The funding will be used by Turkish electricity distribution company Osmangazi Elektrik Dagitim (OEDAS) to upgrade the electricity distribution network in order to enhance environmental and safety standards and improve the efficiency and reliability of supply.

The project will involve upgrade, modernization and expansion of the distribution network in the Osmangazi region, which comprises five provinces including Afyonkarahisar, Bilecik, Eskisehir, Kutahya and Usak.

The distribution network planned to be modernized serves around 2.7 million people in 194 towns and 1,596 villages.

EBRD is providing $110m loan while IFC and FMO are extending a loan worth $80m and $65m respectively.

OEDAS is ultimately owned by Zorlu Enerji, which is a part of the Turkish conglomerate Zorlu Holding.

Zorlu Enerji CFO Elif Yener said: “The new long-term financing in Turkish Lira from international finance instritutions for our distribution company will enable us to focus on improvements in the infrastructure and grids, providing better services to millions of people.”

EBRD expects the network improvements project to reduce electricity losses and enable the connection of increased solar capacity, thus saving at least 40,000 tons of CO2 emissions annually.

IFC Europe and Central Asia regional director Wiebke Schloemer said: “Power sector development is one of the priority areas identified in the World Bank Group’s strategy for Turkey.

“The financing package in local currency tranches, will help our long-term partner Zorlu Enerji and its subsidiary OEDAS to further improve the quality and reliability of service to over 2.5 million people in provinces of Turkey.

“The structure of this significant agreement demonstrates IFC’s important role in mobilizing other financial resources and a good example of cooperation between multilateral institutions.”