The World Bank and Turkiye have signed an agreement for a $1 billion program for renewable energy

According to a statement from the institution, the program is expected to assist Turkey in establishing and expanding its distributed solar energy market, as well as conducting a pilot implementation of a battery storage program, in line with the goal of supporting the National Energy Plan.

The statement noted that the government aims to increase its solar energy installed capacity from 9.5 gigawatts as of 2022 to 52.9 gigawatts by 2035, with a target of 7.5 gigawatts for battery storage capacity.

The $1 billion program, which will support efforts to increase renewable energy usage, will be implemented by leading public and private sector development banks in Turkey.

Accordingly, the publicly-owned Turkey Development and Investment Bank (TKYB) and the privately-owned Industrial Development Bank of Turkey (TSKB) will work in parallel to develop Turkey’s distributed energy market in two stages.

According to the statement, firstly, direct financing will be provided to private sector investors developing rooftop and ground-mounted solar energy systems for commercial and industrial customers. Secondly, local commercial banks or leasing companies will be supported to provide similar loans to solar energy investors. The program will thus develop an increasingly diversified financing market to increase the use of distributed solar energy.

Humberto Lopez, Country Director for Turkey at the World Bank, commented on the program, stating, “Turkey has embarked on one of the most ambitious programs seen among emerging market economies in recent times regarding energy transformation. The World Bank welcomes this commitment to doubling renewable energy by 2035 and is pleased to accompany the country in ensuring energy security, reducing energy costs for consumers, and combating climate change through projects such as the one we are signing today.”

Manuel Berlengiero, Lead Energy Specialist at the World Bank responsible for the program, stated, “In addition to meeting increasing electricity demand, the project will accelerate the next phase of market development by laying the necessary foundations for a mature market that can attract private investments for distributed solar energy and storage solutions, ultimately operating with less public support or preferential treatment.”

The financing from the World Bank will consist of a €600 million (approximately $657 million) loan from the International Bank for Reconstruction and Development (IBRD) and a $30 million loan from the Clean Technology Fund (CTF), along with a $3 million grant from the Energy Sector Management Assistance Program (ESMAP). The program is also expected to mobilize $259 million in private capital.

source prepared by Melisa Beğiç

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button