Bank loan

World Bank loan of $ 300 million to boost Turkey’s geothermal energy

The World Bank Board of Directors approved two loans worth $ 300 million (TL 5.3 billion) to support the development of renewable energy by harnessing deep heat sources as part of the project geothermal development in Turkey, according to the bank.

The loans provide additional funding for two initial loans valued at $ 250 million.

The new loans will help finance power generation, drilling capacity and steam field development, as well as direct-use geothermal applications.

With the addition of the two new loans, the geothermal development project plans to finance a total of over 380 megawatts (MW) of new geothermal capacity, mobilize around $ 555 million in private capital and contribute to the country’s climate commitments. by preventing about 30 million tonnes of carbon emissions over the life of geothermal projects.

According to the announcement, the approved loans are complemented by a $ 39.8 million grant from the Clean Technology Fund (CTF), as well as a $ 350,000 grant from the Energy Sector Management Assistance Program. (ESMAP).

Renewable energies have grown rapidly in Turkey over the past decades, with geothermal power plants providing low-carbon energy by using underground heat to drive power-generating turbines.

The World Bank’s financial package enables Turkey to increase private sector investment by reducing risks for investors through a risk-sharing mechanism (RSM).

The RSM increases the incentives to explore exploitable geothermal resources in well-developed and less developed geothermal regions.

Commenting on the recent loan, Auguste Kouame, the World Bank’s country director for Turkey, said the bank was happy to be a partner of Turkey in attracting climate-friendly investments and supporting its energy transition.

“Increasing the capacity of renewable energy generation is essential to achieve energy security and climate change mitigation in Turkey,” Kouame said.

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