Beta Energy, aiming for an IPO, will issue green bonds

MEHMET KARA – EXCLUSIVE INTERVIEW

Transformers are one of the main inputs in the process of increasing modernization and smartening of electrical networks around the world, depending on the energy transformation, one of the main global trends.

Demand for power transformers used in production facilities and distribution transformers used in grids is very high. Both globally and in Türkiye...

For some transformer types, demand is so high that manufacturers have received orders that they can only meet their full capacity until 2032.

Yusuf Cenk Dağsuyu , CEO of Beta Energy , one of Turkey's leading transformer manufacturers, spoke to Enerji Günlüğü. Dağsuyu shared his assessment of the state of the transformer manufacturing sector globally and in Turkey, the market's supply-demand balance, future expectations, and the company's investments and goals.

What is the balance of transformer supply and demand in the world?

The world's energy demand is increasing daily, and we predict this increase will continue until 2050. Therefore, the need for transformers, the key element of electrification, is also increasing daily.

Where do we use them, what kind of transformers are used in electrification?

Transformers are everywhere in our lives, wherever energy is present. In the renewable energy sector, transformers are present in all aspects of electricity generation—solar, wind, hydroelectric, nuclear—and there's no alternative to them.

There are also distribution transformers...

Yes, these are power transformers and distribution transformers we're talking about. Distribution transformers are purchased by distribution companies. Their demand, in parallel with the demand for power transformers, is increasing daily.

So is there a supply-demand imbalance?

Absolutely. I can say this. The US is a distinct market, Europe is a distinct market. We had guests from the US two weeks ago. The world's leading transformer companies are currently giving a 2032 delivery date for medium-sized power transformers in the US. I mentioned this to illustrate the demand. That's why we have no problem with demand. Demand is trending upwards until 2035 and will continue until 2050.

Where does Türkiye's transformer sector stand in the world?

The Turkish transformer sector is in a good position. Turkey is one of the three largest manufacturers in the world: China, India, and Turkey. I can say that Türkiye currently has good manufacturers in the transformer and electrification sectors. We are producing well and selling globally, as a whole sector.

How would you describe Türkiye's transformer production capacity with measurable data? What kind of capacity do we have?

I can give you some information about our market share. We currently dominate 15 percent of Türkiye's distribution transformer sector. We are currently leading in distribution transformers. Our current strengths in power transformers are weak, but with this new investment, we will be among the top 40 manufacturers in the world.

When will this come into effect?

It will be operational at full capacity by the end of 2026. We are currently producing, investing, and providing additional employment.

How much of an investment are you talking about?

This entire investment, once completed, will cost us around $130 million. We've already spent approximately $80 million. We've completed 80% of our construction. We're commissioning the production side, phase by phase. We've commissioned 50% of the power transformer facility. We had switching products we'd never produced before. Products like kiosks, cubicles, circuit breakers, and disconnectors are new additions to Beta Energy's production portfolio. We've also begun production of these products at the new factory.

Always new, always new... You talk about new production and fixed investment, how do you meet the financing needs that these require?

Good question. Yes, the markets are a bit challenging and volatile right now. We can currently finance this in Türkiye. Some of it is with our own resources, but of course, we're working with banks in Türkiye. We have leasing options available, and we're moving forward with them. We have different financing models and plans. We're considering a public offering. We also have financing from abroad. That's how we're progressing.

Are there any bonds, bills, etc. other than stock offerings?

That will happen soon. We plan to issue bonds with green lease certificates. Our preliminary approval process has been completed. If possible, we will issue bonds to corporations in November.

In what currency and in what amount will the issue be made?

We will export this in Turkish Lira in Türkiye. The limits haven't been determined yet, but we can estimate an average of around 3 billion Turkish Lira. Because we don't yet have any data, it's not appropriate to give a definitive figure at this time.

Does Beta Energy have any problems meeting its targets this year?

We've had a very active first nine months. We're exceeding our targets. We expect a turnover of approximately $110 million by the end of the year. Last year, exports accounted for around 50 percent, but this year we've reached around 55-60 percent, and we expect to reach these figures by the end of the year.

What do you expect from next year?

Our expectation for 2026 is a turnover of approximately $180 million. Once our new factory is operational in 2027, we anticipate our turnover will easily reach $400 million.

Well, are you also experiencing a collection problem, cash flow problem, etc. in the market?

It feels like this: The pace of investment in Türkiye has slowed somewhat, but since it's still a necessity, all kinds of financing are allocated to energy, and it must be. Because we're in a sector, a product we use and need daily. So, of course, we have our own precautions. We're ensuring cash flow as quickly as possible without experiencing that hassle.

Mehmet KARA - Energy Diary / ISTANBUL