The European Bank for Reconstruction and Development (EBRD), the Asian Infrastructure Investment Bank (AIIB) and the Black Sea Trade and Development Bank (BSTDB) have approved a financial package worth $350m (£280.6m) for the expansion of the Efeler geothermal power plant in Turkey.
The funding will be used by Gürmat Elektrik, a renewable energy subsidiary of Güriş, to build three new units at the EFELER power plant located in western Turkey, in the region of the Büyük Menderes Graben basin.
The Büyük Menderes Graben basin is claimed to hold the greatest potential for geothermal energy.
The expansion at the EFELER power plant will tap into locally available geothermal resources.
Gürmat Elektrik will receive $100m (£80.1m) loan from the AIIB, $60m (£48.1m) from the EBRD and $20m (£16m) loan from the BSTDB as well as $90m (£72.1m) loan from Turkey’s commercial lender Isbank.
The firm will also receive loans of $50m (£40m) and $30m (£24m) from the Industrial Development Bank of Turkey TSKB and ICBC Turkey, respectively.
AIIB vice-president and chief investment officer D J Pandian said: “This project represents a number of firsts for AIIB: EFELER is our first non-sovereign-based financing in Turkey, our first co-financing with the EBRD and the BSTDB in the private sector, and our first foray in the geothermal space.
“This project is a visible example of AIIB’s commitment to the expansion of renewable energy projects led by the private sector in Turkey. We are very glad to partner with Güriş Holding and our co-financiers in this important transaction.”
Of the three new units, EFE-6 with 22.6MW capacity and EFE-7 with 25MW are currently operational. The EFE-8 with 50MW capacity is under construction.
The expansion project will bring the total installed capacity of the geothermal power plant to 260MW.
The financing will help Turkey encourage private sector investment in the energy sector, develop local renewable energy sources and diversify its energy mix.
BSTDB banking vice-president Hasan Demirhan said: “As a regional development bank, BSTDB seeks to considerably increase its strategic role in supporting infrastructure investments with high development impact in member countries, including creation of long-term employment and increased revenues for the state budget.”