The Turkish Energy Market Regulatory Authority (“Authority”) has published updated procedures and principles for supply companies to determine the base costs for retail price calculations, as well as elements which can be used during calculations and corrections. The Communiqué Regarding Regulation of Retail Prices for Energy (“Communiqué”) was published in Official Gazette number 29578 on 30 December 2015, entering into effect on 1 January 2016.

Supply companies must calculate energy retail prices in line with an equation outlined in Article 6 of the Communiqué. These prices must be determined based on the activities which are necessary for the relevant supply company to carry out energy sales activities (Article 5 of the Communiqué), including operation and energy costs. Supply companies cannot consider costs which are not specified. The Communiqué outlines the allocation keys to use when categorizing activities, as well as variables such as number of consumers and consumption amounts.

Retail sales revenue must be calculated for each tariff year, prior to the implementation period, based on the regulated operation cost and the depreciation charges specified for retail sale activity (Article 7 of the Communiqué).

For consumers which are subject to regulated retail tariffs, supply companies can only charge specified amounts or amounts which are collected in accordance with legal obligations (Article 9 of the Communiqué). These amounts are determined under the Communiqué, related laws, as well as by the Authority. The Communiqué includes a non-exhaustive list of revenues which are not subject to regulation, such as interest and incentive revenues.

Supply companies must present the necessary data to the Authority in the requested format (Article 16 of the Communiqué). The Authority will calculate the amount in accordance with the equation outlined in this article. The amount will be considered when calculating the revenue ceiling for 2016, under Article 11 of the Communiqué. The energy supply cost will be calculated in accordance with the equation given under Article 17 of the Communiqué.

The reference retail price for 2016 is set at 0.7233 kr/kWh under the circumstances outlined in Provisional Article 3 of the Communiqué.

Please see this link for the full text of the Communiqué (only available in Turkish).

Information first published in the MA | Gazette, a fortnightly legal update newsletter produced by Moroğlu Arseven.