UK and Poland finance Turkish solar project

The UK’s Standard Chartered Bank will provide a €249 million ($213 million) loan for Turkish renewable energy investment company Kalyon Enerji.

UK Export Finance (UKEF) and KUKE, the UK and Polish export credit agencies, have guaranteed the loan which will see the construction and operation of solar power plants at seven separate sites across three Turkish provinces, with an aggregate generation capacity of 390MWp.

The 390MWp project is said to be Turkey’s second-largest solar development.

Standard Chartered acted as structuring bank, green loan coordinator, lead arranger and lender. The financing is guaranteed by a 100% UKEF guarantee, with over €122 million reinsured by KUKE.

It means that Kalyon Enerji will be able to pay for the exports provided by the UK and Poland over a longer period, meanwhile supporting jobs in the renewable energy sector supply chain at home.

Gareth Thomas, UK minister for exports, said: “Our mission is to grow the economy, including through 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 support the global transition toward cleaner energy.”

British exporter GE Vernova—via 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 British jobs at GE Vernova’s Staffordshire site and jobs in the wider UK supply chain.

GE says it has helped deliver approximately 2.8GW of solar capacity in Turkey. Uday Mathur, global leader of capital markets at GE Vernova, said the company is proud to support “yet another landmark financing” in the country.

For their part, Polish exporters will deliver security systems (necessary software and equipment) and steel components for the project, creating jobs in the logistics and manufacturing sectors and establishing Polish businesses in Turkey.

In 2021, a 1.35GW solar project in Turkey received £217 million loan support from UKEF, as part of a deal signed with GE Energy Financial Services. GE Grid Solutions also produced transformers for the project, developed by Kalyon Enerji.

As covered on our sister site, PV-Tech, the project—Turkey’s largest ever solar project—was UKEF’s largest-ever guarantee for a solar project. Dr. Murtaza Ata, CEO of Kalyon Enerji, said it became 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 renewable energy projects we are not only providing sustainable energy solutions, but also creating jobs and contributing to Türkiye’s energy independence using renewable energy sources.”

Shoring up supply chains

Establishing supply chains in the country is a key element of Labour’s promise to deliver the UK’s transition to net zero. UKEF supports UK-based companies in expanding their portfolios abroad: in March, it supported a £19 million bank guarantee facility from Santander, awarded to Hive Energy, with a guarantee from its General Export Facility scheme.

Apparently, the product has helped UK firms – primarily small and medium enterprises – to access over £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 renewable projects, we are proud to help shape the future of communities in our footprint.”