The International Finance Corporation (IFC) and the European Bank for Reconstruction and Development (EBRD) are investing $115.5M in the 87MW Paravani hydropower plant in Georgia, their first renewable energy investment in the country.
IFC (part of the World Bank Group) and EBRD will provide Georgia Urban Energy, a subsidiary of Turkey’s Anadolu Endustri Holding, with $40.5M and $52M, respectively, syndicating a further $23M with commercial banks. As part of the project financing, the EBRD will also take a US$5M equity stake in Georgia Urban Energy.
Hursit Zorlu, Chief Financial Officer of Anadolu Group, said that the Paravani project is expanding Anadolu’s renewable-energy generation capacity. “It will also benefit the Turkish electricity market to which Paravani hydropower plant will be able to export green energy,” he said.
“IFC and EBRD are playing a key role in funding the Anadolu Group’s sustainable energy investments in Georgia,” added Tupban Aksoy, Head of the Energy Group for Anadolu Group. “We hope that this strategic support will pave the way for other investors in the country’s renewable energy market.”
The project will provide Georgia with electricity during the winter months, when the country is energy deficient, and export to Turkey in the summer, when Georgia has excess capacity.
“One of IFC’s key priorities is to address climate change through investments in sustainable energy,” explained Gulrez Hoda, IFC Director for Infrastructure and Natural Resources in Europe, Middle East and North Africa. “Paravani is a groundbreaking project that supports Georgia’s efforts to increase renewable energy output, avoid carbon emissions, and achieve energy self-sufficiency.”
“This project confirms the EBRD’s determination to continue making significant investments in renewable energy in a drive to boost competitiveness of economies in the region, improve Georgian energy security and also mitigate the impact of climate change,” said Nandita Parshad, the EBRD’s Director for Power and Energy Utilities. “This first private power generation project in Georgia complements our overall strategy for Georgia and our recent investment in the high voltage transmission network in Georgia.”
This strategic support by these lenders will pioneer the investors to Georgian market and strengthen the relationship between Turkey and Georgia, EBRD said in a statement.
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