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Turkey's Renewable Energy Market

Industry Sector

Energy and Utilities

Published

4 April 2012

Author

Matt Bodimeade

Type of News

Market

Solar Energy in Turkey:
Turkey's geographical location is very favourable in terms of solar energy potential, placing it well ahead of many countries in the solar energy market. The country has the incredible potential to produce an average of 1.100kWh per square meter, if the necessary investments are made on solar energy plants. This makes Turkey the 2nd best country in Europe after Spain in terms of solar power investment potential.

Currently, the largest share of the installed capacity in Turkey is still attributable to thermal power plants. As of the end of 2008, 66 percent of the total installed capacity consists of thermal power plants, 33 percent of hydro power plants, 0.1 percent of geothermal and 0.9 percent of wind power plants. Although there is currently a low level of non-thermal installed capacity, there is an environment conducive to renewable investments due to substantial renewable energy resources and recent developments in renewable legislation and liberalisation in the electricity market.

There are numerous projects undergoing license approvals mainly for HEPPs (Hydro-Electrical Power Plant) and WPPs (Wind Power Plant). 77 percent of the total number of new licenses (176) granted to the private sector in the year 2009 was for the construction of new HEPPs. As of September 2009, there are a total of 105 WPP given and approved licenses, with a capacity of 4,237 MW (megawatts). There are 727 licenses awaits evaluation, corresponding to 31,957 MW.

Monthly average solar energy values in Turkey:
Turkey's most efficient months to produce solar energy are June, July, and August. The least efficient months are November, December, and January.



 

 

 

 

 

 

 

 

Statistics show that solar radiation in Turkey is 112.74 kcal/cm2 and 1311.00 kWh/m2 per year. In terms of solar radiation averages, 308.0 cal/cm2-day, 3.6 kWh/m2-day can be produced from an average sunshine duration of 7.2 hours/day.

Potential Regions for Solar Energy in Turkey:
The decreasing oil, natural gas and hard coal resources together with the pollution that is caused by these primary energy resources are leading the world to search for alternative energy sources. Turkey has significant potential for solar, geothermal and wind energy but still has not taken sufficient steps towards utilising their potential.

In terms of solar energy potential, the South eastern Anatolia and Mediterranean Regions hold the most potential for Turkey. Central Anatolia's large region of flat lands is another highly profitable area for solar power investments. Three provinces in West Mediterranean Region also have very appropriate values in terms of solar energy investments. If we exclude the Black Sea Region, Turkey can produce 1.100 kWh per square meter from an average of 2640 hours of sun light. Accordingly, the total amount of potential energy per year is approximately 1.015 kW hours.

Renewable Energy:
Alternative energy sources are becoming more and more desirable in the world as pollution has become a global threat and the primary energy sources such as oil, natural gas and coal are decreasing in supply. The renewable market in Turkey is still at an infant stage with the majority of electrical generation capacity still coming from thermal plants (66 percent of total installed capacity as of 2008). Hydro power plants contribute 33 percent, and the remaining 1 percent is from geothermal (0.1 percent) and wind (0.9 percent) sources as of end 2008.

Recent developments in Turkey such as the liberalisation of the electricity market and improvements in the renewable legislations have opened the door for growth and investment opportunities in renewable energy sources. These developments coupled with the country's naturally endowed potential for solar, geothermal and wind energy resources, create a vast potential in this market.


 

 

 

 

 

 

 

 

Investment Opportunities:
There is an encouraging investment climate for environmental technologies and the renewable energy sector in Turkey. The Turkish renewable energy sector has been one of the most attractive sectors in terms of M&A activity in the last couple of years. Many utility industry giants have entered Turkey and there are numerous local entrepreneurs who have obtained renewable licenses but are looking for international partnerships.

The following major transactions demonstrate the increasing interest from international investors in the Turkish market since 2005.

M&A Transactions by Foreign Investors in the EGS and Renewable Energy Sector (Source: Deloitte)
AcquirerOriginTargetDateStakeDeal Value (USD million)
Energo - PRO asCzech RepublicAralık HPP / Hamzalı HPP / Resadiye CascadeApril 2010100%407.0
Not DisclosedTurkeyABK Elektrik Üretim ASApril 2010N/AN/A
Enerco GroupTurkeyEssentium GrupoJanuary 2010N/AN/A
StatkraftNorwayYeşil EnerjiJune 200995%118.9
EnBWGermanyBorusan EnerjiMarch 200950%N/A
EDF Energies NouvellesFrancePolat EnerjiDecember 200850%N/A
CEZCzech RepublicAkenerjiOctober 200837.4%302.6
Cogentrix EnergyUSATaşyapı EnerjiJuly 200850%N/A
ItalgenItalyBares ElektrikJuly 2008100%50.2
VerbundAustriaEnerjisaMarch 200750%326.6
Berggruen HoldingUSABND ElektrikDecemeber 200666.7%0.7
United Development CompanyQatarTurk MillenyaJune 200660%N/A
Sumitomo CorporationJapanBirecik Dam and HEPPMay 200531%40.7

 

See all reports on Turkey's energy potential:
Solar Photovoltaic (PV) Power in Turkey, Market Outlook to 2020
Turkey energy report

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