Turkey - Country Commercial Guide
Electric Power – Renewables, Smart Grid, Energy Storage, Civil Nuclear
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Overview

Electric Power Sector

Table: Electric Power Sector Market Size
 2020202120222023 estimated
Total Local Production9601,2301,6801,800
Total Exports185225366480
Total Imports3,8904,3504,9065,200
Imports from the US8395168280
Total Market Size4,6655,3556,2206,520
Exchange Rates7.008.9015.5022.00

total market size = (total local production + imports) - exports)                                                                                 Units: $ millions
Source: Ministry of Energy and Natural Resources, State Institute of Statistics.

Türkiye, with an electric power generation capacity of approximately 105 GW, is Europe’s sixth-largest electricity market and the 14th largest in the world. Approximately 56% of Türkiye’s electric power generation capacity consist of renewable energy, including hydroelectric, wind, solar, geothermal, and biomass power plants, making Türkiye the fifth-largest generator of renewable energy in Europe and the 11th largest in the world.

Türkiye currently has approximately 31.6 GW of hydroelectric, 25.75 GW of natural gas (NG), 21.3 GW of coal, 11.45 GW of wind, 9.93 GW of solar, 1.7 GW of geothermal, and approximately 2 GW of biomass power plant installed capacity.

According to Türkiye’s 2020–2035 National Energy Plan, Türkiye’s power generation capacity will reach 189.7 GW in 2035 (a 79% increase from 2023). Türkiye’s share of renewable energy will increase to 64.7% with solar power capacity increasing 432% and wind capacity increasing 158%. The market’s hydroelectric capacity will increase to 11% while NG will see a 38% increase. In addition, a nuclear power plant is currently being built by Russian company Rosatom at a capacity of 4.6 GW (1.2 GW X 4 units).

Türkiye has a large and growing manufacturing base which requires an increasing amount of power generation. The annual growth rate in additional power generation capacity has been around 5% due to growing economic activity and a rising population in Türkiye.

Türkiye has committed to achieving net-zero emissions by 2053. As a result, Türkiye plans to continue supporting renewable energy investments including nuclear energy projects on a BOT or build-own-operate (BOO) basis. Türkiye is also open to public-private partnerships. The government provides power purchase guarantees with a high feed-in-tariff until the debt is recovered.

Türkiye has been considering nuclear energy power plants as a future base load and designated three locations for the implementation of three separate nuclear power plant (NPP) projects. These planned NPPs are large power plants with total capacities between 4000-5000 MW. The first NPP project is the Akkuyu Nuclear Power Plant project, being built by Rosatom of Russia. The first unit is expected to be operational in late 2023. The other three units are expected to be completed by the end of 2026. However, supply chain issues and sanctions on Russia may delay the project’s full completion. This power plant will ultimately have four 1200 MW VVER units. The other two NPP projects were planned in Sinop and Thrace, however development of these facilities is stalled.

SMR technologies will play a key role in meeting Türkiye’s growing demand, replacing existing coal power plants, and providing support to green hydrogen. SMR power plants will be safer, more readily deployable, and more affordable than traditional, large nuclear power plants.

Türkiye plans to have a hydrogen electrolysis installed capacity of 2 GW by 2030; 5 GW by 2035; and 70 GW by 2053. Most of the hydrogen will be blue and green hydrogen. Türkiye’s Hydrogen Technologies Strategy and Roadmap, published in 2023, states that by 2053, separate hydrogen transportation pipeline infrastructure will be developed in parallel with existing NG pipeline infrastructure to reach industrial zones throughout the country.

Turkish regulations stipulate that renewable energy investments of less than 5 MW do not require a license from the Energy Regulatory Authority (EMRA). Roof-top solar energy producers can sell their excess electricity to the grid at a maximum limit of 5 MW if they are production plant owners, and 10 kW if they are homeowners. Solar and wind energy investments receive customs duty exemptions, corporate tax deduction, and other incentives.

Renewable energy power plants established for the purpose of agricultural irrigation, potable water, and wastewater treatment facilities do not require licensing. Solar or wind energy prosumers are entitled to net-metering with the grid operator. Organized industrial zones (OIZs) receive special incentives for establishing power plants within their zone.

The national electric transmission company, TEIAS, owns and operates approximately 1.5 million Km of medium to high voltage electric transmission power lines spread throughout the country. TEIAS conducts tenders for the establishment of new sub-stations and transmission lines as well as air and video surveillance, live maintenance, repair, and maintenance of existing lines. U.S. firms should find good Turkish partners to bid on these tenders.

Türkiye’s transmission lines connect to 21 distribution grids operated by private companies. These 21 distribution grid companies operate approximately 71,000 Km of distribution lines. One of the aims of distribution system operators (DSOs) or electric distribution companies (DISCOs) is to increase the efficiency of the existing grids by either replacing the old transformers or lines and/or installing smart grid systems.

The ELDER Association of Distribution Systems Operators is active in advising their members on the implementation of smart grid systems. Under a project approved by the EMRA, ELDER had a Smart Grid Roadmap prepared for DSOs outlining what type of smart grid systems their members should deploy.

Türkiye has a semi-liberalized and moderately regulated market. Energy Exchange Istanbul (EXIST) is Türkiye’s electricity spot market, which manages day-ahead and intraday markets where 40% of electricity is traded among 854 market participants. EXIST’s website features electricity prices in real time.

Leading Sub-Sectors

  • Solar energy power generation
  • Wind turbines and generators
  • Energy storage systems
  • Small Modular Reactors (SMRs)
  • Smart grid systems (SCADA, GIS, AMR, AMI, Automated Demand Side Management, PLC and other communication systems, Volt-VAR control systems, OT, CIS, Control Centers, etc.)
  • Grid modernization and voltage and frequency regulation systems
  • Geothermal power plant equipment
  • Waste-to-energy systems
  • Smart LED Lighting Systems
  • Fuel cells
  • Hydroelectric turbines and coal gasification systems
  • Micro Grid Systems

Opportunities

The U.S. Trade & Development Agency (USTDA), the Export-Import Bank of the United States (EXIM Bank), and the U.S. International Development Finance Corporation (IDFC) consider financing renewable energy projects in Türkiye. The European Development Bank of Reconstruction (EBRD) and the International Finance Corporation (IFC) have been very active in Türkiye providing renewable energy and energy efficiency projects financing in Türkiye.

Resources

For further information on the energy sector, contact:

Serdar Cetinkaya

Eurasia Energy and Mining Leader

U.S. Commercial Service

U.S. Embassy, Ankara, Türkiye

Serdar.Cetinkaya@trade.gov