The multilateral lender Climate Investment Funds (CIF) is using Türkiye as a test case for its first-ever review of a Clean Technology Fund (CTF) investment plan, seeking lessons to guide future projects globally, according to its lead official.
"From our workshop in Türkiye, we aim to gather lessons that we can apply to other countries that are preparing investment plans, as well as future work, whether it involves new investment plans or one-time investments," said Daniel Morris, clean energy lead for the CIF, a leading multilateral investor in developing countries.
"Türkiye serves as an interesting test case for us as this is our first time conducting this kind of review for a Clean Technology Fund (CTF) investment plan," Morris told Anadolu Agency (AA).
The CTF supports the piloting and scale-up of promising low-carbon technologies in developing countries, through low-cost finance for renewable energy, energy efficiency, sustainable transport and green industry projects.
The CIF, which works with the World Bank and other leading international lenders, is an important cog in development finance as it is able to take on more risk and offer money at cheaper rates, which in turn helps other investors to join in.
Last month, a CIF team visited Istanbul to review projects funded by its $5.2 billion Clean Technology Fund.
That came nearly two months after the lender agreed to back a $1 billion plan to upgrade Türkiye's electricity grid so it can handle more renewable energy by providing an initial investment to the project.
The CIF board agreed to a $70 million investment from its Renewable Energy Integration (REI) investment platform with the aim of drawing in a further $790 million to expand and improve transmission infrastructure and $330 million for technology.
The "close out" meeting in Istanbul convened Turkish government ministries, multilateral development banks, private sector representatives and civil society to assess the impact of the CTF investment plan.
"Overall, the portfolio here has performed well, with many projects exceeding initial expectations in terms of installed renewable capacity, energy savings from efficiency measures, greenhouse gas emissions reductions and co-financing from other sources," Morris said.
"The projects are outperforming their targets, which is a positive outcome from our perspective," he added.
Morris credited Türkiye's success to its commitment, along with “the ambition of the government, the multilateral bank teams executing the projects, and private sector actors involved.”
Morris said the lessons learned in the Türkiye case will be released after the information gathered is analyzed.
“These lessons will help us design better financing mechanisms for future projects,” he said. “They will also improve our understanding of the relationship between the Clean Technology Fund, multilateral development banks (MDBs) and governments, leading to better project outcomes and more effective investment plans.”
Noting that Türkiye recently received approval for a $70 million renewable energy integration plan, he said: "We can apply the lessons from this workshop to future engagements in the country."
"Additionally, Türkiye has applied for funding to develop an investment plan in industry decarbonization," he noted. “While it's not certain yet whether the country will be selected. If it is, we will apply the lessons learned here to the development of that plan.”
According to the CIF's website, the CIF approved $434 million in funding for Türkiye, with an expectation of mobilizing $3.56 billion in co-financing from international development and finance institutions.
Morris also noted that the approved $70 million "will be made available once the projects are designed and ready for approval."
He explained that the process typically involves government ministries or private sector actors partnering with development banks to identify and develop projects.
"These projects are then executed through the MDBs, who bring them forward for review and approval. Once approved, the funds are allocated to the executing entities," he said.
"Countries are usually given up to 18 months to develop an investment plan, though some move faster or request extensions to spend more time on planning," he explained.
Morris also emphasized that while Türkiye has ambitious targets for renewable energy, attracting financing requires more than target-setting. "It requires an enabling environment that encourages both public and private investments," he said.
Throughout the workshop, Morris explained, "We heard that the regulatory environment is key to facilitating investment, so ensuring that it's conducive to attracting finance is important."
As Türkiye aims to raise its combined wind and solar energy capacity from 30 gigawatts to 120 gigawatts by 2035, the country’s "commitment is also crucial, as well as the country's dedication to its energy transition goals," Morris added.
