World Bank lends $350 mln to EUAS
The World Bank yesterday approved a 280 million euro ($350 million) Electricity Generation Rehabilitation and Restructuring Project loan for Turkey.
The loan will be to Elektrik Üretim AŞ (EUAS), the government-owned electricity generation company that owns and operates about 25,000 MW of thermal and hydrogeneration capacity in Turkey. The loan to EUAS will be guaranteed by Turkey. The World Bank loan to EUAS for the Electricity Generation Rehabilitation and Restructuring Project has a 15-year maturity, including a five-year grace period.
According to a statement from the bank, the objective of the project loan is twofold. The first is to mitigate the risk of electricity supply shortages during the period of energy reform transition until around 2010. The second is to support the restructuring of the state-owned electricity generation sector operated by EUAS into corporate entities and prepare them for operation in the electricity market and subsequent privatization.
The loan will finance the rehabilitation of the Afşin-Elbistan A power plant. Afşin Elbistan A has a 1,355 MW capacity with four generating units that were commissioned between 1984 and 1987. Presently, the plant cannot operate at more that about 75 percent of its capacity, and its efficiency has declined by about 25 percent. The project will repair and upgrade the power plant systems to restore reliability, availability, power output and to improve plant efficiency.
The World Bank said the loan would also be used to support the financial and operational restructuring of the state-owned electricity generation business.
On the occasion of the approval of the project loan World Bank country director for Turkey Andrew Vorkink stated: "Turkey faces a risk of potential shortfall of electricity between 2008-2010 depending on prospective economic and demand growth. To mitigate these risks and reduce the possibility for economic dislocation resulting from power shortages, it is important that two steps are taken."
These two steps are: First, the competitive electricity market under implementation needs to establish an operating track record to remove the uncertainties that investors perceive. Second, cost-effective generation sources and underperforming assets need to be developed and rehabilitated to provide capacity and energy to fuel Turkey's private enterprise and household needs.
"This project loan will complement the ongoing program of World Bank support to Turkey's energy sector by addressing these two priorities." Vorkink added.
The loan will be to Elektrik Üretim AŞ (EUAS), the government-owned electricity generation company that owns and operates about 25,000 MW of thermal and hydrogeneration capacity in Turkey. The loan to EUAS will be guaranteed by Turkey. The World Bank loan to EUAS for the Electricity Generation Rehabilitation and Restructuring Project has a 15-year maturity, including a five-year grace period.
According to a statement from the bank, the objective of the project loan is twofold. The first is to mitigate the risk of electricity supply shortages during the period of energy reform transition until around 2010. The second is to support the restructuring of the state-owned electricity generation sector operated by EUAS into corporate entities and prepare them for operation in the electricity market and subsequent privatization.
The loan will finance the rehabilitation of the Afşin-Elbistan A power plant. Afşin Elbistan A has a 1,355 MW capacity with four generating units that were commissioned between 1984 and 1987. Presently, the plant cannot operate at more that about 75 percent of its capacity, and its efficiency has declined by about 25 percent. The project will repair and upgrade the power plant systems to restore reliability, availability, power output and to improve plant efficiency.
The World Bank said the loan would also be used to support the financial and operational restructuring of the state-owned electricity generation business.
On the occasion of the approval of the project loan World Bank country director for Turkey Andrew Vorkink stated: "Turkey faces a risk of potential shortfall of electricity between 2008-2010 depending on prospective economic and demand growth. To mitigate these risks and reduce the possibility for economic dislocation resulting from power shortages, it is important that two steps are taken."
These two steps are: First, the competitive electricity market under implementation needs to establish an operating track record to remove the uncertainties that investors perceive. Second, cost-effective generation sources and underperforming assets need to be developed and rehabilitated to provide capacity and energy to fuel Turkey's private enterprise and household needs.
"This project loan will complement the ongoing program of World Bank support to Turkey's energy sector by addressing these two priorities." Vorkink added.
posted by Pasha Corporation at 3:47 PM
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