potential for biomass energy production is untapped. As of September 2018, less than 1 per cent of total installed capacity consists of biomass power plants only, which are mainly fuelled by biogas. Biomass generation offers the opportunity to provide stable baseload power utilising the abundant agricultural by-products in Turkey.

Transition Impact

The project will target the "Green" quality by supporting the company develop its portfolio of electricity generation assets through financing the construction and operation of a 12 MW biomass power plant.

Client Information

MAVI BAYRAK ENERJI AS

Mavi Bayrak Enerji ('MBE' or the 'company') was founded by GIH to develop and operate biomass plants in Turkey. MBE owns the Soke - I biomass power plant and the new Soke Extension. MBE's sister company Mavi Bayrak Dogu ('MBD') owns Mardin biomass power plant. Both MBD and MBE are directly owned by Consus Energy, which is in turn a wholly-owned subsidiary of GIH.

GIH, a Turkish conglomerate listed on the Borsa Istanbul, was founded in 1990 as an independent brokerage and investment banking firm in Turkey and transformed into an investment portfolio company in 2004, which has interests in cruise and commercial port operations, energy, mining, real estate and finance. GIH has been a client of the Bank since 2015.

EBRD Finance Summary

USD 18,000,000.00

Total Project Cost

USD 71,000,000.00

Environmental and Social Summary

Categorised B (2014 ESP). Environmental and social issues associated with the financing of a new biomass energy plant can be readily assessed and mitigated through an independent environmental and social due diligence (ESDD).

An independent consultant has been retained to undertake the ESDD of the project as well as the Company's capacity to implement the Bank's Performance Requirements (PRs), the management and sustainability of the biomass fuel supply as well as the compliance of the plants with EU Best Available Technique (BAT) requirements and National regulations. The ESDD will also review the GET Component of the Project.

The ongoing ESDD is addressing the suitability of technology and air abatement requirements as well as assessing the social and biodiversity risks and impacts of the Company's fuel supply chain.

The collection and transport of biomass over large distances can be associated with public safety and nuisance concerns. Specific attention will be placed on how raw material is collected, stored and transported while ensuring the biomass fuel is of legal and sustainable origin.

Based on the ESDD, a corporate as well as Project specific ESAP and SEP will be developed, in addition to a Project specific Non-Technical Summary (NTS).

The Project Summary Document will be updated once the ESDD is completed.

NTS: English | Turkish

Technical Cooperation

A Technical Cooperation ('TC') study for technical review and project preparation has been carried out that was funded by the Bank's Green Economy Project Preparation and Implementation Framework and the client on a cost share basis. The donor of the TC was the European Union under the programme "Enhancement of the Turkish Energy Sector in line with EU Energy Strategies".

Company Contact Information

Atay Arpaciogullari
ataya@global.com.tr
+902122434450
+902122446161
www.globalyatirim.com.tr/tr/
Rihtim Caddesi No: 51 Karakoy 34425 Istanbul/TURKEY

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