SOLAR SECTOR PIVOTAL FACTS AND ISSUES IN TURKEY AND REMAININGS OF INTERNATIONAL ENERGY FORUM 2018

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SOLAR SECTOR PIVOTAL FACTS AND ISSUES IN TURKEY AND REMAININGS OF INTERNATIONAL ENERGY FORUM 2018 Cigdem Yorgancioglu

  

 

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SOLAR SECTOR PIVOTAL FACTS AND ISSUES IN TURKEY AND REMAININGS OF INTERNATIONAL ENERGY FORUM 2018

H.Cigdem YRGANCIOGLU

30 October 2018

 

It was my pleasure to attend 9th Turkey Energy Forum on October 1 2 at the Shangri La Istanbul as panel moderator. I personally   as Cigdem Yorgancioglu   found the  recently held conference informative and worthwhile and enjoyed being part of it.  Because, diverse and delivered dynamic group of speakers and panelists  provided  new outlook to energy sector  and  fascinating insights with enthusiasm and a positive spirit which made our time together both prolific and fun. The panel I have moderated covered  a wide range of issues including, complexities and nuances on PV front.

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The forum was premeditated to feature the loudest minds in the corporate, government and academic worlds, delivering the kind of business acuity that attendees can translate into bottom-line success. The forum was designed for those international players who prefer dynamic, more structured programs with broad networking opportunities, allowing effective exchanges of ideas. The audiences examined a variety of topics tailored to facilitate new alliances and business ventures in Energy sector. Both  small players and  market leaders  provided cutting-edge intelligence on emerging markets in Europe, including Energy, Renewable Energy, Cleantech, PPP, Investment and Energy Project Financing, Transport and Infrastructure,

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https://www.enerjigazetesi.ist/yazarimiz-cigdem-yorgancioglu-enerji-moderatorlugu-sapkasini-takacak/

 

 

http://politikaakademisi.org/2018/09/17/upa-yazari-cigdem-yorgancioglu-uluslararasi-turkey-energy-forumda-panel-moderatoru-sapkasiyla-yer-alacak/

 

https://eksisozluk.com/turkey-energy-forum--5788212

 

http://www.eelevents.co.uk/past-events/turkey-energy-forum-2018.html

 

 

 

Solar PV Industry Update: the State of the Market Under a Changing Regulatory Framework was the panel I moderated. This article will highlights the topics discussed  in the panel together with the general facts and issues in Solar sector.

 

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Turkey has the uppermost rate of growing energy demand among OECD countries over a decade energy import dependency of Turkey, predominantly on oil and natural gas, is snowballing due to this growing energy demand. Presently, Turkey is able to meet only around 26 % of its total energy demand from its own local resources. n terms of energy growth demand, So Turkey is the second country in the world (after China). Its energy sector is also profoundly dependent on imports with an average of EUR 35 billion for energy imports.  Increasing the ratio of local and renewable energy in our energy mix and increasing energy efficiency are some of key elements of Turkey’s  energy strategy and Turkey’s transition towards a low-carbon economy. Turkey has been vigorously involved in international cooperation efforts in this regard to address environmental issues that are complex and mostly related to socio-economic problems. .   Implementation of the most recent solar power plant products with smart grid stabilizing technology planning, coordinating, programming, tendering, procurement, implementation and monitoring of all the projects are quite important in this regard    decreasing trend of the System Integration prices in sense of PV Panels and BOS costs are some of the key fundamentals that makes the  projects  striking or not  in terms of Equity Internal rate of returns (IRR).

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Turkey has great solar energy potential due to its topographical position. The total annual insolation time is 2,741 hours (a total of 7,5 hours per day), and the total solar energy derived per year is 1,527 kWh/m2 per year (total 4,18 kWh/m2 per day), on the basis of  the Solar Energy Map (SEM) of Turkey structured by the Renewable Energy General Directorate,  The solar energy technologies are varied in terms of their methods, materials and technological levels, they can be categorized into two major groups:  the first one Solar Cells: Semi-conducting materials, known as photovoltaic solar energy systems, convert the sunlight directly into electricity. The second one is Photo-emissive Solar Technologies and Concentrated Solar Power (CSP): the heat is attained from solar energy, and can be used either directly or for the generation of electricity. The total proven solar collector area within our country as of 2017  is almost  20,000,000 m2. Likewise, in 2017, close to 823,000 TEP Tonnes Equivalent to Petrol) heat energy was generated via solar collectors. according to new statistics published by the country’s state-owned grid operator, TEIAŞ, which appeared on the twitter account of the company’s general manager, Abdullah Atalay. Turkey’s cumulative registered unlicensed PV capacity has reached 4.59 GW (AC) as of the end of March 2018, and total recorded unlicensed solar power of Turkey  has reached 4.62 GW (AC) as of the end of April 2018, according to new statistics published by  state-owned grid operator  Turkish Electricity Transmission Company (TEIAS), based on the declaration on  the twitter account of the company’s general manager. Around 1.7 GW of new PV installations were connected to the grid in Turkeyi  n 2017 and solar are expected to reach greater share in the country’s electricity mix

 

Turkey is presently aiming to install 5 GW of solar by 2023. As of the end of June 2018, the total installed capacity of the PV solar power plant is 4,723 MW, with 4,703 MW unlicensed and 23 MW licensed.TEIAŞ, reported just 18 MW of new, registered and unlicensed PV capacity. In July 2018 uncertainty for the Turkish economy was higher due to  devaluation ,lost value of the  Turkish lira and  one argument was focused on if   currency volatility and political uncertainty (especially due to  Bronson case) had  possibility to  jeopardize forthcoming investment in renewable  energy including Solar sector in  Turkey or not.

Since the beginning of 2018, newly registered unlicensed solar up to 1 MW has reached over 1.1 GW, while total cumulative capacity has topped 4.59 GW. In March alone, newly registered unlicensed solar power totaled 648 MW. In January and February, meanwhile, new registrations for unlicensed PV projects up to 1 MW reached around 522 MW. Thus, since the beginning of this year, around 1,170 MW of new, unlicensed projects have been registered by TEIAŞ’s official statistics. As for other new renewable energy sources, wind saw the addition of around 38 MW in March, while for geothermal power, newly registered capacity was 65 MW.

 

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Since the earliest solar panels were technologically advanced, it has been an objective for inventors to improve the efficiency of panels, so that further of the sun's energy can be collected and used.  Additionally the need to compromise with costs, attaining efficiency for as little cost as possible. The Turkish solar market experienced large volumes of development over the past two years due to the diminishing costs of the PV technology and to the unlicensed PV projects, which can in theory not exceed 1 MW, but can be joined in bigger solar parks comprising of several 1 MW sub-units.

In January 2011, the Law on Utilization of Renewable Energy Resources for the Purpose of Generating Electrical Energy (the "RER Law") experienced a significant set of amendments, in which feed-in tariffs and other incentives were introduced. With such amendments the   Renewable Energy Resources( RER) Law verified a renewable energy support mechanism namely   Renewable Energy Resources Support Mechanisms ("RERSM"). In order to achieve Turkey's 2023 target of increasing the share of renewable energy sources to 30 percent  the EML and the Law  was  also amended on 4 June 2016.  Further amendments followed, the Regulation on Certification and Supporting of Renewable Energy Resources (the "RERSM Regulation") was amended on 1 May 2016. Prior to the amendments, power plants under the scope of the RERSM Regulation were subject to a system in which the produced energy was traded to the market operator without a generation limitation or a risk regarding the price or amount of energy generated. Furthermore, power plants were free of compulsions regarding the steadiness mechanism. Hence, they did not have to reimburse any imbalance expenses. The RER Law guaranteed the prices in terms of US cents, and access to loans was relatively easy due to foreseeable cash flows. Power plants operating under the RERSM portfolio system could vend all of their products to a market operator and they were not supposed to engage in any market activity. With the amendments in the RERSM Regulation, power plants within this regulation's scope had possibility to  sell the generated energy directly to the free market. The Turkish government introduced the Renewable Energy Resource Zone (YEKA) model in 2016 targeting to commission large-scale renewable energy projects through utilization of locally-manufactured constituents in the renewable power plants.Turkey plans to hold 10 GW of solar tenders in next decade as a part of Turkey’s Renewable Energy Resource Zone (YEKA) project. Recent announcement of 3 GW YEKA Tenders includes. Energy Storage; the next 1 GW planned for January 2019.

 

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Vis-a-vis  the financing issues, In July 2018 The Turkish government decided to authorize foreign-currency loans for approved unlicensed PV projects to diminish domestic foreign exchange exposure for investors and inventors of PV projects with a capacity of up to 1 MW and which were approved by June 21, 2018. Previously, only licensed PV projects exceeding 1 MW in size were eligible for such kind of financing. Such new provisions made possible following amendments to Decree N. 32 on the Protection of the Value of the Turkish Currency, led by the government in May 2018 seemed promising to minor solar parks. Some opinion leaders think that, such measure with May’s decree, actually limits more and more the likelihood of using foreign-currency financing. Truly, under these constraints, legal entities in Turkey are proscribed from using this kind of financing, unless they are able to create foreign exchange income, that is to say revenue attained with activities that bring foreign currency into Turkey.

 

Unlicensed PV has fueled the Turkish solar market over the two past years, underwriting to a record growth especially in 2017, while licensed PV projects nominated by tenders still denote a small portion of the country’s installed capacity. However 2018 growth, is not estimated to reach a parallel performance, due to grid-fee increase and the dropping Turkish Lira. There comes a  time the cost of manufacturing and installing solar systems is low-slung enough that the return on investment creates installations just about feasible even without generous subsidies, nonetheless the solar industry categorically seems to have slowed down  Despite the slow-down, major players in the solar industry are still investing in the industry and, in recent months, some remarkable developments recorded by corporations, both in the field of solar panels, and in other arena incorporating solar technology.  

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Adding to  the facts  and issues abridged  above  to put it in a  comprehensive  nutshell, some of the take-out from the panel  highlights were  as follows:

 

 

In 2018, the local PV market is not projected to experience the same immense growth registered between 2016 and 2017, in which around 2.5 GW of solar was grid-connected, with registered unlicensed PV capacity reaching 3.39 GW. Based on this,  Turkish solar market will see slower growth in 2018 compared to that of last year. Although unlicensed PV projects are still benefiting from a FIT, an increase in the grid-fee for solar projects, may cause a lower level of deployment of solar installations for 2018.

 

Enhancement of financing conditions and bureaucratic procedures for the development of PV projects of all kinds is also said to be essential, in order to realize Solar sector determined goals.

Domestic production of PV technologies can be fully established with clear regulatory frameworks especially with th expiration of the current scheme subsidizing unlicensed projects up to 1 MW

The necessity of decreasing the Bureaucratic process that leads tardiness in solar sector

PV Solar Power offers clear advantages to decrease Turkey‘s dependency on oil & gas imports which hypothetically also provides  a reduction in current account deficit of Turkey  

 

benefits of Solar- Gas Hybrid Systems Grid Stabilizing Technologies may be taken into account

PV Solar Power in Turkey has the lowest LCOE in the last 3 years

More than 50 GW AC connection capacity is available according to the data published by the TEİAŞ

Bold steps ought be taken in order to achieve a substantial decrease of oil & gas imports

Self consumption centric streamlined regulation for Roof tops commercial use

Boost self-consumption centric Solar Cooperatives of Households , provide non agriculture treasury

 

Invitation for bids for the installation and operation of wind power capacity of 1 GW was placed by Turkey under the Renewable Energy Resources Area (YEKA) scheme.

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