Turkey Mid-size Sustainable Energy Financing Facility (MidSEFF)

Turkey Mid-size Sustainable Energy Financing Facility (MidSEFF) is a financing facility, developed by the European Bank for Reconstruction and Development (EBRD), which aims to support the private sector borrowers in Turkey to undertake mid-size renewable energy, waste-to-energy and industrial energy efficiency investments.

Within MidSEFF, a total of EUR 1,050 million in loans will be provided through 5 Turkish banks for on-lending to private sector borrowers: EUR 700 million from EBRD and EUR 350 million from the European Investment Bank (EIB). The project aims at boosting mid-size investments for the following type of projects:

• mid-size (5 - 50 MW; up to 40 MW for hydropower plants - HPP) renewable energy Sub-projects;
• energy efficiency improvements in the industrial sector;
• private sector investments in municipal and/or industrial waste-to-energy projects;

In order to apply to the MidSEFF credit line the Sub-projects must be in compliance with the technical eligibility criteria for each type of investment and with the environmental and social policy requirements as elaborated in the EBRD's Environmental and Social Policy 2008.

The MidSEFF Team will check the compliance of the Sub-Projects and of the Sub-Borrowers with all the eligibility criteria and will support the Participating Banks and Project Sponsors in all the process connected to the Environmental and social risks identification, assessing and suggestion on the mitigation measures.

Sub-Projects must be financially viable and meet the Participating Banks' credit criteria and be approved in accordance with the Participating Banks' credit appraisal procedures. Furthermore, the sub-loans financed from the Facility Loan proceeds shall comply with the following criteria:

• Individual Sub-loan amounts shall be in the range of EUR 10 to 40 million and the total investment cost of the Sub-project shall not exceed EUR 50 million; Sub-loans amount outside this range and/or Sub-projects requiring higher investment volumes will be considered on a case by case basis and financed only following approval from the EBRD.
• Sub-loans shall be provided to Sub-borrowers on terms consistent with arms length market terms prevailing in the local banking market.
• Each Sub-loan will have an appropriate tenor and grace period based on the projected cash flow of the Sub-project being financed and consistent with the Participating Banks normal policies and procedures.

Eligible Sub-borrowers
Eligible Sub-borrowers shall meet the following requirements:

• Be private enterprises, firms, businesses, sole proprietors or other private legal entities formed under the laws of and operating in Turkey.
• Sub-borrowers shall have majority private ownership and control (i.e. majority rights) or be in the final stage of the process of an irrevocable privatisation, according to explicit privatisation law or regulation.
• Sub-borrowers must be financially viable and meet the PB's credit criteria and be approved in accordance with the PB's credit appraisal procedures.
• Sub-borrowers must pass the integrity check by the PBs (as requested in the loan agreement) and may not be persons or entities that are included on EBRD's list of persons or entities ineligible to be  awarded an EBRD-financed contract or for EBRD funding, as such list may be found at http://www.ebrd.com/pages/about/integrity.shtml (or any successor website or location).

Eligible Sub-projects
Facility financing may be on-lent as Sub-loans to eligible Sub-borrowers only for investments that meet the eligibility criteria for Sub-projects as described herein. Eligible Sub-projects shall be investments which contribute to:

• The production of energy from renewable energy sources; or
• The improvement of the energy efficiency of industrial enterprises; or
• The production of energy from municipal and/or industrial waste or
• Combination of some or all above type of investments.