Renewables Portfolio

Location:

Turkey

Project number:

47631

Business sector:

Power and energy

Notice type:

Private

Environmental category:

B

Target board date:

09 Dec 2015

Status:

Signed

PSD disclosed:

06 Nov 2015

Translated version of this PSD: Turkish

Project Description

The EBRD (the Bank) is providing an equity investment, in the form of capital increase, in return for a stake in Akfen Yenilenebilir Enerji Company (the company), a new investment entity which will own a portfolio of renewable power generation assets both operational and under development. The portfolio, with a total operational capacity of 210 MW, consists of operational hydro (203 MW) and solar power plants (7 MW) and numerous wind, solar and hydro projects in construction and under development. The Company will be controlled and owned by Akfen Holding A.S. (Akfen), and will be created following the reorganisation and merger of several of Akfen's energy subsidiaries.

Project Objectives

The Bank's capital will help fund the development and construction of new renewable power generation projects. The projects are located across several regions of Turkey.

Transition Impact

The project will support the company in developing its portfolio of power plants focused on renewable, efficient and sustainable energy generation. The Project will assist Turkey in further diversifying its power sector, reducing GHG emissions and increasing the generation of energy through renewable sources.

The project will also set standards for corporate governance and business conduct. The Bank will review the current board practices and management systems of the company and, via a shareholders agreement, help implement best practice corporate governance in the company. The Bank will play a key role in this respect, particularly in ensuring that the company is ready for a potential future IPO.

Client Information

AKFEN HOLDING ANONIM SIRKETI

Akfen Holding A.S. (Akfen) is an existing client of the Bank, an infrastructure developer and operator currently active in energy generation, sea port operations, waste-water and water utilities management, maritime transportation and airport terminal construction and operations.

Akfen Yenilenebilir Enerji Company will be a new entity to be created following the reorganisation and merger of several of Akfen's energy subsidiaries. The company will own a portfolio of renewable power generating assets with a current total installed capacity of 210 MW.

Environmental and Social Summary

Category B. Through its equity investment the Bank will be exposed to all environmental and social risks associated with the Company operations, inclusive of reputational risks. In accordance with the Bank's Environmental and Social Policy such an equity investment into a multi-sites operation requires an Environmental and Social Due Diligence study (ESDD) of the company's operations. The Bank's investment currently does not include any A category Projects.

An ESDD was undertaken by an independent consultant and the Bank's staff inclusive of a corporate review and site visits to key operating assets. The ESDD has confirmed that the company has the capacity to fully implement the Bank's Performance Requirements (PR) and has a good and robust EHS management system. The ESDD, among others, identified the need for additional strengthening of corporate EHS management systems and procedures. Based on the ESDD a corporate Environmental and Social Action Plan (ESAP) has been developed and is being agreed with the company.

The ESDD has also confirmed that current assets are well managed and not located in sensitive locations. Additional due diligence is being undertaken on one of the proposed sites to assess the site location and ensure that project design complies with the Bank's PRs and National Legislation.

The ESAP includes measures to reduce and mitigate impacts and ensure compliance with the Bank's PRs and need to ensure compliance with national legislation.

It should be noted that the Company plans to develop new renewable energy projects in the future, some of which may be A category. For these projects the Company will need to develop appropriate corporate standards and make disclosures in line with the Bank's PRs. This requirement is included in the Environmental and Social Action Plan (ESAP).

Technical Cooperation

None.

Company Contact Information

Kadri Samsunlu
ksamsunlu@akfen.com.tr
http://www.akfen.com.tr/en/

Business opportunities

For business opportunities or procurement, contact the client company.

For state-sector projects, visit EBRD Procurement: Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

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The Project Complaint Mechanism (PCM) is the EBRD's accountability mechanism. It provides an opportunity for an independent review of complaints from individuals and organisations concerning EBRD-financed projects which are alleged to have caused, or are likely to cause, environmental and/or social harm.

Please visit the Project Complaint Mechanism page to find information about how to submit a complaint. The PCM Officer (pcm@ebrd.com) is available to answer any questions you may have regarding the submission of a complaint and criteria for registration and eligibility, in accordance with the PCM Rules of Procedure.