World Bank Funds $748 Million for Turkey's Energy Transmission Improvement Project
Turkey is set to undergo a significant transformation in its energy sector, with a focus on renewable energy, as the World Bank has approved $748 million in financing for the Türkiye Energy Transmission System Transformation Project.
Treasury and Finance Minister Mehmet Simsek highlighted the successful outcomes achieved in the energy sector through long-standing cooperation with the World Bank. He noted that the minister's statement indicates a continued support for public investments within the framework of reducing dependence on imported energy sources.
The project, to be implemented by the Turkish Electricity Transmission Corporation (TEIAS), aims to eliminate constraints in Turkey's energy transmission system operations. It will complete the electricity transmission grid ring and strengthen transmission infrastructure.
The funding will be provided to TEIAS under the Turkish Treasury and Finance Ministry's repayment guarantee. The financing comes from the World Bank loans ($708 million), Bank-managed Clean Technology Fund loans ($38 million), and CTF grants ($2 million).
The initiative is aligned with Turkey’s 12th National Energy Plan and broader climate commitments, intending to reduce greenhouse gas emissions significantly and create jobs within the renewable energy sector. The goal is to make Turkey's power grid greener, more resilient, and more digital, unlocking renewable energy potential while improving electricity supply reliability for homes and businesses.
The project emphasizes three core components: upgrading transmission infrastructure, digitalizing the power grid, and providing technical assistance for innovation. This includes establishing Turkey’s first High-Voltage Direct Current (HVDC) corridors and building institutional capacity at TEİAŞ for better implementation.
The strategic energy goals Turkey pursues include reducing natural gas imports, increasing solar and wind power capacities, achieving a high renewable installed capacity share, implementing climate legislation, expanding regional pipeline infrastructure, and using energy strategically for geopolitical influence.
With this World Bank funding, favorable-term financing from international organizations is expected to reach approximately $7 billion by 2025, according to ministry sources. The minister's statements suggest a broader strategic vision for Turkey's energy sector, including a partnership with Iraq for energy purposes.
Europe views Turkey as an integral part of the wind energy supply chain, and the minister's comments imply a continued focus on Turkey's energy goals, including reducing dependence on imported energy sources and increasing electricity production from renewable energy. Simsek stated that the successful partnership will continue in the coming period.
The approval was given by the World Bank's Board of Executive Directors, marking a significant step forward in Turkey's journey towards a sustainable and self-reliant energy future.
- The Turkish Electricity Transmission Corporation (TEIAS), with the support of the World Bank, is set to execute a project in Turkey, aiming to upgrade critical transmission infrastructure and digitalize the power grid using international financing, including Turkish finance ministry loans and loans managed by the Clean Technology Fund.
- Notably, this project aligns with Turkey's strategic energy goals, such as reducing natural gas imports, increasing solar and wind power capacities, and achieving a high renewable installed capacity share – all of which reiterate the Turkish Treasury and Finance Minister Mehmet Simsek's statements regarding reducing dependence on imported energy sources.
- In addition to its alignment with Turkey’s 12th National Energy Plan and broader climate commitments, the Türkiye Energy Transmission System Transformation Project is expected to create numerous jobs within the renewable energy sector, contributing to a greener, more resilient, and more digital power grid for homes and businesses in Turkey.
