news - FMO supports the upgrade and expansion of OEDAŞ’ Electricity Grid in Turkey


FMO supports the upgrade and expansion of OEDAŞ’ Electricity Grid in Turkey

March 7, 2022

The Dutch entrepreneurial development bank FMO, IFC, EBRD, AIIB, and Denizbank have joined forces to finance for the second time the improvements in the electricity distribution network in Turkey’s Osmangazi region in Western Anatolia. 

The financing package of Turkish Lira (“TRY”) equivalent of USD350m to OEDAŞ, will help to upgrade, modernize and expand the distribution network which serves around 1.9 million end-users in 125 towns and 1,455 villages. These investments are part of a capital expenditure programme required by Turkey's Energy Market Regulatory Authority for the five-year regulatory period between 2021 and 2025. OEDAŞ is the electricity distribution company of the Osmangazi region, which includes five provinces: Afyonkarahisar, Bilecik, Eskisehir, Kutahya, and Usak. In 2018, the first debt transaction with OEDAŞ was contracted, with USD320m (also Turkish Lira equivalent) in total. In this second USD350m transaction, FMO contributed USD75m, with an additional USD25m to be activated late 2022 when needed and so agreed. IFC contracted USD75m, EBRD: USD50m, AIIB: USD75m, and Denizbank provided USD75m.

Zorlu Enerji’s CFO, Elif Yener said: “This second long-term financing in Turkish Lira from international finance institutions and Denizbank for our distribution company, OEDAŞ, enables us to focus on improvements in our regional distribution grid while providing essential services to millions of people and thousands of companies. Under our five-year investment plan, as agreed with the Regulator/EMRA, these local currency debt funds will enable us to deliver electricity to our clients in a reliable and safe manner”.

Improvements in OEDAŞ’s electricity distribution grid will, among others, reduce the technical losses and enhance the connection of more renewable energy projects (like solar and/or wind). As a result, this will also reduce carbon emissions. OEDAŞ’ teams continue the execution of an Environmental & Social Action Plan, which enhances compliance with the highest environmental and safety standards.

OEDAŞ is indirectly wholly-owned by Zorlu Enerji which together with its subsidiaries, engages in establishing and operating electrical energy production plants in Turkey and abroad. It is part of the Turkish conglomerate Zorlu Holding.

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