The World Bank Board has approved two loans worth $300 million (TL 5.3 billion) to support the development of renewable energy by harnessing deep underground heat sources under the project of geothermal development in Turkey, according to the bank.
The loans provide additional funding for two initial loans worth $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 expects to fund a total of more than 380 megawatts (MW) of new geothermal capacity, leverage approximately $555 million in private capital, and contribute to the country’s climate commitments. preventing approximately 30 million tonnes of carbon emissions over the lifetime 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. energy (ESMAP).
Renewable energy has seen rapid growth in Turkey over the past few decades, with geothermal power plants providing low-carbon energy using underground heat to drive power-generating turbines.
The World Bank’s financial package allows Turkey to increase private sector investment by reducing the risks for investors through a Risk Sharing Mechanism (RSM).
The RSM increases incentives to explore exploitable geothermal resources in both well-developed and less-developed geothermal regions.
Commenting on the recent loan, Auguste Kouame, World Bank Country Director for Turkey, said the bank was delighted to be a partner with Turkey in attracting climate-friendly investment and supporting its energy transition.
“Increased renewable energy generation capacity is key to ensuring energy security and climate change mitigation in Turkey,” Kouame said.