Istanbul, Turkey, June 1, 2018— IFC,
a member of the World Bank Group, EBRD, European Bank for Reconstruction
and Development and the Dutch Development Bank FMO have joined forces to
finance improvements in the electricity distribution network in Turkey’s
Osmangazi region in Western Anatolia.
The financing package of Turkish Lira equivalent of $330 million to Osmangazi
Elektrik Dagitim A.S (OEDAS), will help to upgrade, modernisation and expansion
of the distribution network which serves around 2.7 million people in 194
towns and 1,596 villages. OEDAS is the electricity distribution company
of the Osmangazi region, which includes five provinces: Afyonkarahisar,
Bilecik, Eskisehir, Kutahya and Usak. IFC is extending a loan worth US$
80 million, the EBRD is providing US$ 110 million and FMO is contributing
US$ 65 million.
Zorlu Enerji CFO Elif Yener said: “ The new long-term financing in Turkish
Lira from international finance instritutions for our distribution company
will enable us to focus on improvements in the infrastructure and grids,
providing better services to millions of people”.
Improvements are expected to reduce electricity losses and enable the connection
of increased solar capacity, as a result saving at least 30.000 tonnes
carbon emissions per year. They will also enhance environmental and safety
standards and improve efficiency and reliability of supply. These investments
are part of a capital expenditure programme required by Turkey's Energy
Market Regulatory Authority for the five-year regulatory period between
2016 and 2020.
Wiebke Schloemer, IFC’s Regional Director for Europe and Central Asia,
said: “Power sector development is one of the priority areas identified
in the World Bank Group’s strategy for Turkey. The financing package in
local currency tranches, will help our long-term partner Zorlu Enerji and
its subsidiary OEDAS to further improve the quality and reliability of
service to over 2.5 million people in provinces of Turkey. The structure
of this significant agreement demonstrates IFC’s important role in mobilizing
other financial resources and a good example of cooperation between multilateral
OEDAS is ultimately owned by Zorlu Enerji which together with its subsidiaries,
engages in establishing, renting, and operating electrical energy production
plants in Turkey. It is part of the Turkish conglomerate Zorlu Holding.
The World Bank Group has been a long-time partner in the development of
power sector in Turkey. Since 2008, IFC consistently continues to support
the sector with a series of high impact projects. IFC has financed over
5GW capacity generation by investing or mobilizing more than $3 billion
in the Turkish power sector. Turkey is IFC’s second-largest country exposure
globally and IFC’s office in Istanbul, established 30 years ago, is one
of its largest outside Washington, D.C. providing services across regions.
The EBRD is a major investor in Turkey. Since 2009 it has invested €10
billion in various sectors of the Turkish economy, with almost all investments
in the private sector. Earlier this year it invested in the debut bond
issuance by Zorlu Osmangazi, the OEDAS parent company.
FMO has long term relations with several key players in the Turkish industry
and financial sector. During the last few years, FMO’s Energy Department
increased its focus on renewable energy projects. The investments as executed
by Zorlu Osmangazi and OEDAS also contribute, among others, to improved
state-of-art, more efficient (i.e. reducing losses and CO2-emissions) electrical
grids and distribution systems, more smart metering and a dedicated, professional
approach to facilitating and managing the intermittency of wind-, solar
and hydro powered projects in Turkey.
IFC—a sister organization of the World Bank and member of the World Bank
Group—is the largest global development institution focused on the private
sector in emerging markets. We work with more than 2,000 businesses worldwide,
using our capital, expertise, and influence to create markets and opportunities
in the toughest areas of the world. In FY17, we delivered a record $19.3
billion in long-term financing for developing countries, leveraging the
power of the private sector to help end poverty and boost shared prosperity.
For more information, visit www.ifc.org