Renewable Energy in Turkiye

It is inevitable that the increasing population, traffic, industrialization, waste used, etc. pollute nature and the environment. As humans, we should reduce environmental pollution for future generations. This is where alternative energy production comes into play.

Turkiye’s geographical location is an advantage when it comes to renewable energy sources, so the development and implementation of renewable energy is crucial for Turkiye.

Turkey’s renewable energy legislation

Turkish law recently defined renewable energy sources as wind energy, solar energy, geothermal energy, biomass energy, waves and non-fossil energy sources such as runoff or hydroelectricity with a reservoir area of ​​less than 15 square kilometers.

In 2005, Turkiye created the legal basis for renewable energy Act on the use of renewable energy sources to generate electricity, number 5346. Purpose Act on the use of renewable energy sources to generate electricity is to expand the use of renewable energy sources to generate electricity, use these resources in a safe, economical and qualified manner, increase the diversification of energy sources, reduce greenhouse gas emissions, assess waste products, protect the environment and develop related manufacturing industries towards achieving these goals .

In 2013 Turkish Electricity Market Law No. 6446 was published and further changes were introduced that also regulate the renewable energy market. Regarding secondary legislation, Regulation on licensing of electricity trade was published on November 2, 2013, as amended from time to time.

In 2016 Regulation on renewable energy resource areas also entered into force. Its importance is that it defines renewable energy resource areas (so-called “YEKA”). YEKA areas are areas where, without administrative permits, you can build power plants using wind and/or solar energy with large installed capacities and economic potential.

In 2019 Regulation on unlicensed generation of electricity on the electricity market has been published (and further changes have been made) for electricity-related activities that do not require a license. There are further secondary provisions, not listed in this document, relating to renewable energy.

With the adoption of the draft law on ratification Paris Climate Agreement by the Turkish Grand National Assembly and its publication on October 7, 2021, Turkiye officially became a party to the agreement. The Paris Climate Agreement imposes certain obligations on Turkiye and other signatory countries to reduce the use of fossil fuels and increase the number of renewable energy sources.

By Turkiye National Action Plan for Energy Efficiency spanning 2024-2030, the goal is to reduce energy consumption by 16% and contribute to 100 million tonnes of emissions reductions, with the country investing $20 billion in energy efficiency programs in the public and private sectors by 2030.

Licensed business

In order to operate in the Turkiye electricity generation market, you must obtain a license from the Turkiye Energy Market Regulatory Authority (EMRA). All electricity produced by licensed legal entities can be sold on the free electricity market or through bilateral trade agreements. In addition, Renewable Energy Resources Support Mechanism (YEKDEM) applies to electricity generated in licensed electricity generating plants based on renewable energy sources certified by YEK, which will be put into operation in the period from July 1, 2021 to December 31, 2030. Under YEKDEM, a purchase guarantee is offered in a given period, and prices are announced based on the source in the range Turkish Presidential Decree of May 2023.

Operating without a license

Regulation on unlicensed generation of electricity on the electricity market defines natural or legal persons who can produce electricity without the need to obtain a license or establish a company.

A general look at the disputes in the renewable energy market

This is an extensive issue and depends on the participants in the dispute. If the party to the dispute is the government or an administrative party such as EMRA, Ministry of Energy, etc., the dispute may be resolved before the Turkiye Administrative Court. On the other hand, if the dispute is between private sector entities, contracts between such parties usually opt for international arbitration.

Author: Gozde Esen Sakar, senior partner at Sakar Law Firm

This article was originally published in issue 11.9 of CEE Legal Matters magazine. If you would like to receive the paper version of the magazine, you can subscribe here.