$125m geothermal energy programme launched in Turkey
A new $125 million programme has been launched to finance geothermal energy development in Turkey
A new $125 million programme has been launched to finance geothermal energy development in Turkey.
The European Bank for Reconstruction and Development and the Clean Technology Fund will provide the funding to support exploratory drilling for geothermal resources.
The initiative was announced in January at the 35th Energy Efficiency Forum in Istanbul and Dr. Adonai Herrera-Martinez, senior manager in the EBRD Energy Efficiency and Climate Change team said: “The EBRD is the first international financial institution to help private geothermal energy developers bridge the equity gap."
Dr Herrera-Martinez added: “Our goal is to unlock the vast amounts of renewable energy trapped deep underground and to attract more private investment and bank financing in the sector, moving away from reliance on purely public funds.”
Geothermal energy projects are known for high investment costs and development risks and very limited access to project finance once drilling has confirmed the resource
The newly announced $125 million PLUTO initiative will provide finance and advice to private developers with the aim of minimising the risks.
The PLUTO initiative includes $100 million from the EBRD with $25 million from the CTF and is part of a global effort by multilateral development banks to scale up geothermal energy investments.
PLUTO is structured in two phases with phase one targeting initial geothermal exploration, drawing on the funds provided by the CTF.
If the exploration phase is successful, the EBRD will then finance the final stages of the drilling and the construction of the power plant in the second phase of the project.
The initiative includes plans to develop five new geothermal power plants with a total combined capacity of about 60 MW, generating more than 450 GWh of renewable electricity per year.
The target is to increase the amount of installed geothermal capacity in Turkey by more than 10 per cent.
Turkey has pledged to cover 30 per cent of its total installed capacity with renewable energy by 2023 and is aiming to add 34 GW of hydropower, 20 GW of wind energy, 5 GW of solar energy, 1 GW of biomass and 1 GW of geothermal.
About 600 MW of geothermal capacity is currently installed in Turkey which means that the country is only tapping into 13 per cent of its geothermal power potential, estimated at 4.5 GW.
The EBRD has already financed six geothermal power plants through Turkish commercial banks: Tuzla, Gümüşköy, Pamukören, Babadere, Alaşehir, and Umurlu GPPs. It has also financed Efeler GPP, the largest geothermal power plant in Turkey and the second largest in Europe.
