Q&A: electricity generation and transmission in Türkiye

Regulation of electricity utilities – power generation

What authorisations are required to construct and operate generation facilities?

Market participants should obtain a generation licence from the Energy Market Regulatory Authority (EMRA) to construct and operate generation facilities (except for certain generation activities). The Electricity Market Law No. 6446 (EML) introduces a preliminary licence for generation activities. After obtaining the preliminary licence, investors are expected to fulfil certain requirements stated in the preliminary licences such as obtaining the necessary decisions, permits and approvals (eg, environmental impact assessment decisions for most of the application types, technical interaction permits for wind energy applications, approval of zoning plans for preliminary projects) or completing certain transactions such as property acquisition or establishment of usufruct right before applying for a generation licence. A preliminary licence can be given for a maximum period of 36 months.

As per the Electricity Market Licence Regulation of 2 November 2013 (EMLR), in both preliminary licence and licence applications regarding generation activity, applicants must submit a letter of guarantee to the EMRA for the amount determined based on the resource type by the EMRA for each installed capacity in megawatts. The ceiling for letters of guarantee for preliminary licence applications is determined by the EMRA and it does not exceed 5 per cent of the investment value. The letter of guarantee amounts to be submitted during the licence application will also be determined by the EMRA so as not to exceed 10 per cent of the investment value for generation licence applications.

To obtain a preliminary licence and a generation licence, an applicant must pay licence fees, the amount of which depends on the installed capacity of the generation facility, and must also pay annual licence fees depending on the generated electricity amount after obtaining the licence.

With regard to power plants based on domestic natural resources, the right to use such resources must be obtained. For instance, for hydroelectric power plants, private parties should sign an agreement on the right to use the water with the General Directorate of State Hydraulic Works (SHW) after obtaining the preliminary licence from the EMRA. For local mines and geothermal, market participants should sign a resource agreement for the use of the energy resource. Finally, for power plants based on solar and wind power, solar power plant or wind power plant contribution agreements with the Turkish Electricity Transmission Company (TEIAS) should be signed. According to the EML, in licence applications to establish a power plant based on solar or wind power, applicants should submit a measurement of a certain period duly taken within the past eight years in the area where the power plant will be established, and the EMLR regulates the processes and principles for such measurements.

If the landowner where the solar and wind power plant is to be established applies for a licence, no other licence application can be made for the relevant land. If there is more than one licence application for a solar or wind power plant for the same region or the same transformer station or both, the companies wishing to establish a solar or wind power plant must participate in a contest to determine which one of them will connect to the system. The purpose and scope of this Regulation is to determine the procedures and principles regarding the contest to be held by TEIAS based on the lowest price offer principle to determine the ones to be connected to the system up to the declared capacity among the applications for pre-licences made to establish wind or solar energy based production facilities within the framework of the Electricity Market Law, in case there are more applications than the declared capacity for connection to the same connection area and/or in case there is more than one application for the same area, and the rights and obligations of the legal entities that will participate in the contest. The principles and procedures of the contest are regulated by the Regulation on the Contest Regarding the Pre-licence Applications for Establishing Power Plants Based on Wind or Solar Power of 13 May 2017 (the Contest Regulation). As per the Contest Regulation, the applicants offer the electricity prices in a way that the highest price to be offered will be the incentivised price determined under the Law on Utilisation of Renewable Energy Resources for the Purpose of Generating Electrical Energy of 18 May 2005 (the Renewable Energy Law) for a period of 10 years.

A new regulation has entered into force regarding the contest. According to this regulation, legal entities that have been granted connection capacity within the scope of EML and have a production licence, pre-licence or licence application, and who will not be able to make investments due to increases in input and investment costs caused by unpredicted extraordinary conditions, have been given the right to cancel or amend the relevant contracts, licences, pre-licences or pre-licence/licence applications by applying to the Ministry of Energy and Natural Resources and the Energy Market Regulatory Authority upon request. In this context, the resulting capacity can be allocated to new investments that can be established in a shorter time and will be transformed into production more effectively and rapidly.

The capacity increase is allowed if the installed capacity is not exceeded and the opinion of TEIAS or the opinion of the relevant distribution company is positive. The legal entities holding electricity generation licences based on wind or solar energy that undertake to establish an electricity storage facility from the generation facilities can increase their generation capacity up to the installed capacity of the storage facility that they undertake to establish.

The EML provides that some activities may be conducted as being exempt from the preliminary licence and licence requirements. In line with the EML, the unlicensed generation activity was introduced with the Regulation on the Generation of Unlicensed Electricity in the Electricity Market of 2 October 2013 and the Communiqué on the Generation of Unlicensed Electricity in the Electricity Market of 2 October 2013. The regulation and communiqué were abolished and replaced by a regulation bearing the same name, published on 12 May 2019 (the Unlicensed Electricity Regulation).

With the amendments dated August 2022 on Unlicensed Electricity Regulation, it has been stated that unlicensed electricity generation is aimed to meet consumption needs, and the upper limit on installed capacity applied to such facilities has been removed. If there is sufficient capacity in the distribution and/or transmission system, it is allowed to establish multiple production facilities based on renewable energy sources with the same netting and support structure for a consumption facility. However, in practice, several technical constraints remain. For instance, TEIAS must approve the connection based on transformer fault current limits, and if those are exceeded, the application can be refused. Additionally, with the amendment made, the requirement for the consumption facility to be located in the same distribution region as the generation facility has been removed.

With the Regulation Amending the Regulation on Environmental Impact Assessment, published in the Official Gazette on 26 June 2025, the installed capacity threshold for subjecting solar power plants to environmental impact assessment (EIA) has been removed. The same amendment provides that solar power plants with 25 hectares or more and only wind power plants with 15 or more turbines, as well as offshore wind power plants, will now be subject to EIA. Previously, all wind power plants were required to undergo an environmental impact assessment.

The Unlicensed Electricity Regulation also regulates the activities that may be conducted as being exempt from the preliminary licence and licence requirements for the following categories:

• emergency groups and generation facilities not connected to transmission or distribution systems;
• a generation facility based on renewable energy sources with an installed capacity of up to 1 megawatt or the upper limit of the installed capacity determined by the Presidential Decree;
• municipalities’ solid waste facilities and generation facilities established for the disposal of mud from treatment plants;
• micro-cogeneration facilities (defined by the EML as cogeneration facilities that have a total installed capacity of 100 kilowatts or less);
• cogeneration facilities (defined by the EML as facilities that simultaneously generate both heat and electricity) and trigeneration facilities (defined by the EMLR as facilities where electricity generation, heating and cooling processes are carried out simultaneously) that meet the efficiency figures to be determined by the Ministry;
• a generation facility based on renewable energy sources that uses all of the energy it produces without giving it to the transmission or distribution system, and whose production and consumption are at the same measurement point;
• market activities carried out within the scope of electricity storage and demand side participation within the limits, procedures and principles to be determined by the Board after taking the opinion of the Ministry;
• generation facilities based on renewable energy sources established and operated by the State Hydraulic Works (SHW) or irrigation unions to meet the electricity needs of the agricultural irrigation facilities, provided that installed capacity is limited with the contractual capacity of the agricultural irrigation facility stated in the connection agreement or the sum of the agreement capacities of the facilities stated in the connection agreement, if there are multiple agricultural irrigation facilities;
• renewable energy generation facilities to be established at the same or different measurement points with the consumption facility, which the irrigation unions are responsible for operation, maintenance, repair, and management, on the immovable properties owned or under the disposal of the irrigation union and SHW up to the contracted capacity specified in the connection agreement; and
• the generation facilities to be established by special provincial administrations provided that it has technical feasibility and the project is approved by the SHW and it serves only for irrigation purposes.

With the Decision of the Energy Market Regulatory Board (Board) dated 16 May 2019 and numbered 8587, the information and documents required for unlicensed electricity generation applications are specified. To construct an unlicensed power plant, one should first apply to the relevant network operator (ie, the distribution company authorised in the region where the power plant will be located or TEIAS) with certain documents, such as land usage rights documents, an environmental impact assessment document or a single line diagram, depending on the energy resource.

If the relevant network deems the application sufficient, a call letter to invite the applicant to sign the connection agreement is sent. Upon the issuance of this document, the applicants have 30 days to obtain Environmental Impact Assessment documentation and 90 days to apply for project approval to the institution authorised by the Ministry of Energy and Natural Resources and have 180 days to obtain approval. Investors sign a connection agreement with the network operator within 30 days following the fulfilment of all requirements and submission of all the required documents. However, for an unlicenced power plant to become operational, the system usage agreement should also be signed within one month following the start of commercial activity. Under the Unlicenced Electricity Regulation, the acceptance of facilities must be made:

• in generation facilities utilising the distribution transformer owned by the relevant grid operator, for a period of one year;
• in generation facilities not utilising the distribution transformer owned by the relevant grid operator:
  • for hydro-based generation facilities, for a period of three years; and
  • for generation facilities based on other sources, for a period of two years.

Failure to obtain acceptance within these timescales will result in the termination of the technical interaction permit, connection agreement, allocated capacity, and permits regarding water usage rights, except in cases of force majeure and delays owing to reasons acceptable to the EMRA.

With the amendments on the Unlicensed Electricity Regulation, users can establish unlicensed power plants for their self-consumption without being subject to any installed capacity limit, even in different distribution regions. The only limit they have now is the upper limit determined under their system usage and connection agreement.

The concept of a storage-based electricity generation facility has been included within the scope of the EMLR as of November 2022. According to the regulation, preliminary licences will be granted by EMRA to legal entities that commit to establish an electricity storage facility up to the installed capacity of the committed storage facility.

Furthermore, new provisions have been introduced to the Law on the Use of Renewable Energy Sources for the Purpose of Generating Electricity for unlicensed production facilities that have completed 10 years to operate in the electricity market. In this sense, if the license fee and the hourly market clearing price formed in the electricity market during the license period exceed the current Renewable Energy Resources Support Mechanism (YEKDEM) price applied on a facility type basis, the facilities in question can switch to licensed production activities on the condition that the price difference is paid as a contribution fee to YEKDEM. Accordingly, the applicable license fee for these applications, the license period and other details regarding the transition to licensed production will be determined separately by EMRA. The price to be applied for the excess electricity to be produced in facilities with ongoing unlicensed production, not to exceed the PTF formed in the electricity market, and the procedures and principles regarding the application will be determined by the President.In general, regardless of whether the generation facility is licenced or unlicensed, it must not exceed the limit on its connection agreement. With the new amendment to the Electricity Market Connection and System Usage Regulation of 28 January 2014 (the Connection and System Usage Regulation), if requested by the Ministry on the grounds of security of supply, electrical energy exceeding the allowed capacity limit may be supplied to the system by the generation facilities for a period to be determined by the Board. In this context, the energy supplied to the system above the agreement power is not considered a power overrun.

What are the policies with respect to connection of generation to the transmission grid?

Turkish Electricity Transmission Corporation (TEIAS) has a legal monopoly regarding transmission activities. No other legal entity is allowed to construct and operate transmission networks. TEIAS must ensure that connection to the transmission system and the system-use demands of real persons or legal entities are met in a non-discriminatory manner.

With the amendment to the Connection and System Usage Regulation (Regulation), the obligation to apply to TEIAS for connection and system usage agreements within the pre-license period before applying for a generation license has been amended to cover only the connection agreement. According to the Regulation, if any new transmission plant or transmission lines to connect such a plant to the system are required for the connection of the generation plants to the system and if TEIAS does not have the necessary financing for such an investment, the investment can be made or financed by the company or companies that request connection to the new plant. The ownership and operation responsibility of the facilities or lines built in this context belong to TEIAS. The investment amount regarding the transmission facility is calculated according to the methodology prepared by TEIAS and approved by the Energy Market Regulatory Authority (EMRA). The investment amount is fixed in Turkish lira and deemed as the system usage fee received in advance, and it is subject to set-off with the system usage fee. The user does not pay the system usage fee (excluding value-added tax) until the investment amount is completed. If the total investment amount set off is not completed within five years, the remaining amount is paid to the relevant user in a lump sum at the end of the fifth year.

Does government policy or legislation encourage power generation based on alternative energy sources such as renewable energies or combined heat and power?

The Renewable Energy Law provides a renewable energy support mechanism that covers different incentives and benefits for renewable energy projects including feed-in tariffs.

Feed-in tariffs (fixed minimum electricity sale prices) for the legal entities holding generation licences that started operations in the period between 18 May 2005 and 30 June 2021, depending on the type of renewable energy projects, were determined as follows:

• Turkish lira equivalent of US$ 0.073 per kilowatt-hour for hydroelectric power plants;
• Turkish lira equivalent of US$ 0.073 per kilowatt-hour for wind power plants;
• Turkish lira equivalent of US$ 0.105 per kilowatt-hour for geothermal power plants;
• Turkish lira equivalent of US$ 0.133 per kilowatt-hour for biomass power plants; and
• Turkish lira equivalent of US$ 0.133 per kilowatt-hour for solar power plants.

The above-mentioned feed-in tariffs are applicable for 10 years from the operation date of the first installed capacity inserted in the generation licence if the whole facility entered into operation, and from the date the facility entered into the renewable energy support mechanism (RES mechanism) if it entered into operation partially.

According to Presidential Decree No. 3453, feed-in tariffs for the legal entities holding generation licences that start operations between 1 July 2021 and 31 December 2025 were denominated in Turkish Lira, depending on the type of renewable energy projects. These feed-in tariffs were subject to quarterly escalation (in January, April, July and October) each year according to a formula set out in the Presidential Decree subject to certain thresholds. This structure was later replaced by Presidential Decree No. 7189 dated 1 May 2023, which introduced a US$-indexed feed-in tariff mechanism as explained below.

However, by the Presidential Decree dated 1 May 2023 and numbered 7189, feed-in tariff has been updated and concepts of YEK Support Mechanism Base Price (YEKDEM Base) and YEK Support Mechanism Ceiling Price (YEKDEM Ceiling) were introduced. Facilities that enter into operation between 1 July 2021 and 31 December 2030 will be able to benefit from new feed-in tariff as of 1 May 2023.

The reference US$-indexed tariff ranges (YEKDEM Base and Ceiling) determined in Decree numbered 7189 and dated 1 May 2023 are as follows:

• from 6,75 US$ to 8,25 US$ per kilowatt-hour for Hydroelectric power generation plant with reservoir;
• from 6,30 US$ to 7,70 US$ per kilowatt-hour for River Type Hydroelectric power generation plant;
• from 4,95 US$ to 6,05 US$ per kilowatt-hour for Onshore Wind power generation plant;
• from 6,75 US$ to 8,25 US$ per kilowatt-hour for Offshore Wind power generation plant;
• from 9,45 US$ to 11,55 US$ per kilowatt-hour for Geothermal energy based production plant;
• from 4,95 US$ to 6,05 US$ per kilowatt-hour for Landfill Gas / Resources obtained from by-products of waste tire processing;
• from 8,10 US$ to 9,90 US$ per kilowatt-hour for Bio-methanation;
• from 5,75 US$ to 8,00 US$ per kilowatt-hour for Thermal Disposal (Municipal wastes, vegetable oil wastes, agricultural wastes without food and feed value, forest products other than industrial wood, industrial waste sludges and treatment sludges);
• from 4,95 US$ to 6,05 US$ per kilowatt-hour for Solar power generation plant;
• from 5,85 US$ to 7,15 US$ per kilowatt-hour for Pumped storage hydroelectric power generation plant; and
• from 9,45 US$ to 11,55 US$ per kilowatt-hour for Production plant based on wave or tidal energy.

Such feed-in tariff will be updated monthly within the specified range between YEKDEM Base and YEKDEM Ceiling, indexed to the US$. Such feed-in tariffs determined with the Presidential Decree effective as of 1 July 2025 are as follows:

• 305,40 Turkish lira per kilowatt-hour for Hydroelectric power generation plant with reservoir;
• 286,30 Turkish lira per kilowatt-hour for River Type Hydroelectric power generation plant;
• 224,80 Turkish lira per kilowatt-hour for Onshore Wind power generation plant;
• 305,40 Turkish lira per kilowatt-hour for Offshore Wind power generation plant;
• 428,44 Turkish lira per kilowatt-hour for Geothermal energy based production plant;
• 224,80 Turkish lira per kilowatt-hour for Landfill Gas / Resources obtained from by-products of waste tire processing;
• 366,90 Turkish lira per kilowatt-hour for Bio-methanation;
• 286,12 Turkish lira per kilowatt-hour for Thermal Disposal (Municipal wastes, vegetable oil wastes, agricultural wastes without food and feed value, forest products other than industrial wood, industrial waste sludges and treatment sludges);
• 224,80 Turkish lira per kilowatt-hour for Solar power generation plant;
• 265,11 Turkish lira per kilowatt-hour for an Electricity storage facility integrated with a wind or solar power generation plant;
• 428,44 Turkish lira per kilowatt-hour for Pumped storage hydroelectric power generation plant; and
• 286,30 Turkish lira per kilowatt-hour for the Production plant based on wave or tidal energy.

These Turkish lira amounts represent the applicable feed-in tariffs as of July 2025, based on the US$-indexed YEKDEM Base and Ceiling ranges and the prevailing foreign exchange rate.

To benefit from the RES mechanism, legal entities holding renewable energy generation licences and the renewable energy support certificate should apply to the Energy Market Regulatory Authority (EMRA) by 30 November of the year before they wish to benefit. YEKDEM is operated by the market operator on a calendar year locked-in basis.

Generators included in the RES mechanism remain in the concerned mechanism for the whole year. After the above-mentioned 10-year period provided to renewable energy generation facilities expires, facilities generating renewable energy will not be able to participate in the RES mechanism and will only be able to sell their electricity in the market at the market price or through bilateral agreements just like the other market participants at negotiated prices without benefiting from the incentives. The Renewable Energy Law also features further incentives as bonus tariffs for licence holders that use locally produced mechanical or electromechanical equipment or both, or components of this kind in renewable energy facility for a five- or ten-year term, depending on the type of source.

However, on 11 May 2024, pricing for unlicensed electricity generation facilities that have completed their 10-year term was amended. Accordingly, unlicensed electricity facilities that have completed their 10-year term can switch to licensed generation activities upon the request of the facility owner. Under the former regulation, 15 per cent of the hourly market clearing price in the electricity market was required to be paid as a contribution to YEKDEM to transition to licensed generation activities. With the amendment, the electricity prices of such power plants have been changed. Therefore, the facilities benefiting from this right will now pay the price difference as a contribution to YEKDEM if the hourly market clearing price in the electricity market during the license period is higher than the current YEKDEM price applied for the relevant facility type pursuant to article 6 of the Law on the Use of Renewable Energy Resources for Electricity Generation. It is aimed to ensure that generation facilities that will complete their 10-year term and start licensed generation activities are included in YEKDEM or obtain generation licenses as a result of Renewable Energy Resource Areas (RERA) contests and generate income in line with other licensed generation facilities.

The Renewable Energy Law authorises the President to determine these bonus tariffs (in terms of tariff amount, terms and the eligible energy sources) that will apply for facilities that commence generation after such date. It is also stated that after the mentioned 10-year period, procedures and principles regarding the operation of these power plants will be determined by the President. With the Presidential Decision of 18 September 2020, renewable energy generation facilities that started their operations between 1 January 2021 and 30 June 2021 will also be able to benefit from the bonus tariffs provided in the Renewable Energy Law for locally manufactured components used in these generation facilities for five years. Such bonus tariffs differ according to the type of renewable energy and the component manufactured from US$0.004 to US$0.035 per kilowatt-hour. The Regulation on the Support of the Local Components of 28 May 2021 (the Local Manufacture Regulation) stipulates the principles, standards and certification processes regarding locally manufactured mechanical and electromechanical components. The components used in the construction of the power plant and the parts that constitute these components and the percentage of each part in these components are outlined in the Local Manufacture Regulation. The Local Manufacture Regulation provides that the bonus tariffs shall apply in proportion to the percentage of each locally manufactured part in the components, provided that the locally manufactured parts constitute at least 55 percent of the relevant components. According to Presidential Decree No. 3453 dated 30 January 2021, the bonus tariffs for the renewable energy facilities that will start their operations between 1 July 2021 and 31 December 2025 would benefit from a bonus tariff of 0.8 Turkish lira per kilowatt-hour regardless of the type of renewable energy project.

However, changes have been made to the bonus tariff for locally manufactured components and their application periods by the Presidential Decree dated 1 May 2023 and numbered 7189. Bonus tariffs that will be applicable for renewable energy generation facilities that started their operations between 1 July 2021 and 31 December 2030 have been differentiated according to their sources both in terms of price levels and duration as of 1 May 2023. The application period of bonus tariffs for locally manufactured components has been updated to 10 years for wind and solar power plants integrated with electrical storage facilities, pumped hydroelectric power plants, and wave or tidal energy-based power plants, and five years for other types of facilities. The tariff is also updated as 38.45 TL/ KWh for storage system integrated to the wind or solar power plants, pumped hydroelectric power plants, wave or tidal energy-based power plants and offshore wind power plants, as 21.58 TL/KWh for biomass power plants based on thermal disposal and as 28.80 TL/KWh for the rest of the sources.

According to the Turkish National Energy Plan, Turkey has set a target of 5GW of offshore wind power installed capacity by 2035. In line with this target, candidate RERA areas have been allocated off the coasts of Bandırma, Bozcaada, Gelibolu and Karabiga. Globally, wind capacity is projected to quintuple in the next 10 years, increasing the demand for vessels required for RES installations.

With the Amendment on the Regulation on Unlicensed Electricity Generation in the Electricity Market, in case of negative results of the technical interaction permit in wind energy-based applications, the applicant was given the right to apply to the relevant network operator for site change or revision within 60 days, provided that it is connected from the same substation for distribution level connections and from the same transmission region for transmission level connections.

With the decision numbered 11098, EMRA made an amendment to the Unlicensed Electricity Regulation aiming to balance the generation and the consumption amount concerning the surplus energy from the generated electricity from the unlicensed facilities. With the developments in the electricity market, the amount of generated electricity exceeding the consumption will be considered a free contribution made by the unlicensed electricity facility to the YEKDEM system.

The Electricity Market Law No. 6446 (EML) permits capacity increases, modernisation, renewal investments and modifications under certain circumstances. On the other hand, if generation facilities based on renewable sources obtain approval for a capacity increase from the EMRA after 28 February 2019, the increased capacity will not be able to benefit from the incentives. Accordingly, the formula to calculate the RES Mechanism fee to apply has also been amended to reflect this change (by applying the ratio of the old installed capacity to the new install capacity to the generation amount).

Regulation on Renewable Energy Resource Areas (the RERA Regulation) dated 9 October 2016 designates special renewable energy resources areas (RERAs)s. RERA Regulation enables the use of state-owned lands by private parties for electricity generation from renewable resources.

As opposed to the small capacities allocated for each generator in a conventional licence-obtaining process, under the RERA Regulation, high installed capacities can be allocated to one generator through the execution and award of a RERA Agreement. While the RERA Regulation sets forth two different methods for the designation of the RERAs, in both methods, the a RERA Agreement through a contest, the procedures of which are regulated in the RERA Regulation. Different from the conventional licence-obtaining process, the RERA Regulation requires the use of locally manufactured components in the generation facility to be established in the RERA. The applicants of such contests will either be required to manufacture the components themselves in Turkey, in their own factory, or undertake to use components locally manufactured by third parties or both, depending on the specific requirements outlined in the specifications regarding the relevant RERA Agreement. In cases where the party to the RERA Agreement will be required to locally produce the components, it will also be required to perform research and development activities under the requirements to be stipulated under the specifications. As applicable to both methods, as per the RERA Regulation, the highest electricity purchase price that may be offered during the contest will be outlined in the specifications of each contest, taking into consideration the feed-in tariffs set forth for the generators subject to the RES mechanism in the renewable energy legislation. The winner and the purchase price of the electricity will be determined during the contest as the bidder offering the most suitable bid.

The Regulation Amending the Regulation on Renewable Energy Resource Areas was published by the Ministry of Energy and Natural Resources in the Official Gazette No. 32683 on 5 October 2024. The term 'RERA usage right' has been removed from the Regulation, and a definition of the 'RERA Agreement' has been introduced instead. Prior to this amendment, a connection opinion from TEIAS was required following the designation of an area as a Candidate RERA. This procedure has now been repealed. Instead, areas deemed suitable will directly be announced as Candidate RERAs for further technical assessments. Previously, the approval of the General Directorate of Energy Affairs was required for Candidate RERAs. Under the amended Regulation, inquiries will now be made to relevant institutions and organisations designated by the Ministry, or the Environmental Impact Assessment (EIA) process will be initiated. Within this framework, the installable capacity will be determined by assessing the usable land within each Candidate RERA. Where necessary, a sufficient number of energy measurement stations will be established and/or commissioned on site, depending on the resource type. The Regulation also provides that permits must be obtained from landowners for such activities. Candidate RERAs that have either been reviewed by relevant institutions or received a 'Positive' or 'Not Required' EIA decision will be officially designated as RERAs via publication in the Official Gazette, and subsequently communicated to relevant authorities for inclusion in regional development plans.

According to the Regulation, letters of guarantee submitted for bids other than the top three most suitable offers, determined in line with the criteria set out in the tender specifications, will be returned. Additionally, the term 'low bid' has been removed from the Regulation and replaced with the term 'most suitable bid.'

Unlicenced electricity generation facilities are subject to a price guarantee different than the feed-in tariffs. It is the retail single-time active energy price for the specific subscriber group of their consumption facility, as announced by EMRA in TL/KWh. In the context of unlicenced electricity generation, there is a system called net metering mechanism. It allows the unlicenced electricity generator to offset the excess electricity they generate against their consumption from the grid monthly. The surplus electricity generated by the producer is fed into the grid, and the energy supplier deducts this amount from the electricity consumed by the producer during the monthly billing period. The generator is billed only for the net electricity consumed after deducting the surplus generation. This mechanism enables the unlicenced electricity producer to reduce their electricity costs by effectively utilising their own renewable energy generation and contributing to the grid.

The surplus electricity will be purchased by the relevant authorised supply companies from the tariffs for 10 years from the start of electricity generation in such facility. However, while the licence holders may continue selling their electricity freely after the expiry of such 10 years, an unlicenced generator will not be able to sell the electricity it generates through the system and only continues to use it for its own consumption. Unlicensed generators may now apply for a licence to benefit from additional incentives and continue sales. However, those who remain unlicensed cannot benefit from such rights. With the Local Manufacture Regulation and the amendment in the Unlicenced Electricity Regulation in line, unlicenced facilities cannot benefit from bonus tariffs applied to the use of locally manufactured components.

Under the regime set forth with the RERA Regulation, on the other hand, the electricity that will be generated by the generation facility will be subject to a purchase guarantee under the RES mechanism at the price stated in the RERA Right of Use (that will be signed by the Ministry and the winner), which is determined as per the contest results. The company obtaining the RERA Usage Right under a contest will not have an option to opt in or opt out of the RES mechanism. The purchase period will start from the date of execution of the RERA Usage Right agreement (not from the date of the licence issuance) and after the expiry of this period, the licensee may sell its electricity in the market with its generation licence.

Renewable energy generation plants can be established without a zoning plan in the areas declared as RERA by the Ministry of Energy and Natural Resources in the seas, dam lakes, artificial lakes and natural lakes, except for the reservoirs and wetlands from which drinking-utility water is supplied and the coasts and coastlines within the scope of the said law. In the said areas, multi-source generation facilities based on renewable energy resources can be established by legal entities holding pre-licence or generation licence based on hydraulic resources.

Another incentive was granted for the renewable energy facilities regarding the use of state properties. If any state property is used for generating electricity from renewable resources or mines and minerals, the Ministry of Environment and Forestry or the Ministry of Finance shall permit the use of such properties concerning the facility and access ways and energy transmission grids up to the connection point of the grid in return for a fee. This permission may be in the form of permits, leases, rights of easement or rights of usage. For facilities that start operating before 31 December 2025, for access ways and energy transmission grids up to the connection point, a discount of 85 per cent shall be applied to the fees for permission, lease, right of easement and right of usage for the first 10 years starting from the date of their licence. Additionally, with Presidential Decree No. 5209, a new incentive was granted for unlicensed solar power plants providing some exemptions, such as:

• VAT exemption;
• Customs Duty Exemption; and
• if the Investment Contribution Rate is 30 per cent outside the Organized Industrial Zones (OIZ), 40 per cent is deducted from the corporate tax to be paid, and the portion exceeding 70 per cent is reduced from tax to be transferred to the following years.

Insurance Premium Employer's share support will be applied for seven years inside the OIZ and six years outside the OIZ. According to the Electricity Market Licence Regulation of 2 November 2013 (EMLR), the legal entities applying for a preliminary licence and licence for the generation facilities based on domestic natural resources and renewable energy resources shall only pay 10 percent of the total preliminary licensing and licence-obtaining fees. Generation facilities based on renewable and domestic energy resources shall not pay annual licence fees for the first eight years following the first provisional acceptance date of the power plant.

Also, TEIAS and distribution licensees must give priority to the system connection of generation facilities based on domestic natural resources and renewable resources.

Combined electricity generation facility, combined renewable electricity generation facility, supportive sourced electricity generation facility and joint-fired electricity generation facility concepts and related new provisions regulating and permitting the establishment of auxiliary generation units from another source in addition to the main generation power plant were also introduced in the Electricity Market Licence Regulation. While a ‘combined electricity generation facility’ is defined as a single facility established to generate electricity from multiple energy resources connected to the grid from the same connection point, a ‘combined renewable electricity generation facility’ is defined as a single facility established to generate electricity totally from multiple renewable energy resources connected to the grid from the same connection point. A ‘supportive sourced electricity generation facility’ is defined as a single electricity generation facility also benefiting from another energy resource in the thermal conversion process.

Finally, a ‘joint-fired electricity generation facility’ is defined as a single electricity generation facility where a renewable auxiliary resource is fired in addition to the main resource, which is not a renewable energy resource. All these facilities are together referred to as ‘electricity generation facilities based on multiple resources’. As per the Licence Regulation, the auxiliary resource in the generation power plant cannot be transformed into the main source in the combined renewable electricity generation facility and combined electricity generation facility. The preliminary licence application procedures for the auxiliary source in these two facilities are conducted under the same provisions of obtaining a conventional licence, except for the contest applied in the preliminary licence application. The amount for obtaining a licence and the security amounts to be provided by the applicants of combined generation facilities are calculated by taking into consideration the sum of the installed capacities of the main source and the auxiliary source.

Pursuant to the amendment on the Electricity Market License Regulation, TEIAS will submit a report to the Ministry of Energy and Natural Resources and the EMRA on the regional generation facility capacities that can be connected to its systems by connection point or on a regional basis for the following five years and for the following 10 years until 1 October of each year, except for the applications to be made for RERA, and the capacity allocated for generation facilities based on wind or solar energy will be determined separately in the said report.

At the same time, changes were made for unlicensed investments in wind power plant sites. Accordingly, with the amendment made in the article titled 'Right of priority in case of more than one application to the same place', it was also made possible for the owners of the right of use in wind power plant sites to establish unlicensed generation facilities.

In line with these insertions in the Licence Regulation, certain amendments were also made in the Regulation on the Documentation and Support of the Renewable Energy Resources on the same date. Under this legislation, if generation facilities that are within the scope of the renewable energy support mechanism (RES Mechanism) are transformed into a supportive sourced electricity generation facility or combined renewable electricity generation facility using solely renewable resources, there will be no change in the period that the facility will benefit from the RES Mechanism. If all the resources used in a supportive sourced electricity generation facility are renewable, then this facility will be subject to the feed-in tariff applied to the main resource for the period remaining for the unit subject to the main resource. The same legislation also stipulates that the energy amount that is generated in a combined renewable electricity generation facility will be within the scope of the RES Mechanism at the lowest of the feed-in tariff prices determined for the renewable energy resources used in such a facility for the remaining period that the facility may participate to the RES Mechanism. The Regulation does not provide a new provision setting forth benefits for the RES Mechanism for a combined electricity generation facility where only the supportive resource is renewable.

Additionally, Regulation on the Documentation and Support of the Renewable Energy Resources regulates whether the electricity generated shall be evaluated under YEKDEM or not for the facilities integrated with the storage unit. Regarding the amount of energy supplied through the integrated electricity storage unit in the storage-based power generation facility and the YEKDEM eligible power generation facility, the following provisions are accepted: First, the energy supplied to the grid after being generated and stored in the power generation facility is considered under the scope of YEKDEM. Second, in case energy is withdrawn from the integrated electricity storage unit in the storage-based power generation facility to the YEKDEM-eligible power generation facility during any reconciliation period, the energy is primarily withdrawn from the grid, and the amount of energy withdrawn from the grid is supplied from the electricity storage unit without being subject to YEKDEM. Third, the energy supplied from the electricity storage unit to the grid above the amount withdrawn from the grid, is considered as falling under the scope of YEKDEM.

What impact will government policy on climate change have on the types of resources that are used to meet electricity demand and on the cost and amount of power that is consumed?

Government energy policy promotes renewable energy resources to tackle climate change. The government is also promoting energy efficiency to decrease the amount of power that is consumed. Turkey signed the Kyoto Protocol in February 2009; however, it is not listed in Annex B of the Protocol. Turkey signed the Paris agreement and opened for the signature at the United Nations Climate Change Conference (COP 21) on 22 April 2016 and ratified the agreement on 11 October 2021. Turkey has pledged a net zero commitment by 2053.

Also, after ratifying the agreement, Turkey declared that it is preparing a regulation regarding Climate Change under the terms of the Paris Agreement. The Climate Law (Law) No. 7552 was published in the Official Gazette No. 32951 and entered into force on the same date. The purpose of the Law is to combat climate change, support green growth, and achieve net-zero emissions. Within this scope, the Law sets out core principles, outlines the duties and authorities of public institutions, and regulates activities aimed at reducing greenhouse gas emissions, including the Emissions Trading System (ETS) and related sanctions.

In line with the Law, emission reduction activities must comply with the Nationally Determined Contribution (NDC), the net-zero target, and strategies and action plans issued by the Climate Change Presidency (Presidency). A Turkey Green Taxonomy will be developed and implemented by the Presidency, while a Border Carbon Adjustment Mechanism (BCAM) will be introduced to address embedded emissions in imported goods. The procedures and principles regarding BCAM will be determined by the Ministry of Trade.

The ETS — a market-based mechanism designed to cap and reduce emissions — will be established nationally. Under this system, emission allowances may be traded, and EPIAS will operate the ETS market. Businesses that cause direct emissions will be required to obtain an emission permit from the Presidency within three years of the Law’s entry into force. During this transition period, they will be deemed to hold a one-time temporary permit.

Companies covered by the ETS must surrender allowances each year equal to their verified emissions; this obligation can partly be met through equivalent carbon credits. Businesses not subject to the ETS may also voluntarily purchase carbon credits to offset their emissions.

The Law also governs voluntary carbon markets, where companies that emit below their allocated allowances may sell their surplus to others. Conversely, those that exceed their limits may obtain credits from this market. Emission reductions in this context must be verified by third-party organisations, in accordance with defined standards and methodologies. Verified carbon credits may be used either to meet ETS requirements or to achieve voluntary climate targets.

In case of non-compliance, administrative sanctions may be imposed, including fines and — in certain situations — the suspension or revocation of permits. The maximum administrative fine is set at 50 million Turkish lira. The Ministry may grant a one-time grace period of up to one year for corrective action. According to a provisional article of the Law, administrative fines during the ETS pilot phase may be reduced by up to 80 per cent. The Carbon Market Board is responsible for determining the duration and scope of the pilot period, as well as implementation procedures.

Public institutions and organisations must fulfil their legislative and planning obligations by 31 December 2027, with the possibility of a one-year extension by Presidential decree. Local climate action plans must also be prepared by the same deadline, subject to a possible extension granted by the Ministry.

The Turkish government's policy on climate change is aimed at reducing greenhouse gas emissions and promoting sustainable energy practices. While there may be initial costs associated with the transition, the long-term benefits include a cleaner energy mix, reduced environmental impact, and potentially more stable and affordable electricity prices. According to the 2024-2030 Climate Change Mitigation and Adaptation Strategy and Action Plan of the Ministry of Energy and National Resources, with the realisation of this target, which corresponds to a 16 per cent reduction in Turkey's primary energy consumption between 2024 and 2030, 100 million tons of CO2 equivalent. Greenhouse gas reduction is projected. In order to achieve these targets, public financial resources are planned to be directed to energy efficiency-oriented investments, improvement programmes and incentive practices, taking into account the cost-benefit balance. In addition, the Ministry of Energy and National Resources states that it is important that non-public financial institutions play a more active role in energy efficiency financing and mobilise foreign and international financial resources. The Presidency of Climate Change has explained its vision in its Strategic Plan covering 2024-2028, as follows: to lead the realisation of the green transformation in Turkey's Century, without leaving anyone behind, and to build climate resilience in line with the 2053 Net Zero Emission Target.

Does the regulatory framework support electricity storage including research and development of storage solutions?

Electricity storage-related secondary legislation entered into force in May 2021. Electricity storage legislation’s scope excludes pumped hydroelectricity power plants and uninterruptible power supplies. The electricity storage facility is defined in the relevant regulation as ‘a facility that could store electrical energy and transmit the stored energy to the system’. The relevant regulation differentiates the storage facilities as:

• storage facilities that may be established by grid operators (transmission system operators) and distribution system operators);
• stand-alone storage facilities;
• storage-based generation facilities;
• storage facilities integrated into generation facilities; and
• Storage facilities integrated into consumption facilities.

A separate licence for the storage facility is not needed, as the storage facility can be established through an existing licence by amendment.. A temporary article was added by the Regulation Amending the Electricity Market Licensing Regulation, published on 21 May 2025. According to the amendment, legal entities that (1) have applied to the Authority for a stand-alone electricity storage facility under a supply licence, (2) whose applications have been deemed eligible, or (3) whose supply licences already include a stand-alone electricity storage facility, must fulfil capital and collateral obligations related to these facilities within three months from the effective date of the article. Legal entities holding a supply or aggregator licence that intend to establish a stand-alone electricity storage facility must apply to EMRA for a licence amendment in order to incorporate the facility into their licence. The capital requirement is calculated by adding 20 per cent of the total investment amount estimated by EMRA for the stand-alone electricity storage facility to the minimum capital amount set by the Board for supply or aggregator licences. The collateral amount, on the other hand, corresponds to the value calculated based on the capacity of the storage facility and the rates determined by the Board. If the relevant obligations are not fulfilled within the prescribed period, the stand-alone electricity storage facility or facilities incorporated into the licence shall be removed from the licence.

On the other hand, with the recent developments on the electricity market, legal entities that commit to establishing an electricity storage facility are granted a preliminary licence by the Energy Market Regulatory Authority (EMRA) for the establishment of wind and/or solar energy-based electricity generation facilities up to the installed capacity of the committed electricity storage facility. It is stated that the electricity storage unit within the generation facility with storage facility is not subject to a separate licence or preliminary licence and should be added to the existing licence through an amendment.

Additionally, for storage-based electricity generation facilities under the scope of the Electricity Market Licence Regulation of 2 November 2013 (EMLR), the minimum capital required for the preliminary licence and a guarantee must be provided.

Furthermore, the following requirements apply: (1) the maximum ratio of the electrical installed capacity of the wind or solar energy-based electricity generation facility to the committed installed capacity of the electricity storage unit should be 1, (2) applications for wind energy-based projects should have a minimum installed capacity of 20MW, and solar energy-based projects should have a minimum installed capacity of 10MW and should not exceed 250MW, (3) the minimum ratio of the committed electricity storage capacity to the installed capacity of the electricity storage unit should be 1, and (4) the committed electricity storage unit should be located within the boundaries of the applied power plant site.

According to the EMRA, more than 5,000 pre-licence applications for generation facilities with storage have been submitted to the EMRA to date. Of these, 231 were returned, 1,912 were rejected and 399 were accepted and entered into force. While the number of applications under evaluation is 256, there are 3,071 projects in the application phase. The total capacity of the preliminary licences in force and the projects under evaluation and application has reached 750 GWh. The Regulation Amending the Electricity Market License Regulation was published in the Official Gazette on 14 October 2023 and entered into force. For the reasons, the amendment regulated generation facilities with storage and renewable energy resource area applications. Accordingly, with the temporary article added to the regulation, pre-licence applications for electricity generation facilities with storage, the scope of which is specified in the relevant regulation, have not been received since then until a new decision is made by EMRA.

As of mid-2025, the suspension on new pre-licence applications remains in force. However, several projects that had already been granted pre-licences have progressed to the generation licence phase. Notably, in March 2025, EMRA issued generation licenses to multiple storage-integrated projects, including Mersin WPP and Oze SPP. In addition, contracts have reportedly been signed for storage facilities with a total installed capacity of around 1,500MW.

If an electricity storage facility is to be added to a generation facility covered by a generation licence, it must be added through an amendment. In this context, the following conditions must be met: (1) not exceeding the boundaries specified in the licence, (2) no change in the specified electrical and/or mechanical installed capacity, (3) no change in the existing connection method, connection point and voltage level specified in the licence, and (4) obtaining a positive opinion on the connection of the electricity storage unit to the system and its system usage.

For stand-alone storage facilities, licence holders of supply licences are required to submit an amendment application to be added to their existing licences. In these licence amendment applications, the technical compliance of the facility is evaluated by seeking an opinion from TEIAS (Turkish Electricity Transmission Corporation).

A positive opinion by the Ministry of Energy and Natural Sources regarding the environmental impact assessment is required. However, TEIAS’s opinion on whether the storage unit complies with the technical criteria is necessary in all cases.

Does government policy encourage or discourage development of new nuclear power plants? How?

To promote private sector nuclear energy investments, the Nuclear Energy Law (Nuclear Law), the first such law in Turkey, was published on 21 November 2007 as a legislative proposal and the Nuclear Law was published on 8 March 2022 to try to cover the developments on the Nuclear Energy sector.

The purpose of the law is to stipulate the procedures and principles regarding the commissioning and operation of nuclear power plants for electrical energy production and energy sale under energy planning and policies.

The Turkish Atomic Energy Authority and the Energy Market Regulatory Authority (EMRA) have published the vast majority of legislative documents and criteria regarding nuclear safety, licensing, reactor types, power plant lifetimes, proven technology, fuel technology, localisation, operational records and electrical power. In 2018, a regulatory authority, namely the Nuclear Regulatory Authority (NRA) was established, and regulatory authorities of the Turkish Atomic Energy Authority have been transferred to the NRA.

The Turkish government promotes nuclear power plants. Currently, there are three nuclear power projects either in the process of realisation or being considered to be realised. One of those is the Akkuyu Power Plant, which is currently being built by one of the subsidiaries of Rosatom State Atomic Energy Corporation, Akkuyu NPP Joint Stock Company. The installed capacity of the Akkuyu Power Plant is expected to be 4,800MW and it is estimated that it will meet approximately 10 per cent of Turkey's electricity demand. Akkuyu Nuclear Power Plant, has achieved the classification of a 'nuclear facility' following the arrival of fuel on April 2023. After completing the necessary tests and preparations, the first unit is scheduled to be operational. The aim is to commence electricity generation from nuclear energy.

Additionally, on 8 March 2022, Nuclear Law was published in the Official Gazette. With the law, general principles regarding the activities to be carried out regarding nuclear energy and ionising radiation are determined.

Natural or legal persons who will carry out any activities related to nuclear energy and nuclear materials shall apply for a licence from the Nuclear Regulatory Authority and will be obliged to comply with international agreements and conventions related to nuclear assurance to which Turkey is a party.

In addition, the export, import, transportation and transit of radioactive materials, within the scope of nuclear assurance, materials, equipment, systems, components and related technology and nuclear dual-use materials, equipment, systems, components and materials specially designed or prepared for use in the nuclear field are the subjects of the Nuclear Law. Within the scope of nuclear assurance, it will be obligatory to obtain permission for the import of substances, materials, equipment, systems, components or related technology determined by the institution, and for other activities determined by the institution, taking into account safety, security and nuclear assurance. Last, with the amendment made to the Law in 2024, in accordance with the provisions of the Convention on Civil Liability in the Nuclear Energy Field dated 29 July 1960, it is regulated that the carriers may also be liable upon the request of the person transporting nuclear material, with the consent of the nuclear facility operator and the approval of the NRA.

Regulation of electricity utilities – transmission

What authorisations are required to construct and operate transmission networks?

The Turkish Electricity Transmission Company (TEIAS) has a legal monopoly on transmission activities. No other legal entity is allowed to construct and operate transmission networks. TEIAS also holds a transmission licence from the Energy Market Regulatory Authority (EMRA) to conduct transmission activities. The transmission licence can be issued for a maximum of 49 years and a minimum of 10 years at a time.

Who is eligible to obtain transmission services and what requirements must be met to obtain access?

Legal entities engaged in generation activities, distribution companies and organised industrial zone distribution licence-holding companies, electricity storage facilities, unlicenced generation facilities and the consumers meeting the certain requirements stipulated in the concerned legislation (such as owning a consumption facility with a capacity of 50MW or more, or, although having a capacity less than 50MW, following the distribution company’s admission of its inability to meet the electricity demands of such a facility), may request access to the transmission grid.

• connection and system usage requests of real or legal persons to the transmission and distribution system are met by Turkish Electricity Transmission Corporation (TEIAS) and the distribution company without any discrimination between equal parties. No negative opinion can be given about the connection of real or legal persons to the transmission or distribution systems operated by TEIAS or the distribution company, and the use of the system, except for the situations listed below. The technical features of the network at the required connection point are insufficient;
• the standards concerning system connection, the condition of the facility to be connected to the system and the technical standards indicated in the relevant regulations have not been met;
• TEIAS justifies that the intended connection would constitute an obstacle to public service obligations;
• the values, such as the voltage drop, harmonic, electromagnetic interference, or flicker level at the entrance or exit point to the network and the transmission and distribution stages, do not meet the limits specified in the relevant regulations;
• the facility for which the connection is to be made makes the quality of the electrical energy of the system within the standards specified in the relevant regulations; or
• a connection point, which is more economical and provides fewer losses in power compared with the connection point applied to, is available in the case of applications for connection of wind or solar power generation facilities.

If TEIAS is of a negative opinion concerning the connection to the system and system use, it should justify such an opinion, and such an opinion should also be approved by the Energy Market Regulatory Authority (EMRA). If the reasons for such an opinion are not deemed appropriate by the EMRA, TEIAS would be obliged to sign the related connection and system use agreements.

If multiple applicants wish to connect to the transmission system from the same connection point and it is not possible for the transmission system to meet all the applications, the following company types will have priority as set out in the following:

• for consumption facilities:
• the distribution companies; and
• organised industrial zone distribution licence-holding companies;
• for generation facilities:
• companies generating electricity based on domestic coal; and
• companies generating electricity based on renewable energy.

Transmission system users shall sign connection and use-of-system agreements with TEIAS.

Are there any government measures to encourage or otherwise require the expansion of the transmission grid?

With a legal monopoly over the transmission grid, Turkish Electricity Transmission Corporation (TEIAS) is responsible for the grid’s expansion. According to the Electricity Grid Regulation of 28 May 2014 (the Grid Regulation), TEIAS prepares the 20-year statement report regarding the transmission system (long-term report).

Such a long-term report includes items such as investment plans regarding the transmission system and potential supply possibilities. In addition to the long-term report, TEIAS is also responsible for preparing and publishing a short-term (ie, one-year term) electricity energy supply and demand projection report for the following year with the participation of all the authorities and institutions and the cooperation of the Ministry of Energy and Natural Resources.

Enabling generation companies to finance and make investments for new transmission lines required for the connection of the generation facilities to the system when TEIAS does not have the necessary financing under the repayment plan regulated in the Electricity Market Connection and System Usage Regulation of 28 January 2014 (Connection and System Usage Regulation) may also be interpreted as an encouragement for the expansion and improvement of the transmission grid.

Who determines the rates and terms for the provision of transmission services and what legal standard does that entity apply?

The transmission service is subject to regulated tariffs consisting of fees required to be collected for the performance of the transmission system usage activity by TEIAS. The transmission tariff includes the transmission system usage price, transmission system operation price (market operation included) and other fees that may occur under the legislation. Transmission system usage and operation tariffs are prepared and proposed by TEIAS.

TEIAS prepares the transmission tariff proposal and then submits it to the EMRA for approval. The tariff becomes effective for the tariff period once approved by the EMRA. TEIAS is obliged to announce its approved tariffs.

Which entities are responsible for the reliability of the transmission grid and what are their powers and responsibilities?

EMRA is responsible for preparing regulations for the connection and reliability of the transmission grid, such as the Grid Regulation and the Connection and System Usage Regulation published in the Official Gazette, both dated in 2014. These regulations outline the technical and other standards to be met for the transmission system and also for connection to the transmission network.

According to these regulations, the general responsibility for assuring transmission grid reliability lies with TEIAS. TEIAS must meet the demands of third parties for connection to the transmission network and system use on a non-discriminatory basis between equal parties. TEIAS may take necessary measures and actions in the case of any threat to the reliability and safety of the transmission grid. It is also responsible for the planning and development of the transmission system.