National Renewable Energy Action Plan for Türkiye 2013-2023

1.1 Rationale 8 energy from renewable resources in electricity

1.2 Summary of the national policy on applied by Turkey 50 energy from renewable energy sources 10 Legislation 50

1.2.1 Current national policy on renewable energy 11 Specific questions for feed-in fixed tariffs 53

1.2.2 Commission Staff Working Document. Specific questions on financial support to European Commission Guidance for the renewable energy projects 56 Design of renewables support schemes. 4.4 Plans to support and promote the use of November 5, 2013 13 energy from renewable resources in heating

1.2.3 Objective of the Renewable Energy and cooling applied by Turkey 56 National Action Plan (REAP) 14 Legislation 57 Financial support 58 2 Expected energy consumption, 2013 – 2023 15 4.5 Plans to support and promote the use of energy from renewable resources in transport 3 Renewable energy targets and trajectories 21 applied by Turkey 59

3.1 Overall national target 22 Legislation 60

3.2 Sectorial targets and trajectories 23 Financial support 61

4.6 Specific measures for the promotion of the 4 Measures for achieving the targets 25 use of energy from biomass 62 4.1A Overview of all policies and measures to 4.6.1 Biomass supply 62 promote the use of energy from renewable 4.6.2 Measures to increase biomass availability, resources 26 taking into account other biomass users 4.1B Incentives to promote new investments in Turkey 30 (agriculture and forest-based sectors) 63 4.1C Feed-in Tariff 30 4.7 Planned use of statistical transfers between 4.1D Management of licensing and authorizing Turkey and Member States and planned procedures 31 participation in joint projects with other 4.1E National Energy Efficiency Action Plan (NEEAP) 32 countries 65

4.2 Specific measures to fulfill the requirements under Articles 13, 14, 16 and Articles 17 to 21 of 5 Assessments 66 Directive 2009/28/EC 33 5.1 Total expected contribution by each renewable

4.2.1 Administrative procedures and spatial energy technology to meet the binding 2023 planning (Article 13(1) targets and the indicative interim trajectory of Directive 2009/28/EC) 33 of energy shares from renewable resources

4.2.2 Technical specifications (Article 13(2) in electricity, heating & cooling and of Directive 2009/28/EC) 39 transportation 67

4.2.3 Buildings (Article 13(3) 5.2 Total contribution expected from energy of Directive 2009/28/EC) 39 efficiency and energy saving measures

4.2.4 Information provisions (Articles 14(1), to meet the binding 2023 targets and the 14(2) and 14(4) of Directive 2009/28/EC) 41 indicative interim trajectory for the shares

4.2.5 Certification of installers (Article 14(3) of energy from renewable sources 71 of Directive 2009/28/EC) 42 5.3 Assessments of the impact 71

4.2.6 Electricity infrastructure development 43 5.4 Preparation of the National Renewable Energy

4.2.7 Electricity network operation Action Plan and the follow-up of its (Article 16(2) and Article 16(7) implementation 72 and (8) of Directive 2009/28/EC) 47

4.2.8 Biogas integration into the natural gas 6 Bibliography 74 network (Article 16(7) and Article 16(9) and (10) of Directive 2009/28/EC) 48

4.2.9 District heating and cooling infrastructure development (Article 16(11) of Directive 2009/28/EC) 48

4.2.10 Biofuels and other bioliquids – sustainability criteria and verification of compliance 21 of Directive 2009/28/EC. 49 3 | National Renewable Energy Action Plan for Turkey Figures Figure 1: Primary Energy Consumption in Turkey, Figure 18: Details of the New Investment Incentive recent data and forecast for 2023. Source: Program 30 Ministry of Energy and Natural Resources 8 Figure 19: List of administrative procedures Figure 2: Consumption of electricity in Turkey: to install new renewable power capacity 33 recent data and forecast. Source: TEİAŞ 8 Figure 20: Adaptation of the transmission Figure 3: Electricity generation structure in Turkey: infrastructure commitment, TEİAŞ 44 production and installed capacity. Source: TEİAŞ 9 Figure 21: Current international grid interconnections 44 Figure 4: Renewable energy production. Source: Eurostat 9 Figure 22: Planned international grid interconnections Figure 5a: Evolution of renewable energy regulations to be developed 45 and policies in Turkey including the most important energy efficiency regulations 11 Figure 23: Legislation and national authority 49 Figure 5b: Evolution of energy efficiency regulations Figure 24: Renewable energies for electricity generation: and policies in Turkey 11 concrete obligations/targets per year (per technology) from 2013-2023 52 Figure 6: The Evolution of Turkey’s GDP (in current prices) Source: IMF and Turkstat 16 Figure 25: Feed-in tariff in Turkey for Renewable Energy 54 Figure 7: Potential GDP growth rate of Turkey 16 Figure 26: Incentive scheme for renewable energies to produce electricity 55 Figure 8: Primary Energy Consumption in Turkey 17 Figure 27: Heating and cooling: concrete Figure 9: Primary Energy in Turkey 17 obligations/targets per year (per technology) 2013-2023 following the methodology established Figure 10: Primary energy consumption versus in the Directive 2009/28/EC on the Promotion GDP | Sources: BP and IMF (historical data), of the Use of Energy from Renewable Sources 57 and Deloitte (forecast) 17 Figure 28: Transportation: concrete estimations/targets Figure 11: Turkish Electricity Consumption: per year (per technology), 2013-2023 (Base Year 2012) 60 Recent and Forecasted 17 Figure 29: Natural gas projection in 2023 71 Figure 12: Final Energy Consumption in the Transportation Sector. Source: Eurostat Figure 30: CO2 emissions avoided by REAP (recent data) and International Energy Agency (IEA) implementation 72 and Deloitte (forecast) 18 Figure 13: Breakdown of energy supply for the Transportation Sector. Source: Eurostat 18 Figure 14: Electricity generation and installed capacity: 2013 data, 2023 forecast and increases 18 Figure 15: Electricity generation and installed capacity: 2013 data and 2023 forecast and increases 19 Figure 16: Electricity generation and installed capacity from renewable sources: 2013 data and 2023 forecast 19 Figure 17: Regions of Turkey according to incentive plan 30 4 | National Renewable Energy Action Plan for Turkey Tables Table 1: Expected gross final energy consumption Table 11: Estimates of total expected contribution of Turkey for electricity, heating and cooling and (final energy consumption) by renewable energy transportation up until 2023 taking into account technology in Turkey to meet its binding 2023 the effects of energy efficiency and energy targets; and the indicative interim trajectory saving measures 20 (2012-2023) of energy shares from renewable resources in heating and cooling (ktoe) 69 Table 2: Overall national target for the share of energy from renewable sources in gross final Table 12: Estimate of the total contribution expected consumption of energy in 2010 and 2023 in Turkey by technology from the use of renewable (figures to be transcribed from Annex I, energy sources, with regard to the binding targets Part A to Directive 2009/28/EC) 22 for 2023; and the indicative trajectory (2013-2023) of energy shares from renewable sources, in the Table 3: National target for 2023 and the expected transportation sector in (1000 toe) 70 progression of renewable sources in the sectors of electricity, heating and cooling, and transportation 23 Table 4a: Calculation table for each sector’s contribution to the share of renewable energy in final consumption of energy 24 Table 4b: Calculation table for the share of renewable energy in the transportation sector 24 Table 5: Overview of all plans and measures 26 Table 7: Biomass supply (m3 as FM/tFM/OIL or ktoe) 62 Table 7a: Estimated biomass domestic supply for the electricity and heating and cooling sectors in 2018 (other EU = 2015) and 2023 (other EU = 2020) (m3 as FM/tFM/Oil or thousand toe) 63 Table 10a: Estimate of total expected contribution (installed capacity, gross electricity generation) by renewable energy technology in Turkey to meet its binding 2023; targets and the indicative interim trajectory (2013-2017) of energy shares from renewable resources in electricity 68 Table 10b: Estimates of total expected contribution (installed capacity, gross electricity generation) by renewable energy technology in Turkey to meet its binding 2023 targets; and the indicative interim trajectory (2018-2023) of energy shares from renewable resources in electricity 68 In order to make it comparable to other National Renewable Energy Action Plans, the Tables included in the National Renewable Energy Action Plan for Turkey are in accordance with the template for National Renewa- ble Energy Action Plan under Directive 2009/28/EC of the European Parliament and of the Council (2009/548/EC. Table 6 “Estimated share of renewable energy in the building sector”, Table 8 “Current agricultural land use for production of crops dedicated to energy in 2006”, Table 9 “Estima- ted excess and/or deficit production of renewable energy compared to the indicative trajectory which could be transferred to/from other Member States in Turkey” and Table 13 “Estimated costs and benefits of the renewa- ble energy policy support measures” are not applicable. 5 | National Renewable Energy Action Plan for Turkey List of Abbreviations AFD Agence Française de Développement LEED Leadership in Energy and Environmental Design Bio-ETBE Bio Ethyl Tert-Butyl Ether (Enerji ve Cevre Dostu Tasarımda Liderlik) BOTAŞ Boru Hatları İle Petrol Taşıma Anonim LI-DER Lisanssiz Elektrik Uretimi Dernegi (The Unlicensed Şirketi (Petroleum Pipeline Corporation) Electricity Generation Association) BREEAM Building Research Establishment M Million Environmental Assessment Method M&A Mergers and Acquisitions BtL Biomass to Liquid MCM Multi-Chip Module Btu British Thermal Unit MFRC Market Financial Reconciliation Center BİYOGAZDER The Biogas Association MidSEFF Turkish Mid-Size Sustainable Energy Financing Facility CCGT Combined Cycle Gas Turbine MTA Maden Tetkik Arama (General Directorate CEO Chief Executive Officer of Mineral Research and Exploration) CHP Combined Heat and Power Mtoe Million tonnes of oil equivalent CO2 Carbon dioxide MVA Megavolt Ampere ÇŞB T.C. Çevre ve Şehircilik Bakanlığı (The Ministry MW Megawatt of Environment and Urbanization) MWh Megawatt hour CSP Concentrated Solar Power MWt Thermal megawatt DC Direct Current MYTM Milli Yük Tevzii Merkezi (National Load Dispatch Center) DNO Distributed Network Operators m3 Cubic meter DSI Devlet Su İşleri (General Directorate NEEAP National Energy Efficiency Action Plan of State Hydraulic Works) NGO Non-Governmental Organization DSO Distribution System Operator OECD Organization for Economic Co-operation EBRD European Bank for Reconstruction and Development and Development ÖTV Özel Tüketim Vergisi (Special Consumption Tax) EC European Commission PEFC Programme for the Endorsement EED Energy Efficiency Directive of Forest Certification EML Electricity Market Law PMUM Piyasa Mali Uzlaştırma Merkezi EMRA Energy Market Regulatory Authority Market Financial Settlement Center ENVER Association of Energy Efficiency PSH Passive Solar House EPB Energy Performance in Buildings PV Photovoltaic EPBD Energy Performance of Buildings Directive R&D Research and Development EPDK Enerji Piyasası Düzenleme Kurumu RE Renewable Energy (Energy Market Regulatory Authority) REAP Renewable Energy Action Plan EPIAS Enerji Piyasaları İşletme A.Ş. REL Renewable Energy Law ESCO Energy Service Company RER Renewable Energy Research ESR Energy Saving Ratio RES Renewable Energy Sources ETBE Ethyl tert-butyl ether R2 R squared, coefficient of determination ETKB Enerji ve Tabii Kaynaklar Bakanlığı SP Strategic Purpose (The Ministry of Energy and Natural Resources) ST Strategic Targets EU European Union t tonne FIT Feed-In Tariff TEİAŞ Türkiye Elektrik İletim A.Ş. FM Fresh Material TİGEM Tarım İşletmeleri Genel Müdürlüğü FSC Forest Stewardship Council (The General Directorate of Agricultural Enterprises) GATT General Agreement on Tariffs and Trade TL Turkish Lira GDF General Directorate of Forestry TOBB Türkiye Odalar ve Borsalar Birliği (Turkish Union GDM General Directorate of Meteorology of Chambers and Commodity Exchanges) GDP Gross Domestic Product toe Tonnes of oil equivalent GÜNDER The International Solar Energy Association TOKİ T.C. Başbakanlık Toplu Konut İdaresi Bakanlığı GW Gigawatt (The Housing Development Administration) GWh Gigawatt hour TS Transformer Substation/Turkish Standard ha Hectare TSKB Türkiye Sinai Kalkınma Bankası A.Ş. Halkbank Türkiye Halk Bankası (The Industrial Development Bank of Turkey) HEPP Hydroelectric Power Plant TTGV Türkiye Teknoloji Geliştirme Vakfı ICEX Instituto de Comercio Exterior, Gobierno de España (Technology Development Foundation of Turkey) IEA International Energy Agency TÜREB Türkiye Rüzgar Enerjisi Birliği (Turkish Wind IFC International Finance Corporation Energy Association) IMF International Monetary Fund TurSEFF Turkish Sustainable Energy Finance Facility IRR Internal Rate of Return TWEA Turkish Wind Energy Association ISO International Organization TWh Terawatt hour for Standardization USD United States Dollar kg Kilogram UTM Universal Transverse Mercator coordinates km Kilometer VAT Value Added Tax km2 Square kilometer VGM Vakıflar Genel Müdürlüğü (General KOSGEB Kucuk ve Orta Olcekli Sanayi Geliştirme ve Directorate of Foundations) Destekleme İdaresi Başkanlığı (Small and Medium YEGM Yenilenebilir Enerji Genel Müdürlüğü Enterprises Development Organization) (General Directorate of Renewable Energy) ktoe Thousands tonnes of oil equivalent YEKA Yenilenebilir Enerji Kaynak Alanı kV Kilovolt (Renewable Energy Resources Area Regulation) kW Kilowatt YY Local authorities, Governorships and Municipalities kWh Kilowatt hour Punctuation system followed: “,” thousands separator and “.” decimal separator. 6 | National Renewable Energy Action Plan for Turkey 1 NATIONAL RENEWABLE ENERGY STRATEGY 1 National renewable energy strategy

1.1 Rationale On one hand, by 2023 Turkey plans to have an electricity Turkey is a candidate country to join the European Union, generation mix in which the share of renewable energy working diligently on the actions towards building a accounts for 30% of overall need, as well as, having 10% strong, clear and direct path toward complying with the of the requirements of the transportation sector met by EU acquis and its requirements. Energy is one of the most renewable energy. On the other hand, there is also a com- critical chapters in the EU acquis. ‘The Renewable Energy mitment to reduce by at least 20% (with reference to 2011 Directive’, Directive 2009/28/EC (1) on the Promotion figures) the amount of energy consumed per unit GDP in of the Use of Energy from Renewable Sources calls on the year 2023 (in terms of energy intensity). every Member State to draw up and promote a National Renewable Energy Action Plan (NREAP) for the period Figure 1: Primary Energy Consumption in Turkey, recent data and forecast for 2023 Source: Ministry of Energy and Natural Resources of 2011-20201 to present to the European Commission (EC) by June 30, 2010 with a view to complying with the Primary Energy Consumption: historical data and forecast 250 binding targets stated within the Directive. 218 200 Energy (million of toe) As the Directive indicates, NREAP is expected to conform 150 to the national action plan template adopted by the 114 121 108 106 106 109 European Commission via the June 30, 2009 Commission 100 Decision establishing a template for the National Renewa- 50 ble Energy Action Plans under Directive 2009/28/EC of the European Parliament and of the Council. Turkey, as a 0 2007 2008 2009 2010 2011 2012 2023 candidate country, has prepared this action plan as a ma- forecast nifestation of its commitment to those renewable energy targets and EU accession. The Government has established very ambitious objec- tives for 2023 regarding electricity generation based on Turkey is the 17th largest economy in the world and the 6th the high availability of renewable energy resources: hydro, largest in Europe. With a growing economy and popula- wind, solar irradiation, geothermal, etc., which would tion, energy demand in Turkey has steeply risen, which has increase the share of renewable energy in electricity gene- ranked security of supply at the top of the government’s ration to at least 30% and 127.3 TWh in 2023. agenda, both for electricity and for other primary energy sources. The Turkish economy is heavily dependent on Figure 2: Consumption of electricity in Turkey: recent data and forecast Source: TEİAŞ imported energy supplies, and its primary energy con- sumption is mainly based on fossil fuels, which was appro- Consumption of electricity in Turkey: historical and forecast Electricity Consumption (TWh) ximately 90% in 2012 where majority of this supply was 450 405 424 400 367 386 348 imported from other countries. In the upcoming years, it is 350 293 311 329 300 277 forecasted that Turkey will continue with the major eco- 242 246 262 250 229 194 210 nomic development, which will require an increase in the 200 150 demand of energy supply. 100 50 0 According to current estimates, an increase of around 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 90% in primary energy demand will take place during the period of 2011-2023. Aside from investments for the crea- tion of new capacity within the field, the source of energy For many years, hydroelectric power plants, the use of (for instance, the need for local and renewable sources) biomass for heating purposes and use of geothermal and maximizing energy efficiency are also critical points were the major contributors in terms of renewable for Turkey. In order to both avoid the risks linked to a high energy resources to the Turkish energy mix. During level of energy dependency and to develop a sustainable recent years, other technologies such as geothermal energy model, the Government is committed to pro- and wind energy have begun to make an impact on the moting alternative solutions based mainly in renewable Turkish energy sector. energy. Therefore, Turkey has initiated a forward-looking and innovative energy policy in which renewable energy As demonstrated in Figure 3, in 2013, the renewable plays a significant role. energy share in electricity production was 29% of the total production and 40% of the installed capacity 1. For Turkey, rather than the year 2020, the year 2023 is taken as the milestone, as it is the 100th anniversary year of the Republic and several macroeconomic and sectorial targets are set for that year. 8 | National Renewable Energy Action Plan for Turkey 1 National renewable energy strategy Figure 3: Electricity generation structure in Turkey: production and installed capacity Source: TEİAŞ It is also important to note that primary energy consump- tion in Turkey reached 121 Mtoe in 2012, where 82% of the 10,092; 4% Other renewable total figure was from imports. In addition, the energy in- Hydro Fossil fuel tensity (unit of energy consumed to generated unit GDP) 59,420; 25% in the country was 0.27 toe per USD 1,000 of GDP and is 170,641; 71% 2013 Electricity generation higher than in the rest of major EU countries. structure in Turkey (GWh & percentage) Total: 240,153 GWh However, international economic institutions forecast high economic growth rates for the next several years, and 3,294; 5% Other renewable energy consumption is expected to increase to 218 Mtoe Hydro Fossil fuel by 2023 (or a 91.2% increase from 2011 to 2023). These 22,289; 35% figures give an idea of the important role of energy in Tur- 38,424; 60% 2013 Installed power key over the next decade. It is critical that the demand will capacity in Turkey (MW & percentage) not be a bottleneck for economic development. Total: 64,007 MW Therefore, the Turkish energy policy2 has being articulated Figure 4 depicts the share of different renewable energy ensuring the following basic values and principles: sources in Turkey. In 2012, the total energy produced based on renewable sources reached 12.1 million toe, or approxi- • Transparency: operations conducted in a manner mately 10% of Turkey’s total primary energy consumption. that is open and accessible to all parties concerned, along with informing and soliciting the opinion of the Figure 4: Renewable energy production. public about the framework of the laws. Source: Eurostat Renewable energy production • Reliability: operations conducted so that the policy 12.1 11.6 12 11.2 and policymakers are both reliable and reputable on a 10 9.6 9.3 9.9 national and international scale. Energy (million toe) 8 • Innovation and Pioneering: the encouragement of 6 R&D activities and pioneering the use of new technologies. 4 • Cooperation: operations are conducted by recruiting 2 the participation of relevant parties and with the aim of providing services in line with needs and expectations. 0 2007 2008 2009 2010 2011 2012 Wind energy Geothermal energy Biomass & renewable wastes Solar energy Hydro electric • Efficiency: overseeing the utilization of public resour- ces allocated to the Ministry of Energy and Resources for Renewable energy production structure (million toe) the purpose of ensuring efficiency and effectiveness. Biomass & Solar renewable Geothermal Hydro Wind Total energy energy electric energy wastes • Coherency: operations are conducted with a view 2007 0.4 5.0 1.0 3.1 0.0 9.6 2008 0.4 4.8 1.2 2.9 0.1 9.3 toward medium and long term goals and according to the 2009 0.4 4.6 1.6 3.1 0.1 9.9 global developments in line with Turkey’s overall interests. 2010 0.4 4.5 2.0 4.5 0.3 11.6 2011 0.6 3.6 2.1 4.5 0.4 11.2 The National Renewable Energy Action Plan (REAP) for 2012 0.8 3.6 2.2 5.0 0.5 12.1 Turkey has been created in alignment with Directive Today, the development of renewable energy sources and 2009/28/EC and the template predetermined by the Euro- the promotion of energy efficiency measures are two of the pean Commission Decision of 30.06.2009 (2009/548/EC). priorities of Turkish energy policy, supporting a sustainable industrial development under environmental considera- tions. The best proof of this is the present REAP and the futu- re National Energy Efficiency Action Plan (NEEAP). The latter document will be developed by the Turkish Government in collaboration with EBRD in the coming months. The main objectives of this policy are and will be the security of supply and its sustainability in economic and environmental terms. 2. The Republic of Turkey Ministry of Energy and Natural Resources Strate- gic Plan (2010-2014) (5). 9 | National Renewable Energy Action Plan for Turkey 1 National renewable energy strategy The general conditions of this REAP are based on the infor- Since 2010, the strategies followed by the Turkish Govern- mation provided by the different Ministries of the Turkish ment3 for increasing the share of renewable energy within Government and the following strategic energy guidelines: the energy mix have been: • Electricity Energy Market and Security of Supply 1. Precautions will be taken for the completion of licen- Strategy Paper (2), sed projects within the projected terms for renewable energy resources of economic value. • Climate Change Action Plan 2011–2023 (3), 2. Production planning will be prepared considering • Energy Efficiency Strategy Paper 2012–2023 (4) and developments within the renewable energy field, in • The Republic of Turkey Ministry of Energy and Natural line with advances in technology and the arrange- Resources Strategic Plan 2010–2014 (5). ments within current legislation. 3. Precautions will be taken for the maximum utiliza- tion of Turkey’s hydroelectric potential, as is economi-

1.2 Summary of the national policy on energy from cally feasible and for the integration of this potential renewable energy sources into the national economy through the private sector. Several factors such as population growth, increasing energy demand, concerns over energy security supply 4. Cooperation will increase, in an accelerated rate, and climate change have evoked a new era for renewable with studies conducted for the development of water energy technologies worldwide. resources as economically feasible for electricity gene- ration on the basis of integrated approaches in view of Considering the fact that Turkey is rich in renewable meeting changing consumption demands. energy resources together with the aim of diversifying 5. The criteria for the economic analysis of hydroelectri- energy supply, the maximum level for domestic, renewa- city plants will be evaluated according to the present ble resources in the production of electricity has been day standards. targeted within the framework of the national energy policy. Turkey, being the 17th largest economy in the 6. Acceleration in the number of studies required for world and 6th largest in Europe, is experiencing a steep the growth of the electricity transmission system that increase in its demand for energy. Therefore, Turkey has would allow for the connection of a higher number initiated a forward-looking and innovative energy policy of intermittent energy technologies such as solar and in which renewable energy plays a significant role. On wind energy power plants. one hand, by 2023 Turkey plans to have an electricity 7. The protection of geothermal resources during uti- generation mix in which the share of renewable energy lization, including their sustainability in terms of their accounts for 30% of overall need as well as having 10% renewal and regeneration. of the requirements of the transportation sector met by renewable energy. On the other hand, there is also a 8. Plans to open up areas for geothermal development, commitment to reduce by at least 20% (with reference to where suitable for electricity production, in order to 2008 figures) the amount of energy consumed per unit accelerate private sector participation. GDP in the year 2023 (in terms of energy intensity). 9. Emphasis will be given to technology development studies in the field of renewable energy resources. Investments in sustainable energy will continue to move forward in Turkey as long as emerging technologies appear on the horizon and are supported by sufficient incentives. In accordance with the Turkish Energy Effi- ciency Strategy Paper (4), there are two specific targets directly related to the renewable energy sector. One of them, Strategic Purpose 2, states the percentage of the targeted share for renewable energy resources within the energy supply. In the other, Strategic Purpose 7, the necessity of minimizing the negative environmental impact of the activities within the energy and natural resources sectors is highlighted. 3. The Republic of Turkey Ministry of Energy and Natural Resources Strate- gic Plan (2010-2014) (5). 10 | National Renewable Energy Action Plan for Turkey 1 National renewable energy strategy Regarding the minimization of the negative environmental 1.2.1 Current national policy on renewable energy impact of industrial activities, Turkey has joined the United Progress has been made in the field of renewable energy Nations Framework Convention on Climate Change and rati- starting from 2005, after the publication of the Law on fied The Kyoto Protocol on the May 28, 2009. Additionally, the Utilization of Renewable Energy Resources for the Pur­ Turkish Government has carried out a roster of actions against pose of Generating Electrical Energy (Renewable Energy any negative environmental impact since 2010, including: Law, REL, Law No. 5346). Investments in renewable energy technologies remained limited between 2005 and 2010 • The promotion of the usage of renewable energy due to the lack of secondary legislation and relatively low resources and the effective use of energy and clean coal feed-in tariff levels. Nevertheless, the Renewable Energy technologies, Law amendment in December 2010 introduced higher feed-in tariff rates for some technologies, and other • The reduction of greenhouse gas emissions, various monetary and non-monetary incentives. There- fore, the penetration of renewable energy technologies • The utilization of biomass/biogas potential (in infras- was accelerated as compared to the period 2005 - 2010. tructure facilities for water, waste water and solid waste), After feed-in tariff rates were revised, renewable energy investments attracted the attention of both local and • Increase in the effectiveness of control and supervision international investors. for compliance with sustainable mining and sustainable environmental principles in mining operations, and • Training and public awareness of climate change and environmentally friendly energy technologies. Figure 5a: Evolution of renewable energy regulations and policies in Turkey including the most important energy efficiency regulations Tender regulation for License Applications Regulation for Technical REL Amendment, RER Support Regarding Energy Assesment License Geothermal Law No: Published in the Mechanism is enabled generation from Solar Applications of Solar 5686 Official Gazette No: 6094 on November 1, 2011 Facilities Power Plants 2005 2007 2009 2010 2011 2012 2013 The Law on Utilization of Electric Energy Market Documentation and Sup- Communique Electricity market Law Renewable Energy Resources and Supply Security port for Renewable Energy on Measurement Amendment No: 6446 of the Purpose of Generating Strategy Paper: 30% Resources Standards for Electrical Energy (REL) Renewable Energy Wind & Solar Amendment in Unlicensed No: 5346 by 2023 Regulation for Unlicensed Energy Generation Regulation Electricity Generation Regulation for Amendment in Regulation for implementationof Local implementation of Local Equipment Bonus Equipment Bonus Figure 5 b: Evolution of energy efficiency regulations and policies in Turkey Officially announced as «Year of Energy Regulation for KOSGEB Regulation on Efficiency»: Supports on Energy Increasing Efficiency in Communique on Energy Launch of official Efficiency use of Energy Resources Efficiency Incentives ENVER program for Public Awareness 2007 2008 2010 2011 2012 Energy Efficiency Law The Regulation of National Climate Amendment in Energy Efficiency No: 5627 Energy Performance of Change Strategy paper The regulation Strategy Paper Buildings (2010-2020) of Energy Performance Comminuque on Measures of Buildings for Increasing the Energy Efficiency in Transportation 11 | National Renewable Energy Action Plan for Turkey 1 National renewable energy strategy Turkey’s current national energy regulation is articulated • Law Amending the Law on the Utilization of Re- in the following laws: newable Energy Resources in Electricity Generation (Law No: 6094) • New Electricity Market Law (Law No. 6446) This law introduces significant amendments to improve This law (6) introduces some important changes in the current the incentive mechanism under the Renewable Energy electricity market system, including amendments to license Law and encourage renewable energy investment oppor- types, framing its provisions around each type of market ac- tunities in Turkey (8). The following are its main points: tivity, specific provisions for certain license types (generation, transmission, distribution, wholesale, retail, auto-producer and - Each supplier who sells electrical energy to consu- auto-producer group), the introduction of a preliminary licen- mers has an obligation to pay a renewable energy sing mechanism and investment incentives, such as extended fee proportional to the amount of electricity that the deadlines and grace periods for environmental compliance. In supplier has sold to its consumers divided by the total reference to the renewable energy sector, it establishes: electric energy that all suppliers have sold to all consu- mers in the country. In other words, they are indirectly - The maximum installed capacity for a renewable ener- obliged to purchase electricity that is generated from gy plant to operate without a license has been raised renewable resources. from 500 kW to 1 MW, with the ease of increasing up to 5 times (5 MW) by a decree of the Council of Ministers - A new feed-in tariff plan, categorizing the different without a change in the Law. Furthermore, with the new levels of feed-in tariff for different technologies is intro- Law, there is no limit for renewable energy facilities that duced. In addition, the local equipment bonus is to be serve for self-consumption without feeding into the grid. added to the feed-in tariff plan. - Renewable generation facilities that extend over - The scope of time for the support mechanism is extended more than one premise can be considered one single for facilities that are commissioned before the December 31, generation entity provided that they are connected to 2015. (According to a Board Decision in December 2013, this the system from the same point. date was extended to December 31, 2020). - The Law reasserts the exemptions and discounts in land - Feed-in tariffs are based on the USD (United States use rights as described in the Renewable Energy Law. Dollar) and not subject to any escalation. - The pre-licensing step is defined in the licensing pro- - Land Usage Fee Incentives: Until 2020, a discount cess and all M&A activities at this stage are restricted. of 85% for permission, lease, easement rights and servitude right fees for generation facilities based on - For wind and solar power plants that would compete for renewable energy resources will be applicable for the the grid access rights, the tendering process has been mo- first 10 years, including the period of investment and dified to reduce the 20 year payment period of contribution operation. fees to the Transmission System Operator to 3 years. The contribution fee that was paid according to generated kWh • Energy Efficiency Law (Law No: 5627) was modified to be paid for unit installed capacity (per MW). The purpose of this Law (9) is to increase efficiency in using energy sources by avoiding waste, easing the burden of • The Law on the Utilization of Renewable Energy energy costs on the economy and protecting the environ- Resources for the Purpose of Generating Electrical ment. This law covers principles and procedures applica- Energy (Law No: 5346) ble to increasing and promoting energy efficiency in the This is the initial legal framework that regulates Renewable energy generation, transmission, distribution and con- Energy Sources for the Purpose of Generating Electrical sumption phases at industrial establishments, buildings, Energy (7). Renewable energy resources were defined as power generation plants, transmission and distribution non-fossil energy resources such as hydro (less than 15 km2 networks and transport. It also raises energy awareness in of reservoir area and run-of-the-river hydroelectric), wind, the general public. solar, geothermal, biomass, biogas (including landfill gas), and wave, current and tidal energy. • Environmental Law (Law No: 2872), amended in 2006 Industrial plants receive a reduction of up to 50% of their electricity bills if they set up their own waste treatment facilities (10). 12 | National Renewable Energy Action Plan for Turkey 1 National renewable energy strategy • Geothermal Law (Law No: 5686) • Clear commitments to avoid changes that alter the This law (11) establishes the rules and principles for effecti- return on investments already made and undermine ve search, exploration, development, production and pro- investors’ legitimate expectations tection of geothermal and natural mineral water resources. It also additionally defines the rights of the beneficiaries • Wide and public consultation on scheme design for their economic use of resources in compliance with regulations and reclamation of after use. • Stable scheme financing in line with the EU-acquis linked to consumption and off-budget financing to • Energy Efficiency Strategy Paper 2012-2023 avoid fiscal impacts and uncertainty The Turkish Government has a strong commitment to energy efficiency. This document (4) presents strategic guidelines and • Keep costs transparent and separate from other actions for creating energy efficiency in the building, transpor- system costs tation and industrial sectors in Turkey. It plans to enhance ener- gy efficiency, preventing unconscious use and dissipation, and The main objective of the above mentioned communica- decreasing energy density either within the sectorial base or tion is to encourage the integration of support schemes in at the macro level. These guidelines form important compo- the market. Firstly, competitive allocation mechanisms (e.g. nents of the Turkish national energy policy, in all its stages from auctions) lead to price reductions. In addition, price decrea- energy production and transmission to final consumption. se is also achieved through competition. The more players entering the auction process the lower the resulting price. • The Ministry of Energy and Natural Resources Strategic Plan (2010-2014) Feed in premiums are support schemes with greater The plan (5) encompasses energy policy guidelines focused interaction with the market than feed-in tariff systems, so on energy security and mitigation of fossil fuel imports, taking that feed in premiums should be given priority over feed in advantage of the available renewable sources in the country. tariffs. Best practice for feed in premium schemes includes:

1.2.2 Commission Staff Working Document. European • Preference for feed in premiums over feed-in tariffs for Commission Guidance for the Design of renewables technologies that are approaching maturity support schemes. November 5, 2013 Due to market regulatory failures (e.g. low competition • Determine the form of premium - floating (with or level), support schemes are necessary to promote the pe- without cap) or fixed – as function of desirable exposu- netration of renewable energy. The European Commission re of producers to price risk has recently issued a document4 exploring best practices in reforming/designing these mechanisms. • No payment of premiums for production in hours where the system price is negative or above the level of In order for the support schemes to adapt to the falling remuneration deemed necessary cost of renewables, a reform is mandatory. It is important to take into account that this kind of changes normally has an • Use of competitive allocation mechanisms for gran- impact on capital financing costs. Therefore, the reform pro- ting premiums cess should be managed considering the following aspects: • Planned volume based premium reductions for new • Long term legal commitments on the timing and installations, dependent on when they are approved, phasing out of support connected or commissioned • Devising a support scheme that is flexible enough to • Regular, planned and inclusive reviews of premiums account for changes in the development of costs and for new installations technologies Another form of promoting market integration is through • Announcement of automatic reductions in support de- quota obligations. This instrument exposes the energy pending on specified caps and/or lower technology costs producer to market prices, since the energy has to be sold in the relevant market. • Planned review periods and no unannounced interim changes 4. Commission Staff Working Document. European Commission Guidance for the Design of renewables support schemes. November 5, 2013. 13 | National Renewable Energy Action Plan for Turkey 1 National renewable energy strategy Moreover, favoring investment over operating support will • Fulfill the level of usage of renewable energies in trans- decouple production from the sales price and might be portation established in the Directive 2009/28/EC: a 10% appropriate to promote market integration. Tax exemp- share of renewable energy in the transportation sector. tions and Feed in tariffs are two additional support mecha- nisms used in the renewable energy sector. It has already • Ensure technological and industrial development been said that feed in premiums have a better interaction based on the installation of a higher renewable energy with the market. Nevertheless, given that feed in tariff is capacity by 2023. one of the most widely adopted support mechanism, best practice for it are presented below: • Plan use of renewable energy resources taking into consideration the impact of climate change and sustai- • Phase out of feed in tariffs (may be appropriate if nability to the ecosystem, orienting plans toward the combined with a pre-set capacity cap (per technology mitigation of climate change (3). or market segment) for small scale activities and/or in non-developed markets) • Avoid obstacles in developing renewable energy in the country, by enabling the following: • Tariffs need built-in cost-based or expected cost- based reductions in tariff levels for new installations - financial support for projects, (in line with learning curves and expected future cost - removal of barriers linked to the administrative reductions in various technologies) process, • Planned volume based tariff reductions for new - develop legal framework for the implementation installations, dependent on when they are approved, of new solutions, connected or commissioned - provide secure access to renewable energy for electricity generation Apart from market integration, the European Commission highlights in its communication the importance of mini- - optimize the usage of any relevant infrastructure mizing system impacts on power markets. Electricity grid - develop support mechanisms balancing, dispatching rules and grid cost management are the main points addressed. • Develop an appropriate framework to promote the penetration of distributed generation based on re- To finalize, when it comes to design/reform support newable energies and the usage of renewable energy schemes, the cost of the different renewable technolo- in buildings. gies plays an important role. To start with, the process for determining costs has to be carried out in an exhaustive way. Once actual costs are known, the support level can be set transparently including all estimated costs. The recommendation is that support schemes should be dynamic, independently of the way in which they were set initially. Periodic review and adjustment of the support level should be performed together with the setting of time frames for the mechanism.

1.2.3 Objective of the Renewable Energy National Action Plan (REAP) The objective of Turkey’s national Renewable Energy Action Plan (REAP) presented under Directive 2009/28/ EC is the establishment of strategies to promote the development of renewable energy in Turkey. These strategies are set to: • Ensure that the share of renewable energy in elec- tricity production has increased to 30% of the total demand by 2023, based on the high accessibility of renewable sources in Turkey. 14 | National Renewable Energy Action Plan for Turkey 2 EXPECTED ENERGY CONSUMPTION 2013 – 2023 2 Expected energy consumption, 2013 – 2023 In order to bring Turkey’s strategy in line with the European Economic Growth Union’s 2009 Renewables Directive, Turkey’s National Re- During the last seven years, Turkey has undergone a pro- newable Energy Action Plan evaluates the expected final found economic transformation and its economy expe- gross energy consumption for the period of 2013-2023. The rienced remarkable development. Turkey is the 17th largest gross energy consumption forecast is broken down into economy in the world and the 6th largest economy in the sectors of electricity, heating and cooling, and trans- Europe with GDP of 1.6 trillion TL in 2013 in current prices. portation (encompassing petrol, diesel and biofuels consu- med in road and rail transportation as well as electricity). The average annual Gross Domestic Product (GDP) growth rate from 2003 to 2013 was 4.96%, with the GDP reaching This evaluation takes into consideration the expected TL 122.5 billion in 2013. Figure 6 demonstrates the GDP effects of energy efficiency policy measures. In this regard, development of Turkey the ‘reference scenario’ only considers the energy efficien- cy and the energy savings measures taken into account The real GDP growth decelerated sharply in 2012 due to prior to 2013. While the ‘additional energy efficiency scena- weaker economic conditions in the EU (Turkey’s main rio’ would take into account all the additional policy mea- export market), however in 2013 GDP experienced a 4.12% sures in energy efficiency that could be considered from increase compared to the previous year. In the short term, 2013 to 2023, including the growth of renewable energy. international economic institutions forecast high growth rates, estimating: 5.1% for the period of 2012-2017 and 4.3% Moreover, in the short term the Turkish Government in for the period of 2018-2030. Turkey’s potential GDP increase collaboration with the EBRD plans to launch a NEEAP to es- is depicted in Figure 7. tablish a common framework of measures for the promo- Figure 7: Potential GDP growth rate of Turkey tion of energy efficiency within Turkey in order to ensure Source: OECD Economic Outlook 2013 the achievement of the future Turkish’s targets on energy Potential GDP growth rate of Turkey efficiency and to pave the way for further energy efficiency Yearly GDP (percent change) 6 improvements. 5 5.1 4.3 4 Economic, international, and geopolitical uncertainties 3 could cause inevitable deviation from the expected objec- 2 tives. Accordingly, the development of the expected gross 1 energy consumption in the sectors of electricity, heating 0 2012-2017 2018-2030 and cooling, and transportation should be considered a guideline and not an exact prediction of development in these areas in Turkey. In order to better understand both Energy consumption scenarios, a brief overview of Turkey’s energy requirements Turkey’s continuous economic growth during recent deca- is detailed below. des has made Turkey increasingly dependent on imported energy supplies. Turkey’s total primary energy consump- tion in 2012 was 121 million tonnes of oil equivalent (Mtoe), 6% higher than in 2011, which was 114 Mtoe; again, most of the supply was imported. Figure 6: The Evolution of Turkey’s GDP (in current prices) Source: IMF and Turkstat Turkish Gross domestic product, constant prices (percent change) 10.00 9.16 8.77 8.00 6.89 6.00 GDP (percent change) 4.67 4.00 4.12 2.13 2.00 0.66 0.00 2006 2007 2008 2009 2010 2011 2012 2013 -2.00 -4.00 -4.83 Gross domestic product, constant prices (percent change) -6.00 16 | National Renewable Energy Action Plan for Turkey 2 Expected energy consumption, 2013 – 2023 Figure 8: Primary Energy Consumption in Turkey Source: Ministry of Energy and Natural Resources Turkey’s primary energy supply is expected to rise in the next decade, the forecast is estimated to be 158 Mtoe for 2023. Turkish Primary Energy Consumption Primary Energy Consumption (million of toe) 125 Turkey has a high correlation between energy consumption 121 and GDP evolution, more than 95% of R2, with an increase of 120 1 billion TL in GDP resulting in a fuel consumption increase of 115 114 0.116 Mtoe. In relative terms, an increase of 1% in GDP would 110 108 109 result in an increase of 3.4% in the national energy consump- 105 106 106 tion. Figure 10 depicts the strong correlation between the evolution of energy consumption and GDP. 100 Figure 11: Turkish Electricity Consumption: Recent and Forecasted 95 2007 2008 2009 2010 2011 2012 Source: TEİAŞ Turkish Electricity Consumption: Historical & Forecast Figure 9 shows the primary energy production and con- sumption. Accordingly, in 2012 Turkish energy production 450 405 424 367 386 Electricity Consumption (TWh) 400 from national resources accounted for approximately 26% 350 329 348 293 311 of primary energy consumption. 300 246 262 277 250 229 242 194 210 200 Figure 9: Primary Energy in Turkey 150 Source: Ministry of Energy and Natural Resources 100 50 Primary Energy (toe) 0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 120.9 2011 32.0 With reference to final consumption, electricity consump- tion is expected to experience an increase of 72% com- -10 40 90 140 pared to 2013 figures (it would increase from 246 TWh in Primary Energy (toe) 2012 to 424 TWh in 2023). The Government is committed Consumption Production to promoting alternative energy solutions to mitigate this energy dependency. Moreover, Turkey is one of the highest countries in terms of energy consumption per GDP (energy intensity5) Additionally as shown in Figure 12, the energy consumption compared to the rest of the largest European countries in the transportation sector is expected to reach 29.4 million excluding Poland; its energy intensity was 0.27 toe per toe in 2020 and 34.5 million toe in 2023 according to the Inter- $1,000 of GDP in 2013. national Energy Agency and Deloitte forecasts respectively6. Figure 10: Primary energy consumption versus GDP | Sources: BP and IMF (historical data), and Deloitte (forecast) 250 Primary energy consumptio vs. GDP 250 200 200 150 150 Mtoe Billion TL 100 100 50 50 0 1980 1983 1984 1985 1996 1997 1998 1999 2013 2014 2015 1986 1987 2000 2001 2016 1981 1988 1989 1990 1991 1992 2002 2003 2004 2005 2006 2007 2017 2018 2019 2020 1982 1993 1994 1995 2008 2009 2010 2011 2012 2021 2022 2023 GDP (Billion TL, constant prices) GDP (Billion TL, constant prices)-Forecast Primary Energy Consumption (Mtoe) Primary Energy Consumption (Mtoe)-Forecast 6. This figure includes the total energy consumption in the transport sec- 5. Energy consumption per $1,000 of GDP tor: road, railway, air transport, maritime transport and others 17 | National Renewable Energy Action Plan for Turkey 2 Expected energy consumption, 2013 – 2023 Figure 12: Final Energy Consumption in the Transportation Sector • To reduce fossil fuel consumption of motorized Source: Eurostat (recent data) and International Energy Agency (IEA) and Deloitte (forecast) vehicles, by increasing the share of public transporta- 40 Energy Consumption in the Transport Sector tion on highways, maritime transit and railroads and 35 34.5 by preventing unnecessary fuel consumption in urban Energy Consumption (million of toe) 30 29.4 transportation. 25 20.2 • To use energy effectively and efficiently in the public 20 16.4 15.8 16.0 sector. 15 10 • To strengthen institutional capacities and collabo- 5 rations. 0 2009 2010 2011 2012 2020 2023 Forecast by IEA Forecast by Deloitte • To increase the use of state of the art technology and building awareness through diverse activities. The breakdown of energy supply for the transportation sector shows that biomass has just begun being used in • To develop financial mechanisms other than public the sector. As it can be seen in Figure 13, the share of bio- financial institutions. mass was 0.11% in 2012: its contribution is still negligible and the major energy source for this sector is oil. Based on the strategic objectives established in the Energy Figure 13: Breakdown of energy supply for the Transportation Sector Efficiency Strategy Paper, Table 1 includes estimates of final Source: Eurostat energy consumption in the areas of heating and cooling, Breakdown of energy supply for transport sector electricity and transport. The ‘reference scenario’ and ‘addi- tional energy efficiency scenario’ are presented separately. 100% 0.22% The reference scenario includes all the measures on energy 0.11% efficiency and energy saving taken before 2013, while the 99% 1.68% Electricity additional energy efficiency scenario forecast includes all 98% Biomass the additional measures in energy efficiency and energy Gas savings that would be undertaken from 2013 onwards. 97% Oil New energy efficiency guidelines will be given in the futu- 96% 97.99% re NEEAP, which will be developed in the near future by the 95% Turkish Government in collaboration with the EBRD. 94% Electricity 2012 The following targets depicted in Figure 14 have been established for renewable energy penetration in the elec- Energy efficiency tricity sector for 2023 according to : The Energy Efficiency Strategy Paper for 2012 - 2023 targets a decrease of at least 20% of the amount of energy consu- Figure 14: Electricity generation and installed capacity: 2013 data, 2023 forecast and increases med per unit Turkish GDP in the year 2023, by taking 2008 Renewable Installed power capacity (MW) Electricity generation (GWh) as reference year. The objectives established under this energy technology 2013 2023 Δ 2013 2023 Δ strategy paper can be summarized as follows: Hydro 22,289 34,000 53% 59,420 91,800 54% Wind 2,759 20,000 625% 7,558 50,000 562% • To reduce energy intensity and energy losses in indus- Geothermal7 310 1,000 223% 1,364 5,100 274% try and services sectors. Solar 0 5,000 - 0 8,000 - Biomass 224 1,000 346% 1,171 4,533 287% • To decrease the energy demand and carbon emis- By 2023, 61,000 MW of renewable energy will be installed sions of buildings: to promote sustainable environmen- to generate approximately 159 TWh. Figure 15 shows the tally friendly buildings using renewable energy sources. electricity generation and installed capacity for 2013 and forecasts for 2023. 7 • To promote a market transformation toward energy efficient products. • To increase efficiency in production, transmission and distribution of electricity, and to decrease energy losses 7. Taking into account the evolution of the geothermal energy in recent and harmful environmental emissions. years, geothermal energy capacity is expected to rise to 1,000 MW by 2023 18 | National Renewable Energy Action Plan for Turkey 2 Expected energy consumption, 2013 – 2023 Figure 15: Electricity generation and installed capacity: 2013 data and 2023 forecast 3,294; 5% Other renewable Other renewable Hydro Hydro 27,000; 22% Others Others 22,289; 35% 64,000; 51% 38,424; 60% 34,000; 27% 2013 Installed power 2023 Installed power capacity in Turkey capacity in Turkey (MW & percentage) (MW & percentage) Total: 64,007 MW Total: 125,000 MW 10,092; 4% Other renewable Other renewable 67,633; 16% Hydro Hydro Others Fossil fuel 59,420; 25% 91,800; 22% 170,641; 71% 264,567; 62% 2013 Electricity generation 2023 Electricity generation structure in Turkey structure in Turkey (GWh & percentage) (GWh & percentage) Total: 240,153 GWh Total: 424,000 GWh Figure 16: Electricity generation and installed capacity from renewable sources: 2013 data and 2023 forecast 65,000 65,000 60,000 60,000 1,000 1,000 5,000 55,000 Biomass 55,000 Biomass 50,000 Geothermal 50,000 Geothermal Solar Solar 45,000 45,000 20,000 Wind Wind 40,000 40,000 Hydro Hydro 35,000 35,000 30,000 30,000 25,000 310 224 25,000 34,000 2,759 0 20,000 20,000 22,289 15,000 15,000 Installed Power capacity 2013 (MW) Installed Power capacity 2023 (MW) 160,000 160,000 5,100 4,533 8,000 140,000 Biomass 140,000 Biomass Geothermal Geothermal 120,000 120,000 50,000 Solar Solar Wind Wind 100,000 100,000 Hydro Hydro 80,000 80,000 1,171 91,800 60,000 1,364 7,558 0 60,000 59,420 40,000 40,000 Electricity generation 2013 (GWh) Electricity generation 2023 (GWh) 2023 targets were provided by Security of Supply Strategy Paper, the information for hydropower capacity and energy, real data for the base year 2012 and 2013 have been provided by TEİAŞ. 19 | National Renewable Energy Action Plan for Turkey 2 Expected energy consumption, 2013 – 2023 Development of the gross final consumption of energy in the sectors of electricity, heating and cooling and transportation8,9 Table 1: Expected gross final energy consumption of Turkey for electricity, heating and cooling and transportation up until 2023 taking into account the effects of energy efficiency and energy saving measures 8,9 Expected final 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 gross energy Additional consumption Base Reference Reference Reference Reference Reference Reference Reference Reference Reference Reference Reference energy (ktoe) year scenario scenario scenario scenario scenario scenario scenario scenario scenario scenario scenario efficiency 1) Heating and cooling 49,091 49,245 49,606 49,788 50,018 50,270 50,511 50,691 50,861 51,024 51,213 - (Base year = 2011) 2) Electricity 20,804 21,561 22,935 24,538 26,223 28,067 29,993 31,938 33,973 36,025 38,146 40,223 - 3) Transport as in Article 3(4)a 17,566 18,462 19,404 20,394 21,434 22,527 23,495 24,506 25,559 26,658 27,805 29,000 - 4) Final gross energy consumption - 89,115 91,585 94,537 97,445 100,613 103,757 106,955 110,223 113,544 116,975 120,436 107,000 8. According to Directive 2009/28/EC on the Promotion of the Use of Energy from Renewable Sources, the targets for the Transport Sector only include road and railway transport (final energy consumption): the rest of activities in the Transport Sector are excluded. 9. A more through analysis with other sectorial breakdowns and using other methodology and models can be conducted by the Ministry within the scope of National Energy Efficiency Action Plan. 1 GWh = 0.0859845228 ktoe (source: International Energy Agency). 1 GWh = 0.0859845228 ktoe (source: International Energy Agency). 20 | National Renewable Energy Action Plan for Turkey 3 RENEWABLE ENERGY TARGETS AND TRAJECTORIES 3 Renewable energy targets and trajectories

3.1 Overall national target Table 2: Overall national target for the share of energy from renewable sources in gross final consumption of energy in 2010 and 2023 (figures to be transcribed from According to the guidelines of the Ministry of Energy Annex I, Part A to Directive 2009/28/EC) 11 and Resources the main strategic issues regarding energy policy in the next decade are: A) Share of energy from renewable sources in gross final consumption of energy in 2012 (S2012) (%) 13.5% B) Target of energy from renewable sources in gross final • Reduction of energy dependency in order to mitigate consumption of energy in 2023 (S2023) (%) 20.5% the risks linked to high energy dependency on fossil fuel C) Expected total adjusted energy consumption in 2023 (ktoe) 107,000 supplies from other countries and the volatility of their prices, and their impact on economic development. D) Expected amount of energy from renewable sources corresponding to the 2023 target (calculated as B x C) (ktoe) 21,905 • Additional capacity to reach 125,000 MW and supply the estimated demand growth of 75.4% between 11 2012 and 2023: the Government strategy includes an increase in natural gas10 and nuclear generation capacity, and establishes an increase of the share of renewable energy in electricity generation of at least 30% of the total. • The objectives for the different technologies are 34,000 MW of hydropower, 20,000 MW of wind energy, 1,000 MW of geothermal energy, 5,000 MW of solar energy (photovoltaic and concentrated solar power) and 1,000 MW of biomass (the biomass target is not yet included in the official documents). • Improvement of the transmission grid infrastructure is targeted, 60,717 km of lines and 158,460 MVA of power distribution unit capacity is expected. • Improvement of energy efficiency in the electricity transmission grids, reducing electricity loss/theft up to an average of 5% and extending the use of smart grids is targeted. • Taking full advantage of the agricultural sector enhan- cing the biofuel industry (biodiesel and bioethanol). The intention of Turkey’s REAP is to have at least 20% of renewable energy sources for its general energy con- sumption in 2023. Considering an expected total energy consumption of 107 Mtoe, which would imply an energy consumption of 21.7 Mtoe from renewable energy sources. The overall national target for the share of energy from renewable sources in final gross consumption of energy in 2010 and 2023 is presented in Table 2. 11. Directive 2009/28/EC on the Promotion of the Use of Energy from Renewable Sources: 20% target for the overall share of energy from 10. The objective is a maximum share of natural gas in the generation mix, renewable sources and a 10% target for energy from renewable sources in which is 30% transport. 22 | National Renewable Energy Action Plan for Turkey 3 Renewable energy targets and trajectories

3.2 Sectorial targets and trajectories cooling, and transportation sectors in both gross final con- Table 3 gives an overview of the expected trajectory of the share sumption of energy and total gross final consumption of energy of energy from renewable sources in the electricity, heating and according to the Directive. Table 3: National target for 2023 and the expected progression of renewable sources in the sectors of electricity, heating and cooling, and transportation Base year 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Renewable sources of energy – heating + cooling (1) (%) 12.54% 12.74% 12.90% 13.01% 13.16% 13.30% 13.43% 13.56% 13.71% 13.86% 14.01% 14.16% Renewable energy sources – electricity (2) (%) 27.02% 28.02% 29.40% 31.50% 33.41% 35.27% 36.62% 37.75% 37.84% 37.77% 37.65% 37.57% Renewable energy sources – transport (3) (%) 0.07% 0.87% 1.29% 1.70% 2.70% 3.70% 4.71% 6.00% 7.29% 8.88% 9.48% 10.08% Renewable energy sources, total (4) (%) 13.48% 13.92% 14.54% 15.29% 16.20% 17.10% 17.92% 18.75% 19.29% 19.83% 20.16% 20.47% Of which through cooperation mechanism (5) (%) - - - - - - - - - - - - Surplus for cooperation mechanism (5) (%), - - - - - - - - - - - - In accordance with Part B of Annex I to the Directive 2014 - 2015 2016 - 2017 2018 - 2019 2020 - 2021 2023 Minimum value for target path for renewable energy (6) Minimum value for target path for renewable energy sources (ktoe) (1) Share of renewable energy in heating and cooling: Gross final consumption of energy from renewable sources for heating and cooling (according to Article 5 (1) (b) and Article 5 (4) of Directive 2009/28/EC), divided by the gross final consumption of energy for heating and cooling. Row A of Table 4a, divided by Row 1 of Table 1 (2) Share of renewable energy in the electricity sector: Gross final consumption of energy from renewable sources for electricity (as referred to in Article 5(1)(a) and Article 5(3) of Directive 2009/28/EC), divided by the total gross final consumption of electricity. Row B of Table 4a, divided by Row 2 of Table 1 (3) Share of renewable energies in the transport sector: End use of energy from renewable sources for the transport sector (see` Article 5, paragraph 1, point c, and Article 5, paragraph 5 of Directive 2009/28/EC), divided by consumption in the transport sector is 1. petrol, 2. diesel fuel, 3. biofuels used in road and rail and 4. electricity used in land transportation, see Row 3 of Table 1. Row J of Table 4b divided by Row 3 of Table 1. (4) Share of renewable energy in gross final consumption of energy. Row G of Table 4a, divided by Row 4 of Table 1 (5) As percentage points of the overall share of renewable energy sources. 23 | National Renewable Energy Action Plan for Turkey 3 Renewable energy targets and trajectories Table 4a: Calculation table for each sector’s contribution to the share of renewable energy in final consumption of energy Base Base (ktoe) (ktoe) 2013 2013 2014 2014 2015 2015 2016 2016 2017 2017 2018 2018 2019 2019 2020 2020 2021 2021 2022 2022 2023 2023 year year Expectedgross Expected gross final final consumption consumption of energy A of energy from fromsources renewable renewable sources for heating and for cooling 6,154 6,254 6,353 6,453 6,553 6,652 6,752 6,851 6,951 7,050 7,150 7,249 heating and cooling Expected gross Expected gross final final consumption consumption of electricity B of electricity from renewablefrom renewable energy sources 5,621 5,977 6,613 7,499 8,427 9,425 10,359 11,281 11,925 12,526 13,111 13,709 energy sources Expectedfinal Expected final consumption consumption of of energy energy from C from renewable renewable sources sources in transport in transport (1) (1) 10 140 212 293 482 689 902 1,185 1,486 1,868 2,061 2,267 Expectedtotal Expected total consumption consumption of of energy energy from D from renewable renewable sources sources 11,786 12,371 13,179 14,245 15,462 16,766 18,012 19,317 20,361 21,445 22,322 23,225 Expectedtransfer Expected transfer of of energy energy fromfrom renewable E renewable sources sources to other to other Member Member States17 - - - - - - - - - - - - States 17 Expected Expected transfer transfer of from energy from of energy renewable sources F renewable from sources other Member from States andother Member third countries - - - - - - - - - - - - States and third countries Expected consumption Expected consumption of energy of energy from from G renewablesources renewable sources after after adjusting adjusting the the 11,786 12,371 13,179 14,245 15,462 16,766 18,012 19,317 20,361 21,445 22,322 23,225 target(D) target (D)- -(E)(E) ++ (F)(F) (1) In accordance with Article 5(1) to Directive 2009/28/EC, gas, electricity and hydrogen from renewable energy sources will be considered only once. They shall not be counted twice. Table 4b: Calculation table for the share of renewable energy in the transportation sector Base Base (ktoe) (ktoe) 2013 2013 2014 2014 2015 2015 2016 2016 2017 2017 2018 2018 2019 2019 2020 2020 2021 2021 2022 2022 2023 2023 year year “Expectedfinal “Expected final consumption consumption of energy of energy from C from renewable renewable sources insources transportin(1) transport (H) + (I)” (1) 10 140 212 293 482 689 901 1,185 1,486 1,868 2,061 2,267 (H) + (I)” Expected consumption of Expected consumption of biofuels biofuels from fromwastes, wastes, H residues, non-food residues, non-food cellulosic cellulosic material, material,and andlig- lig- 10 11 12 13 14 16 17 18 19 19 20 20 nocellulosic material nocellulosic material in in the the transport transportsector sector(2) (2) Expectedfinal Expected final consumption consumption of of energy energy from I from renewable renewable sources sources in in (1) transporttransport (1) - 129 200 280 468 673 885 1,167 1,467 1,849 2,041 2,247 Expected contribution of energy from renewable J sources in transport in view of the target for the 25 286 430 592 971 1,386 1,812 2,380 2,980 3,746 4,132 4,544 transport sector (C) + (2.5 - 1) × (H) + (2 -1) × (I) (1) Here all renewable energy sources used in the transportation sector are considered, including electricity, hydrogen, renewable gas and biofuels only that do not meet sustainability criteria (see Article 5(1), last subparagraph). Here actual values are specified, without applying multiplication factors. (2) Here actual figures are specified, without applying multiplication factors. 24 | National Renewable Energy Action Plan for Turkey 4 MEASURES FOR ACHIEVING THE TARGETS 4 Measures for achieving the targets 4.1A Overview of all policies and measures to pro- mote the use of energy from renewable resources This section 4.1 introduces possible measures that would contribute to the further development of renewable energy in Turkey (Table 5).12 13 14 Table 5: Overview of all plans and measures Date of the Type of measure12 Target group Exists/is beginning and end Name and reference of the measure Expected result13 and/or activity14 planned of the measure Feed-in tariff scheme. Financial Investments in Investors, Private Exists 2005 - 2020 renewable energy. households The Law on the Utilization of Renewable New power Energy Resources for the Purpose of Genera- capacity. ting Electrical Energy (Law No: 5346) and its amendment (Law No: 6094) (8). The end date of the feed-in tariff scheme was extended to December 31, 2020 according to the Board Decision published in the Official Gazette on December 5, 2013 (No: 28842, Decision No: 2013/5625) Incentive to promote the use of local Financial Investments in Industrial players, Exists 2010 - 2030 equipment. renewable energy. Investors Local incentives for renewable energy New power capa- Energy Investors, technologies stated in Renewable Energy city and energy Industrial players Law (No:5346) generation for heating. Investment Incentives Program. Financial New power capa- Energy Exists 2012 - on-going city and energy Investors, Industrial The New Investment Incentives Program in generation for players Turkey has been in effect since the January heating 1, 2012 (12). Support from major international financial Financial Investments in Industrial players, Exists 2012-2023 institutions. renewable energy. Investors Promoting support from major institutions, New power capa- such as TurSEFF and MidSEFF provided city and energy by EBRD, the World Bank, the Industrial generation for Development Bank of Turkey (TSKB), the heating. International Finance Corporation (IFC) and the Technology Development Foundation of Turkey (TTGV). Subsidized long-term loans for renewable Financial Investments in Energy promoters, Under Under energy projects. renewable energy. Investors. consideration consideration In the short term, the Turkish Government, in New power capa- collaboration with the Turkish financial sector city and energy and international financial institutions focu- generation for sed on economic development, will analyze heating. the possibility of enabling mechanisms to provide long-term loans for renewable energy project construction and implementation. Advisory services, provided by govern- Technical Use of geothermal Geothermal Under Under ment agency under the General Directo- potential more promoters/ consideration consideration rate of Mineral Research and Exploration targeted develop- investors (MTA), on engineering and best practices ment effort in resource development 12. Indicates whether the measure is (predominantly) regulatory, financial or soft (i.e. an information campaign). 13. Explains the expected result. 14. Identifies who the targeted persons are i.e. investors, end users, public administration, planners, architects, installers, etc. or what the targeted activity/sector is i.e. biofuel production, use of animal manure, etc. 26 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets Date of the Target group Exists/is beginning and end Name and reference of the measure Type of measure12 Expected result13 and/or activity14 planned of the measure Financial support to private sector for Financial Use of geothermal Geothermal Under Under geothermal exploration activities. potential. promoters / consideration consideration investors In the short term, the Turkish Government in collaboration with the Turkish financial sector and international financial institu- tions focused on economic development will consider analyzing the possibility of enabling mechanisms that mitigate capital risk to support geothermal exploration and drilling activities Support for the MTA in expanding its early Technical / Greater exploration MTA Under Under stage of geothermal exploration activities. Financial of geothermal consideration consideration potential Turkish Government, in collaboration with the international financial institutions focused on renewable energy development, will consider analyzing the possibility of providing support to the MTA in scaling-up surface and shallow drilling exploration activities across the country Land Usage Fee Incentives Legislative Investments in Investors Exists 2005 - 2020 (Law No: 6094) (8). renewable energy. New power capa- Discount of 85% for permission, lease, easement city and energy rights and servitude right fees for generation generation for facilities based on renewable energy resources. It heating. will be applicable for the first 10 years, including the period of investment and operation. Reduction in electricity bills, in-house Legislative Licensed use of Investors Exists 2006 - waste treatment facilities. waste. Law on the Environment (Law No: 2872) (9), amended in 2006, establishes that industrial plants receive a reduction of up to 59% of their electricity bills if they set up their own waste treatment facilities. Permits unlicensed power generation up Legislative Investment in Private Exists 2013 - to 1 MW and the receipt of feed-in tariff renewable energy households, revenue. and distributed Investors generation. Electricity Market (Law No: 6446) (6). Permits unlicensed power generation up Legislative Investment in Private Planned Under to 5 MW and the receipt of feed-in tariff renewable energy households, consideration revenue. and distributed Investors generation. Electricity Market (Law No: 6446) (6). Reviewing of procedures for licensing Legislative Enabling Investors Planned Under and issuing of permits for unlicensed promotions consideration generation, in order to reduce their costs of facilities. and establish deadlines for the different administrative tasks. In the medium term there will be a revision of administrative requirements to avoid delays and adopting the procedure outlined in Directive 2006/123/EC on services in the internal market. Among others, the following measures will be taken into consideration: positive admi- nistrative silence, time limit for administrati- ve tasks and a one-stop-shop. Reviewing of licensing and issuing of Legislative Enabling Investors Regulation stu- Under permit procedures for renewable energy promotion dies for authori- consideration facilities in order to avoid delays. of facilities. zation of General Directorate In the medium term, there will be a revision of Renewable of the administrative requirements, avoiding Energy in the delays and adopting the procedure outlined name of Ministry in Directive 2006/123/EC on services in the of Energy and internal market. Resources are ongoing Among others, the following measures will be taken into consideration: positive admi- nistrative silence, time limit for administrati- ve task and a one-stop-shop. 27 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets Date of the Target group Exists/is beginning and end Name and reference of the measure Type of measure12 Expected result13 and/or activity14 planned of the measure Review of Transmission System Operator Legislative Enabling facilities Investors, TEİAŞ Under Under legal framework. promotion consideration consideration In the medium term, a revision might be con- sidered for the system operator revenue mo- del: an incentive based on renewable energy penetration could be established taking into consideration the positive externalities. Grid operation procedures to enable large Soft Improvement of Investors, TEİAŞ Planned Under renewable energy penetration. the transmission consideration grid and enabling renewable energy capacity connection. Implementation of systems to monitor and Soft Enabling renewa- Investors, TEİAŞ Planned Under manage renewable energy penetration ble energy capacity consideration in the grid and monitoring in the same connection. center which should be close to National Load Dispatch Center (MYTM). TEİAŞ considers implementing, in the short and medium term, systems for monitoring and managing a large number of renewable energy facilities Implement the legal framework to Legislative Increase of DSO, Investors, Planned Under develop distributed generation based on distributed Households consideration renewables. renewable energy. Establish the following: connection to the grid, creating the revenue model, distribu- tion system balancing and signaling. Reinforce international electricity inter- Soft Enable the Energy promoters, Exists (being 2012-ongoing connections. penetration of RES TEİAŞ developed) and improve the Georgia, Azerbaijan, Armenia, Iran, Iraq, reliability of the Syria, Bulgaria and Greece. system. Obligation to purchase the excess electri- Legislative Enable RES Investors Exists 2005 city generated. penetration. The Law on the Utilization of Renewable Energy Resources for the Purpose of Gene- rating Electrical Energy (Law No: 5346) (7) says that distribution companies holding retail licenses are obligated to purchase the excess electricity generated by the unlicensed renewable energy generators (at feed-in tariff prices). Establish incentives to promote the insta- Legislative Improvement of Wind energy Planned Under llation of capacitor banks in wind farms. energy quality and investors, TEİAŞ consideration system reliability. Incentive for wind energy penetration. Biofuels obligation Legislative Increased use Biofuel Investors, Exists 2013 - of biofuels. Transportation To obtain a biodiesel content of at least sector 1% by January 1, 2014, 2% as of January 1, 2015, and 3% as of January 1, 2016 (this re- Ministry of Food, gulation was cancelled according to Official Agriculture and Gazette No. 28688 which was published on Livestock June 25, 2013). Ministry of Energy To obtain a bioethanol content of at least and Resources 2% as of January 1, 2013, and 3% as of January 1, 2014. Biofuels tax exemption Legislative Increased use Biofuel Investors, Exists 2011 - The Energy Market Regulator of biofuels. Transportation sector Authority has established that 2% of biofuels (biodiesel and bioethanol) pro- Ministry of Food, duced from domestic raw material that is Agriculture and blended with diesel fuel is exempt from the Livestock special consumption tax (ÖTV is the Turkish acronym). Ministry of Energy and Resources Stimulate collaboration plans between Soft Increased biomass Investors, Farmers Planned Under biomass energy investors and the agricul- usage. consideration ture sector. 28 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets Date of the Target group Exists/is beginning and end Name and reference of the measure Type of measure12 Expected result13 and/or activity14 planned of the measure Incentives to develop energy crops. Legislative Increased use of Biofuel Promoters, Partially exists Under biofuels. Investors, Trans- consideration portation sector, Ministry of Food, Agriculture and Livestock Develop the Directive 2010/31/EU of 19 Legislative Promote distribu- Investors, Partially exists Under May 2010 on the energy performance of ted generation ba- Households consideration buildings in order to promote distributed sed on renewable YEGM generation based on renewable energy in energy. buildings and zero emission buildings. Training and education initiatives. Soft Establishing Professionals, Planned Under Introducing specific programs that enable qualifications for Population at large. consideration personnel to deal with new energy professionals. technologies: training plans, and academic involvement. Introduction of green certificates for Legislative Increased preferen- All renewable Planned Under electricity generated in renewable energy ce for renewable energy investors consideration power plants. energy consump- tion will further that will further encoura- ge its generation Within the scope of Renewable Energy Legislative To prevent effort, re- Solar energy Planned Under Resources Area Regulation (YEKA), the source and time loss investors consideration measurement of selected solar fields to be due to measure- completed under one unit ment of areas close to each other. Combination of generation and power Legislative Removing the All renewable Planned Under disadvantage of energy investors consideration not experiencing scale economy for the small scale investments. Actualization of Renewable Energy Legislative Easy access to All renewable Planned Under Cooperatives project finance energy investors consideration for licensed and unlicensed projects and enabling scale advantage Financial support to promote the Financial Investment in re- Investors Planned Under development of the Hot Dry Rock search activities to consideration geothermal technology develop materials and technology Financial support for the promotion for Ti- Financial Use of tidal/ Investors Planned Under dal/Wave, sea thermal, and marine current wave and current consideration energy technologies potential. Development of the Turkish National Ener- Legislative Promote energy Turkish Planned Under gy Efficiency Action Plan (NEEAP) efficiency actions Government, consideration Energy Sector Measures introduced in Table 5 are explained in depth throughout this chapter, including each measure in the appropriate section. The Investment Incentive Program is a special case because it applies to all sectors and for all requirements; therefore it should be considered for every point that follows. 29 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets Support Measures 1 2 3 4 5 6 4.1B Incentives to promote new investments Regional Incentive Applications in Turkey Tax Reduction 15% 20% 25% 30% 40% 50% Investment Contribution Rate The New Investment Incentives Program in Turkey has Incentive for Large Scale Investments been effective since the January 1, 2012 and offers four Tax Reduction 25% 30% 35% 40% 50% 60% Investment Contribution Rate different kinds of plans (12): Support for Employer’s National Insurance Contribution (Both) 2 Year 3 Year 5 Year 6 Year 7 Year 10 Year 1. General Investment Incentive Plan: The plan is These incentive plans, depending on the activities under- available for all investment types considering that the taken, can be applied to renewable energy facilities, R&D investment category is not excluded from the program initiatives, development of equipment and the manu- list, and that the minimum defined fixed investment facturing of component parts for the renewable energy amount is fulfilled. Within this framework, electricity ge- power plant. neration facilities with renewable energy generation are entitled to VAT and customs duty exemption, but other Early stage exploration, including exploratory drilling, is ar- facilities are entitled to the incentives listed below. guably the most risky stage for a geothermal project deve- loper from a financial and technical perspective. Currently, 2. Regional Investment Incentive Plan: These incentives are there have been some exceptional cases, where private allocated depending on the region to eliminate inter-regio- sector investors have developed geothermal fields from nal imbalances within the country. Minimum investment surface exploration stage, financed by the company’s equi- amounts have been determined for different kinds of ty. In collaboration with International Financial Institutions, investments. If not stated for the specific type of project, the the Government will develop programs to support private minimum investment amount is TL 1 Million for Regions 1 sector investors to participate in early stages of develop- and 2, and TL 500,000 for regions 3, 4, 5, and 6. An additional ment of geothermal resources, in parallel with the MTA ac- labor cost deduction of 38% is available only for region 6. tivities. This support will come in the forms of risk-sharing mechanisms, drilling insurance programs, concessional Figure 17: Regions of Turkey according to incentive plan funds with limited recourse to the parent company and/or equity or quasi-equity (mezzanine) products. Additionally, the Government could support private sector investment for early stage geothermal development by offering an additional FiT premium for projects. New formulation of FIT will be elaborated regarding the scale and technology (for instance the use of waste heated water in greenhouses). Region 1 Region 4 Region 2 Region 5 The potential of energy technologies, such as Hot Dry Region 3 Region 6 Rock and Tidal/Wave, needs to be considered. Hot Dry 3. Large Scale Investment Incentive Plan: The goal Rock describes the process of extracting heat from deep of this program is to improve Turkey’s technological crystalline rock while Tidal/Current energy technologies abilities and R&D capacity. are designed to capture the kinetic motion of the ebbing and surging of ocean tides in order to produce electricity. 4. Strategic Investment Incentive Plan: This plan is offered Both technologies (Hot Dry Rock and Tidal/Current) have a for production of intermediate and final goods with high promising future in Turkey, as the country has an extensive import dependence (more than 50%). Investments of TL surface and a large coastline, suitable to develop them. 50 million or above are eligible to benefit from this plan. Therefore, financial support for R&D and the promotion of Figure 18: Details of the New Investment Incentive Program these technologies will be established. Support Measures General Regional Large Scale Strategic Investment Investment Investment Investment Vat Exception 4.1C Feed-in Tariff Customs Duty Exemption The legal framework, the Law on the Utilization of Tax Deduction Renewable Energy Resources for the Purpose of Genera- Land Allocation ting Electrical Energy (Law No: 5346) (7), established an Interest Support incentive plan for the promotion of renewable energy in Vat Refund Turkey, this plan has been modified by the Law Amen- Employer’s Social Security Pre- ding the Utilization of Renewable Energy Resources in mium Support Only For Region 6 Electricity Generation (Law No: 6094) (8). The incentive Income Tax Withholding Support is established in USD, and the licensees can only benefit Employee’s Social Security Premium Support 30 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets from these tariffs during the first 10 years, beginning on The Government is evaluating the possibility to link the date of operation and for facilities that are commis- the feed-in tariff to the necessary time (and the level of sioned before the December 31, 2015. The plan has been difficulty) to fulfill the targets. The framework could be extended until 2020. developed according to the following scheme: Each year, the investor can choose between this feed-in ta- 1. A level of renewable energy technology penetration riff plan and direct sales in the power market. The plan takes is established for a yearly period. During this time, the- into consideration the following issues: re would be a fixed feed-in tariff scheme (USD/MWh). • Wind and hydro energy have very challenging tar- 2. If the penetration target were fulfilled before the end gets15, which would be difficult to meet without taking of the period, a lower feed-in tariff scheme would be necessary precautionary actions. There are many obs- applied for the rest of the period and the next. tacles and the most critical ones include the following: Investors have difficulty in accessing financial support, 3. If the penetration target were not fulfilled before as most financial providers take the feed-in tariff as the the end of the period, an equal or higher feed-in tariff reference price for electricity (however, the forecasted scheme would be applied for the rest of the period market price is higher than this feed-in tariff ) and the and the next. forecasted project cash flow (based on feed-in tariffs) are not attractive enough for financial providers and The incentive would be adapted dynamically to the level guarantees are required creating a barrier for new of renewable energy penetration: For instance; incenti- generation facilities. ves given according to scale and region (regions that are difficult to invest in such as altitude or construction). These • Solar energy also has a significant target for 2023, mechanisms would allow identifying the technologies 5,000 MW should be installed by the end of 2023 that require less (or do not need) incentives. (currently, the penetration of solar technologies is only marginal). However, due to the evolution of solar PV To obtain the guaranteed FIT, geothermal projects will be technology, the investment cost has dropped during required to integrate in a design mechanism that either recent years. Thanks to this fact, together with the high abate or re-inject non-condensable fluids, extracted from availability of solar irradiation in Turkey, it would not the geothermal resources. be necessary to incentivize in the medium term to promote solar PV technology. 4.1D Management of licensing and authorizing • Biomass energy has a low penetration rate in procedures the country and its development depends on the Given the impact that renewable energy projects have current feed-in tariff in the short term as well as the on the economy and society, it is necessary to establish availability of raw materials, which depend on the control mechanisms to assure the adequate development type of technology. of these technologies. A number of authorizations and permits from different bodies are required. • The current feed-in tariff plan established for hydro- power and geothermal energy are appropriate for the Today, the licensing and permits procedures are costly and feasibility of these investments. time consuming. This fact might discourage investors and delay the deployment of new activities in the renewable Additionally, an incentive to promote the use of local energy business. Therefore, there is a need to improve the equipment has been established to promote the develop- administrative procedures to enable a large penetration of ment of a national industry. renewable energy in Turkey. 15. For wind energy, it would be necessary to develop approximately 17,800 MW between December 2012 and the end of 2023. In the hydro case, approximately 16,000 MW would have to be installed during the same period. 31 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets The Directive establishes the simplicity in the adminis- 3.1.3 Metering and billing (EED Articles 9-11) trative procedures, avoiding duplication and reducing

3.1.4 Consumer information programmes and unnecessary delays. The following three aspects could be training (EED Articles 12 and 17) considered in order to speed up the process:

3.1.5 Availability of qualification, accreditation and • A one-stop-shop: it would avoid duplications and the certification schemes (EED Article 16) need to manage the necessary tasks with different bodies.

3.1.6 Energy Services (EED Article 18) • Time limit to manage administrative tasks: it would 3.1.7 Other energy efficiency measures of a horizontal reduce delays in the different processes. nature (EED Articles 19 and 20)

3.2 Energy efficiency in buildings • Positive administrative silence: in case of no response, the application would be automatically authorized, 3.2.1 Building renovation strategy (EED Article 4) helping to reduce the time.

3.2.2 Other energy efficiency in buildings sector These three measures are explained in detail throughout 3.3 Energy efficiency in public bodies this document.

3.3.1 Central government buildings (EED Article 5)

3.3.2 Buildings of other public bodies (EED Article 5) 4.1E National Energy Efficiency Action Plan (NEEAP)

3.3.3 Purchasing by public bodies (EED Article 6) The Turkish Government in collaboration with the EBRD is expected to launch the National Energy Efficiency 3.4 Other end use energy efficiency measures including Action Plan (NEEAP) to establish a common framework of in industry and transport measures for the promotion of energy efficiency within

3.5 Promotion of efficient heating and cooling Turkey in order to ensure the achievement of the future Turkish’s targets on energy efficiency and to pave the way 3.5.1 Comprehensive assessment (EED Article 14) for further energy efficiency improvements.

3.5.2 Other measures efficient heating and cooling (EED Article 14) In line with the Directive 2012/27/EU of the European Par- liament and of the Council of 25 October 2012 on energy 3.6 Energy transformation, transmission, distribution, efficiency (13), the NEEAP is expected to be completed and demand response by taking into consideration the guidance (14) and the

3.6.1 Energy efficiency criteria in network tariffs and template (15) published by the European Commission. It regulation (EED Article 15) is important to note that, the objectives to be included in the future NEEAP could modify the different targets inclu- 3.6.2 Facilitate and promote demand response (EED ded throughout this report, the Turkish REAP: Article 15)

3.6.3 Energy efficiency in network design and 1. Introduction regulation (EED Article 15) 2. Overview of national energy efficiency targets and savings The objectives to be included in the future NEEAP could

2.1 National energy efficiency targets modify the different targets included throughout this

2.2 Additional energy efficiency targets report, the Turkish REAP.

2.3 Primary energy savings

2.4 Final energy savings 3. Policy measures implementing EED

3.1 Horizontal measures

3.1.1 Energy efficiency obligation schemes and alte native policy measures (EED Article 7, Annex XIV, Part 2 3.2)

3.1.2 Energy audits and management systems (EED Article 8) 32 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets

4.2 Specific measures to fulfill the requirements The licensing procedures for renewable energy inves- under Articles 13, 14, 16 and Articles 17 to 21 of tments have similar requirements to those of other Directive 2009/28/EC technologies defined in the Electricity Market Law and License Regulation; however, the specific require-

4.2.1 Administrative procedures and spatial planning ments for the different renewable sources differ from (Article 13(1) of Directive 2009/28/EC) one to another. a) List of existing national and, if applicable, regional For solar and wind power plants, grid connection is procedures concerning authorization, certification, the most critical step before being entitled to a license. licensing and spatial planning applied to plants and The New Electricity Market Law regulates the tender associated transmission and distribution network process for grid connection rights. In light of this, all infrastructure for the production of electricity and solar and wind projects that apply at the same trans- heating or cooling from renewable sources. formation center for grid connection, will require a Authorization, certification and licensing procedures mandatory tender based on a contribution fee payable linked to the renewable energy projects. to the Transmission System Operator for the first 3 years following commissioning. Land restrictions do apply Figure 19: List of administrative procedures to install new renewable power capacity especially in the case of solar and wind energy that Step 1 Step 2 Step 3 require the vast use of land. • For solar and wind: • For solar and wind • Completion of the completion of the necessary land use per- energy, gaining grid connection rights environmental impact assessment and other For small hydro generation units, water usage rights are mits and applications to through bidding on the related permissions. granted by the General Directorate of State Hydraulic the General Directorate tender. of Meteorological Works • Technical and financial Works (DSI) and a water usage fee is payable to the DSI. to start measuring. • Biomass, geothermal feasibility studies and and hydro investors completion of the This General Directorate can also organize tenders for the • For geothermal submit their technical project’s development. energy, applications specifications to TEİAŞ water usage rights. should be made to the to enable access to the Secretary General of system. Special Provincial Admi- In the case of biomass power plants, a tender is appli- nistration for access to the geothermal source. Then, all the applica- cable to those companies who want to build a power tions are overseen by plant that uses landfill gas as a fuel. In those cases, usage the General Directorate of Mining Affairs. rights to the city landfill are granted through a tender by • For hydro energy, the municipality. water usage rights agreement should be signed with the General Directorate of State Additionally, any natural or legal entity generating less Hydraulic Works. than 1 MW in its facility can benefit from the feed-in • For biomass power plants, a tender is tariff defined by the Renewable Energy Support Mecha- applicable for those nism without a generation license. However, although companies that want to build a power plant that shorter, easier and cheaper, it should be noted that uses landfill as fuel. In that case, a usage right there are some permits and legal procedures for these of the city landfill is granted through a ten- facilities as well: municipality licenses, connection to der by the municipality. the distribution company and certification to withstand Step 4 Step 5 earthquakes, etc. • Pre-license application. • Obtaining the license after comple- ting the necessary documentation. • Review with the grid operator Other authorizations and licensing procedures include docu- connection requirements. mentation for regional and local authorities as well as those Required Documents for all Resources regarding the specific characteristics of the project. • Letter of Application (from EPDK) • Authorization Certificate (from EPDK) • Principal Agreement or Commercial Registry Gazette (also for partners of legal entities) • Production Plant Information Form (from the Applicant) • Single-line Diagram (from the Applicant) • Map and Settlement Plan (1/25,000 scale) (from the Ministry of Environment and Urbanization) • Document concerning the right of resource utilization • No-Lien Affidavit with the Ministry of Energy and Natural Resources • Statement of Partnership Structure (from Commercial Registry Gazette) • Declaration of Financial Status (from the Applicant) • Letter of Guarantee from the Bank 33 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets Below are the requirements for the administrative licenses of wind energy investments, EPDK has gained substantial and procedures that should be managed at the regional level: experience since 2007, however for solar, the mecha- nisms are quite new and EPDK will be gaining necessary • Environmental Impact Assessment Report from the Ministry of Environment and Urbanization. experience throughout the process. • Cadastral records from the General Directorate of Land Registry and Cadaster. Depending on the renewable energy technology, other • Spatial approval and expropriation require local authorization for land use. entities have to authorize the new facility: It is compulsory to get the necessary clearances from the following organiza- tions for the land that will be used for the project: The municipality where the investment will be made, the municipality of the greater region (if applicable), • The Ministry of Energy and Natural Resources - the the Special Provincial Administration, the Ministry of Culture and Tourism, the General Directorate of Renewable Energy: respon- Regional Board of Preservation of Cultural Assets, the Regional Board of the Pre- servation of Natural Assets and the Ministry of Environment and Urbanization. sible for all renewable energy sources. The technical On the other hand, depending on the characteristics of the project, investors assessment of the energy license applications are should get the approval of the following institutions: the General Directorate of performed under this organization. Nature Preservation and National Parks, the State Highways Commission, the State Hydraulic Works, the Regional Board of Preservation of Cultural Assets, the provincial organization of the Ministry of Food, Agriculture and Livestock, the • The General Directorate of State Hydraulic Works: Regional Directorate of Forestry, the provincial organization of the Ministry of Environment and Urbanization, the Transmission System Operator, the provincial hydropower units. organization of the Ministry of Culture and Tourism, BOTAŞ (the National Natural Gas Transmission Company), Türk Telekom (the telecom company), the regional electricity distribution company and the regional gas distribution company. • Turkish State Meteorological Service: measurement station installation permits for wind farms and solar In order to avoid delays in the licensing and authorizing power facilities. processes, these procedures will be reviewed by the Government adopting them under Directive 2006/123/EC • The Secretary General of Special Provincial Adminis- on services in the internal market: mandatory deadlines tration and the General Directorate of Mining Affairs should be established for the different administrative tasks (under the Ministry of Energy and Natural Resources): in order to reduce process delays. geothermal energy. Additionally, in the case of unlicensed generation, some • The Ministry of Environment and Urbanization: envi- of the administrative requirements are similar to those of ronmental impact assessment reports and distributed large facilities. generation based on renewable energy in buildings. The Directive establishes the simplicity in the administra- • System Operator: tendering process for wind and tive procedures, avoiding duplication. It also establishes solar energy and evaluating the connection of licensed a time limit to manage administrative tasks (e.g. three renewable energy units to the grid. months) and the positive administrative silence. Moreover, a one-stop-shop for licensing procedures would enable Responsibilities at regional and local levels are described the management of the abovementioned processes. in point 4.2.1.e. Due to the large number of administrative tasks that are The revision of the procedures would enable the review necessary to install new power capacity, a one-stop-shop process of the requirements established in the permits approach would simplify the licensing process and reduce and authorizing processes, and allow the investor and cost and time. operator to have easier and shorter processes. The license for exploration activities in geothermal energy A one-stop-shop approach would avoid duplications and is a special case that should be reviewed: in order to increa- the need to manage the necessary tasks with different se the penetration of this technology, the cost of the licen- bodies. Additionally, a reasonable time scope for each se should be reduced and the information about possible procedure would reduce delays. locations for geothermal capacity should be improved. b) Responsible Ministry(ies)/authority(ies) and their responsibility in the field Power plants that have an installed capacity greater than 1 MW are required to obtain a generation license from the Energy Market Regulatory Authority (EPDK). EPDK has little experience with some renewable energy technologies that have limited penetration. In the case 34 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets c) Revision with a view toward taking appropriate In the case of unlicensed generation, some of the adminis- measures to comply with the meaning of Article 13, trative requirements are similar to those of large facilities, paragraph 1 of Directive 2009/28/EC planned before and the following should also be considered for the the end of 2015. unlicensed generation: municipal licenses, connection to Article 14 of the New Electricity Market Law (Law No. the distribution company and certification of earthquake 6446) (6) defines the activities entitled under law to be con- readiness. Furthermore, there is no difference in applica- ducted without license: the maximum installed capacity tion and documentation for very small scale unlicensed for a renewable energy plant to operate without a license projects and 1 MW projects. Topics regarding different has been established at 1 MW. In addition, The Board of administrative procedures which will enable cost effective Ministers is authorized to increase the maximum installed measures for very small scale projects are expected to be capacity for a renewable energy plant to operate without considered in the coming months. a license to 5 MW. It is also important to mention that re- newable energy power plants that do not connect the load Additionally, the legal framework to develop the distri- to the system (generation and consumption take place at buted generation on a large scale; the establishment of the same location) do not need any kind of license. an economic incentive for the distribution company to enable the installation of new capacity based on its positi- The detailed procedures have been explained in point ve externalities should be considered. 4.2.1.a of this document. e) What level of administration (local, regional and On the other hand, in order to make administrative require- national) is responsible for authorizing, certifying ments quicker and avoid duplication, in the medium term and licensing renewable energy installations and there will be a revision of licensing and permits procedures for spatial planning? (If it depends on the type to install renewable energy facilities as well as unlicensed of installation, please specify.) If more than one generation. For instance, a one-stop-shop would be a level is involved, how is coordination between the good way to speed up and resolve licenses and permits different levels managed? How will coordination without delays or duplications, avoiding bureaucracy. between different responsible authorities be im- proved in the future? d) Have obstacles or disproportionate requirements Several different authorities have roles in the authori- been detected in relation to the approval, certifi- zation and approval processes in licensing procedures: cation or licensing rules applicable to plants and associated transmission and distribution network in- • Environmental Impact Assessment Report from the frastructure for the generation of electricity, heating Ministry of Environment and Urbanization. or cooling from renewable sources and to the trans- formation of biomass into biofuels or other energy • Cadastral records from the General Directorate of products? If so, which? Land Registry and Cadaster. Sometimes, the process to apply for new generation licenses can be time consuming. It would be necessary • Spatial approval and expropriation rights require local to review the administrative processes in order to reduce authorization for land use. unnecessary delays and make the process quicker. It is essential to get the necessary clearance from the The licensing process should be made faster and delays following organizations for the land that will be used for in the management of these tasks should be avoided. the project: The municipality where the investment will be Concentrated effort from the investors is required in time made, the municipality of the greater region (if applicable), consuming tasks. In order to shorten the period for per- the Special Provincial Administration, the Ministry of Cultu- mits and view processes: re and Tourism, the Regional Board of Preservation of Cul- ture Assets, the Regional Board of Preservation of Natural • Reasonable time scopes could be implemented for Assets and the Ministry of Environment and Urbanization. the different administrative tasks. Depending on the specific characteristics of the project, • Positive administrative silence could be set for these the investor should get the approval of the institutions procedures, as a part of the one-stop-shop approach. listed below: the General Directorate of Nature Preserva- tion and National Parks, the State Highways Commission, • A one-stop-shop could be implemented to centralize the State Hydraulic Works, the Regional Board of Preserva- all the licensing and authorizing procedures. tion of Cultural Assets, the provincial organization of the Ministry of Food, Agriculture and Livestock, the Regional 35 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets Directorate of Forestry, the provincial organization of the f) How is it ensured that comprehensive information Ministry of Environment and Urbanization, the Transmis- on the processing of authorization, certification and sion System Operator, the provincial organization of the licensing applications and on assistance to applicants Ministry of Culture and Tourism, BOTAŞ (the National Natu- is made available? What information and assistance ral Gas Transmission Company), Türk Telekom (the telecom is available to potential applicants for new renewable company), the regional electricity distribution company energy installations on their applications? and the regional gas distribution company. Today, comprehensive information and assistance to applicants are the responsibility of different organizations The ultimate license application portfolio should include: depending on the technology. Nevertheless, a one-stop-shop the Letter of Application (from EPDK), the Authoriza- approach would make the process more efficient by facilita- tion Certificate (from EPDK), the Principal Agreement or ting administrative procedures. The design of the one-stop- Commercial Registry Gazette (also for partners of legal shop for the renewable energy in Turkey should follow the entities), the Production Plant Information Form (from the guidelines defined by Directive 2006/123/EC on services in Applicant), the Single-Line Diagram (from the Applicant), the internal market, simplifying procedures and requirements, the Map and Settlement Plan 1/25,000 scale (from the and avoiding duplications. Ministry of Environment and Urbanization, the document about the right of resource utilization (referring to hydro, For solar and wind, the General Directorate of Meteorolo- biomass, and geothermal power plants), No-Lien Affidavit gical Works provides information regarding the procedu- with the Ministry of Energy and Natural Resources, the Sta- res for starting measurements and the application for land tement of Partnership Structure (from Commercial Regis- use permits. In addition, EPDK publishes the procedures to try Gazette), the Declaration of Financial Status (from the take part in the tenders on its website. Applicant) and the Letter of Guarantee (from the Bank). In the case of geothermal energy, the investors can ask for In medium term, a one-stop-shop should be implemen- instruction about the procedure to access the geothermal ted in order to coordinate the different bodies and tasks to source from the Secretary General of Special Provincial avoid unnecessary efforts and delays. Administration. It would be beneficial that the activities of monitoring and Investors can consult with the General Directorate of State controlling the licensing and authorizing procedures are Hydraulic Works for information on water usage rights performed by the General Directorate of Renewable Energy. agreements and the development of new hydropower facilities. The information about the process to apply for • Identify inefficient procedures and duplications in the the generation license is published by EPDK both on its abovementioned processes. website and in the Official Gazette. • Identify non-justified delays in the performance of Finally, the System Operator TEİAŞ publishes documents licensing and authorizing procedures. on procedures with the information on the conditions to access and operate power generation units in Turkey. • Identify non-justified delays in the grid access application. g) How is horizontal coordination facilitated between • Identify non-appropriate practices in the licensing and different administrative bodies, responsible for the authorizing application: discrimination in the appli- different parts of the permit? How many procedural cation processes, abusive practices in the reserve of steps are needed to receive the final authorization/ capacity, abusive conditions, speculative practices, etc. license/permit? Is there a one-stop shop for coordina- ting all steps? Are timetables for processing applica- Based on its controlling activity, the Agency will give re- tions communicated in advance? What is the average commendations to improve the licensing and authorizing time for obtaining a decision for the application? procedures. A report will be issued every year. Referring to the abovementioned procedures, the license application process for energy generation from renewable energy requires completion of different steps through interaction with several authorities. The pre-licen- se period is defined as taking 6 months - 2 years. Currently, there is no one-stop-shop for the coordination of all the effort needed in the process. 36 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets In order to facilitate the administrative task, reducing the Wind energy task time scope and avoiding duplication, the licensing and • Investors would benefit from the Wind Energy Atlas of Turkey before selecting a site for a permit procedures will be reviewed by the Government wind power plant so they would be able to choose sites that are suitable for investment. adopting the procedure under Directive 2006/123/EC on • The land restrictions for building wind energy power plants are as follows: according services in the internal market. Among other considera- to National Parks Law No: 2873 there are certain defined fields that cannot be utilized for wind energy power plants. These include national parks, natural parks, natural mo- tions, the following rules should be taken into account: numents and natural monument protection areas. According to the Land Hunting Law No: 3167 wind energy power plants can be established in wildlife protection areas after obtaining necessary permits. Housing settlement areas and military fields also cannot • Necessary requirements to install new renewable be used for wind energy power plant establishment. The field to be utilized for wind energy power plants needs to be owned either by the applicant or the government. energy capacity must be reexamined and redefined with a focus on optimizing the necessary control and • In the application process, UTM coordinates of the wind power plant to be built must be given. The distances between the planned turbine and existing opera- ease of doing business. ting turbines also should be submitted within the application. • Application should include the turbine model, brand, blade diameter and rotor height. • Stakeholders who grant the permissions should be • Applications for pre-license can be submitted to EPDK in the first five business redefined with an optimization focus and should be days of October in the scope of the announced wind capacity the year before. enabled to share a common database relevant for the · After the GDM grants approval, 6 months of measurement in the field should be renewable permits. The database should be accessed completed. The remaining 6 months should be completed with existing or GDM values (for a total of 1 year of measured data). and used by the licensing authority and the transmission system operator at the very least. A one-stop-shop to ma- • As an additional document, (required since the publication of the Electricity Market License Regulation on November 2, 2013) the applicant should provide nage all the permits, licenses and authorizations neces- total of 1 year of measured wind data obtained at least within 3 years. sary to install new power capacity should be established. Solar energy • A reengineering study for the administrative activities • When selecting a field for their solar power plants, investors should consider the should be conducted with a focus on both enhancing announced regions/transformer centers set out by the Ministry, including the radiance values and field characteristics. the IT infrastructure for the smooth and fast opera- • Investors must acquire installation report from the General Directorate of tion of the permitting procedures. Information and Meteorology (GDM) in order to install measurement stations. document requirements from different administrative • Companies that apply to the GDM should complete their application process bodies should be optimized. within 15 days. • After the GDM grants approval, 6 months of measurement in the field should be • A timeframe must be set to manage the different ad- completed. The remaining 6 months should be completed with existing or GDM values (for a total of 1 year of measured data). ministrative tasks (no more than a three month period for each step) and the total licensing procedure (no • Collected/recorded data covering a 1 year period are sent to the GDM for a final control at least 30 days before an application is sent to EPDK. more than one year). • Applications are then evaluated by YEGM in a technical perspective. After this stage, EPDK evaluates the applications an administrative perspective. • A positive administrative silence should be establis- • If same region/transformer center has received more than one application, then hed: in case of no response the application would be applications are sent to TEİAŞ in order to organize a competition – a competitive analysis or competition between existing applicants. automatically authorized. • If an application does not share any regions/transformer centers with other applicants, then the licensing process starts. h) Do authorization procedures take into account the specifics of the different renewable energy technolo- • The field to be utilized for solar energy power plants needs to be owned either by the applicant or the government. gies? If so, please describe how. If they do not, do you envisage taking them into account in the future? Hydro energy The common procedures to be taken into account for • Before applying for a license for hydro power plants, a Water Usage Rights each different renewable energy technology are: Agreement should be signed with the State Hydraulic Works. Biomass energy • A fuel provision agreement or energy type provision agreement should be committed to by both legal entities (producer of the fuel/energy resource and the applicant). Additionally, renewable energy investors for any renewa- ble energy technology have to complete the licensing application process described in question 4.2.1.h. 37 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets Electricity Market Law (Law No. 6446) (6) defines the Additionally, for the recurring component of the license activities that can be conducted without a license: the fee: 0.003 kuruş per kWh generated of electricity is payable maximum installed capacity for a renewable energy plant on a yearly basis throughout the license period. to operate without a license has been established in 1 MW. In addition, the Council of Ministers is authorized to Furthermore, all solar and wind projects connected to the increase the maximum installed capacity for a renewable electricity grid, that apply for the same transformer center energy plant to operate without a license to 5 MW. Also, to connect to the grid, have to follow a tendering process renewable power plants, which are not connected to the based on a contribution fee payable to the Transmission grid, are exempted from obtaining a license (generation System Operator for the first 3 years following commissio- and consumption take place at the same location). ning. This contribution fee depends on the tender results. For biomass power plants, a tender is applicable for those i) Are there specific procedures, for example simple companies that want to build a power plant which uses notification, for small-scale, decentralized installa- landfill gas as a fuel. In that case, usage rights of the city tions (such as solar panels on buildings or biomass landfill are granted through a tender by the municipality. boilers in buildings)? If so, what are the procedural steps? Are the rules publicly available to citizens? There are other fees associated with the municipal license Where are they published? Is the introduction of and with connection to the grid. simplified notification procedures planned in the future? If so, for which types of installation/system? For unlicensed generation some fees are applicable such (Is net metering possible?) as payments to the municipality and distribution com- Any natural or legal entity generating less than 1 MW pany to access the system. in its facility can benefit from the feed-in tariff defined by the Renewable Energy Support Mechanism. k) Is official guidance available to local and regional administrative bodies on planning, designing, buil- As described in the Electricity Market Law (EML), distribution ding and refurbishing industrial and residential areas companies holding retail licenses are obligated to purchase to install equipment and systems using renewable the excess electricity generated by the unlicensed renewa- energy sources in electricity and heating and cooling, ble energy generators via relevant feed-in tariff prices. including in district heating and cooling? If such offi- cial guidance is not available or insufficient, how and Solar thermal energy that is used for water heating does when will this need be addressed? not require any particular license and/or permit. Even though there is no official guidance available to local and regional administrative bodies on planning, j) Where are the fees associated with applications for designing, building and refurbishing industrial and authorization/licenses/permits for new installations residential areas to install equipment and systems using published? Are they related to the administrative renewable energy sources in electricity and heating and costs of granting such permits? Is there any plan to cooling, including in district heating and cooling, informal revise these fees? guidance is provided if there is a demand. The license application fee is payable by the applicant to EPDK and announced by EPDK periodically. Only the Nevertheless, secondary legislation clearly indicates the ten percent of the price of having a pre license is collected steps to be executed in detail for local and central admi- from legal entities who apply to have pre license in order nistrative bodies for electricity generation. to establish generation power plants based on domestic natural resources and renewable energy. Licensing fees l) Are there any specific trainings for case handlers of also have a recurring component; a certain amount per authorization, certification and licensing procedures MW is applicable to EPDK on a yearly basis. The current of renewable energy installations? license application fees are structured as follows: EPDK publishes guidelines about licensed and unli- censed procedures for renewable energy installations 0 < P ≤ 10 MW TL 5,000 and also the General Directorate of Renewable Energy 10 < P ≤ 25 MW TL 10,000 provides advice and support to the local administrative 25 < P ≤ 50 MW TL 15,000 bodies in this field. 50 < P ≤ 100 MW TL 25,000 100 < P ≤ 250 MW TL 50,000 Turkey has renewable energy associations that provide 250 < P ≤ 500 MW TL 100,000 support to the investors so that they can fulfill their admi- 500 < P ≤ 1000 MW TL 150,000 nistrative requirements. P > 1000 MW TL 250,000 38 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets

4.2.2 Technical specifications (Article 13(2) of Directi- a) Reference to existing national and regional legisla- ve 2009/28/EC) tion (if any) and summary of local legislation concer- ning the increase of the share of energy from renewa- a) To benefit from support schemes do renewable ble sources in the building sector. energy technologies need to meet certain quality The Government of Turkey is evaluating the measures standards? If so, which installations and what quality that should be implemented to develop the Directive standards? Are there national, regional standards 2010/31/EU of 19 May 2010 on the energy performance that go beyond European standards? of buildings (in particular regarding self-consumption and The large penetration of renewable energies requires zero emission buildings). the fulfillment of technical and environmental necessities by facilities and equipment, and additionally appropriate So far, there is no specific legislation concerning the procedures to guarantee the reliability and security in the increase of the share of energy from renewable sources exploitation of the electricity system. in the building sector, but the Law on the structuring of areas under risk of natural disasters (Law No. 6306) (13) Technical and quality measures based on internatio- provides the legal framework for the principles and proce- nal standards focused on renewable energy compo- dures of restructuring and reconstruction of urban areas at nents, equipment and procedures must be taken into risk of natural disasters. Among other principles, the Law consideration, for example: TR-ISO 12975 for ther- also sets out provisions concerning the implementation of mal solar energy (system and components), TR-ISO restructuring of these areas. 50548/60904/61829/62093 for solar PV energy, TR-ISO 61400 for wind energy, TR-ISO 62270 for hydropower and One of the Strategical Purposes (SP) presented in the pa- TR-ISO 162014/303001 for biofuels. per, SP-02, is directly related to buildings. The goal of this SP is “to decrease energy demand and carbon emissions Moreover, some of the renewable energy technologies of buildings; to promote sustainable environmentally have a high volatility. Therefore, the grid codes should be friendly buildings using renewable energy sources”. adapted to this characteristic in the medium term. TEİAŞ will update the following grid operation procedures to Lastly, it is important to consider that the Turkish Govern- enable large renewable energy penetration: ment is committed to develop a National Energy Efficiency Action Plan (NEEAP) in the near future. Among others, the • The requirements, criteria and procedures to manage plan will include measures and actions to increase the sha- secondary and tertiary reserves. re of energy from renewable sources in the building sector. Therefore, the points highlighted in this section are subject • The participation of renewable energy facilities in the to modification in accordance with the new NEEAP. voltage control management. b) Responsible Ministry(/ies)/authority(/ies) • The criteria to develop curtailment procedures in Regarding the Law on structuring of areas under risk order to avoid problems related to energy exports to of natural disasters (Law No. 6306) (13), the responsibilities the system, and to the maintenance of the security and would fall under the duties of the Ministry of Environment reliability of the electricity system. and Urbanization (ÇŞB). For the measures proposed in the Energy Efficiency Strategy Paper, the responsibilities • The requirements that the renewable energy promoters mentioned in the document concern the Ministry of have to fulfill to enable the monitoring of the facilities. Environment and Urbanization for ST-01 and the Ministry of Energy and Natural Resources (ETKB) for ST-02.

4.2.3 Buildings (Article 13(3) of Directive 2009/28/EC) c) Revision of rules, if any, are planned by: This section is built on existing documents and plans At the moment, the majority of possible measures are regarding energy in buildings. There exists a strong not currently in place. Nevertheless, a period between 12 commitment from the Turkish Government to energy and 36 months has been established for revisions, con- efficiency, in 2012 the Energy Efficiency Strategy Paper sultation and preparation for the bill to pass in Parliament. 2012–2023 was published. Although the measures themselves do not include any revision, it is likely that during this development period that measures will be completed, reviewed and finalized, including any possible future revision of the rules. 39 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets d) Summary of the existing and planned measures at g) Please describe plans for ensuring the exemplary regional/local levels: role of public buildings at national, regional and local The abovementioned measures do not include any level by using renewable energy installations or beco- specific modification at regional/local level. Nonetheless, ming zero energy buildings from 2012 onwards? (Plea- some of them (e.g. SP-02/ST-01/A-01) account for diffe- se take into account the requirements under the EPBD). rences according to regions (such as climate conditions). Apart from the plans already commented on in previous Therefore, this could be seen as encompassing planned points, and the measures to be pointed out in the future NEE- measures at a regional/local level. AP, there is a specific Strategical Purpose, SP-06, on the Ener- gy Efficiency Strategy Paper that deals with public buildings: e) Are there any minimum levels for the use of re- “To use energy effectively and efficiently in the public sector”. newable energy in building regulations and codes? The plans proposed under that SP ensure the exemplary role In which geographical areas and what are these of public buildings by using renewable energy installations. requirements? (Please summarize.) In particular, what measures have been built into these codes to ensure h) How are energy efficient renewable energy techno- the share of renewable energy used in the building logies in buildings promoted? sector will increase? What are the future plans related The proposed package of measures presented in this to these requirements/measures? chapter promotes energy efficient renewable energy techno- The existence of the regulation regarding unlicensed logies in buildings. Given that the measures/actions are due generation for electricity, including the availability of feed- to come into force in the short/medium term (1 or 2 years) in tariff mechanisms for the excess generation, is regarded the promotion would be guaranteed. as the sole most important incentive for buildings; there- fore a further incentive mechanism is not on the agenda Moreover, SP-07 aims at strengthening institutional at the time of writing this report, although it could change structures, capacities and collaboration to increase use with the development of the new NEEAP. of state of the art technology, awareness activities and to develop financial mechanisms. The lines of action include The table with the increase of renewable energy use in the following topics: strengthen corporate structures and buildings is not included here because of the coming collaborations, training programs, R&D, agreements with NEEAP. The development of the future NEEAP will place consultancy companies, and communication and cons- Turkey in a better position to forecast the penetration of ciousness in the community. All these action lines would renewable energy in buildings. promote energy efficiency. f) Have obligations for minimum levels of renewable energy in new and newly refurbished buildings been considered in national policy? If so, what are these le- vels? If not, how will the appropriateness of this policy option be explored by 2015? SP-02/ST-01/A-01 of the Energy Efficiency Strategy Paper establishes the minimum annual energy demand covering the areas of heating, cooling, lighting, etc., will be determined according to the different characteristics of the buildings and based on energy requirements and emission limitations. The Building Energy Performance Specification shall be revi- sed with all of its sub-arrangements within 36 months of the date of publication of the Energy Efficiency Strategy Paper (July 2, 2012) and the necessary standards shall be defined. 40 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets

4.2.4 Information provisions (Articles 14(1), 14(2) and Regarding certification schemes or equivalent quali- 14(4) of Directive 2009/28/EC) fication schemes, information will be provided on the installation of small-scale biomass boilers and stoves, solar In a similar way to previous chapter, this section is built on photovoltaic and solar thermal systems, shallow geother- existing plans. mal systems and heat pumps. Those schemes may take into account existing schemes and structures as appro- a) Reference to existing national and or regional legis- priate, and shall be based on the criteria laid down. lation (if any) concerning information requirements according to Article 14 of Directive 2009/28/EC. d) Please indicate how information is made available Information and public awareness are two key points on supporting measures for using renewable ener- when it comes to the promotion of renewable energy. gy sources in electricity, heating and cooling and in One of the Strategic Purposes proposed in the Energy Effi- transport to all relevant actors (consumers, builders, ciency Strategy Paper, SP-07, covers this kind of campaign. installers, architects, suppliers of relevant equipment and vehicles). Who is responsible for the adequacy So far, the existing legislation concerning information provi- and the publishing of this information? Are there sion has been mentioned. In addition, new mechanisms will specific information resources for the different target be studied during the development of the Turkish NEEAP. groups, such as end consumers, builders, property managers, property agents, installers, architects, b) Responsible body/(ies) for dissemination of infor- farmers, suppliers of equipment using renewable mation at national/regional/local levels. energy sources, public administration? Are there According to the Energy Efficiency Strategy Paper, the information campaigns or permanent information responsible bodies/entities for the dissemination of infor- centres in the present, or planned in the future? mation are ETKB, the public sector and General Directorate The General Directorate of Renewable Energy is the of Renewable Energy. In addition, collaboration with the main authority for collecting, analyzing and disseminating private sector and NGOs will be required in order to come the information in the domain of energy efficiency and up with an effective information campaign. renewable energy. General Directorate of Renewable Energy’s website is the ultimate source of information, c) Summary of existing and planned activities at a open to the public, on the different groups of energy regional/local level (where applicable). users. All relevant campaigns, regulations (including both There are no concrete activities scheduled so far. Plans incentives and obligations) and recommendations with detailing communication and ways to develop awareness case studies are available on the General Directorate of shall be conducted under the recommendations set by the Renewable Energy’s website. two actions (SP-07/ST-04/A-01 and SP-07/ST-04/A-02) pre- viously presented. The framework for this communication Furthermore, all the primary and secondary regulations are campaign shall be prepared within 12 months of the date available to the public through the Official Gazette, which of the publication of the paper and shall be applied within is published both in print and on the web on a daily basis. three years of that date, at most. From 2008, which was the “Year of the Energy Efficiency”, General Directorate of Renewable Energy should design a General Directorate of Renewable Energy initiated nume- campaign with local and regional authorities to provide in- rous public campaigns raising awareness in different sec- formation on support measures to encourage the penetra- tors (Mrs. Energy; ENVER, and the like) and details about tion of renewable energy (in particular, distributed genera- these campaigns are available on the web and on sepa- tion based on renewable energy and renewable energy in rate websites linked to General Directorate of Renewable buildings) to all relevant players, such as consumers, builders, Energy’s main site. installers, architects, and suppliers of heating, cooling and electricity equipment and systems and of vehicles compati- The previous points of this chapter have detailed the ble with the use of energy from renewable sources. specific measures proposed to carry out the information process within its specified dates. This information program should ensure that informa- tion on the net benefits, cost and energy efficiency of equipment and systems for the use of heating, cooling and electricity from renewable energy sources is made available either by the supplier of the equipment or sys- tem or by the General Directorate of Renewable Energy. 41 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets e) Who is responsible for publishing information on integration in buildings. The design of the program by the the net benefits, costs and energy efficiency of equi- Ministry of National Education with the collaboration of pment and systems using renewable energy sources the Ministry of the Environment and Urbanization and the for heating, cooling and electricity? (Supplier of the Ministry of Energy and Natural Resources will be beneficial. equipment or system, public body or someone else?) In Turkey, the Ministry of Energy and Resources is the In addition, with contribution of some NGOs there are ultimate owner and entity responsible for disseminating currently studies to adapt an environmental certificate all energy related information and manages this responsi- system for buildings specific to the geographical, climatic, bility through one of its divisions specializing in Renewa- political, social and technological context of Turkey. The ble Energy and Energy Efficiency, which is the General association is also working on the evaluation of the envi- Directorate of Renewable Energy. Thus General Directorate ronmental impacts of buildings and their surroundings of Renewable Energy, as mentioned in the above item, dis- aiming for a green transformation of construction industry. seminates information on the internet which includes, but is not limited to, the benefits, costs and energy efficiency g) Please describe the existing and planned informa- of equipment and systems using renewable energy sour- tion, awareness raising and training programs for ces for heating, cooling and electricity in a broad sense. citizens on the benefits and practicalities of develo- ping and using energy from renewable sources. What Some academic institutions which have departments is the role of regional and local actors in the designing specializing in energy efficiency (e.g. Istanbul Technical and managing these programs? University, Laboratory for Energy Efficiency and Lighting), Currently, “Mrs. Energy” and “ENVER” are the largest some NGOs such as the Chamber of Mechanical Engi- public campaigns intended to create public awareness in neers, the Association of Energy Efficiency (ENVER) are Turkey. Mrs. Energy was launched in 2013 and is designed also important entities that publish well researched and to promote awareness of energy efficiency in the home thoroughly analyzed information specifically on the net along with training regarding the implementation of basic benefits, costs and energy efficiency of equipment and efficiency principles. ENVER, which was created in 2008, systems using renewable energy sources for heating, is intended to reach a wide range of different people and cooling and electricity. It is expected with the growing sectors within Turkey, including the industrial sector as emphasis on efficiency from the General Directorate of well as public buildings. The leader in these campaigns is Renewable Energy, that collaboration from the private the Energy Efficiency Association, which was officially es- sector and NGOs will be further increased. tablished through the involvement of General Directorate of Renewable Energy and is now led by the CEOs of some f) How is guidance for planners and architects provided of the largest companies in Turkey. to help them to properly consider the optimal combi- nation of renewable energy sources, high efficiency 4.2.5 Certification of installers (Article 14(3) technologies and district heating and cooling when of Directive 2009/28/EC) planning, designing, building and renovating industrial or residential areas? Who is responsible for that? a) Reference to existing national and/or regional There is no one distinct entity responsible for this purpo- legislation (if any) concerning certification or equi- se: however, the Chamber of Mechanical Engineers has been valent qualification plans for installers according to taking various steps including organizing training events, rai- Article 14(3) of the Directive 2009/28/EC. sing awareness through diverse activities and has developed Certification and qualification plans with regards to such things as reports, studies, information packets, surveys training are considered under Strategic Purpose 7 (SP- and the like. The Chamber of Architects and the Chamber of 07) of the Energy Efficiency Strategy Paper. The overall Civil Engineers are greatly interested in energy efficiency in objective of this ST is “to strengthen institutional capa- buildings and have been involved in several training cam- cities and collaborations, to increase the use of state of paigns focusing on energy efficient design and implemen- the art technology and awareness, to develop financial tation. Some architecture companies have certifications for mechanisms with the exception of public financial energy efficient design (both for LEED and BREEAM). institutions”. Furthermore, the Government suggests that in the Training and certification programs would fall within medium term the Turkish Renewable Energy Training and the strengthening of institutional capacities category. Education Plan should focus on improving professional SP-07/ST-01/A-02 is focused on strengthening collabo- technical skills in this field. One of the most important rations among the main players: the Ministry of Energy lines of action will be programs that develop professio- and Natural Resources (ETKB), the General Directorate of nal expertise in energy efficiency and renewable energy Renewable Energy, the Turkish Union of Chambers and 42 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets Commodity Exchanges (TOBB) and the General Directo- e) Summary of the existing and planned measures at rate of Efficiency (VGM). In this collaborative framework, regional/local levels (where relevant). energy audits, trainings and incentive contests within There are various effprts going on with the participa- the industry shall be addressed. tion of chamber of industry, academia, local municipalities, development agencies and NGOs in several cities. Under the same target, SP-07/ST-01/A-03 points out the need for training programs for the staff of construction 4.2.6 Electricity infrastructure development supervisory companies and local authorities. a) Reference to existing national legislation concerning b) Responsible body/(ies) for setting up and authori- requirements related to the energy grids (Article 16). zing certification/qualification schemes by 2012 for In the medium term, it is advisable for TEİAŞ to up- installers of small-scale biomass boilers and stoves, date the grid codes to enable large renewable energy solar photovoltaic and solar thermal systems, shallow penetration according to security and energy reliability geothermal systems and heat pumps. criteria. The following procedures, among others may There is no specific authorization however, generally be engaged: secondary and tertiary reserves, voltage the following parties relevant for the topic are Energy and control, curtailment, and control and monitoring of Natural Resources (ETKB), the Ministry of Environment and renewable energy facilities. TEİAŞ will update its techno- Urbanization (ÇŞB), the General Directorate of Renewable logy to be able to control, monitor and manage a large Energy and the local authorities (YY). grid penetration of wind and solar energy. Today, there is no distinction among the different systems Additionally, the legal framework to develop distributed (small-scale biomass boilers and stoves, solar photovoltaic generation based on renewables, among others; and solar thermal systems, shallow geothermal systems and heat pumps) although this may change in the for- • Connection to the grid, thcoming period. • Balancing in distributed systems (ancillary services, c) Are such certification schemes/qualifications al- operation criteria, reverse power flows and active ready in place? If so, please describe. demand management, storage, curtailing and smart The General Directorate of Renewable Energy has metering processes linked to the balancing (15)) authorized (and will authorize in the future) a number of Energy Service Companies (ESCOs) to engage in energy • And signaling (data exchange with distribution ge- efficiency implementations, specialized in either or both neration and/or consumption, signals among sensors industrial and residential energy efficiency (14). However, and metering). certification plans for small-scale biomass boilers and stoves, solar photovoltaic and solar thermal systems, It may be composed of the mentioned procedures. In shallow geothermal systems and heat pumps are not addition, a revenue model for auto-consumption may be yet in place. The measures contained in the Energy defined. Efficiency Strategy Paper are due to be enacted in the short/medium term. For the specific measures presented Finally, the Turkish Government may evaluate in the above: SP-07/ST-01/A-02, SP-07/ST-01/A-03 and SP-07/ medium term and establish a coordination scheme for the ST-02/A-01, the period shall be 12, 24 and 6 months DNOs which will enable connection of distributed gene- respectively starting from the July 2, 2012. ration considering reduction of losses and the economic benefits due to renewable energy (with regards to the d) Is information on these schemes publicly available? mitigation of energy dependency). Are lists of certified or qualified installers published? If so, where? Are other schemes accepted as equiva- b) How is it ensured that transmission and distribution lent to the national/regional scheme? grids will be developed with a view to integrating the A list of residential and industrial ESCOs, authorized by targeted amount of renewable electricity while maintai- General Directorate of Renewable Energy, regarding the ning the secure operation of the electricity system? How relevant regulations are published on the General Directo- is this requirement included in the transmission and rate of Renewable Energy’s website. distribution operators’ periodical network planning? The development of transmission and distribution grids is ensured thanks to the update of the abovemen- tioned procedures. 43 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets Additionally, TEİAŞ has a commitment to update the trans- d) Is the reinforcement of the interconnection capa- mission infrastructure for future needs. Figure 20 depicts the city with neighboring countries planned? If so, which adaptation scheme. In medium term, TEİAŞ will elaborate interconnectors, for which capacity and by when? the grid expansion plan for the period 2015-2020 taking into Turkish authorities are aware of the need for intercon- consideration the forecast penetration of renewable energy. nection reinforcement not only to increase renewable energy penetration, but also to guarantee security of For the System Operator, an incentive scheme (revenue mo- supply, increasing at the same time the quality and the del) based on renewable energy penetration and the positive reliability of the supply. externalities derived from renewable energy will be designed. Figure 20: Adaptation of the transmission infrastructure commitment, TEİAŞ 4,916 MW 8,510 MW ~ 8,000 MW expected ~20,000 MW Affirmed connection Affirmed connection connection capacity Affirmed to the grid. Later on, to the grid affirmation connection ~1,000 MW - 1,200 MW was to the grid by 2023 cancelled by EMRA Board Deicision 2002 1/11/2007 2010 2013 2014 2015 2016 2017 2018 2019 2020 2023 c) What will be the role of intelligent networks, infor- In the Resources Strategic Plan (2010-2014), published by mation technology tools and storage facilities? How the Ministry of Energy and Natural Resources (5), the Stra- will their development be ensured? tegic Theme-2 emphasized the need to establish Turkey’s The penetration of renewable energy at the distribu- regional and global influence in the energy sector. The tion level requires the implementation of new solutions plan also stated that the Government has applied policies based on intensive usage of information and telecommu- for contributing to the supply security of electricity and for nication technologies. In order to encourage electricity supplying adequate energy without any interruption and distribution operators to facilitate renewable energy at a high level of quality. Importance is also being given to penetration, the Turkish Government will evaluate in the interconnections with neighboring countries bilaterally medium term the possibility of establishing incentives for and as multi-parties (i.e. regional). the DNOs, which will enable connections to sources of dis- tributed generation while also taking into consideration Currently, the following international interconnections are in the reduction of losses and economic benefits (including place and detailed in Figure 21. mitigation of energy dependency). Figure 21: Current international grid interconnections Pumped-storage hydroelectricity research in Turkey was Line Handling Interconnection Lines Capacity (MVA) initially started by EIE in the year 2009. Japanese expertise was Turkey - Georgia Hopa (Turkey) – Batum (Georgia), 287 received for PSH systems in combination with wind energy 220 kV – 954 MCM, Rail – 28 km generation. A projection of Turkey’s peak energy demand was Turkey – Azerbaijan Igdir (Turkey) – Babek (Nakhichevan), 2x132 154 kV – 2x477 MCM, Hawk – 180 km also included in the scope of the project. Turkey - Armenia Kars (Turkey) – Gumri (Armenia), 574 220 kV – 2X954 MCM, Cardinal – 80.7 km Conceptual designs were created for the Gökçekaya Turkey – Iran 1. Dogubeyazit (Turkey) – Bazar- 204 and the Altınkaya HEPPs, rating 278 MW and 700 MW gan (Iran), 154 kV – 954 MCM, 581 (220 kV) respectively, for possible PSH system implementation. Cardinal – 40 km 1,510 (400 kV) 2. Baçkale (Turkey) – Khoy (Iran), Currently, there is a project in progress regarding the mi- 400 kV – 3x954 MCM, Cardinal 124 tigation of the negative effects of wind energy genera- Turkey – Iraq PS3 (Turkey) – Zakho (Iraq), 408 400 kV – 2x954 MCM, tion on the grid with the utilization of PSH systems. It is Cardinal- 28 km (154 kV energized) located in the Yahyalı district of Kayseri. The project will Turkey – Syria Birecik HES (Turkey) – Aleppo 1,005 consist of 4 MW PSH and 4x2.5 MW wind turbines. (Syria), 400 kV – 2x954 MCM, Cardinal - 124 km Turkey – Bulgaria 1. Hamitabat (Turkey) – Maritsa 995 Turkey indeed realizes the importance of large scale energy East (Bulgaria), 400 kV – 2x954 1,510 MCM, Rail – 133 km storage for a reliable grid. Even though studies are conducted 2. Hamitabat (Turkey) – Maritsa by governmental organizations, Turkey offers tremendous be- East (Bulgaria), 400 kV 3x954 MCM, Cardinal – 145 km nefits to investors to utilize the ample sources of hydropower. Turkey – Greece Babacski (Turkey) – Nea Santa 1,510 (Greece), 400 kV – 3x954 MCM, Cardinal 130 km 44 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets A series of system development plans are under evaluation for in the relevant year’s investment plan and approved by development in the medium term. the Ministry of Energy and Natural Resources and the Ministry of Development. Figure 22: Planned international grid interconnections to be developed in the short/medium term After the necessary approvals are complete, TEİAŞ con- Interconnection Lines ducts land use studies for the properties that are within Turkey – Iran 600 MW back-to-back DC with a 400 kV is planned. the territories of the planned facilities. Permits are filed Construction for a 400 kV interconnection line from Cizre with the relevant departments of TEİAŞ including – allo- (Turkey) and Musul (Iraq) is on-going. cation for non-agriculture use of land, permits for forested Investments in this project are expected to be completed Turkey - Iraq by 2013. areas, removal of meadow feature, permits for protected According to feasibility studies, a 500 MW back-to-back DC areas, permits from the State Hydraulic Works, the City link has been planned to be built. Health Directorates and the City Environmental Directo- In order to increase the current transmission capacity of rates, etc. – and after completion of the permits, expro- Turkey – Syria 400 kV between Birecik (Turkey) and Halep (Syria) a 600 MW back-to-back DC facility is planned. priation procedures can begin. TEİAŞ lists the properties concerned and determines the value of the properties. If necessary, TEİAŞ may ask for the opinion of the related tax e) How is the acceleration of grid infrastructure authoriza- and deed offices and the local chamber of industry and tion procedures addressed? What is the current state and trade. Generally, the judicial and the transfer process ends average time for getting approval? How will it be impro- in two or three months, if the parties agree on the expro- ved? (Please refer to current status and legislation, bott- priation; however, the whole process of getting the appro- lenecks detected and plans to streamline procedure with val from all relevant parties takes a considerable amount timeframe of implementation and expected results.) of time depending on the parties involved. All information All power plants above 1 MW apply to EPDK for licen- flow is done through official letters, and this extends until sing and EPDK sends the project details to TEİAŞ for its the start of construction. Once the approvals are complete approval to gain grid access for those plants that want to and the construction has started, construction work is connect to 154 kV or 380 kV. For connections on a middle conducted according to the plan. voltage level, the regional distribution authority provides consent or denial. TEİAŞ checks the possible transforma- The different parties involved in the process of granting tion center to which the plant would connect and checks permission are: TEİAŞ, the Ministry of Energy and Natural the availability of capacity and sends its consent or denial Resources, the Ministry of Development, the Ministry of back to EPDK. If the power plants get its license, the inves- Forestry and Hydraulic Works, the Ministry of the Environ- tor applies to TEİAŞ to sign a “System Use Agreement”. This ment and Urbanization, the Ministry of Finance, the State procedure could take time and changes from project to Hydraulic Works, the City Health Directorates, the City project can be necessary. Environmental Directorates, the Chamber of Industry and Trade, the Judiciary, etc. Additionally, in order to avoid the main problem regarding the management of these procedures, the delays in the In order to improve horizontal coordination between process, a maximum time scope should be established to the different bodies in charge of granting the permit, a the grid infrastructure authorization procedure, e.g. three one-stop-shop approach would be ideal. It would have a months. On the other hand, to improve the quality of the ser- two-fold objective: one is to facilitate the communication vice provided by the system operator to the promoters, a call between the different administrative bodies involved, center should be established to manage all the information the other to simplify the administrative burden on the regarding grid access of these facilities in a centralized way: applicant side. A call center should be established to this mechanism would facilitate the communication to the manage all the information in a centralized way: this me- applicants and will reduce the interruptions in the technical chanism would facilitate the communication between the assessments (avoid/reduce the need to contact the techni- applicants and the different organizations; with only one cian to acquire information about the applications state). contact point (in just one call/visit to a site) the applicant could consult the state of all the requirements linked to f) How is horizontal coordination facilitated between the application (or manage them). different administrative bodies, responsible for the different parts of the permit? The Research, Planning and Coordination De- partment of TEİAŞ plans the location, length and neces- sary investments for new transmission lines or a capacity increase in the existing lines. These studies are placed 45 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets g) Are priority connection rights or reserved connec- tion for 87 connection points. 147 companies that had tion capacities provided for new installations produ- proposed the highest price per kWh were awarded system cing electricity from renewable energy sources? connection rights. According to the Law on the Utilization of Renewable Energy Resources for the Purpose of Generating Electri- After the completion of the competitions, a contribution cal Energy, when EPDK evaluates license applications, fee was signed between TEİAŞ and the winners. Connec- renewable resource based generation facilities shall be tion agreements were made for companies that acquired prioritized in connection to the grid. their licenses from EPDK. However, the same Law states that until December 31, A 5% restriction of Short Circuit for connecting wind tur- 2013, 600 MW at most of solar power plants can be connec- bines into the connection point was removed in January, ted to the system. After this date, the capacity at which solar 2013 with the amendment of the Regulation Regarding generation facilities can be connected shall be announced Supply Security and Quality for Electricity Transmission. by the Ministry of Energy and Natural Resources every year. TEİAŞ announced a total of 600 MW capacity that can Similar to solar based generation facilities, wind power be connected to the grid by December 31, 2013. Appli- plants cannot be connected to the system randomly. The cations for solar power plants were received by EPDK Ministry determines the maximum capacity that can be con- between the June 10 and 14, 2013. In case of land/re- nected to the grid and announces that capacity periodically. gional crossings between the applicants for solar power In regards to the capacity announced – for both solar and plants, TEİAŞ will organize competitions compatible with wind – if there are more applications requesting connection, the Electricity Market Law for solar power and capacities a competition (tender) shall be conducted in order to deter- will be allocated. mine the generators that will be connected to the grid. h) Are any renewable installations ready to come on- In practice, there are connection capacities reserved for line but not connected due to capacity limitations of new installations producing electricity from wind and solar. the grid? If so, what steps are taken to resolve this and by when is it expected to be solved? In 2007, there were a total of 751 wind power plant appli- Currently, there does not exist any installation ready cations to EPDK rated at 78,000 MW and TEİAŞ was asked to come online, which has not been connected due to for connection rights, as well as restrictions of these wind capacity limitations of the grid. turbines. TEİAŞ projected a peak demand of 48,000 MW for 2013 and has allocated 12,000 MW for the connection of The procedure to access to the grid depends on the wind power plants. renewable energy technology: • Regarding the procedures in wind and solar, the licen- Additional Transformer Substations (TS) with 380 kV were sing is based on tender procedures. planned to be built in areas where wind potential was high, and the number of applications received was also high. The • The rest of technologies can apply directly to the following TS are included in the Investment Program and system operator for access to the grid. capacities have been announced for these regions: The criteria to allocate capacity depend on the limits of • Izmir Havza TS in Izmir. connectable capacity to the available transformers, and the • Can Havza TS and Gelibolu Havza in Canakkale. application of the grid codes with reference to the following topics: overload of the circuits, voltage control (over/under • Vize Havza TS in Kırklareli. voltage), frequency control and application of N-1 criteria. • Catalca Havza in Istanbul. For wind power plant applications that were not in the areas of TS, applications were evaluated as single appli- cations and were provided 2,000 MW of capacity. For wind power plant applications that applied for the same TS region, they were evaluated as multiple-applications, which resulted in a competition for connection of the wind power plants. There were a total of 13 competitions regarding wind applications resulting in a total allocation of 5,500 MW. 596 companies took part in this competi- 46 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets i) Are the rules on cost sharing and bearing of grid te- In turn, electricity producers are responsible for connecting chnical adaptations set up and published by transmis- their production plant to the electricity network and are only sion and distribution system operators? If so, where? responsible for the costs associated with building this link. How is it ensured that these rules are based on objec- tive, transparent and non-discriminatory criteria? Are The operator of the transmission network recovers its there special rules for producers located in peripheral investments by means of the network tariff, in the same regions and regions with low population density?16 way as in the case of any other investment that it makes in The legal and regulatory rules that have been defined for the network it operates. the transmission network have established, in general terms, that the internal development of the network is supported However, if it is necessary to reinforce the grid infrastructu- by tariffs paid by consumers. TEİAŞ is responsible for building re, this can be done by the grid operator or the renewable the transmission infrastructure and for those cases where energy investor. In the first case, the grid operator recovers TEİAŞ is unable to build the transmission line from the power the investment with the tariff, while in the second case plant to the transformer in a timely manner, the power plant the investor develops the infrastructure; the investment is investor may build the line and deduct it from the system recovered in 10 years through system use and the opera- usage and system operation fees which are payable to TEİAŞ tion fee as described in the above section. for the first 10 years after commissioning. Payback is on a monthly basis. The payback amount is calculated by TEİAŞ k) How will it be ensured that transmission and distribu- based on a fixed methodology. The rules are those publis- tion system operators provide new producers wishing hed by TEİAŞ in the form of announcements and secondary to be connected with the necessary information on regulations and are available on the TEİAŞ website in detail. costs, a precise timetable for processing their requests and an indicative timetable for their grid connection? In case the investor did not have the total cost of the trans- Regulations regarding license applications for solar mission line covered in the first 10 years through these and wind energy and their connection to the grid have deductions, TEİAŞ pays the remaining portion of the inves- been prepared and published in the Official Gazette. tment in one cash payment at the end of the 10 years. On one hand, before connecting the facilities to grids The level of system use is actually announced by TEİAŞ, meetings are held between the grid operator and the but escalation within the Consumer Price Index is used investor: they discuss the grid capacity, the costs and the for forecasting future values. The Electricity Market Law timeframe for connection to the grid. Provisional Article 14: For plants commissioned until December 31, 2015, a 50% discount on the system usage On the other hand, to encourage the penetration of a fee is applicable. Although the date is announced as 2015, distributed generation based on renewables in distri- this can be further postponed by policymakers. The date is bution grids, the Turkish Government will evaluate, in now extended until 2020. the medium term, the establishment of an economic incentive for the DNOs based on the level of renewable j) Please describe how the costs of connection and energy within its grid. The economic incentive should be technical adaptation are attributed to producers and/or established according to the benefits of this integration: transmission and/or distribution system operators? How reduction of losses, economic benefits due to renewable are transmission and distribution system operators able energy and mitigation energy dependency, etc. to recover these investment costs? Is any modification of these costs bearing rules planned in the future? What 4.2.7 Electricity network operation (Article 16(2) and changes do you envisage and what results are expected? Article 16(7) and (8) of Directive 2009/28/EC) The transmission and distribution system operators are responsible for reinforcing and expanding the elec- a) How is the transmission and distribution of electri- tricity network, and supporting the resulting costs. These city from renewable energy sources guaranteed by costs are integrated into the network tariffs and are paid transmission and distribution system operators? Is for by the customers. priority or guaranteed access ensured? The Law on the Utilization of Renewable Energy Resour- ces for the Purpose of Generating Electrical Energy (Law No: 5346) (7) establishes that the distribution companies holding 16. Cost bearing rules define which part of the costs is covered by the retail licenses are obligated to purchase the excess electricity generator wishing to be connected and which part by the transmission or generated by the unlicensed renewable energy generators distribution system operator. Cost sharing rules define how the necessary via relevant feed-in tariff prices. Referring to item 4.2.6, (c) re- cost should be distributed between subsequently connected producers that all benefit from the same reinforcements or new lines. newable power plants have priority access to the grid by Law. 47 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets b)How is it ensured that transmission system ope- Center) in TEİAŞ. PMUM is soon to be restructured under a rators, when dispatching electricity generating different corporate entity, EPİAŞ, that is in the preparation installations give priority to those using renewable phase while this report is being submitted. Generating energy sources? plants are able to be involved in the bilateral agreements The Law on the Utilization of Renewable Energy with eligible consumers or wholesalers and also benefit Resources for the Purpose of Generating Electrical Energy from the feed-in tariff mechanism. (Law No: 5346) clearly establishes this priority. f) What are the rules for charging transmission and Further, TEİAŞ has been appointed to update its technolo- distribution tariffs to generators of electricity from gy to be able to control, monitor and manage a large grid renewable energy sources? penetration of wind and solar energy. The end user pays the distribution tariff and the gene- rator bears the transmission cost, payable to TEİAŞ. Due to the large scale penetration of renewable energies with high levels of volatility that can produce problems of 4.2.8 Biogas integration into the natural gas network reliability and security in the electricity system, in the me- (Article 16(7) and Article 16(9) and (10) of Directive dium term a curtailment procedure for renewable energy 2009/28/EC) will be established to avoid legal uncertainty. g) How is it ensured that the charging of transmission c) How are grid- and market-related operational and distribution tariffs does not discriminate against measures taken in order to minimize the curtailment gas from renewable energy sources? of electricity from renewable energy sources? What At the moment there is no such mechanism. kinds of measures are planned and when is imple- mentation expected? h) Has any assessment been carried out on the need Grid operation procedures will be updated to enable to extend the gas grid infrastructure to facilitate the large renewable energy penetration, including: secon- integration of gas from renewable sources? What is dary and tertiary reserves, voltage control, curtailment, the result? If not, will there be such an assessment? and control and monitoring of renewable energy facili- At the moment there is no such assessment. ties. Additionally, curtailment procedures will be defined for the distribution grid to enable the penetration of i) Are technical rules on grid connection and connec- distributed generation, and guarantee the security and tion tariffs for biogas published? Where are these reliability of the system. rules published? At the moment there are no such rules. TEİAŞ will implement technology solutions to monitor and manage large renewable energy penetration in the grid. 4.2.9 District heating and cooling infrastructure deve- lopment (Article 16(11) of Directive 2009/28/EC) Finally, an increase of international interconnections to export excess production and to improve the reliability of a) Please provide an assessment of the need for new dis- the system will take place in the short/medium term. trict heating and cooling infrastructure using renewa- ble energy sources and contributing to the 2023 target. d) Is the energy regulatory authority informed about Based on this assessment, are there plans to promote these measures? Does it have the competence to mo- such infrastructure in the future? What are the expected nitor and enforce implementation of these measures? contributions of large biomass, solar and geothermal In Turkey, EPDK, as the regulatory authority, is fully infor- facilities in the district heating and cooling systems? med on the plans, actions, measures and possible implica- At the moment, there are no planned short term tions of the measures both planned and in progress in the efforts for new district heating and cooling infrastructure domain of energy. EPDK has the authority to monitor and to using renewable energy sources. execute the applications for the aforementioned measures. However, geothermal and biomass resources have the e) Are plants generating electricity from renewable potential of being used in district heating and cooling (the energy sources integrated in the electricity market? proven geothermal capacity is 31,500 MWt). Could you please describe how? What are their obliga- tions regarding participation in the electricity market? Plants generating electricity from renewable energy sources are integrated in the electricity market which is operated under PMUM (Market Financial Settlement 48 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets

4.2.10 Biofuels and other bioliquids – sustainability c) If a national authority/body will monitor the fulfill- criteria and verification of compliance 21 of Directive ment of the criteria, does such a national authority/ 2009/28/EC. body already exist? If so, please specify. If not, when is it envisaged to be established? a) How will the sustainability criteria for biofuels and The national authority in charge of monitoring the bioliquids be implemented at the national level? fulfillment of the criteria is the Energy Market Regulatory In terms of the sustainability of biofuels, the first concern Authority and it already exists. Furthermore, as the ulti- is the availability of sufficient crops for food before genera- mate authority with the data, information and knowled- tion of biofuels, and thus, these criteria will be implemented ge on the availability of crops and the food requirements through a gradual introduction of biofuels into the fuel mix of the country, the Ministry of Food, Agriculture and without compromising the food requirements of the coun- Livestock is involved in the process by providing input try. This sustainability concern has just led the government to with regards to the viability of energy policies on crop revise the biodiesel obligation as the Ministry of Food, Agri- based energy generation. culture and Livestock warning and the Ministry of Energy and Resources on the problem of insufficient and unsustainable d) Please provide information on the existence of local crops that are to be used for biodiesel generation rather national law on land zoning and national land re- than for use as food for the respective year. gister for verifying compliance with Article 17(3) to (5) of Directive 2009/28/EC. How can economic A set of obligations for biofuel and bioethanol has already operators have access to this information? (Please been established in order to guarantee this progressive provide information on the existence of rules and integration. The plan is detailed in the next point (4.2.10.b) distinction between different land statuses, like of this chapter. biodiversity area, protected area, etc.; and on the competent? national authority responsible who b) How will it be ensured that biofuels and bioliquids will monitor this land register and changes in that are counted towards the national renewable tar- land status.) get, towards the national renewable energy obliga- The table below (point 4.2.10.e) shows the different tions and/or are eligible for financial support comply legislation related to biodiversity and protected areas. with the sustainability criteria set down in Article 17(2) to (5) of Directive 2009/28/EC? e) As far as protected areas are concerned, please pro- The fulfillment of the sustainability criteria has been vide information under which national, European or taken into account by the Energy Market Regulatory international protection regimen they are classified. Authority. The decision of this authority was published in the Official Gazette on September, 27, 2011. Figure 23: Legislation and national authority Legislation Law/Decree/Regulation National Authority The obligation for biodiesel content in diesel fuels Forest Law, Law No. 6831, 31 August 1956 General Directorate that is produced from domestic agricultural products No: 6831 (Amended by Laws: 3302 (1986), of Forestry 3373 (1987), 2896 (1983), 3493 (1988), for road fuel supplied to the market is mandated to 4999 (18 November 2003) and “Law Amending some provisions of Forest be at least 1% as of January 1, 2014, 2% as of January Law No. 6831” (02 July 2004)) 1, 2015, and 3% as of January 1, 2016. However, this National Parks Law, Law No. 2873, 09 August 1983 Ministry of Forestry obligation has been cancelled after a communiqué No: 2873 (Amended by Law No. 5400 (14 and Water Manage- July 2005)). Revised text in Law No. ment, General Di- published by EPDK in the Official Gazette (No.28688) 5919 on National Parks. rectorate of Nature (17 August 2011) on June 25, 2013. EPDK by its mandate is fully invol- Conservation and National Parks ved in keeping track and providing opinions on these developments. Pasture Law, Law No: 4342, 25 February 1998; Ministry of Food, No: 4342 (amended by “Law Amending Agriculture and the Law on Pastures No. 4342.” (27 Livestock The obligation for bioethanol content in gasoline that is May 2004) and by “Law Amending the Law on Soil Preservation and produced from domestic agricultural products for road fuel Land Utilization and the Law on Pastures” (26 March 2008) (petroleum) supplied to the market is mandated to be at Terrestrial Hunting Law No. 4915, (01 July 2003) Ministry of Forestry least 2% as of January 1, 2013, and 3% as of January 1, 2014. Law, No: 4915 and Water Manage- ment, Central Hun- ting Commission In the case of bioliquids, no measures have been esta- Environmental Law, Law No. 2872, 11 August 1983 Ministry of Environ- blished so far. No: 2872 (amended by Law No. 5491 ment and Urban (26 April 2006)) Planning Coastal Law, Law No. 3621 of April 4, 1990 Ministry of Environ- No: 3621 amended by Law No. 3830 Amen- ment and Urban ding the Coastal Law No. 3621 of Planning 1990. 01/07/1992 49 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets Legislation Law/Decree/Regulation National Authority g) How is compliance with good agro-environmental Soil Protection and Law No. 5403 of July 3, 2005 on Soil Ministry of Food, practices and other cross-compliance requirements Land Use Law, Preservation and Land Utilization Agriculture and (required by Article 17(6) of Directive 2009/28/EC) No: 5403 (5403-03.07.2005). Official Journal No. 25890 of 19 July 2005, amen- Livestock ensured and verified at national level? ded by the Law Amending the Law on Soil Preservation and Land Uti- Dedicated non-food lignocellulosic energy crops, such lization and the Law on Pastures of 26 March 2008, published in Official as short rotation willow or miscanthus, grown on surplus Journal No. 5751, 26 March 2008. agricultural land could provide additional feedstock for Ramsar Convention Ramsar Convention Ministry of Forestry bioenergy production. Competing land use require- The convention (came into force and Water Mana- – was enacted by the Ministry ments for the food and livestock sector as well as land use gement verdict 94/5434 and the decision conversion from agriculture to other uses determines the was declared on 05.17.1994 with Official Journal No. 21937. availability of agricultural land for energy crop produc- Decree on Specially Updated version was published on Ministry of Forestry tion. Food demand in Turkey is expected to expand in Protected Areas 4th of April 2014 in Official Gazette and Water Mana- No: 28962. the coming decades as a result of population growth and gement, Special Environmental economic development. Protection Agency Law for the Law No. 2863 of July 21, 1983 on Ministry of Culture However, 30% of agricultural land in Turkey is currently not Protection of the Conservation of Cultural and and Tourism Cultural and Natural Property (as last amended used and it can be assumed that by 2020 one million hecta- Natural Assets by Law No. 5835 of February 4, 2009 and Law No. 5917 of June 25, 2009) res of degraded forests in Turkey can be used for lignocellulo- (23.07.1983, Official Gazette 18113) sic energy crop plantings with yields of 5 tonnes/ha. It would Regulation on 17.05.2005, Official Gazette, 25818 National Wetlands provide 2 Mtoe of bioenergy from the agricultural sector. Wetland Protection Committee Regulation Concerning 13.06.2003, Official Gazette 25577 Ministry of Food, h) Do you intend to help develop voluntary ‘certifica- Agriculture and the Protection and Use of Livestock tion’ plan(s) for biofuel and bioliquid sustainability as Agricultural Land described in the second subparagraph of Article 18(4) Aquatic Products Law No. 1380 on Aquatic Products Ministry of Food of Directive 2009/28/EC? If so, how? Law (04-04-1971, Official Gazette Agriculture and 13799) (amended by Laws No. Livestock Currently, there is no voluntary certification plan for 3288 of 28-05-1986, Official Gazette 19120 and No. 4950 of biofuel and bioliquid sustainability. 22-07-2003) National Was published on 2007. Ministry of Biodiversity ISBN: 978-605-393-030-3 Environment Strategy and and Forestry

4.3 Plans to support and promote the use of Action Plan energy from renewable resources in electricity applied by Turkey f) What is the procedure for changing the status of land? Who monitors and reports at the national level This section collects information from existing documents on land status changes? How often are land zoning re- and plans regarding the use of energy from renewable gisters updated (monthly, annually, bi-annually, etc.)? resources in electricity. The National Energy Efficiency In Turkey, for land that is within the borders of a muni- Action Plan (NEEAP) is meant to play an important role in cipality, the municipality has the right and responsibility the near future since energy transformation, transmission, of changing the land status through 5-year resettlement distribution, and demand response issues will be covered. plans. For the others, the Ministry of Environment and Urbanization, and the General Directorate of Spatial Plan- Legislation ning are in charge. a) What is the legal basis for this obligation/target? The Law on the Utilization of Renewable Energy Resour- The Municipality, the General Directorate of Land Registry ces for the Purpose of Generating Electrical Energy (Law No: and Cadaster and the provincial section of the Ministry of 5346) (7) established an incentive plan for the promotion Environment and Urbanization keep the records on the of renewable energy in Turkey, this plan was modified by status of land. the Law Amending the Utilization of Renewable Energy Resources in Electricity Generation (Law No: 6094) (8). The incentive is established in USD, and the licensees can only benefit from these tariffs during the first 10 years beginning on the date of operation and for facilities that are commis- sioned before the December 31, 2020. 50 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets The Council of Ministers will determine the feed-in tariffs • The current feed-in tariff plan established for hydro- applicable to generation plants starting operation after power and geothermal energy is appropriate for the the December 31, 2020 but such tariffs cannot exceed the feasibility of these investments. rates already introduced by the Law. The Government is evaluating the possibility to link the Each year, the investor can choose between this feed-in feed-in tariff to the necessary time to fulfill the targets (and tariff plan and direct sales in the power market. the level of difficulty). The framework could be developed In addition, an incentive to promote the use of local according to the following scheme: equipment has been established to promote the develop- ment of national industry. 1. A level of a renewable energy technology penetra- tion target is established for a yearly period. The current feed-in tariff plan ends in 2020, therefore, an During this time, there would be a fixed feed-in tariff update of the plan would be needed. The new plan would scheme (USD/MWh). take into consideration the following issues: 2. If the penetration target were fulfilled before the end • Wind energy has a very challenging target17, which of the period, a lower feed-in tariff scheme would be would be difficult to meet without taking necessary applied for the rest of the period and the next period. precautionary actions. There are many obstacles and the most critical ones include the following: Inves- 3. If the penetration target were not fulfilled before tors have difficulty in accessing financial support, as the end of the period, an equal or higher feed-in tariff most financial providers take the feed-in tariff as the scheme would be applied for the rest of the period reference price for electricity (however, the forecasted and the next period. market price is higher than this feed-in tariff ) and the forecasted project cash flow (based on feed-in tariffs) The incentive would be adapted dynamically to the level are not attractive enough for financial providers and of renewable energy penetration: this mechanism would guarantees are required creating a barrier for new allow identifying the technologies that require less (or do generation facilities. The feasibility studies for the not need) incentives. diversification of Feed-In-Tariff options depending on the geography and investment scale can be consi- b) Are there any technology-specific targets? dered. Additionally, as described below a gradual According to the Security of Supply Strategy Paper, the Feed-In-Tariff can be applied in order to achieve the Strategic Plan of the ETKB and other policy declarations targeted installed capacity. made by the Minister of Energy and Resources, the targets to promote the use of energy from renewable resources in • Solar energy also has a significant target for 2023, electricity by 2023 are: 5,000 MW should be installed by the end of 2023 • Hydro: 34,000 MW (currently, the penetration of solar technologies is only marginal). However, due to the evolution of solar PV • Wind: 20,000 MW technology, the investment cost has dropped during • Geothermal18: 1,000 MW recent years. Therefore, together with the high availa- bility of solar irradiation in Turkey, it would not be ne- • Solar: 5,000 MW cessary to incentivize in the medium term to promote • Biomass: 1,000 MW solar PV technology. Therefore, rather than the financial aspects, the main barrier to developing solar PV tech- nologies in Turkey is linked to the 600 MW limitation introduced in Renewable Energy Law (No. 5346). • Biomass energy has a low penetration rate in the country and its development depends on the current feed-in tariff in the medium term as well as the avai- lability of raw materials, which depend on the type of technology. 17. For wind energy, it would be necessary to develop approximately 16 18. Considering the actual developments in geothermal energy, it is ex- GW between December 2014 and the end of 2023. pected that the geothermal installed capacity might surpass 1,000 MW. 51 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets C) What are the concrete obligations/targets per year (per technology)? 19 Figure 24: Renewable energies for electricity generation: concrete obligations/targets per year (per technology) from 2013-202319 Base year 2013 2014 2015 2016 2017 MW GWh MW GWh MW GWh MW GWh MW GWh MW GWh Hydropower: 19,620 57,837 22,289 59,420 23,908 64,359 25,526 68,767 27,145 73,175 28,763 77,584 Geothermal energy: 162 849 310 1.364 338 1,724 412 2,099 485 2,474 559 2,849 Solar energy: - - - - 40 64 300 480 800 1,280 1,800 2,880 photovoltaics - - - - 40 64 300 480 800 1,280 1,800 2,880 concentrated solar energy - - - - - - - - - - - - Tides, waves, other ocean energy: - - - - - - - - - - - - Wind energy: 2,261 5,970 2,759 7,494 3,759 9,398 5,660 14,151 7,604 19,010 9,549 23,873 land-based 2,261 5,970 2,759 7,494 3,759 9,398 5,660 14,151 7,604 19,010 9,549 23,873 offshore - - - - - - - - - - - - Biomass: 159 721 224 1,171 300 1,367 377 1,719 453 2,071 530 2,422 Overall: 22,202 65,377 25,582 69,449 28,345 76,911 32,275 87,215 36,487 98,010 41,201 109,608 2018 2019 2020 2021 2022 2023 MW GWh MW GWh MW GWh MW GWh MW GWh MW GWh Hydropower: 30,382 81,992 32,000 86,400 32,500 87,750 33,000 89,100 33,500 90,450 34,000 91,800 Geothermal energy: 632 3,224 706 3,599 779 3,975 853 4,350 926 4,725 1,000 5,100 Solar energy: 2,400 3,840 3,000 4,800 3,600 5,760 4,000 6,400 4,400 7,040 5,000 8,000 photovoltaics 2,400 3,840 3,000 4,800 3,600 5,760 4,000 6,400 4,400 7,040 5,000 8,000 concentrated solar energy - - - - - - - - - - - - Tides, waves, other ocean energy: - - - - - - - - - - - - Wind energy: 11,458 28,644 13,308 33,270 15,090 37,725 16,800 41,999 18,436 46,089 20,000 50,000 land-based 11,458 28,644 13,308 33,270 15,090 37,725 16,800 41,999 18,436 46,089 20,000 50,000 offshore - - - - - - - - - - - - Biomass: 606 2,774 683 3,126 759 3,477 836 3,829 912 4,181 1,000 4,533 Overall: 45,478 120,474 49,697 131,196 52,729 138,687 55,488 145,678 58,174 152,485 61,000 159,433 19. National Renewable Energy Plan includes renewable and non-renewa- ble hydro plants. It should be noted that according to the Renewable Energy Law, only power plants with less than 15 km2 of reservoir area and the river-type hydroelectric power plants are considered as renewable energy resources. Both types of hydro units are included in the national plan according to the Directive 2009/28/EC. 52 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets d) Who has to fulfill the obligation? g) Is there any mechanism to modify obligations/targets? Fulfilling the obligations is a commitment of the The Ministry of Energy and Natural Resources can upda- Government of Turkey, and specifically, it is by the under- te the targets. Target adjustments are made in the context signature of the Ministry of Energy and Natural Resources. of the Plan’s revisions, mentioned in the previous point, f. e) What is the consequence of non-fulfillment? Specific questions for feed-in fixed tariffs Consequences for the non-fulfillment of the renewa- The current feed-in tariff scheme is established in the ble targets fall under several aspects, the most important Law Amending the Law on the Utilization of Renewable of these are as follows: Energy Resources in Electricity Generation (Law No: 6094). The feed-in tariff scheme has been introduced for the sale 1. Negative impact on the Turkish Current Account Ba- of electricity by generation facilities based on renewable lance: Regarding the higher dependence on imported energy resources according to following characteristics: energy sources (fossil fuels), the majority of which are imported at a considerable cost. • It establishes a fixed price per kWh produced by renewable energy units (see the Figure 25). Every 2. Negative impact in terms of energy dependency: renewable technology, wind energy, solar, hydropower, The risk exposure of the Turkish economy to the vola- biomass and geothermal, has its own level of feed-in tility of fossil fuel prices will be higher and there will be tariff. The feed-in tariff is complemented with a bonus higher risk exposure to the fossil fuel supply chain. plan for power plants that utilize locally produced equi- pment (which fulfills current regulation on this point). 3. Negative impact on domestic industry and the economy: The large scale penetration of renewable • Engaging in the feed-in tariff mechanism is not man- energies according to current commitments will con- datory for the renewable energy power plants, rather, it tribute to the industrial development of the country. It is optional. Each year, until the October 31, the inves- will be necessary to provide equipment, components tor can apply to EPDK to engage in the feed-in tariff and services to develop new infrastructure, most of mechanism for the next calendar year. It is left to the these supplies will come from local providers. preference of the investor, whether to sell the genera- tion through a bilateral agreement, to the day-ahead 4. Negative impact in opportunity cost terms: This market or to engage in the feed-in tariff mechanism. means, the high availability of renewable energy resources in Turkey: wind, solar irradiation, geother- • Licensees can only benefit from these tariffs during mal capacity and hydro will be wasted when more the first 10 years from its opening date of operation. expensive (not only in capital expenditures, but also While the feed-in tariff is valid for the first 10 years regarding environmental and other macroeconomic following commissioning, the local equipment bonus impact) approaches are selected to solve the energy plan is available to the investor for the first 5 years. supply problem. • The current feed-in tariff time scope applies to facilities that 5. Negative environmental impact: The utilization of start their operations before the December 31, 2020. local and renewable sources creates less environmental hazard (waste, CO2, etc.) and with less renewable contri- • The new incentive was established in US Dollars (US bution in the national generation mix, the environmen- Dollar cent/kWh), and is not subject to change or any tal impact will be higher per MWh of energy generated. kind of escalation. f) Is there any mechanism to supervise fulfillment? The Council of Ministers will determine the sale tariffs The General Directorate of Renewable Energy will moni- applicable to generation plants starting operations after tor the development of the National Renewable Energy Plan. December 31, 2020, but such tariffs cannot exceed the rates defined above. The Plan will be evaluated at regular intervals through progress reports. It contains sector descriptions of develo- pments, recommendations for appropriate adjustments, corrections and cost of recovery among the different renewable energy technologies. The progress report will be followed by an update of the Plan. 53 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets As result of the abovementioned framework, the following Reconciliation Center) shall be regulated with a regulation to Renewable Energy Resources Support Mechanism was be issued by the EPDK (Energy Market Regulatory Authority). published on November 1, 2011: Figure 25: Feed-in tariff in Turkey for Renewable Energy The annual production amount to be affixed on the licen- ses of facilities producing electrical energy from Renewable Feed-in-tariff in Turkey for Renewable Energy Energy Resources is the maximum annual amount that such Technology Incentive (USD cent/kWh) facilities can produce with their existing installed capacity Wind energy 7.3 with their resources. And the licenses available on the date this Solar 13.3 article becomes valid shall be corrected in line with this within Hydro 7.3 three months upon application of concerned parties. Biomass 13.3 Geothermal 10.5 Entities generating electrical energy from Renewable Energy Resources within the scope hereof and not intending to be a) What are the conditions to get the fixed tariff? subjected to the provisions of this article are allowed to make The conditions to get the fixed tariff in Turkey are sales in the market within the scope of their licenses.” included in Article 6 of the Law No: 5346 (7) and amended by Law No: 6094 (8) in which the legal entities holding b) Is there a cap on the total volume of electricity pro- licenses to generate electricity from the renewable energy duced per year or of installed capacity that is entitled resources under the scope of this Law are subject to the to the tariff? following principles of implementation: Yes, TEİAŞ according to the provisional Article 17 of the Electricity Market License Regulation and in the sco- “Those wishing to be subjected to the RES Support Mechanism pe of Article 23 of the Electricity Market Law (No.6446) in the next calendar year are obliged to obtain RES Certificates will announce connection capacities for solar and wind and apply to the EPDK (Energy Market Regulatory Authority) energy depending on the connection point and/or for until the October 31. the five years following 2014 and the next ten years. Time periods projected in the RES Support Mechanism shall For solar energy, a specific limitation exists: The total commence as from the date of commissioning for those faci- installed capacities of production facilities based on RES lities under operation, and as from the date they will be com- Certified solar power to be connected until 31/12/2013 missioned for those facilities that are not yet under operating. may not be over 600 MW. Those subject to the RES Support Mechanism cannot leave the practice in the year they are included in the practice. For wind energy capacity, TEİAŞ announced 3,000 MW limit for the years between 2014 and 2018. A list of those subject to the RES Support Mechanism and information on the commissioning dates, annual electri- For the rest of the technologies, there is no cap on the to- cal energy production capacities and annual production tal volume of electricity produced per year or of installed programs of their facilities shall be published by the EPDK capacity that is entitled to the tariff. (Energy Market Regulatory Authority) until the 30th of every November, based on the types of resources. The MFRC (Market Financial Reconciliation Center) shall announce the RES total amount for each invoice period and determine the payment obligation rate of each supplier. Du- ring the determination of the payment obligation rate, the amount of electrical energy produced from the Renewable Energy Resources within the scope of this Law and sold in the market without being subject to the RES Support Mechanism are not included in calculations within the scope herein. The amount that each supplier supplying the consumers with electrical energy is obliged to pay is calculated and invoiced to the supplier in question and the collections made are paid pro rata to the entities that are subject to the RES Support Mechanism. Principles and procedures concerning applica- tions covered herein including the MFRC (Market Financial 54 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets c) Is it a technology specific scheme? What are the Feed-in-tariff and Local Equipment Bonus Prices for Biomass tariff levels for each? Locally manufactured component Bonus (USD cent/kWh) There are specific feed-in tariffs for hydro, wind, solar, Biomass 13.3 biomass and geothermal energy as detailed in Figure 26. Steam boiler with fluid bed 0.8 Liquid or gas fired steam boiler 0.4 d) Are there other criteria differentiating tariffs? Gasification or gas removal group 0.6 There are differing prices for hydro, wind, solar, biomass Steam or gas turbine 2 and geothermal energy when the facilities are built using components manufactured domestically. The following Internal combustion or stirling engine 0.9 tables detail the specific bonus for each technology. Generator and power electronics 0.5 Cogeneration system 0.4 Figure 26: Incentive scheme for renewable energies to produce electricity Feed-in-tariff and Local Equipment Bonus for Wind Power Feed-in-tariff and Local Equipment Bonus for Geothermal Locally manufactured component Bonus (USD cent/kWh) Locally manufactured component Bonus (USD cent/kWh) Wind energy 7.3 Geothermal 10.5 Blade 0.8 Steam or gas turbines 1.3 Generator and power electronics 1.0 Generator and power electronics 0.7 Turbine tower 0.6 Steam injector or vacuum compressor 0.7 All mechanical equipment in rotor and nacalle (exluding blade group, genera- tor, and power electronics) 1.3 e) For how long is the fixed tariff guaranteed? As indicated in the above items, the fixed tariff is valid Feed-in-tariff and Local Equipment Bonus for Solar PV for 10 years from the date of the power plant’s commissio- Locally manufactured component Bonus (USD cent/kWh) ning. Law No: 6094 (8) specifies: Solar PV 13.3 PV panel integration and production 0.8 “Time periods stipulated in the RES Support Mechanism shall commence for facilities under operation from their date of PV Modules 1.3 commission and for facilities not yet operating from their date of PV Module Cells 3.5 commission. Those subject to the RES Support Mechanism shall Inverter 0.6 not leave the practice in the year they are included in the practice. Material which focuses radiation on PV 0.5 Module A list of those subject to the RES Support Mechanism and Feed-in-tariff and Local Equipment Bonus Prices for Solar CSP information regarding commissioning dates, annual elec- Locally manufactured component Bonus (USD cent/kWh) trical energy production capacities and annual production Solar CSP 13.3 programs of their facilities shall be published by EPDK (Energy Market Regulatory Authority) until the predefined deadline Radiation collector tube 2.4 each year, based on the types of resources.” Reflective surface 0.6 Sun tracking system 0.6 f) Is there any tariff adjustment foreseen in the scheme? Mechanical components of heat energy

1.3 The sale tariffs applicable to generation plants starting storage system operation after the December 31, 2020 will be defined Mechanical components of heat energy storage system 2.4 before the end of 2020. Stirling engine 1.3 Panel integration and production of 0.6 structural solar mechanics Feed-in-tariff and Local Equipment Bonus for Hydro Power Locally manufactured component Bonus (USD cent/kWh) Hydro Power 7.3 Turbine 1.3 Generator and power electronics 1.0 55 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets Specific questions on financial support to renewable b) What support plans are in place to encourage the energy projects use of district heating and cooling using renewable Financial providers require guarantees from renewa- energy sources? ble energy investors and in some cases are reluctant to Currently, there is no support plan in place to en- support projects, e.g. exploration in geothermal energy. courage the use of district heating and cooling using Due to this reason, the current penetration of geother- renewable energy sources. However, under Strategical mal energy and the target for 2023 (1,000 MW) is very Purpose 02 (SP-02) of the Energy Efficiency Strategy low in light of the potential within the country. In order Paper (2012-2023), “To decrease energy demand and to overcome this barrier in the short term, the Turkish carbon emissions of the buildings; to promote sustaina- Government is collaborating with the financial sector, and ble environmentally friendly buildings using renewable international financial institutions focused on economic energy sources“. development, and will analyze the possibility of enabling mechanisms to mitigate capital risk, in order to support c) What support plans are in place to encourage the geothermal exploration and drilling activities. use of small-scale heating and cooling from renewa- ble energy sources? However, renewable energy investors (both large units Currently, there are no specific support plans in place and unlicensed facilities) have problems in accessing fi- to encourage the use of small-scale heating and cooling nancial support and guarantees that are required by finan- from renewable energy sources. Nevertheless, according cial providers. In a similar fashion, the Turkish Government to regulatory framework small-scale heating and cooling is collaborating with the financial sector, and international do not fall under the renewable energy category. financial institutions for economic development and will analyze the possibility of enabling mechanisms to provide Regarding finance facility, the use of small-scale heating financial guarantees for renewable energy projects. and cooling from renewable energy sources falls within the category of small-scale renewable energy projects. This is one of the credit lines supported by two institutions in

4.4 Plans to support and promote the use of order to promote sustainable energy. energy from renewable resources in heating and cooling applied by Turkey First, the European Bank for Reconstruction and Develop- ment (EBRD) launched the Turkey Sustainable Energy Fi- The Energy Efficiency Strategy Paper (2012-2023) is a sup- nancing Facility (TurSEFF) on the July 14, 2010, with a USD porting document outlining how the country will achieve 200 million credit line that is available for households and energy targets and facilitate the necessary changes in ener- private enterprises. Apart from EBRD, in March of 2011, gy efficiency laws (4). The questions included in this chapter the Agence Française de Développement (AFD) laun- are answered based mainly on this document. Although, in ched the Climate Turkey Program. This program provides a near future, the new NEEAP will play an important role in Halkbank (Türkiye Halk Bankası) with a €100 million credit the promotion of renewable energy in heating and cooling. line in order for the bank to be able to support small and The report will include, among others, a comprehensive as- medium enterprises through investment loans. Out of sessment of the potential for the application of high-efficien- the €100 million granted by AFD to Halkbank, €60 million cy cogeneration and efficient district heating and cooling. will support energy efficiency improvements in enter- prises and €40 million will finance small-scale renewable a) How are the support plans for electricity from energy production units. renewable energy sources adapted to encourage the use of CHP from renewable energy sources? Currently, there is no support plan for electricity from renewable energy sources adapted to encourage the use of CHP. Nevertheless, one of the purposes of the Energy Efficiency Strategy Paper (SP-02) is to define the measures that are proposed to decrease energy demand and CO2 emissions of buildings, promoting at the same time the use of renewable energy sources. Specific ac- tions are also defined to encourage the use of CHP from renewable energy sources. 56 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets d) What support schemes are in place to encourage b) Are there any technology-specific targets? the use of heating and cooling from renewable ener- The targets for 2023 only include 606.2 ktoe of gy sources in industrial applications? geothermal solutions. There are no specific numerical Under Strategical Purpose 01 (SP-01) of the Energy targets for solar, biomass or heat pumps. Efficiency Strategy Paper (2012-2023), “To reduce energy intensity and energy losses in the industrial and services sectors”, a Strategical Target (ST) is defined with the goal of decreasing energy intensities at a rate determined in co- llaboration with the sector. The SP has one ST, ST-01, with 4 actions, which are due to be applied within 12 months of c) What are the concrete obligations/targets per year the date of the publication of the document. (per technology)? Figure 27: Heating and cooling: concrete obligations/targets per year (per technology) 2013-2023 following the methodology established in the Directive 2009/28/EC on the Promotion of the Use of Energy from Renewable Sources (ktoe) Base year 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Geothermal (except in low- temperature geothermal heat 329 344 358 372 386 400 414 428 443 457 471 485 pump applications) Solar energy: 630 644 659 673 687 702 716 730 745 759 773 788 Tides, waves, other ocean energy: - - - - - - - - - - - - Biomass: 3,537 3,537 3,537 3,537 3,537 3,537 3,537 3,537 3,537 3,537 3,537 3,537 solid 3,537 3,537 3,537 3,537 3,537 3,537 3,537 3,537 3,537 3,537 3,537 3,537 biogas - - - - - - - - - - - - bioliquids (1) - - - - - - - - - - - - Renewable energy through heat pumps: 1,657 1,729 1,800 1,871 1,942 2,013 2,084 2,155 2,226 2,297 2,369 2,440 - aerothermal - - - - - - - - - - - - - geothermal 1,657 1,729 1,800 1,871 1,942 2,013 2,084 2,155 2,226 2,297 2,369 2,440 - hydrothermal - - - - - - - - - - - - Overall: 6,154 6,254 6,353 6,453 6,553 6,652 6,752 6,851 6,951 7,050 7,150 7,249 SP-01/ST-01/A-01 and SP-01/ST-01/A-03 deal with energy d) Who has to fulfill the obligation? audits in certain industries every 4 years in order to test the The Turkish Government has committed to establishing application of the plans and measures in place. Therefore, if partial objectives for national agencies. Specifically, heating heating and cooling measures were promoted in Turkey, the- and cooling targets shall be under the auspices of General se audits would be able to check the scope of their fulfillment. Directorate of Renewable Energy. SP-01/ST-01/A-02 establishes the need to obtain an Energy Management System Standard, ISO 50001, in the industrial and services sectors. On the other hand, SP-01/ST-01/A-04 promotes the development of studies to provide additional support mechanisms to increa- se energy efficiency. Heating and cooling systems fall within this category too. Legislation a) What is the legal basis for this obligation/target? The legal basis for the use of energy from renewable resources in heating and cooling will be set by the Stra- tegical Purposes, Targets and Actions mentioned above. These measures are not in place yet, but the changes shall be made in the framework of the legislation and enactment of these measures is due to take place soon. The period varies according to the actions. The range is from 12 to 36 months from the publication of the Energy Efficiency Strategy Paper on the July 2, 2012. 57 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets e) What is the consequence of non-fulfillment? According to this: Within two years of the signing of the There are several downsides to non-fulfillment of these Efficiency Improvement contract and after the industrial targets (or perhaps a more realistic way to phrase this in business informs General Directorate of Renewable Ener- Turkey’s case would be not acting in a way to promote the gy, the General Directorate or an authorized legal delegate already developing use of renewables in heating and coo- will evaluate the industrial business within the scope of the ling), among which the most critical are: communique’s procedures and principles within sixty days of the notification date. Within the scope of the aforemen- 1. Negative impact in the Turkish Current Account Balan- tioned statement, the suitability of the project is contro- ce: Low utilization of renewable energy for heating and lled. Necessary measurement defined within the scope of cooling would call for increased use of fossil fuels and the communique published by the General Directorate thus, imported energy sources, which in return cause an of Renewable Energy will be utilized to measure if the increase in the deficit in the current account balance. expected saving were obtained or not. Performance report which contains information about the performance, certi- 2. Negative impact in terms of energy dependency: fied public accountant approved bills, measurements and Similar to the above item, there is the risk of exposure to calculations of the industrial business should be prepared the fossil fuel supply and fossil fuel price volatility. and presented to General Directorate of Renewable Ener- gy. If the required conditions for the site evaluation are not 3. Negative impact in economic terms: Less contribution met, then the business cannot be supported. to economic development due to less activity in develo- ping these facilities and installing solutions/equipment. Additionally, within the scope of the same regulation two incentives are available regarding “Voluntary Agreements”; 4. Opportunity cost: Available renewable energy resou- rces in Turkey including solar irradiation, geothermal Legal entities that make voluntary agreements with the capacity and biomass would be wasted. General Directorate of Renewable Energy and fulfill their commitment regarding the industrial business agree- 5. Environmental risks: Low utilization of renewable ment, General Directorate of Renewable Energy will meet energy for heating and cooling would call for increa- the 20% of the energy expenses if the Directorate has sed use of fossil fuels, which have an adverse impact enough grants and will pay up to two hundred thousand on the environment, in terms of waste, emissions, etc. Turkish Liras. The arithmetic average of the difference between each year compared to the reference energy f) Is there any mechanism to supervise fulfillment? intensity year is taken as the principle value in order to See 4.3.f for details. calculate the reduction ratio. At the same time, if the energy intensity reduction committed is less than the g) Is there any mechanism to modify obligations/tar- committed value in the end year of the agreement, it has gets? to be less than the reference energy intensity. See 4.3.g for details. In the case of the following activities are to be performed Financial support by the industrial business within the agreement period, the a) What is the name and a short description of the annual total energy consumption will be deducted as well plan? as energy intensity calculation just for one year; converting “Projects such as “Efficiency Improvement Projects” waste to heat and electricity through modern combusti- and “Voluntary Agreements” will also apply to and support ble systems, locally manufactured cogeneration systems the use of energy from renewable sources in heating and that have a cycle efficiency greater than eighty percent or cooling in Turkey. This topic was arranged in the Regulation generation of electricity through hydro, wind, geothermal, Regarding Increasing Efficiency in the Use of Energy Resou- solar and biomass resources. Cogeneration facilities that rces and Energy Consumption (Published in Official Gazette can prove that more than seventy percent of the cost is No. 28097 on 27.10.211). Apart from aforementioned plan, fulfilled by local manufacturing through certified public an additional plan for this specific field does not exist. accountant are considered to be locally manufactured. The payment plan for the end of the voluntary agreement pe- “Facilities which use electricity generation systems from riod is decided by the General Directorate depending on its renewable energy or cogeneration/micro-cogeneration allowances. The priority is offered for the support payments system that have a cycle efficiency of at least eighty of previous years, and for the current year the payment percent and above which supply the energy need of the is processed as the ratio of the allowance to the support industrial business and is located at most within the ten amount. Therefore, there will not be any demands for rights kilometers of the business” is supported. or interest if deferred payments occur.” 58 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets b) What are the measures taken to ensure availa- a) What are the concrete obligations/targets per year bility of necessary budget/funding to achieve the (per fuel or technology)? national target? In order to fulfill European directives, at least 10% re- There has not been any measure defined within this scope. newable energy is to be used in the transportation sector. The Turkish Government has established a set of obliga- c) Does support differ according to technology? tions for biofuel use per year. The objectives have been The “Projects for Increasing Energy Efficiency” and defined for the different biofuels: biodiesel and bioethanol, “Volunteer Contracts” do not distinguish according to as described in section 4.2. technology. In the case of biodiesel fuel, the Energy Market Regulatory d) What is the expected impact in terms of energy Authority Board Decision states the obligation for biodie- production? sel fuel (No. 28607) published in the Official Gazette on The proposed financial plans would aim to promote new the September 27, 2011. Biodiesel content (produced from eligible heat generation projects from renewable energy in domestic agricultural products) for road fuel supplied to order to help Turkey meet its target, which is a 20% reduction the market has been mandated to be at least 1% as of the of energy intensity by 2023 compared to the values for 2011. January 1, 2014, 2% as of the January 1, 2015, and 3% as of the January 1, 2016, but these targets have been cancelled e) Is support conditional on meeting energy efficien- after a communiqué published by EPDK in the Official cy criteria? Gazette (No.28688) on June 25, 2013. The supports are structured according to energy efficiency criteria. For bioethanol fuel, the obligation was published by the same organization on the September 27, 2011 in the f) Is it an existing measure? Could you please indicate Official Gazette (No. 28607). Bioethanol content (produced national legislation regulating it? from domestic agricultural products) for road fuel (petro- The mentioned measures are defined in the energy leum) supplied to the market has been mandated to be at efficiency legislation. least 2% as of the January 1, 2013, and 3% as of the January 1, 2014, and these obligations are still valid despite the • Energy Efficiency Law (No. 5627 published in Official deferral for biodiesel. Gazette No.26510 on May 2, 2007) b) Is there differentiation of the support according • Regulation Regarding Increasing Efficiency in Using to fuel types or technologies? Is there any specific Energy Resources and Energy Usage (Published in support to biofuels which meet the criteria of Article Official Gazette No. 28097 on October 27, 2011) 21(2) of the Directive? In Turkey, in regards to biofuels, there is no differentia- • Small and Medium Size Enterprises Development tion in the support in reference to the tax exemption plans and Support Administration (KOSGEB) Support Re- established. Both types of biofuels, biodiesel and bioetha- gulation (Published in Official Gazette No. 27612 on nol, are subjected to the same tax exemption plan. 2% of June 15, 2010). biodiesel/bioethanol produced from domestic raw mate- rial, that is blended with diesel fuel/petrol is exempt from g) Are there maximum or minimum sizes of system the special consumption tax (ÖTV, in the Turkish acronym). which are eligible? There are no limitations for the system sizes. This measure responds to Strategical Purpose (SP) 5 and Strategical Target (ST) 2, SP-05/ST-02, of the Energy Efficien- cy Strategy Paper 2012 – 2023. One of the actions presen-

4.5 Plans to support and promote the use of ener- ted in the document proposes a tax reduction to promote gy from renewable resources in transport applied the use of biofuels obtained from biomass sources or by Turkey synthetic fuels in transportation. Questions below are answered based on current and future plans already agreed by the Turkish Government. Never- theless, the future NEEAP is also concerned with other end use energy efficiency measures including in industry and transport. Thus, this chapter is subjected to future updates in accordance with the measures proposed in the NEEAP. 59 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets Legislation Bioethanol content that is produced from domestic agri- a) What is the legal basis for this target? cultural products: The obligation was referred in the legislation published by • 2% as of the January 1, 2013 the Energy Market Regulatory Authority in the Official Gazette the September 27, 2011 and numbered 28067 on “Amend- • 3% as of the January 1, 2014. ment on Technical Regulation Communiqué on Diesel Types. b) Are there any technology-specific targets? The targets apply to fuels for road transportation. There are currently no specific targets for other carriers. The Directive 2009/28/EC sets a 10% share of renewable energy specifically in the transportation sector. According to the biofuel obliga- tions presented above, the specific targets set by Turkey are: Biodiesel content that is produced from domestic agricultural products the targets set below were deferred in light of con- cerns regarding sustainability that were put forth in June 2013: • 1% as of the January 1, 2014 • 2% as of the January 1, 2015 c) What are the concrete obligations/targets per year (per technology)? • 3% as of the January 1, 2016. Figure 28: Transportation: concrete estimations/targets per year (per technology), 2013-2023 (Base Year 2012)20 (ktoe) Base year 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Bioethanol/ETBE 18 127 195 272 352 440 529 623 723 830 857 886 Biodiesel: 9 33 57 81 105 218 338 522 718 988 1,148 1,319 Hydrogen from renewable - - - - - - - - - - - - energy sources: Electricity from renewable 10 11 12 13 14 16 17 18 19 19 20 20 energy sources of which in road transport 3 3 3 3 3 4 4 4 4 4 4 4 of which not in road transport 7 8 9 10 11 12 13 14 15 15 16 17 Other (biogas, BtL, - - - - - - - - - - - - vegetable oils, lower limit) Other (biogas, BtL, - - - - - - - - - - - - vegetable oils, ceiling): Total (lower limit) 37 171 264 366 471 674 883 1,163 1,459 1,837 2,025 2,226 Total (upper limit) 37 171 264 366 471 674 883 1,163 1,459 1,837 2,025 2,226 20 20. Production estimations are calculated according to the Directive and related legislative frameworks. Currently there is not a yearly production expectation for biodiesel however there might be developments depen- ding on a new legislative framework. 60 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets d) Who has to fulfill the obligation? c) Who manages the plan? (Implementing body, mo- Biofuel obligations, similar to other obligations in the nitoring authority) domain of energy efficiency and renewable energy, are a The targets were established by the Energy Market commitment of the Government of Turkey. Regulatory Authority. In order to fulfill the target, partial objectives are establis- d) What are the measures taken to ensure availa- hed for retail petrol companies in charge of supplying bility of necessary budget/funding to achieve the fuel(s) to the market. national target? The tax exemption plan will achieve the targets e) What is the consequence of non-fulfillment? without budget/funding needs, since it is basically a Failing to fulfill the targets in biofuels, or in general, failing reduction of tax revenue. to take action to promote biofuels is expected to cause some problems, among which the most important ones are: e) How is long-term security and reliability addressed by the plan? 1. Negative impact on the Turkish Current Account The current plan should be extended since it only co- Balance: More use of biofuels would in turn lessen the vers the short and medium term. New targets/obligations volume and thus, cost of energy input, which is basica- should be set from 2016 and 2014 onward for biodiesel and lly supplied by imported fossil fuels. bioethanol, respectively. 2. Negative impact in terms of energy dependency: Risk f) Does support differ according to technology? exposure to fossil fuel supply and fossil fuel price volatility. In the case of biodiesel, the Energy Market Regulatory Authority decision (No. 28067) published the obligation for 3. Negative impact in economic terms: Less contribution biodiesel in the Official Gazette on the September 27, 2011. in economic development due to less activity in develo- Biodiesel content that is produced from domestic agricul- ping these facilities and installing solutions/equipment. tural products for road fuel supplied to the market has been mandated to be at least 1% as of the January 1, 2014, 2% as 4. Wasting the high level of availability of renewable of the January 1, 2015, and 3% as of the January 1, 2016. This energy resources in Turkey, including solar irradiation, obligation (Official Gazette 28688) is deferred with another geothermal capacity and biomass. regulation published in June 2013. 5. More pollution. For bioethanol, the obligation was published (Official Gazette 28067) by the same organization on the September f) Is there any mechanism to supervise fulfillment? 27, 2011. Bioethanol content that is produced from domestic See 4.3.f for details. agricultural products for road fuel (petroleum) supplied to the market has been mandated to be at least 2% as of the g) Is there any mechanism to modify obligations/ January 1, 2013, and 3% as of the January 1, 2014. targets? See 4.3.g for details. However, both biofuels are subjected to the same tax exemption plan. 2% of biodiesel/bioethanol produced Financial support from domestic raw material, that is blended with diesel At the moment, financial support to promote the use of fuel/petrol is exempt from the special consumption tax energy from renewable resources in transportation is mainly (ÖTV, in the Turkish acronym). supported through a tax exemption plan. It has already been introduced, so that hereinafter the answers to the g) What are the expected impacts in terms of energy questions of this section will be given in light of this plan. production? The expected impact is the reduction in the con- a) What is the name and a short description of the plan? sumption of diesel and gasoline in Turkey due to their As mentioned before, the amendment of the obligation substitution by biodiesel and bioethanol (this substitu- was published by the Energy Market Regulatory Authority in the tion will mitigate the dependency on petrol). The level of Official Gazette (No. 28607) on the September 27, 2011. substitution will depend on the mandatory yearly target. b) Is it a voluntary or obligatory plan? h) Is support conditional on meeting energy efficien- It is a mandatory plan that retail petrol companies have cy criteria? to include biofuels in the final product according to the At the moment, the support is not conditional. established percentages. 61 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets i) Is it an existing measure? Could you please indicate k) Is it possible for the same project to be supported national legislation regulating it? by more than one support measure? Which measures The measure already exists. Rather than a regulation, the can be cumulated? issue is handled through EPDK Board decisions. Support mechanisms are not mutually exclusive. The obligation was added as a clause to the first paragraph l) Are there regional/local schemes? If so, please detail of the second article of the “Technical Regulation Commu- using the same criteria. niqué on Diesel Types (Liquid Fuel serial no: 15)” publis- The plan is applicable at national level only. hed in the Official Gazette dated the August 7, 2009 and numbered 27312. This amendment was published by the Energy Market Regulatory Authority in the Official Gazette 4.6 Specific measures for the promotion of the use on the September 27, 2011 and numbered 28067. of energy from biomass j) Are there maximum or minimum sizes of systems 4.6.1 Biomass supply which are eligible? For the mandatory use of biofuel, there are two yearly minimum mandatory usage rates, one for biodiesel and the other for bioethanol. In reference to the tax exemption, there is no maximum or minimum system size for eligibility. The total amount of fuel subjected to tax exemption has not been regulated. 21 Table 7: Biomass supply (m3 as FM21/tFM/Oil or ktoe) Imports Primary Domestic energy Sector of origin Imports Net resources production EU Non-EU (ktoe) Of which 1. direct supply of wood biomass from forests and other wooded land for energy generation (thousand m3) - A) Biomass From forestry 4,258 166 4,424 761 2. indirect supply of wood biomass for energy generation - Of which 1. biodegradable fraction of industrial solid wastes, (biodegradable garden and park was- B) Biomass te, food and kitchen waste from households, - - - - From restaurants, canteens and retailers, compara- agriculture ble waste from food processing plants), and and fisheries: landfill gasincluding organic waste - 4,682 (% year 2009) 2. biodegradable fraction of industrial waste - - - - (including paper, cardboard, pallets) Of which 1. biodegradable fraction of industrial solid wastes, including organic waste (biodegrada- ble garden and park waste, food and kitchen - - - 25,277 75 waste from households, restaurants, canteens C) Biomass and retailers, comparable waste from food From waste: processing plants), and landfill gas 25,277 (year 2011) 2. biodegradable fraction of industrial waste - - - - - (including paper, cardboard, pallets) 3. Sewage sludge - - - - 21. Fresh matter. 62 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets Table 7a: Estimated biomass domestic supply for the electricity and heating and cooling sectors in 2018 (other EU = 2015) and 2023 (other EU = 2020) (m3 as FM/tFM/Oil or thousand toe) Year 2018 Year 2023 Sector of origin Expected Expected Primary energy Primary energy amount amount production production of domestic of domestic (ktoe) (ktoe) resource resource 1. direct supply of wood biomass from forests and other wooded land for energy generation A) Biomass from 1.57 268.00 3.92 670.00 forestry: 2. indirect supply of wood biomass for energy generation 1. biodegradable fraction of industrial solid wastes, including organic waste (biodegradable garden and park waste, food and kitchen waste from households, restaurants, canteens and retailers, comparable waste from food processing plants), B) Biomass and landfill gas From agriculture - 860.00 - 2,150.00 and fisheries: 2. biodegradable fraction of industrial waste (including paper, cardboard, pallets) 1. biodegradable fraction of industrial solid wastes, including organic waste (biodegradable garden and park waste, food and kitchen waste from households, restaurants, canteens and retailers, comparable waste from food processing plants), and landfill gas - 2.31 - 4.62 C) Biomass From waste: 2. biodegradable fraction of industrial waste (including paper, cardboard, pallets) 3. Sewage sludge - 0.01 - 0.02

4.6.2 Measures to increase biomass availability, taking According to recent studies (16), by 2020 one million into account other biomass users (agriculture and hectares of degraded forest in Turkey can be used for lig- forest-based sectors) nocellulosic energy crop plantings and can achieve yields of 5 tonnes/ha. This would provide an additional 2 Mtoe Mobilization of new biomass sources of bioenergy from the agricultural sector. Furthermore, a) Please specify how much land is degraded biomass energy can also serve as a mechanism to finance The total growing stock is quoted as 1.37 billion m³. the rehabilitation of degraded lands. Forests have experienced consistent growth since the 1970s. However, the contribution of degraded forest has b) Please specify how much unused arable land there is. remained constant at around 82.2 million m3 (6% of the The total utilized agricultural area of Turkey in 2009 was total figure). The total forest area amounted to 21,389,783 about 38.9 million ha, where 24.3 million ha was used as ha in 2009. Half of the forest area is either degraded or arable land or land containing permanent crops. In gene- severely degraded, which is mainly a result of severe ral, agriculture is on a very small scale in Turkey. The largest forest fires. For example, during the last decade between agricultural player is state-owned TİGEM. In total TİGEM has 2,800 ha (in 2005) and 29,700 ha (in 2008) of forest has 370,000 ha of land, out of which 200,000 (54.05%) is arable been destroyed by fire. land and the rest marginal grassland, 170,000 (45.95%). Degraded and abandoned forests may be used for ligno- c) Are any measures planned to encourage unused cellulosic energy crop production. Energy crop plantings arable land, degraded land, etc. to be used for energy on degraded areas usually can only achieve lower yields purposes? compared to their potential when growth is on fertile far- As it has already been stated, 34% of the agricultural mland. Especially in the first 3 to 5 years, when plantings are land in Turkey is currently not used and by 2020, one mi- established, yields are between 5 and 7 tonnes dry biomass llion ha of degraded forests will be available for lignocellu- per hectare. When plantings are mature and well managed, losic energy crop plantings with yields of 5 tonnes/ha. This yields may increase to 10-15 tonnes/ha. would provide an additional 2 Mtoe of bioenergy from the agricultural sector. 63 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets Today, forest management activities are predominantly focu- In terms of landfill gas, its use is restricted within the limits sed on forest rehabilitation, afforestation and erosion control. of available technology. It seems that it is unlikely that Some 28% of forests have been replanted during the past de- modern, stricter requirements and standards for the ope- cades; 2 million ha afforested and 1.5 million ha rehabilitated. ration of landfills will be implemented in the near future, Additionally, 620,000 ha of energy wood plantings have been which should encourage investments in this technology, established on forest land since 1978. however this fact has not led to a significant increase in the use of landfill gas so far. It is well known that biomass energy can also serve as a mechanism to finance the rehabilitation of degraded Regarding biogas from livestock manure, its rapid develop- lands. In spite of this, there are no measures planned to en- ment was mainly driven by favorable feed-in tariffs for elec- courage unused arable land and degraded land to be used tricity. Farmers of smaller scale biogas plants mainly earn for energy purposes. However, neither is there any legal money (13.3 USD cent/kWh) with the production of electri- restriction for converting arable land to grow lignocellulo- city. Therefore, feed-in tariff plans can be seen as a policy for sic energy feedstock, such as short rotation forestry. the promotion of the production and use of biogas. d) Is energy use of certain already available primary ma- f) What measures are planned to improve forest mana- terial (such as animal manure) planned for energy? gement techniques in order to maximize the extrac- Experience and use of biomass for heat and electricity in tion of biomass from the forest in a sustainable way? rural areas is limited to traditional uses at the household level How will forest management be improved in order to (direct burning of firewood, crop residues and dried manure). increase future growth? What measures are planned Large scale introduction of modern bioenergy technologies to maximize the extraction of existing biomass that will entail structural changes in Turkey’s agricultural sector. can already be put into practice? The General Directorate of Forestry (GDF) is currently Regarding animal manure, a low use factor of 20% of cattle promoting the use of forest residues for energy purposes. manure has been assumed to be exploitable for biogas pro- Currently forest residues are mostly disposed of by stacking duction, suggesting an annual bioenergy potential of 0.58 and burning in order to reduce forest maintenance costs, Mtoe. The poultry industry’s waste is even more concen- however, there is still room for improvement in that regard. trated, this property facilitates the use of manure for biogas production. The total potential is estimated at 0.3 Mtoe Turkey is mountainous and forestry infrastructure is in poor making the total potential from livestock manure 0.9 Mtoe. condition, as a result transportation costs climb easily. This is one of the main issues that should be addressed in order to Currently, there are some projects still not released publica- maximize the extraction of biomass from forests and increase lly and two projects that have been announced for produ- future growth. The overall demand for forest roads was esti- cing energy (biogas) from manure are in the pipeline. The mated at about 210,000 km in 2009, of which an approximate Efeler Dairy farm, one of the largest dairy breeding farms in two-thirds (2/3) have been constructed. Regulations on the Turkey has 2,600 head of dairy cattle. There are plans to use transportation of forest products in Turkey and the criteria the biogas output from the farm for heating, hot water pro- used in the calculation of costs are regulated in Governmen- duction and treatment of liquid fertilizers. The Sütaş group tal Decree No: 288 (published on the January 5, 1996). has a daily milk processing capacity of 1,200 tonnes in the Karacabey factory and 1,300 tonnes in the Aksaray facility. To ensure that biomass extraction from forests is perfor- The company is invested in biogas production and the 2.2 med in a sustainable way, all forestry measures (thinning, MW scale biogas facility was commissioned in 2013. cuttings) have to be carried out in compliance with the forest management plans prepared by the General e) Is there any specific policy promoting the produc- Directorate of Forestry (GDF). These plans are prepared tion and use of biogas? What type of uses are promo- according to Forest Management Regulation, which ted (local, district heating, biogas grid, natural gas has been regulated since the February 5, 2007. Forestry, grid integration)? including pruning and thinning of forests, is regulated in In the case of biogas from waste, waste law imple- Government Decree No. 298 “Silvicultural Fundamentals ments EU directives and regular waste deposits are in and Principles to be Applied in our Forests” published on line with EU law. It aims to reduce the amount of biode- the November 1, 2006. gradables by 30% in 50 years. Biogas from waste is often used in small captive industrial process, and therefore, The easiest way to prove sustainability is the use of verified does not benefit from FIT. In the Turkish case, the seven woodland. There are currently two Forest Management commercial licensed players are eligible for FIT, which Certificates covering 94,662 ha and 103 Chain-of-Custody contributes to the development of this technology. Certificates in Turkey (FSC, 2012). All certificates are granted 64 | National Renewable Energy Action Plan for Turkey 4 Measures for achieving the targets by the Forest Stewardship Council (FSC). Other certification Productivity increase would also increase the amount of plans, such as the Program for the Endorsement of Forest residue, impacting the raw material used for energy pur- Certification (PEFC), are not yet operational. poses. However, efficiency improvements in the utilization of raw materials could lead to lower by-product levels. For Apart from the feed-in tariffs (FIT) plan, there exists a set example, sawmills with better machinery, thinner blades of incentives within the Renewable Energy Law No: 5346 or optimized cut layout, result in lower residue: sawdust, framework. Among them, the most closely related to fo- wood chips and waste wood. The optimization of proces- restry is the one that allows the use of national parks and ses often leads to a decreased consumption of raw mate- protected areas through the necessary permits. rials for the main product and therefore, to the reduction of by-products. Impact on other sectors a) How will the impact of energy use of biomass on other sectors based on agriculture and forestry be 4.7 Planned use of statistical transfers between monitored? What is the impact? (If possible, please Turkey and Member States and planned participa- provide information also on quantitative effects.) Is tion in joint projects with other countries the monitoring of the impact planned in the future? There is growing concern about competing land use: There is no planned use of statistical transfers between Tur- food, livestock and conversion from agriculture to other key and Member States nor planned participation in joint uses, such as for energy crops. The population is worried projects with other countries, however these participations about the risk of trading food against fuel. and collaborations may be in the agenda for near future. Future domestic food and feed area requirements are the For the moment, Turkey does not expect to use any result of developments in food demand (population and renewable energy from abroad to meet the objectives es- dietary changes) combined with changes in production tablished. Therefore, no negotiations with other Member intensity (crop yields and intensity in livestock production) States or other countries have started as of today. Never- and trade in agricultural products. As a result, food demand theless, Turkey is interested in ensuring flexible coopera- in Turkey is expected to expand in the coming decades. tion mechanisms among countries, which might lead to further development of renewable energies. As a result, With respect to forestry, this industry could find a market the participation of working groups on flexible coopera- for biomass that was previously left as residue and sawmills tion mechanisms should be promoted. could achieve higher incomes from sawdust, bark, etc. For instance, most pruning residues are either left on ground Regarding national procedures to be established for arran- after they have been shredded or destroyed in the case of ging a statistical transfer or joint project, Turkey will publish parasite problems. The economics of pruning collection guidelines on the use of flexible mechanisms for coope- and environmental considerations suggest that about 25% ration. These guidelines will comply with the European are potentially usable for modern bioenergy production Directive and be in line with the mechanism and processes resulting in 0.2 Mtoe/a22 bioenergy potential. agreed in the working groups. At the same time, an increase in demand on the part of bioenergy could lead to competition over pulpwood and thereby, contribute to increased prices even on biomass that would be used for industrial purposes (e.g. raw mate- rials for the forestry industry). b) What kind of development is expected in other sectors based on agriculture and forestry that could have an impact on the energy use? (e.g. could impro- ve efficiency/productivity increase or decrease the amount of by-products available for energy use?) First, by-products and residue not currently used by industry could lead to additional income for companies within both the agriculture and forestry industries. 22. Source: EBRD 65 | National Renewable Energy Action Plan for Turkey 5 ASSESSMENTS 5 Assessments

5.1 Total expected contribution by each renewa- Given the targets presented above, the gross electricity ble energy technology to meet the binding 2023 generation in 2023 would be 91,800 GWh for hydropower; targets and the indicative interim trajectory of 50,000 GWh for onshore wind energy; 5,100 GWh for energy shares from renewable resources in electri- geothermal energy; 8,000 GWh for solar energy; and 4,533 city, heating & cooling and transportation GWh for biomass. All in all, the total gross electricity ge- neration would be 159,433 GWh. This quantity represents The figures in Tables 22a 22b are the Turkish forecast. They 37% of the total forecast consumption in 2023; the com- are based on model calculations with 2012 as their base year, mitment of the Government is 30%, 127,324 GWh. the calculations were performed for the years 2013 to 2023. In reference to heating and cooling, the capacity would The model estimates the installed capacity for different te- have an increase of 18% with reference to base year. chnologies and is based on the 2023 targets for the Turkish energy system. Installed capacity targets are: The Turkish Government has a strong commitment to re- newable sources in the transportation sector. Obligations • 34,000 MW of hydropower and support plans have been established in order to meet the targets. The policies for biodiesel and bioethanol can • At least 60023 MW of geothermal power. be seen below: • At least 5,000 MW of solar power. • Biodiesel: two measures have been adopted to pro- mote its usage, tax exemption and mandatory usage of • 20,000 MW of wind power (this power capacity has all this fuel (this has been repealed). been sized for onshore technology). Tax exemption: 2% of biodiesel produced from do- • 1,000 MW of biomass power. mestic raw material, that is blended with diesel fuel is exempt from the special consumption tax (ÖTV, in the In total, by 2023, around 60 GW of renewable energy will Turkish acronym). be installed. Obligation: According to the Energy Market Regulatory The evolution of the installed capacity from the base year Authority Decision published in the Official Gazette (No. to 2023 is based on the following assumptions: 28607) on the September 27, 2011, biodiesel content that is produced from domestic agricultural products • Hydropower: the growing trend based on recent data for road fuel supplied to the market has been mandated of this technology and its future forecast. to be at least 1% as of the January 1, 2014, 2% as of the January 1, 2015, and 3% as of the January 1, 2016. • Geothermal power: assessed, according to the trends in the evolution of electricity demand and the need to • Bioethanol: as in the case of biodiesel, the same type meet its established target. of measures have been adopted. • Solar power: for solar PV according to the evolution of Tax exemption: 2% of bioethanol produced from electricity demand and the need to meet the establis- domestic raw material, that is blended with petrol is hed target. exempt from the special consumption tax. • Wind power: an incremental increase to 1,000 MW Obligation: According to the Energy Market Regulatory for 2014. From 2014 onward the growing trend is to Authority Decision published in the Official Gazette be estimated according to the evolution of electricity (No. 28607) on the September 27, 2011, bioethanol demand and the need to meet the established target. content that is produced from domestic agricultural products for road fuel (petroleum) supplied to the • Biomass power: according to the evolution of electricity market has been mandated to be at least 2% as of the demand and the need to meet the established target. January 1, 2013, and 3% as of the January 1, 2014. Thanks to these policies and the consumption of electri- city in transport based on renewable sources, the total amount of energy coming from renewable sources has been estimated at 1,800 ktoe in 2023. 23. Considering the actual developments in geothermal energy, it is ex- pected that the geothermal installed capacity might surpass 1000 MW. 67 | National Renewable Energy Action Plan for Turkey 5 Assessments Table 10a: Estimate of total expected contribution (installed capacity, gross electricity generation) by renewable energy technology in Turkey to meet its binding 2023; targets and the indicative interim trajectory (2013-2017) of energy shares from renewable resources in electricity 24 Base year 2013 2014 2015 2016 2017 MW GWh MW GWh MW GWh MW GWh MW GWh MW GWh Hydropower: 19,620 57,837 22,289 59,420 23,908 64,359 25,526 68,767 27,145 73,175 28,763 77,584 Geothermal energy: 162 849 310 1,364 338 1,724 412 2,099 485 2,474 559 2,849 Solar energy: - - - - 40 64 300 480 800 1,280 1,800 2,880 photovoltaics - - - - 40 64 300 480 800 1,280 1,800 2,880 concentrated solar energy - - - - - - - - - - - - Tides, waves, other ocean energy: - - - - - - - - - - - - Wind energy: 2,261 5,970 2,759 7,494 3,759 9,398 5,660 14,151 7,604 19,010 9,549 23,873 land-based 2,261 5,970 2,759 7,494 3,759 9,398 5,660 14,151 7,604 19,010 9,549 23,873 offshore - - - - - - - - - - - - Biomass: 159 721 224 1,171 300 1,367 377 1,719 453 2,071 530 2,422 Overall: 22,202 65,377 25,582 69,449 28,345 76,911 32,275 87,215 36,487 98,010 41,201 109,608 Table 10b: Estimate of total expected contribution (installed capacity, gross electricity generation) by renewable energy technology in Turkey to meet its binding 2023 targets; and the indicative interim trajectory (2018-2023) of energy shares from renewable resources in electricity 25 2018 2019 2020 2021 2022 2023 MW GWh MW GWh MW GWh MW GWh MW GWh MW GWh Hydropower: 30,382 81,992 32,000 86,400 32,500 87,750 33,000 89,100 33,500 90,450 34,000 91,800 Geothermal energy: 632 3,224 706 3,599 779 3,975 853 4,350 926 4,725 1,000 5,100 Solar energy: 2,400 3,840 3,000 4,800 3,600 5,760 4,000 6,400 4,400 7,040 5,000 8,000 photovoltaics 2,400 3,840 3,000 4,800 3,600 5,760 4,000 6,400 4,400 7,040 5,000 8,000 concentrated solar energy - - - - - - - - - - - - Tides, waves, other ocean energy: - - - - - - - - - - - - Wind energy: 11,458 28,644 13,308 33,270 15,090 37,725 16,800 41,999 18,436 46,089 20,000 50,000 land-based 11,458 28,644 13,308 33,270 15,090 37,725 16,800 41,999 18,436 46,089 20,000 50,000 offshore - - - - - - - - - - - - Biomass: 606 2,774 683 3,126 759 3,477 836 3,829 912 4,181 1,000 4,533 Overall: 45,478 120,474 49,697 131,196 52,729 138,687 55,488 145,678 58,174 152,485 61,000 159,433 from combined heat and power - - - - - - - - - - - - 24 25 24. National Renewable Energy Plan includes renewable and non-renewa- 25. National Renewable Energy Plan includes renewable and non-renewa- ble hydro plants. It should be noted that according to the Renewable ble hydro plants. It should be noted that according to the Renewable Energy Law, only power plants with less than 15 km2 of reservoir area and Energy Law, only power plants with less than 15 km2 of reservoir area and the river-type hydroelectric power plants are considered as renewable the river-type hydroelectric power plants are considered as renewable energy resources. energy resources. 68 | National Renewable Energy Action Plan for Turkey 5 Assessments Table 11: Estimate of total expected contribution (final energy consumption) by renewable energy technology in Turkey to meet its binding 2023 targets; and the indicative interim trajectory (2012-2023) of energy shares from renewable resources in heating and cooling (ktoe) (ktoe) Base year 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Geothermal (except in low- temperature geothermal heat 329 344 358 372 386 400 414 428 443 457 471 485 pump applications) Solar energy: 630 644 659 673 687 702 716 730 745 759 773 788 Tides, waves, other ocean energy: - - - - - - - - - - - - Biomass: 3,537 3,537 3,537 3,537 3,537 3,537 3,537 3,537 3,537 3,537 3,537 3,537 solid 3,537 3,537 3,537 3,537 3,537 3,537 3,537 3,537 3,537 3,537 3,537 3,537 biogas - - - - - - - - - - - - bioliquids (1) - - - - - - - - - - - - Renewable energy through heat pumps: 1,657 1,729 1,800 1,871 1,942 2,013 2,084 2,155 2,226 2,297 2,369 2,440 - aerothermal - - - - - - - - - - - - - geothermal 1,657 1,729 1,800 1,871 1,942 2,013 2,084 2,155 2,226 2,297 2,369 2,440 - hydrothermal - - - - - - - - - - - - Overall: 6,154 6,254 6,353 6,453 6,553 6,652 6,752 6,851 6,951 7,050 7,150 7,249 (1) Only those are considered that meet the sustainability criteria set out in Article 5(1), last sub-paragraph, of Directive 2009/28/EC. (2) District heating and/or cooling as part of the total consumption of renewable energy for heating and cooling. (3) As part of the total consumption of renewable energy for heating and cooling. 69 | National Renewable Energy Action Plan for Turkey 5 Assessments Table 12: Estimate of the total contribution expected in Turkey by technology from the use of renewable energy sources, with regard to the binding targets for 2023; and the indicative trajectory (2013-2023) of energy shares from renewable sources, in the transportation sector in (1000 toe) (ktoe) Base year 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Bioethanol/ETBE 18 127 195 272 352 440 529 623 723 830 857 886 Biodiesel: 9 33 57 81 105 218 338 522 718 988 1,148 1,319 Hydrogen from renewable - - - - - - - - - - - - energy sources: Electricity from renewable 10 11 12 13 14 16 17 18 19 19 20 20 energy sources of which in road transport 3 3 3 3 3 4 4 4 4 4 4 4 of which not in road transport 7 8 9 10 11 12 13 14 15 15 16 17 Other (biogasBtL, - - - - - - - - - - - - vegetable oils, lower limit) Other (biogas, BtL, - - - - - - - - - - - - vegetable oils, ceiling): Total (lower limit) 37 171 264 366 471 674 883 1,163 1,459 1,837 2,025 2,226 Total (upper limit) 37 171 264 366 471 674 883 1,163 1,459 1,837 2,025 2,226 (1) Biofuels that meet the provisions of Article 21(2) of Directive 2009/28/EC. (2) Of the total amount of bioethanol/bio-ETBE. The import volume shown here is subject to great uncertainty because at present it is not possible to estimate how the international biofuels market - also in terms of compliance with sustainability standards - will develop until 2023. (3) Of the total amount of biodiesel. The import volume shown here is subject to great uncertainty, for the same reason as mentioned in (2). 70 | National Renewable Energy Action Plan for Turkey 5 Assessments

5.2 Total contribution expected from energy efficien- Energy dependence reduction from other countries cy and energy saving measures to meet the binding The development of renewable energy facilities in the 2023 targets and the indicative interim trajectory for electricity sector based on autochthonous sources will the shares of energy from renewable sources avoid the installation of fossil fuel fired units based on imported energy inputs as well as contributing to the The estimated targets are subject to the fulfillment of security of supply. energy efficiency measures set by Directive 2012/27/EU of the European Parliament and of the Council of 25 October The forecast of this impact is based on the following 2012 on Energy Efficiency (18), and Directive 2009/125/EC assumptions: of the European Parliament and of the Council of 21 Octo- ber 2009 establishing a framework for ecodesign require- • Renewable energy would substitute the installation of ments for energy-related products. Moreover, measures more combined cycle gas turbine units, currently the designed by the Turkish Government, existing and new most advanced and common fossil fuel technology. mechanisms to be included in the future NEEAP, will also play an important role in the fulfillment of these targets. • The performance ratio of natural gas combined cycle gas turbine would be 55%.

5.3 Assessments of the impact • All natural gas that is substituted by renewable energy would be imported. Large scale penetration of renewable energies will have a very positive impact on Turkey due to the following • According to political objectives, in 2023 30% of elec- externalities: tricity will be generated from renewable resources: RES would generate 127 TWh (30% of 424 TWh) in 2030. • Energy dependence reduction from other countries and security of supply. According to political objec- Penetration of renewable energy as targeted will help to tives, electricity consumption is expected to be 30 avoid the importation of more than 19 million toe of natu- percent from renewables by 2023. Considering the ral gas per year. According to the natural gas price forecast latest developments in Turkey, by 2023 due to energy published by the US Department of Energy Organization generation from renewables, 21 billion m3 of natural (around USD2010 5/Btu), the forecast total saving due to the gas importation will be avoided along with 47 million avoided energy imports would USD 4,000 million. tons of C02 emissions. Figure 29: Natural gas projection in 2023 2023 • Positive contribution in economic terms: Substantial impact on GDP due to the development of renewable Demand/Forecast demand (TWh) 424 energy facilities, and the supplying of equipment, com- RES generation (TWh) based on 30% of RES production target in 2023 127 ponents and services. Performace ratio of natural gas CCGT 55% • Human resources development: qualified employment. Reduction of Natural Gas imports (TWh) 231 • Development of R&D activities. Annual reduction of Natural Gas 19 million imports (toe) These externalities are detailed hereafter. Annual reduction of Natural 21 milliard Gas imports (m3) Annual reduction of Natural Gas 4,000,000,000 imports (USD 2010) 71 | National Renewable Energy Action Plan for Turkey 5 Assessments CO2 emission abatement Forecasted impact on the Turkish GDP during the The development of renewable energy facilities for investment phase (2013-2023): USD2013 6.274 milliard. electricity generation will mitigate CO2 emissions in the atmosphere. • Impact in the operational phase (annual economic impact). - Annual contribution per MWh: USD2013 86,401 The estimate of this impact is based on the following assumptions: - 2023 target: 20,000 MW. • Renewable energies would substitute combined Forecast annual impact on the Turkish GDP (2023): approxi- cycle gas turbine units, currently the most advanced mately USD2013 1.728 billion. and common fossil fuel technology. • The emission factor per MWh generated by combined

5.4 Preparation of the National Renewable Energy cycle gas turbine technology is 0.37 tons. Action Plan and the follow-up of its implementation According to political objectives, in 2023 30% of electricity a) How were regional and/or local authorities and/or will be generated from renewable resources: RES would cities involved in the preparation of this Action Plan? generate 127 TWh (30% of 424 TWh) in 2030. Were other stakeholders involved? The European Bank for Reconstruction and Develo- Adoption of renewable energy as targeted will help to pment has collaborated with The Turkish Government avoid more than 47 million tons of CO2 emissions: consi- in the task of preparing the National Renewable Energy dering a price of € 20 per CO2 emission EU allowance26, Action Plan. A broad consultation was carried out in order the economic impact of CO2 emission mitigation would to involve the major stakeholders and authorities in Turkey. amount to USD 1,262 million. The main entities consulted are listed below: Figure 30: CO2 emissions avoided by REAP implementation 2023 • The Ministry of Energy and Natural Resources. The General Directorate of Renewable Energy (YEGM, Yeni- Demand/Forecast demand (TWh) 424 lenebilir Enerji Genel Müdürlüğü) RES generation (TWh) based on 30% of RES production target in 2023 127 • The Ministry of Energy and Natural Resources. The Emision factor of natural gas CCGT Mineral Research & Exploration General Directorate (tons/MWh) 0.37 (Maden Tetkik ve Arma Genel Müdürlügü) CO2 emissions that would be avoided 47,101 by renewable energies (000 tons) • The Ministry of Energy and Natural Sources. EU & IFI´s CO2 emissions that would be avoided department 1.2 milliard by renewable energies (USD) • TEİAŞ, The Turkish Electricity Transmission Co. Department-Research, Planning and Coordination Positive contribution in economic terms: impact on GDP Department Based on the large scale penetration of new renewable ener- gy infrastructure, new industrial activities will be developed. • The Energy Market Regulatory Authority (EPDK, Enerji Piyasası Düzenleme Kurumu). The Electricity Market The figures detailed below represent a sampling of the Department possible impact on the GDP: • TWEA, The Turkish Wind Energy Association (TÜREB, Türkiye Rüzgar Enerjisi Birliği) • Impact in the construction phase of wind energy infrastructure: • GENSED, The Turkish Photovoltaic Industry Association - Installed capacity in 2013: 2,759 MW • GÜNDER, The International Solar Energy Association (Turkey Branch) - 2023 target: 20,000 MW • BİYOGAZDER, The Biogas Association - Investment per MW (hypothesis): USD2013 1.179 milliard • LI-DER, The Unlicensed Electricity Generation Association - Investment by Turkish residents (hypothesis): 30%. • Pales Engineering & Consultancy Services CO. LTD. • MidSEFF, Mid-size Sustainable Energy Financing Facility 26. Long term CO2 emission allowance reference price established by the European Union. 72 | National Renewable Energy Action Plan for Turkey 5 Assessments • Fina Enerji Holding A.Ş The European Commission Energy Statistics Ordinance also regulates the transfer of statistics to Eurostat. General • Garanti Bank Directorate of Renewable Energy is also responsible for the • Deniz Bank annual task of devising indicators for the energy sector. • SAIF, Biomass Business branch of SAIF S.p.A. Group • Güriş İnşaat ve Mühendislik A.Ş. • Gama Energy • TOKİ, Residential Buildings and Urban Transformation • GE Wind Energy • Enerjisa • Zorlu Energy • Polat Enerji San. ve Tic. A.Ş. b) Are there plans to develop regional/local renewa- ble energy strategies? If so, could you please explain? In case relevant competencies are delegated to regio- nal/local levels, what mechanism will ensure national target compliance? The National Renewable Energy Action Plan has been created with the collaboration of the main entities and stakeholders in the industry. The energy strategies included in the Plan account for the national, regional and local levels. c) Please explain the public consultation carried out for the preparation of this Action Plan. A series of meetings were held with the main repre- sentatives of the entities listed in the first point (a) of this chapter. The aim of these meetings was for consultation with representatives within the industry and the collection of information in order to prepare this action plan. Furthermore, questionnaires were addressed to other renewa- ble energy players in order to extend the scope of the study. d) Please indicate your national contact point/the national authority or body responsible for the follow- up of the Renewable Energy Action Plan? General Directorate of Renewable Energy is the autho- rity responsible for the follow-up of this Renewable Energy Action Plan. e) Do you have a monitoring system, including indicators for individual measures and instruments, to follow-up the implementation of the Renewable Energy Action Plan? If so, could you please give more details on it? Turkey will endeavor to establish a complete and reliable monitoring system, including indicators for individual mea- sures and instruments. Following up on the developments in the energy sector and associated statistics are the res- ponsibility of the General Directorate of Renewable Energy. 73 | National Renewable Energy Action Plan for Turkey 6 BIBLIOGRAPHY 6 Bibliography 1. Directive 2009/28/EC of The European Parliament and of The 19. Assessing the Market for Commercial Use of Biomass for Council of 23 April 2009 on the promotion of the use of energy Heat and Power Generation in Turkey. The European Bank for from renewable source. Reconstruction and Development. 2. Security of Supply Strategy Paper, published in 2009, 2009- 20. Directive 2012/27/EU of the European Parliament and of 2014 Strategic Plan of Ministry. the Council of 25 October 2012 on energy efficiency, amending Directives 2009/125/EC and 2010/30/EU and repealing Directi- 3. Climate Change Action Plan 2011 – 2023. ves 2004/8/EC and 2006/32/EC. 4. Energy Efficiency Strategy Paper 2012 – 2023, 2nd July 2012. 21. General Agreement on Tariffs and Trade 1994 (GATT1994)- World Trade Organization. 5. The Republic Of Turkey Ministry Of Energy And Natural Resources Strategic Plan 2010-2014. 22. Assessing the Geothermal Market in Turkey. The European Bank for Reconstruction and Development. 6. New Electricity Market Law (Law No. 6446). 7. The Law on the Utilization of Renewable Energy Resources for the Purpose of Generating Electrical Energy (Law No: 5346). 8. The Law Amending the Law on the Utilization of Renewable Energy Resources in Electricity Generation (Law No: 6094). 9. Energy Efficiency Law (Law No: 5627). 10. Environmental Law (Law No: 2872), amended in 2006. 11. Geothermal Law (Law No: 5686). 12. The Turkish Republic New Investment Incentives Program by the Ministry of Economy (which provides valuable incenti- ves for investors). 13. Directive 2012/27/EU of the European Parliament and of the Council of 25 October 2012 on energy efficiency. 14. Guidance for National Energy Efficiency Action Plans Accompanying the document Commission Implementing Decision establishing a template for National Energy Efficien- cy Action Plans under Directive 2012/27/EU of the European Parliament and the Council . 15. Commission Implementing Decision of 22 May 2013 esta- blishing a template for National Energy Efficiency Action Plans under Directive 2012/27/EU of the European Parliament and of the Council . 16. Law No. 6306 on the restructuring of areas at risk for natu- ral disasters and the regulation for its implementation. 17. Turkish Public & Private Sector Energy Service Company Market Assessment. The European Bank for Reconstruction and Development. 18. Turkey: Smart Metering - Market Study. The European Bank for Reconstruction and Development. 75 | National Renewable Energy Action Plan for Turkey With the support of