Turkish minister reacts aganist court decisions, environmentalists

Stays of execution and annulment decisions by Turkish courts cause slowdowns in hydroelectric power plant and wind energy investments, according to Energy Minister Taner Yıldız.The Turkish government aims to evaluate all the energy resources, by giving priority to domestic and renewable energy resources, Yıldız said, speaking to the Anatolia news agency. “The important point is to form a mixture of energy generation that will provide an optimum price.”“We currently observe a slowdown in hydro investments due to reactions from environmentalists and stays of execution and annulment decisions of courts,” Yıldız said. “These developments also affect investors. They say there are problems in hydroelectric and wind in addition to problems in domestic coal. There is no resource left, the sole resource then is natural gas,” he said.Noting that he always calls on related ministries and non-governmental organizations, Yıldız said: “We always propose to sit around a table and discuss the technical part of the issue. We say let’s look at the red points that are not available for renewable energy investments, including cultural and natural properties, and then pick others.”Turkey still cannot agree on from which resource it should generate its electricity need, Yıldız said. “One institution says that you built hydroelectric power plant and damage the nature. Yes, there are some bad examples, I do not object to them. We should definitely be sensitive to the environment. But others say do not build a wind farm, because it damages the radar. Do not use nuclear and coal either, they damage nature, too.”Recalling the government’s targets for the Republic’s 100th anniversary of foundation in 2023, Yıldız said within this scope Turkey’s economy would gain its full potential from hydro energy by then. The capacity of wind energy is striving for 20,000 megawatts, and the target is 600 megawatts in geothermal energy, he said. “At least 10 percent of the energy of the country is expected to be met by nuclear energy.”The installed capacity for hydroelectric energy, which was nearly 12,000 megawatts in 2003, reached around 16,000 megawatts by the end of last year, he said, adding that this figure for wind farms increased to 280 megawatts from 17 megawatts. “These figures are insufficient. Still, we have done a lot and we will continue to do more.” Two nuclear power plants planned to be established, one in the northern province of Sinop and other in the southern province of Mersin, will meet 10 percent of the electricity installed power and 20 percent of electricity consumption, Yıldız said.

Steel giant wins wind energy bid at record price

İÇDAŞ, the biggest private sector steel producer in Turkey based on production capacity, announced Friday that it won the bid for the wind plant to be installed on Biga peninsula in western Turkey by offering 5.1 kuruş per kilowatt-hour of wind.İÇDAŞ will be paying the state 11 million Turkish Liras annually for “wind rights,” which totals around 220 million liras in 20 years with consumer price index excluded.The power generated at the plant will be used to meet both the region and the company’s energy needs. IÇDAŞ previously installed one coal-powered and one hydroelectric power plant in the region.Evaluating the bid results in a press release, İÇDAŞ General Manager Bülend Engin said the company’s next target was establishing solar plants to meet the company’s energy consumption needs. “As we all know our country runs on very limited domestic energy resources. Therefore, we should be working on the make the best of our renewable resources like solar and wind power.”The price İÇDAŞ offered for the plant bid is listed as an unprecedented offer in the press release. Among the best offers in energy bids so far are 3.43 kuruş offered for Çan Transformer Station, 2.82 kuruş offered for Ayvalık Transformer Station and 2.76 kuruş offered for Taşucu Transformer Station.

Report says renewables require different incentives

Turkey it needs to develop different incentive methods for different types of technologies in order to reach its established renewable energy power targets, according to a Deloitte report.Deloitte Turkey released a renewable energy report in late April to provide a thorough analysis of Turkey’s renewable energy policies and targets.The report underlines that the key factor in acquiring the set targets in renewable energy generation is the incentive mechanisms, adding the most successful countries in carbon capping energy types merge multiple mechanisms. The report elaborates on the road map Turkey needs to attain its goals, given that it currently is in the stage of infrastructure studies concerning the formation of incentive mechanisms.The Deloitte report analyses Turkey’s current regulations, either in effect or in draft, concerning the electricity generated out of renewable resources and provides an end-analysis to aid development of renewable energy in the country.Evaluating the report, Deloitte Turkey Energy and Resources Group Responsible Partner Sibel Çetinkaya said the report was the result of a study of the renewable energy targets and strategies of more than 100 countries and it showed that different countries needed to develop different strategies for different types of renewable resources.“The best solution seems to be preparing a portfolio standard in design and application of the incentives,” she said.The types of incentive mechanisms the report mentions are fixed price guarantee, premium guarantee, quota-based green certificate, bid incentives, investment incentives and tax exemption. The report elaborates on the application areas and specific uses of each mechanism, while referring to the best examples in the world.According to the Deloitte report, Spain and Germany offer higher incentives than production costs, while the incentives in Finland are way below production costs. According to Deloitte’s research, the report notes, incentives slightly higher than production costs are most successful.[HH] ‘Turkey can reach its renewable targets’Deloitte experts state that it is possible for Turkey to attain its goals in renewable energies.“Turkey can reach its green energy targets in the following term, provided that the overall conduction capacity is increased, network investments and ameliorations are made, a central estimation center particularly for solar and wind energies is established, and the technological platform to render the incentive mechanisms effective is developed,” the report states.Turkey also needs immediately to prepare the crucial infrastructure like market management integration and diversification of fund resources.“To that end, it is of utmost importance for the investors to take action on sound market analyses,” the report says.

Access roads for wind farms reveal hidden costs of 'going green'

As Turkey seeks to capitalize on green energy projects, those looking to build in the wind-energy sector face several environmental and procedural hurdles. As prospective developers in this sector have discovered, the overall costs of implementing a large-scale renewable energy project extend far beyond installation, a problem evident in the need to construct access roads in western Turkey.In Turkey, the wind energy sector is a fairly new sector, only gaining prominence in the last 30 years. Building the foundations for wind energy in the country is a “special process,” as a representative from one of Turkey’s largest wind energy companies puts it.According to the representative, who spoke on condition of anonymity, every wind energy project in Turkey requires new access roads, due to the difficult terrain that is generally present in suitable wind farm locations. Most wind farms are often built on top of hills or in mountainous regions, largely inaccessible by roads.“The main roads mainly have to be re-built, particularly if there are many curves, a major infrastructure obstacle for wind turbine transport, since the trucks are not able to make sharp turns,” according to the representative. “Turkey is not like Germany, where most wind farms are built near highways, and where the land is flat. Roads must be built, since none exist in these areas, and more specifically they must be built to sustain heavy and large loads.”Environmentalists and community-based organizations, despite generally being in favor of these endeavors, at times have radically different opinions from renewable energy advocates. Local communities in particular may not always be so keen on the construction of service roads for wind turbines in their regions. Tasked with not only creating a renewable energy plant but also an infrastructure system, public and private authorities need to calculate the environmental and financial costs of these infrastructure schemes. This is why in Turkey, where investors are aware of this problem, wind energy companies generally anticipate access roads costs in their projected costs.Mustafa Ataseven, chairman of the Turkish Wind Energy Association, says service road construction in Turkey can be carried out in two ways.“Investors can make a contract with a Turkish company that then directly interacts with the various sub-contractors and construction companies. However, if the investor is able to finance the costs without any credit, they can directly make a deal with sub-contractors,” Ataseven told the Hürriyet Daily News & Economic Review.In both cases, the Turkish construction sector benefits from these contracts.Ataseven said it is mostly local companies that are the ones constructing access roads, either as a sub-contractor or as an investor.However, access roads are not only a financial consideration. They also can affect the local environment and the local population. Accordingly, wind energy developers must consult with local authorities, NGOs and other stakeholders when planning and constructing a wind farm.A representative of Aksa, a Turkish power generation company with three wind farms in Turkey, said his company’s wind farms had to account for building access roads in the mountains and forests, steps that were “necessary for the projects.”Aksa was also required to consult with the Ministry of Environment during the planning process of its wind farms.“We are obliged by the Ministry of Environment to prepare documentation for local communities on the specifics of the project, which can take between five and six months on average,” the representative told the Daily News.At the Turkish Wind Energy Association, Ataseven said the process of building service roads has not been disruptive to local communities.“The local construction business is good in Turkey. As you know, Turkey is second in the world in the construction business,” he said.According to Ataseven, since investors often employ local construction companies to construct these service roads, the locals benefit from wind farm schemes.“They use local construction companies, and these companies know their people. They have good relations with the local population,” he said.The wind energy sector, it seems, has thus far avoided the problems associated with Turkish hydropower schemes, where local villagers, particularly in Turkey’s Black Sea region, have often been grossly dissatisfied with the way energy was being generated at their expense. With wind still in its infancy, the jury is still out on whether it is worth the money, and worth all the asphalt.

Enel optimistic about Turkish geothermal licences

In light of specialist concerns, Enel has expressed confidence and revealed a realistic stance toward its recently purchased Turkish geothermal sites.In response to concerns about “worthless or empty licenses” across Turkey, Giuseppe Farina, Enel’s Representative for Turkey said, “Any business activity includes a certain degree of risk.”The difference, according to Farina, is rooted in Enel’s unique experience in geothermal energy, while also bearing in mind that not all licenses are of the same quality.“Enel Green Power has been operating in the geothermal industry for over a century and has experienced a solid background in identifying those licenses with a higher potential and with better development conditions,” he told the Hürriyet Daily News & Economic Review.The new agreement on the exploration of geothermal sites in western Turkey was confirmed on Jan. 24 between Italian energy giant Enel and Turkish Meteor.The venture will provide research and exploration of 142 geothermal sites in Turkey, while securing collaboration from Turkish partners and the government alike.Although specialists have questioned the profitability and quality of recently purchased geothermal sites, Enel expressed strong optimism about its business purchase in a recent interview with the Daily News.“The Turkish market is not that different from other geothermal markets. Licenses to exploit geothermal energy can be of different kinds and with different potentials,” said Farina.“We do not believe that all the leases are of the same quality, but as a result of over a hundred years of experience in geothermal energy, we will probably be able to pick up the most promising ones,” he told the Daily News.Experts have previously expressed serious concerns about the geothermal reserves, pointing to the unviable nature of many sites and worthlessness of licenses.“The sheer majority of geothermal sites are low-grade resources that could not be used for power generation,” said Ümran Serpen, professor at the Istanbul Technical University.There are so many of those worthless licenses and there are people who are eager to market them and few have made handsome profits by simply marketing a few licenses,” he told the Daily News.One of the main factors cited by Enel for investing in Turkey has been the passing of new energy laws put forward in 2007 and 2010 by the Turkish government.“The new Turkish law on renewable energy is promising enough for starting up the process, even if the tariff is slightly below what’s expected,” said Farina.However, as a result of new legal incentives to invest in renewable energy, the prices have fallen to a reasonable level, said Farina.“In the past years we decided not to participate in tenders, because their mechanism of offer created an over-payment on the leases,” he told the Daily News. “We believe some of the past tenders have been awarded above the real market value.”