Renewable energy developer RES has called on the Turkish authorities to provide regulatory certainty to the clean power sector by continuing to deliver a feed-in tariff (FiT) for wind projects after 2020.
This is necessary to provide developers and investors with the security needed to maintain the industry’s early momentum, the company said.
According to RES, the Turkish market has seen the development and construction of 7.6GW of wind energy to date, with the ambition to reach to 25GW until 2030s.
However, there is a concern that the end of the FiT, currently proposed for 2020, will cause the market to lose its early edge as international investors pause on further projects, the company said.
RES also called for more renewables capacity to be released into the market, giving developers the opportunity to pursue the planning process for new sites.
It said that if the Turkish market is to follow other countries in moving away from subsidy regimes, then, additionally, there needs to be the right kind of market structures in place to facilitate the development of independent power purchase agreements (PPAs).
Key to securing a long-term future PPA market will be an overhaul of present rules that limit current agreements to one year only, the company added.
“At present, this fails to provide enough of an incentive for corporate off-takers to structure any future agreements, preventing any realistic long-term hedge against fluctuating power prices,” RES said.
RES general manager in Turkey Guray Erol said: “While we continue to see some good momentum in the Turkish market, with new commitments such as the Yeka tenders, and RES’s own development pipeline, we want to ensure that the Turkish market has the right kind of foundations in place to be able to move forward to a subsidy free environment successfully.
“In RES’s opinion, in order for the Turkish market to reach its full potential as a subsidy free market, then in the short term, the FiT needs to be continued – at a lower level if needs be – further capacity needs to be made available, and a long term framework adopted that will enable developers and investors to take merchant risk.”