Assessment report identifies Turkey’s energy challenge
The Clean Technology Fund (CTF), jointly with the World Bank, International Finance Corporation (IFC), and European Bank for Reconstruction and Development (EBRD), launched the “Assessment Report of Clean Technology Fund in Renewable Energy and Energy Efficiency market in Turkey” on May 30, 2013
As electricity demand has increased rapidly over the recent years of high economic growth, Turkey faces the twin challenge of ensuring energy security and containing greenhouse gas emissions to mitigate climate change.
However, Turkey is the first country to have benefitted from CTF Funds, a press release issued on May 30, 2013 has said.
Turkey’s Minister of Energy and Natural Resources, Taner Yildiz stated that, “Partnering with the multilateral development banks through the CTF has helped Turkey to scale up investments in energy efficiency, renewable energy, and smart grids by empowering its own national private and banking sector. The fact that Turkey has been a first mover in achieving results on the ground has inspired investors and emboldened us to be even more ambitious not only in the scale of investments we seek to achieve but also in the types of renewable technologies we are considering.”
According to the report, the Clean Technology Fund was set up in 2009 to provide finance for low carbon technologies and reduce greenhouse gas emissions during the period until a new global climate change agreement is negotiated and becomes effective. The governments of Australia, Canada, France, Germany, Japan, Spain, Sweden, United Kingdom, and United States have pledged $5.2 billion to this multilateral fund managed by the World Bank and administered through the World Bank Group and other multilateral development banks.
In Turkey, low-interest CTF loans have helped to increase privately operated renewable energy production and private sector energy efficiency, thereby reducing greenhouse gas emissions and energy cost, and ultimately contributing to the transformation of the Turkish energy sector, it added.
The report noted that, in total, CTF to date has provided $200 million in soft loans and technical assistance to promote private sector investment in energy efficiency and renewable energy projects in Turkey.
Backed by this commitment, EBRD provided and mobilized $285 million and IFC provided $255 million for financing RE/EE projects through financial institutions. The World Bank’s contribution in support of related private sector projects has reached $1 billion. The total volume contributed and mobilized by the Multilateral Development Banks (MDBs) had reached $1.535 billion by the end of 2012.
Country Director of the World Bank in Turkey, Martin Raiser said, “The CTF was set-up to support transformational investments. Through its CTF program, Turkey has launched the transformation of its energy sector towards greater reliance on renewable energy sources, and has shown that this is not just good for the climate but can be good for business, too. Much remains to be done, particularly to boost energy efficiency and decouple growth from emissions. The International Financial Institutions stand ready to help Turkey take further climate action.”
The report analyzes the impact that CTF had on the RE/EE market in Turkey, verifies the methodology used and the data on emission reductions reported by beneficiary banks and other recipients of CTF funds and reviews the monitoring and evaluation system of various government institutions. It validates the emission reductions achieved through CTF, which are estimated to be over 2 million tons per year all the CTF and IFI financed projects.
The Report also makes some recommendations on how to further strengthen the monitoring and evaluation system for renewable energy and energy efficiency investments in Turkey.
By Dorcas Appiah