Notice

Category A project supported: Anka Solar Park Project (photovoltaic), Türkiye

Published 1 October 2024

1. Project description

UK Export Finance has agreed to provide support to Kalyon YEKA GES 3 ve 4 Güneş Enerjisi Yatırımları A.Ş (Kalyon) for the construction and operation of seven solar photovoltaic (PV) Projects in Türkiye, grouped in three clusters, namely:

• G4-BOR-3, approximately 130 MWp/100 MWe, and around 201 hectares (ha) located in the Niğde Province, in the Bor District.
• G3-GAZİANTEP-1-1, 2-1 & 3-1, together totalling approximately 65 MWp/50 MWe, around 123 ha, located in the Gaziantep Province, in the Şahinbey District.
• G4-VİRANŞEHİR-5, 7, & 8, together totalling approximately 195 MWp/150 MWe, around 270 ha, located in the Şanlıurfa Province, in the Viranşehir District.

Each site is comprised of PV Modules and a tracker system, DC combiner box(s), Inverters, substations and/or switchyards, as well as supporting infrastructure.

The Project is aimed at increasing the share of renewable energy resources and resource diversity in Türkiye.

2. Project sector

The Project is in the renewable energy sector.

3. Project sponsor

The Project is being developed by Kalyon YEKA GES 3 ve 4 Güneş Enerjisi Yatırımları A.Ş.

4. UK exporters

UKKA Group Limited and UK Grid Solutions Limited.

5. Export Credit Agent Bank

Standard Chartered Bank Plc.

6. Amount of UK Export Finance support

The principal value of the support is approximately €249 million.

7. OECD Common Approaches and Equator Principles

UK Export Finance categorised the Project as Category A i.e. having potentially significant environmental, social, and human rights (ESHR) impacts in accordance with the definition in the 2012 (Revised 2024) OECD Common Approaches for Officially Supported Export Credits and Environmental and Social Due Diligence (the “OECD Common Approaches”) and the Equator Principles (2020).

As required by the OECD Common Approaches, UK Export Finance disclosed its possible involvement in the Project. A notification was posted on the UK Export Finance website on 22 January 2024, which directed interested parties to the contact from where published ESHR information can be sourced. UK Export Finance did not receive any comments from interested parties.

Mott MacDonald Limited (MM) was commissioned by the Project Company to undertake an independent environmental and social due diligence (ESDD) review on behalf of SCB and UK Export Finance.

8. Environmental, social and human rights standards

Project related ESHR documentation was reviewed for their alignment against the 2012 International Finance Corporation (IFC) Performance Standards (PS) on Environmental and Social (E&S) Sustainability and the World Bank Group Environmental, Health and Safety (EHS) Guidelines.

The applicable IFC PS were:

• PS1: Assessment and Management of E&S Risks and Impacts;

• PS2: Labour and Working Conditions;

• PS3: Resource Efficiency and Pollution Prevention;

• PS4: Community Health, Safety and Security;

• PS5: Land Acquisition and Involuntary Resettlement;

• PS6: Biodiversity Conservation and Sustainable Management of Living Natural Resources;

• PS8: Cultural Heritage.

The applicable World Bank Group EHS Guideline was: The General EHS Guidelines (2007). The IFC/European Bank of Reconstruction and Development (EBRD) Note on Workers’ Accommodation: Processes and Standards (2009) was also considered relevant.

9. Nature of ESHR impacts

The review of potential ESHR risks and impacts took into account the following impacts, receptors and issues during the construction and operational phases of the Project:

• health and safety;

• human rights;

• biodiversity;

• livelihood impacts related to grazing;

• climate change;

• emissions;

• waste and hazardous material management;

• emergency planning and response;

• construction camp conditions;

• grievance mechanisms;

• worker conditions of contract; and

• community engagement.

10. Assessment of ESHR impacts

A review was undertaken in line with the requirements of the OECD Common Approaches and Equator Principles to identify potential ESHR risks and impacts of the Project and how these would be effectively managed.

MM acting as the Independent Environmental and Social Consultant (IESC) with a duty of care to the Lenders undertook an ESDD assessment of the Project producing three reports, one per cluster. The reports formed the basis for UKEF’s evaluation of the Project’s alignment with the relevant standards and recommendations for compliance and monitoring.

The review included:

• An IESC/Lender site visit undertaken between 11 and 15 September 2024;

• Desk-based review of project-related documentation: Environmental and Social Impact Assessment, Environmental and Social Management Plans, and Stakeholder Engagement Plan; and

• Follow-up meetings and interviews with relevant Project representatives.

The results of this review formed the basis for the evaluation of the Project’s alignment with relevant international standards, and recommendations for future compliance and monitoring.

Taking account of the review, the Project was deemed to have potential to cause a number of adverse E&S impacts both during construction and operation. However, a proposed suite of controls as part of the Project’s E&S management systems should facilitate the management of these impacts.

11. Climate change considerations

UKEF considered the potential direct and indirect greenhouse gas (GHG) emissions of the Project and effects of climate change factors on the Project as part of its ESHR review.

The Project is not considered to be a carbon intensive undertaking and so “high” GHG emissions in excess of relevant thresholds for quantification and reporting set by international standards were reasonably not envisaged.

The review revealed that the Project has considered potential physical impacts of climate change.

12. Decision

Various actions have been agreed between the Project developer, operator, and parties involved in the financing, which are necessary to ensure the Project’s on-going alignment with international standards. Following agreement of these commitments, it was concluded that the Project should meet the relevant international standards over the Project cycle. UKEF has therefore decided to provide its support in respect of the supply of goods and services by UK exporters to the Project.

A condition of support is that Project will be subject to monitoring and reporting in order to provide satisfaction that the Project is aligned with the relevant international standards throughout the duration of support.