There is huge growth potential for wind power in Turkey and Southeast Europe (SEE).  This key regional event will examine the current and future wind power markets in Turkey and the SEE region, with in depth analysis and country case studies. 

• Turkey is the 6th largest electricity market in Europe and one of the fastest growing 
• globally.  The Turkish government and authorities have made a strong push for increased electricity production from renewable sources and are increasingly promoting wind power to bolster the country’s power supply
• Turkey is the emerging market destination for wind power investments and is also a rapidly growing economy 
• This potential room for investment and development appears to be huge and growing, as new wind energy projects, and ideal conditions to harness wind energy are helping Turkey pioneer this sustainable form of energy.
• Amongst the top five fastest growing wind markets, Turkey and Hungary are on the list

Steve Sawyer, Secretary General for the GWEC, said he expects to see a boom in Turkey before the other emerging markets in Europe. The country's rapidly-growing economy, tremendous wind resources and a government that's greening up to enhance its bid to join the European Union, has contributed to the speedy growth of wind power in Turkey, he said.

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 Turkey Electricity Market

Turkey has relatively good energy production potential. One estimate places the economically feasible hydroelectric potential at around 29,500 megawatts, which would allow annual production to reach roughly 100,000 gigawatt-hours in years with normal rainfall. Lignite is the second most important potential source of energy, with proven and probable deposits put around 6.4 billion tons. Turkey's proven and estimated petroleum stocks are equivalent to about three years' consumption. Proven reserves are estimated at about 16 million tons, and enhanced oil-recovery techniques may allow extraction of another 30 million tons. Proven reserves of natural gas total about 12.4 billion cubic meters, and reserves of hard coal about 1 billion tons. Turkey's geothermal resources are also considerable. Turkey also has abundant reserves of renewable energy, such as solar, wind.

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 Turkey to play a crucial role in energy politics

Merger and acquisition experts from both sides of the equation gathered in Istanbul last Friday for the IMAP Global Mergers and Acquisitions Symposium, where advisors and corporation managers, sellers and buyers all agreed that the global financial crisis has introduced a new world of corporate deal making. Husnu Ozyegin, Chairman of Fiba Holding, spoke about the recent improvements in relations between Turkey and the neighboring countries, underlying the importance of Turkey’s growing energy market. Ozyegin emphasized the shift in investment flow and said that developing economies with high growth rates will have the upper hand in the post-crisis period. “The dynamics of investing have changed, for it's no longer straight from developed markets to developing economies but so-called sideways deals, with China investing and India investing”, said Ozyegin. He cited an example of a Russian company investing in Turkey, when last year Lukoil paid USD 500 million for Turkish fuel retailer Akpet. Ozyegin noted the strides Turkey has made in improving relations with its neighboring countries, a program that Ankara has been following for years now but one that has shown big developments in recent weeks. The businessman pointed out that Turkey recently signed an agreement whereby Syrians will no longer need visas to enter Turkey, that the government also signed 40 separate trade agreements with Iraq and that Turkey also signed an agreement to establish diplomatic relations with Armenia. The upshot of all this active foreign diplomacy is that European investors have to look at Turkey in a larger context than that of a country with a population of 73 million, said Ozyegin. The energy sector is particularly ripe for deal making, he stressed. “Turkey is one of the few countries where energy consumption has been rising eight percent per year for nearly 30 years”, said Ozyegin. “In Europe, Turkey ranks second in wind energy potential, behind only Scotland, and ranks second in solar energy potential, behind Spain.” Delivering the keynote speech at the symposium earlier on Friday morning, former Spanish Prime Minister Jose Maria Aznar also highlighted energy as an area where Turkey enjoyed special opportunities. “Turkey's geography makes it an important player in supplying Europe's energy needs”, said Aznar, “but this opportunity also involves great responsibility. That's because Turkey, in catching this flood of globalization, employs the principles of a free society, the principles of free trade, and their success on this subject is an important demonstration for the region, for Europe and Asia.”

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 Turkey’s privatizations to gain speed in 2010

Turkey’s Privatization Administration signals that the country will see a rapid privatization process in the upcoming period. The administration is working on a new tender model for the National Lottery, while the privatization of bridges, highways and electricity distribution companies is ongoing.

Regarding the activities taking place in electricity distribution, Aksu outlined the transfer process concerning four privatization tenders. There are 53 pre-qualification applications for Coruh Elektrik Dagitim, Yesilirmak Elektrik Dagitim and Osmangazi Elektrik Dagitim, said Aksu. “This reveals there is high demand for electricity distribution enterprises. We will receive proposals on October 20”, he stated.

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 Europe's largest solar panel factory to be opened in Turkey

Ahmet Arslan, General Manager of AYT Group’s energy division, has announced that the EUR 300 million solar panel manufacturing plant in Kutahya's Tavsanli district will be fully operational by June 2010. Once completed, the plant will be the largest solar panel-producing facility in Europe. Arslan also noted that the factory, which is being established in a 50:50 partnership between AYT and the German Sitizn Group Holding AG, will be the first solar panel-producing plant in Turkey. "The factory will not produce for the Turkish domestic market alone but is eyeing consumers all around the world. Due to our country’s close proximity to European markets, our facilities will provide an advantage in freight time and cost", Arslan noted. The German company has all the required patents and licenses in solar technology, the General Manager underlined. He further added that the partners are planning to combine three different high technology procedures of solar energy panel manufacturing -- monocrystal, polycrystal and thin-film -- under a single roof at their Tavsanli manufacturing plant. The factory will initially employ 250 people, and the number of workers will increase to 750 by 2013.

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 Schneider Electric manages 16 countries from Turkey

Energy specialist Schneider Electric runs the management operations of 16 countries from its Turkey headquarters. According to Schneider Electric Turkey’s Marketing Director Ugur Oktar, the company currently has three factories, two R&D centers, over a thousand employees and more than 200 distributors in Turkey. “We are active in 16 provinces of Turkey, especially in Ankara, Istanbul and Izmir”, said Oktar, adding “Schneider Electric Turkey is the operations center for 16 countries in Central Asia, Eastern and Central Europe.”

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 Wind farm applications to be finalized by the year’s end

Minister of Energy and Natural Resources Taner Yildiz said his ministry will rapidly process some 750 wind farm applications received on November 1, 2007 and have them ready by the year’s end. "We will sort this out until the end of the year" said Yildiz, expressing remorse about the delay license applicants suffered. Stating that they were responsible for the delay of the licenses in wind farms, Minister of Energy Taner Yildiz said, "Private sector is right to complain. We will deliver the licenses to their owners until the end of the year." Mentioning that preliminary license will be required with a new law, Minister Yildiz said that "exploiters" who deal with license trade will be prevented in this way. The Ministry of Energy and Natural Resources received 750 wind farm licence applications on November 1 2007, totaling an installed capacity of 76,000 MW.

No intervention in nuclear tender

Stating that there is a need for the extension of the period by a month or two for strategic, legal and technical assessments in relation to nuclear power station tender, Yildiz said that their negotiations with Russia were going on. Emphasizing that it is not possible for anyone to intervene in the tender process, Yildiz said that the cost of nuclear power station construction and electricity prices were increasing around the world.

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 Turkey's natural gas production will be doubled

Efforts are underway to finish the construction of the Turkish Petroleum Corporation's (TPAO) natural gas production and drilling platform in Romania which will double Turkey's natural gas production. A Romanian company is constructing the giant platform in a dockyard for TPAO in Constanza, on the Black Sea coast.

The two-story platform will start extracting natural gas off the shores of Turkey's Black Sea town of Akcakoca, first discovered in 2003. Metin Kilci, Undersecretary for the Turkish Ministry of Energy and Natural Resources, told reporters after visiting the dockyard that Turkey's natural gas production will be doubled after the completion of the platform.

The platform, planned to go into service by the end of 2010, will cost USD 100 million. The first story of the platform will be used for natural gas production, while the second story will be used for exploration.

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 Turkey and Russia to sign new oil pipeline deal

OAO Gazprom, Russia’s largest company, and Turkey’s Calik Holding AS will sign an accord to build a pipeline between the northeastern port of Samsun and a terminal at Ceyhan on Turkey’s Mediterranean coast, Russian Energy Minister Sergei Shmatko told reporters in Ankara yesterday prior to a visit by Russian Prime Minister Vladimir Putin later this week.

Increased oil output from the Caspian region as Kazakhstan’s Kashagan field will add additional tanker shipments via the Black Sea. Tankers have been delayed as much as a month in passing through the Bosphorus Straits due to weather and seasonal conditions.

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 Turkish wind energy growing fast with feed-in-tariff in the pipeline

The Turkish wind energy industry is one of the fastest growing industries in the country. One reason is that Turkey’s growing industry needs an ever-increasing supply of energy. Furthermore, Turkey has just ratified the Kyoto agreement which is going to result in carbon emission reduction targets for the post 2013 period.

Among other renewable resources, wind has been the most popular and most accessible power source in the last four years. In 2005, the total installed capacity in Turkey was 20.1 MW generated by 34 turbines. With the introduction of the first Law on Renewable Energy Resources in 2005 by the Turkish Parliament, the market more than doubled in 2006 by reaching 50 MW, then tripled to 147 MW by the end of 2007.

As of today, Turkey has almost 490 MW of installed capacity, and by the end of 2010 it is projected to reach 1,500 MW — around 3.5% of the country’s total energy capacity. In 2007, the Turkish Electricity Survey and Development Administration (EIE) developed the Turkish Wind Atlas, which served as a big eye-opener to all types of investors. The Market Authority EMRA has licensed 78 projects constituting 2,900 MW of capacity. There have been almost 78,000 MW of license applications. Currently, the feed-in tariff for renewables is limited to 5.5 eurocent/KWh. The new proposed amendment to the law will offer 8 eurocent/KWh for on land wind power applications.

Turkey is becoming more attractive as public incentive discussions are becoming popular and power prices keep rising. The electricity price for residential customers saw an increase of 31% since last year. The next years are going to be exciting and full of opportunities for domestic and foreign investors. The Investment Support and Promotion Agency of Turkey (ISPAT) has identified renewable energy as an attractive area for foreign investment and is a good point of contact for any foreign investor that is willing to learn more about investment opportunities in the country.

 EWE Energy looks into new investments in Turkey

EWE Energy, an active player in Germany’s energy market and a major shareholder of Bursagaz and Kayserigaz of Turkey, is considering even more investments in Turkey. The fifth largest energy company in Germany is planning to expand into wind energy, taking into account Turkey’s vast resources in particular. The company’s CEO Werner Brinker highlighted the opportunities Turkey offers and mentioned their intention to acquire stakes in the Turkish energy companies. “We are interested in wind energy projects in Turkey. Also, solar energy projects may be considered in the medium term”, added Brinker.

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 Nabucco project has come after seven years of negotiations

Leaders of five countries (Turkey, Bulgaria, Romania, Hungary and Austria) that the pipeline crosses will sign the deal, officially starting the project which is widely regarded as a move to free the EU from its dependency on Russian gas. An investment of EUR 4.5 billion will be made in Turkey for the project. The natural gas pipeline will be 3,300 km long and will create employment for 10,000 people. Meanwhile, Turkey will generate tax income worth USD 400 million per annum. 

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 China on the Bosphorus

Emre Alcan, Partner of ALCAN, "Turkey could be the first in emerging Europe to return to a stable growth next year thanks to its robust banking system, lack of export dependency and enviable demographics. Many analysts forecast Turkey, dubbed "China on the Bosphorus", could see the strongest growth of the ailing emerging Europe region in 2010, with forecasts for economic growth next year as high as 3.0 percent.

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 USD 3 billion of investment from Czech partnered Akenerji

Akenerji, a subsidiary of Akkok Group, which last year established a partnership with one of the Czech Republic’s largest energy groups, CEZ Group, will increase its energy capacity to 3,000 MW by 2013 at an investment cost of USD 3 billion. 35 percent of the investments will be focused on renewable energy.

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 Mobius seeks opportunities in Turkey

Equities are "undervalued" in the majority of markets, while the most "exciting" are the emerging markets because they are expected to grow fastest, Mobius was quoted as saying by the Zagreb-based newspaper.

The most attractive investments are in energy, mining and retail, Mobius said. Valuations are most appealing in Hungary, Turkey and Russia, Mobius said according to Poslovni.

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 The private sector will be the only actor in electricity distribution by 2020

Speaking at a conference titled "Powering Turkey," Güler said the country may produce 90,000 megawatts in total if all the necessary investments are completed by the year 2020.

The increase in the number of private hydroelectric power plants in Turkey is derived from the "environment of trust" created by the government and new regulations aiming to ease private investment in the sector, he added.

Hasan Köktaş, the head of Turkey's Energy Market Regulation Agency, said their goal is to make the private sector the only actor in electricity distribution by 2020. Electricity demand increases 8 or 9 percent each year, he said, adding that the agency aims to use almost all the potential in hydroelectricity, geothermal and solar power areas by 2023 to compensate for the growing need.

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 Agaoglu eyes 1,000 MW energy plants in 3 years

Agaoglu Group will invest 1.2 billion euro in energy over the next three years and will establish plants producing 1,000 megawatts of energy, Murat Onuk, the chairman of Agaoglu Group's energy branch, said in a statement.

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 Turkey's TPAO to explore oil with US Chevron in southeastern

TPAO and its partner Chevron started location activities for the Cudi-1 well to explore oil, the agency reported citing TPAO officials.

 

The preparations began for Cudi-1, which will be located 25 kilometers from Silopi town in Sirnak, the officials said, adding that once location activities were completed next month, a drilling team would start to work in the region.

 

Turkey is also holding talks with Chevron on conducting oil exploration in the Black Sea.

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 Vestas signs contract for 33 MW in Turkey

The project is expected to be completed by early 2010.
Danish wind turbine manufacturer Vestas has received an order for 11 units of its V90-3.0 MW wind turbine to be installed at the Mersin project in Turkey. The order has been placed by the Turkish company Akdeniz Elektrik Uretim, a subsidiary of the Agaoglu Group.

Ali Agaoglu, president of the Agaoglu Group, said: "The Agaoglu Group is interested in contributing to the development of the wind energy industry in Turkey and this 33MW project is the first phase of a larger future project."

The Vestas Turkey office was officially established in January 2008. The office handles sales, project management and service activities in the country. As per 31 December 2008, Vestas has installed 70 turbines in Turkey corresponding to a capacity of around 170 MW.

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 RWE, Turcas Elektrik Uretim to build CCGT power plant in Turkey

800 MW gas-fired power station to be built near DenizliRWE Holding AS, RWE's Turkish subsidiary company, and the Turkish company Turcas Elektrik Uretim, a subsidiary of Turcas Petrol, have signed a joint venture agreement for the construction of an 800MW combined cycle gas turbine (CCGT) power plant near the city of Denizli, Turkey.

RWE said that it will own 70% in the joint venture company, which already holds pre-license rights for the power plant. Initially, the main task of the joint venture company is to continue the project development work and further advance the project.

A final investment decision is expected by the end of 2009 and construction of the CCGT power plant could start in early 2010.

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 New actors to begin operations in Turkey's natural gas market

Enerco and Avrasya Gaz, two companies that obtained import license from Turkey's Energy Market Regulatory Authority (EMRA), are set to start selling gas in Turkey. Four actors, in addition to the state-owned natural gas company Botas, will begin operating in Turkey's natural gas market on Wednesday, officials said.

After their contracts signed in 2007 to take over some distribution of imported natural gas in Turkey from the state-owned Botas, Enerco will sell 2.5 billion cubic meters (bcm) of natural gas per annum for 14 years and Avrasya Gaz will sell 500 million cubic meters (mcm) of gas for 13 years. Shell and Bosphorus were the first two companies to get the greenlight from EMRA for natural gas sales in Turkey.

Meanwhile, Socar-Turcas, the owner of Turkey's petro-chemical company Petkim, has plans to bring 1 bcm of natural gas from Azerbaijan and Turkerler Group has applied to EMRA to import 10 bcm of gas from Iraq.

EMRA Chairman Hasan Koktas said the annual natural gas sales by these four companies will amount to USD 1.5 billion in 2009. "Private sector share is expected to account for a ten percent share in Turkey's natural gas consumption in 2009; however, this share will grow in the future," he said.

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 EnerjiSA continues investing  

EnerjiSA, a joint-venture between Turkey’s Sabanci Holding and Austria’s Verbund, continues to invest despite the global financial turbulence. EnerjiSA, getting ready to build a power plant with an installed power of 450 MW on its existing coal basin in the southern Anatolian province of Adana-Tufanbeyli, aims to double the capacity. To this end, the company is a suitor for acquiring the nearby coal basin owned by the General Directorate of Turkish Coal Enterprises (TKI).

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 Hefty bank loans boost energy investments in Turkey

Many banks in Turkey have accelerated efforts to support energy investments domestically, with a considerable amount of loans already extended to energy projects.

With the steady growth of the economy, incentives offered by the government and an increasing demand from entrepreneurs, banks in Turkey have extended billions of dollars to energy companies within the last five years, the Anatolia news agency reported.

Emre Alcan, Partner of ALCAN, said the Turkish energy sector continues to be the focus of domestic and foreign investors despite the global turmoil.

Experts from the energy market stated that loans granted to the energy sector are expected to amount to $130 billion in 2020. Government incentives and the support of banks have enabled companies to continuously introduce new projects, particularly in the development of renewable energy, which focuses on wind, solar and geothermal energy. It is expected that the energy sector will be less affected by the general negative trends felt in the ongoing global financial crisis.

Garanti Bankası has provided close to $1.5 billion in loans for energy projects in Turkey to date, and the bank expects a distribution of $500 million in loans to the industry.

Officials from İş Bankası said banks have increasingly granted loans for energy projects because of increasing market demand. Today, loans are mostly provided for hydroelectricity projects, while support for wind power endeavors is rising since Turkey has the highest potential for wind power in Europe. İş Bankası officials said the amount of loans they provided for energy projects reached $790 million for 21 projects in Turkey. "We expect this number to reach $1 billion with some new loan applications that are currently being evaluated," they noted.

Experts from the energy sector suggested that Turkey should make around $130 billion in energy investments from now until 2020, and they anticipate that banks in Turkey will continue their support for the projects.

Mert Güvenen from Yapı Kredi said they similarly have extended around $1.3 billion in loans for energy projects in Turkey, the majority of which were hydroelectricity projects, and they plan to give loans for some wind power projects shortly. He said Yapı Kredi gave priority to energy investments when extending loans and will continue to do so. In regard to the amount of new loans they expect to grant to energy projects, he said spending authorization depends on the developments in global markets.

Officials from Vakıfbank said since the beginning of 2009, the bank has extended $324 million in loans for 15 energy projects and that the bank had recently received 20 new loan requests for energy investments which will require $60-70 million this year. Stressing that capacity utilization rates and industrial production declined in Turkey due to the crisis, they said energy investments will be negatively effected in the middle and long term. Emphasizing that energy investments have been and will continue to be in the limelight, Turkish and international banks alike are interested in providing loans for such projects.

Ömer Baktır from Halkbank said the institution was currently evaluating loan requests for 21 energy projects worth 190 million euros, and the bank expects to grant loans to some of them in the near future. He stated that the banks will have an important role in financing energy projects in Turkey in the upcoming period and that they are determined to continue giving support to such projects.

Cem Mengi from Akbank said they had provided $2.1 billion in loans for 31 energy projects. He said a few energy giants from the US and Europe have recently entered the Turkish market, giving a boost to energy investments in the country. "Also some regulations made by the Energy Market Regulatory Agency [EPDK] have played a major role," he noted, adding that the bank gives priority to green projects.

The head of Denizbank's project finance department, Ceyda Çetin Erten, said the amount of loans they extended for energy projects has reached $400 million. She said they expect to extend as much capital as they can for such projects in Turkey, noting that they will help the country greatly minimize reliance on foreign energy sources.