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Ankara, Jun 07, 2006 -- M2 PRESSWIRE
The World Bank today approved a EURO 280 Million (approximately US$350 million) Electricity Generation Rehabilitation and Restructuring Project Loan for Turkey. The development objective of the project loan is two-fold. The first objective is to mitigate the risk of electricity supply shortages during the period of energy reform transition until around 2010. The second objective is to support the restructuring of the state-owned generation sector operated by EUAS into corporate entities and prepare them for operation in the electricity market and for subsequent privatization. To support the achievement of these goals the project will finance: (a) The rehabilitation of the Afsin-Elbistan A Power Plant. Afsin Elbistan A has a design capacity of 1,355 MW with four generating units that were commissioned between 1984 and 1987. Presently, the plant cannot operate at more that about 75% of its design capacity and its efficiency has declined by about 25%. The project will repair and upgrade the power plant systems to restore reliability, availability, power output and to improve plant efficiency. In addition, new environmental protection systems, specifically electrostatic precipitators (ESPs) will be installed to reduce dust and particulate emissions, which is the major environmental impact of the Afsin-Elbistan A power plant. EUAS staff's capacity will also be prepared in modern maintenance practices to keep the plant in good operating condition with higher capacity after rehabilitation. New systems for frequency control will be installed that would allow the power plant to meet the standards established by the Union for the Coordination of Transmission of Electricity in Europe (UCTE). Meeting these standards would help Turkey in being certified to operate synchronously with the South East European Electricity network. (b) Support for the financial and operational restructuring of the state-owned generation business. This will focus on strengthening the portfolio generation companies that will be created by the reorganization of EUAS generation assets, and enabling these companies to function effectively in the competitive electricity market. This aspect will also focus on the design and implementation of mechanisms to attract private investment in generation to ensure adequate electricity supply. On the occasion of the approval of the project loan, Andrew Vorkink, Country Director for Turkey stated: "Turkey faces a risk of potential short-fall 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. 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 on-going program of World Bank support to Turkey's energy sector by addressing these two priorities." The World Bank loan to EAS, for the Electricity Generation Rehabilitation and Restructuring Project has a 15-year maturity, including a 5-year grace period. This will be a variable spread loan with level repayments of principal. For more information about the World Bank's work in Turkey, visit: http://www.worldbank.org.tr. For more information about this project, visit: http://www.worldbank.org/projects M2 Communications Ltd disclaims all liability for information provided within M2 PressWIRE. Data supplied by named party/parties. Further information on M2 PressWIRE can be obtained at http://www.presswire.net on the world wide web. Inquiries to info@m2.com. News Provided By |
