TYPES OF LOAN
The Sustainable Energy Financing Facilities (SEFFs) are part of the European Bank for Reconstruction and Development’s (EBRD) Sustainable Energy Initiative (www.ebrdseff.com). The EBRD was the first international financial institution to establish a specialized energy efficiency team in 1994, and has accumulated valuable expertise in innovative energy efficiency financing. Since launching the first SEFF in Bulgaria by the year of 2004, the EBRD has committed more than EUR 1.9 billion of commercial finance to SEFFs implemented in 15 countries and supported by EUR 200 million from donors.
Turkey Private Sector Sustainable Energy Finance Facility (TurSEFF) is a framework operation with up to USD 265 million under which credit lines will be provided by EBRD to eligible commercial banks for on-lending to private sector borrowers for energy efficiency (“EE”) and small-scale renewable energy (“RE”) investments.
Borrowers may be eligible for loans up to EUR 5 million under TurSEFF to implement projects that include a substantial energy efficiency component. Other project components may be financed by the customer himself or by the participating local bank. Borrowers must meet the Partner Bank’s credit criteria and be approved in accordance with the Partner Bank’s credit appraisal procedures.
TurSEFF includes a comprehensive technical assistance package. A team of local and international experts provide support to help prospective borrowers identify and develop sustainable energy projects, and prepare successful loan applications under TurSEFF. This technical assistance is provided free of charge and carried out through funding by the European Union (EU) and Climate Investment Fund (CIF).
The project implementation team supplying technical assistance consists of local and international experts from the companies Montgomery Watson Harza (MWH) Mühendislik ve Müşavirlik Limited Şirketi leading the consortium and Fichtner GmbH & Co. KG. The team of experts also train loan officers at participating banks in the assessment of sustainable large and small scale energy investments.
The European Bank for Reconstruction and Development – EBRD provides 265 million USD to Participating Banks for on-lending.
The European Union and the Climate Investment Funds – Technical Assistance of the program is financed by EU and CIF Funds.
Participating Banks – are the Turkish commercial banks which have borrowed part of the 265 million USD loan fund to on-lend to their SME customers that invest in energy efficiency and renewable energy projects. The participating banks of the programme are Denizbank, İş Bankası, Vakıfbank and Yapı Kredi.
The sub-borrowers – Benefit from loans and free technical assistance provided by the Project Consultant.
The Project Consultant – Provides free-technical assistance to sub-borrowers.
The Verification Consultant – Ensures that the objectives of the facility are met.
The ultimate goal of TurSEFF is to make a significant impact in critical areas that address climate change challenges in Turkey by:
- Enhancing energy security through improving energy efficiency in SMEs in key sectors of the economy;
- Supporting a clean energy transition by reducing reliance on fossil fuels and focusing on meeting energy needs in an environmentally sustainable manner, thereby reducing GHG emissions; and
- Increasing private sector involvement in the development and financing of energy efficiency investments.
The Consortium of Montgomery Watson Harza (MWH) Muhendislik ve Musavirlik Limited Sirketi and Fichtner GmbH & Co KG has been hired as ”Project Consultant (PC)”. The Consortium will provide technical assistance.
Potential sub-borrowers will receive advice on existing investment plans, help in identifying the best measures to pursue, and support in structuring investment proposals in order to obtain financing under the Facility. Furthermore, sub-borrowers will participate in energy management training through energy audits and regional workshops.
The PC will also provide overall project coordination, capacity building and training to the participating banks which includes training of trainers, and advising on the eligibility of the sub-projects proposed to be financed under the Facility.
AF Mercados Energy Markets International S.A. has been hired as “Verification Consultant (VC)”. The VC will ensure that the objectives of the facility are met by checking and confirming, on a sample basis, that Sub-projects have been completed in accordance with the relevant investment plans and are on track to achieve the planned energy savings.