Britain’s Standard Chartered Bank will provide a €249 million (£213 million) loan to Turkish renewable energy investment company Kalyon Enerji.
UK Export Finance (UKEF) and KUKE, the UK and Polish export credit agencies, have guaranteed the loan that will enable the construction and operation of solar power plants at seven separate locations in three Turkish provinces, with a total generation capacity of 390MWp.
The 390MWp project would be Turkey’s second largest solar energy development.
Standard Chartered acted as structuring bank, green loan coordinator, lead arranger and lender. The financing is guaranteed by a 100% UKEF guarantee, with more than €122 million reinsured by KUKE.
It means Kalyon Enerji can pay for exports from Britain and Poland for an extended period of time, while supporting employment in the renewable energy sector supply chain at home.
Gareth Thomas, the British Export Secretary, said: “Our mission is to grow the economy, including by boosting exports, so British businesses can sell their world-class goods and services around the world.
“This announcement will support jobs and businesses across the country, especially in the Midlands, and underpin the global transition to cleaner energy.”
British exporter GE Vernova – through its subsidiary UK Grid Solutions – will supply and install inverter stations, power plant controllers and other critical equipment. The company says this is expected to directly support UK jobs at GE Vernova’s Staffordshire site and jobs across the wider UK supply chain.
GE says it has helped deliver about 2.8 GW of solar capacity in Turkey. Uday Mathur, global capital markets leader at GE Vernova, said the company is proud to support “another milestone financing” in the country.
In turn, Polish exporters will provide security systems (necessary software and equipment) and steel components for the project, creating jobs in the logistics and manufacturing sectors and establishing Polish companies in Turkey.
In 2021, a 1.35 GW solar project in Turkey received £217 million in loan support from UKEF, as part of an agreement signed with GE Energy Financial Services. GE Grid Solutions also produced transformers for the project, developed by Kalyon Enerji.
As mentioned on our sister site, PV TechThe project – the largest solar energy project ever in Turkey – was from UKEF largest guarantee ever for a solar project. Dr. Murtaza Ata, CEO of Kalyon Enerji, said it would become operational in 2023.
He added: “This is Kalyon Enerji’s second transaction with UKEF and GE Vernova, for the second largest solar project in Türkiye to date. Thanks to our business partners for their support, by investing in sustainable energy projects, we are not only providing sustainable energy solutions, but also creating jobs and contributing to Türkiye’s energy independence through the use of renewable energy sources.”
Strengthening supply chains
Establishing supply chains in the country is a key part of Labour’s pledge to deliver the UK’s transition to net zero. UKEF supports UK companies to expand their portfolios abroad: in March it backed a £19m bank guarantee facility from Santander, awarded to Hive Energy, with a guarantee from its General Export Facility scheme.
Apparently the product has helped UK businesses – mainly SMEs – access more than £325 million in working capital since its launch in 2020.
Yoshi Ichikawa, head of structured export finance for Europe at Standard Chartered, said: “With our unique expertise in sustainable finance and a track record in financing sustainable projects, we are proud to be shaping the future of communities in our can help shape our footprint.”
