Financing for Turkey’s clean energy sector is expected to be in the region of $2.5 billion this year with more than half channeled to solar projects, a banking official at Garanti BBVA told Anadolu Agency exclusively on Monday.
Turkey's installed renewable capacity reached 52.5 gigawatts at the end of October this year, accounting for 53% of the country’s total installed capacity.
Hydropower has currently the largest renewable share capacity of almost 31.5 gigawatts while wind ranks as the second-largest with around 10.3 gigawatts, followed by solar with 7.6 gigawatts, according to data at the end of October.
Emre Hatem, director at investment banking and finance at Garanti BBVA, said that Turkey's renewable energy projects attracted $40 billion between 2002 and 2020, supported by banks providing an average of $2 billion per year.
Solar accounts for 55% of total financing with wind power assigned 30% and geothermal and other renewables making up the remaining 15%.
The biggest financing in the renewable sector in the country was provided to Kalyon Enerji for the country's largest solar power plant, the Karapinar plant in Konya, which on completion will have a capacity of 1,350 megawatts of installed panel power from the current 550 megawatts.
Kalyon Enerji signed a financing agreement with eight Turkish and international banks for $812 million for the plant last week. UK Export Finance, JPMorgan Chase & Co, Denizbank, Garanti BBVA, Turkiye İs Bankasi, Development and Investment Bank of Turkey, Industrial Development Bank of Turkey and VakifBank will provide the financial backing with a maturity of 12 years for the project.
Hatem said he expects financing for renewable energy projects this year to be higher than the average of previous years and forecasts that this will further expand in line with the country’s climate targets.
Turkish President Recep Tayyip Erdogan announced in September that Turkey would ratify the Paris Agreement with an aim for net zero emissions by 2053.
The country became a party to the global climate pact on Nov. 10.
'In line with preparations for the Green Deal, climate targets and net zero goal by 2053, we forecast that annual financing for renewable energy projects in Turkey will reach $3 billion. Distributed solar power plant installations, hybrid power plant investments and biomass projects will be critical in the coming period,' he said.
The International Energy Agency forecasted in its report published last week that Turkey's renewable power capacity will grow by 53%, or 26 gigawatts, between 2021 and 2026 with solar and wind accounting for 80% of the capacity increase.
Renewable Energy Resource Zone (YEKA) projects in Turkey will be the main drivers of growth in wind and solar, the report said.
By Nuran Erkul Kaya
Anadolu Agency
energy@aa.com.tr