March 9, 2018//-The European Bank for Reconstruction and Development ( EBRD) is supporting a major milestone in the privatisation of state-owned power plants in Turkey with a US$ 55 million dual-currency loan (US$ 35 million in US dollars and the equivalent of US$ 20 million in Turkish lira (TRY)) to a subsidiary of Koç Holding, the largest diversified conglomerate in the country.
Entek Elektrik Üretimi A.Ş, the winning bidder of a competitive privatisation tender, is acquiring two hydropower plants in Kahramanmaraş province in Turkey’s south-east: Menzelet, with 124 MW capacity, and Kılavuzlu, with 54 MW. The plants supply clean, renewable energy to a Mediterranean area with a population of more than a million and important industrial installations.
The EBRD’s loan is part of a dual-currency financing package of TRY 1.05 billion, equivalent to around US$ 260 million, to finance the acquisition. Other lenders include Garantibank, İşbank, Akbank, Yapıkredi, Unicredit and ICBC Turkey.
Arvid Tuerkner, EBRD Managing Director for Turkey, said: “Privatisation is a key part of the Turkish government’s strategy to liberalise the country’s energy sector. Our investment supports the goal of increasing the participation of private suppliers in power generation and reinforces the role of renewable energy in the sector.”
Harry Boyd-Carpenter, EBRD Director for Power and Energy Utilities, added: “This is a strong example of how the EBRD delivers its mandate of building economic resilience in Turkey, supporting another major privatisation in the hydropower sector.”
Entek began investments in 1995 and operates six hydroelectric power plants and a gas-fired power plant.
Yağız Eyüboğlu, Chairman of Koç Holding Energy Group, said: “Taking over the operating rights of these two hydroelectric power plants in Kahramanmaraş is an important step for the Koç Group’s vision of growing in sustainable and renewable energy. In order to be one of the leading power generation companies, Entek continues to strengthen its portfolio. By winning the biggest privatisation tender in 2017, we have demonstrated our vision and belief in the future of our country.”
Bilal Tuğrul Kaya, CEO of Entek Elektrik, added: “In 2017, Entek had a total 178 MW of installed capacity. With these two power plants, our installed capacity has almost doubled to 422 MW. The privatisation of Menzelet and Kılavuzlu is the largest acquisition of hydropower plants by a domestic investor in Turkey. In the forthcoming period, we are planning to continue our investments by considering a balanced and diversified generation portfolio.”
The EBRD had already financed in 2016 the privatisation of the Karacaoren hydropower plants, with a combined capacity of 78 MW and located in Burdur, south-western Turkey, by energy company Gama Enerji.
Encouraging greater private sector participation in the energy sector and promoting the use of more environmentally friendly sources of energy is a priority for the EBRD in Turkey. Almost half of its projects in the country contribute to financing sustainable energy.
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 of these in the private sector.
In 2017 alone, the Bank invested €1.6 billion in 51 projects in the country. Nearly a third of this financing was provided in Turkish lira. ebrd.com
