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Turkey Needs More Market Space for Renewables Growth

Turkey's unproductive and inefficient power plants need to retire so domestic renewable energy resources can avail of a greater share of the energy market, a senior advisor at U.S.-based Regulatory Assistant Project (RAP) said Friday.

Turkey has made impressive progress in the electricity sector in recent years, the senior advisor at RAP, Michael Hogan, told Anadolu Agency. However, he warned that the large surplus in Turkey's electricity market can be overcome in the mid-term through policies to rebalance the market.

"Eventually at some point, the supply has to rebalance and market fundamentals are very significant [for this to happen]," Hogan said. He advised that Turkey follow the examples set in Germany and Spain for this market balance by retiring old and inefficient power plants.

Germany has been undertaking an energy transition by phasing out old, environmentally-hazardous and inefficient coal plants and also by boosting renewables capacity, he explained.

"For new investments to be sustainable in the market place, one of the significant issues is that the industry needs to be confident that new or cleaner capacity coming into the system is necessary. The proven way is that, as long as that capacity is needed, the prices will go up," Hogan said, adding that "supply surplus is driving prices down."

He also argued that renewable energy resources do not need any subsidies given that no external costs like carbon emissions are required while the cost of renewables deployment is in decline.

"Existing resources that are causing external costs are increasing pressure in the market. Thus, what is more economic is the one everyone is interested in [renewables]," Hogan said.

However, he cautioned that renewable resources also pose a risk as the amount of energy generation from these plants is not as predictable as fossil-based power plants due to changeable weather conditions.

As at the end of June, Turkey's installed electricity capacity reached 87,000 megawatts. Renewable energy resources, including hydro, wind, solar and geothermal, generated 46.3 percent of this capacity.

(Anadolu Agency)

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