Turkish leaders should grow wind ambitions


June 1, 2015

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“Meet the new boss. Same as the old boss.”

British band The Who wrote this line for their 1971 classic ‘Won’t Get Fooled Again’, but a similar sentiment is likely in Turkey after the general election this coming Sunday (7 June).

Turkish authorities have been denying opposition parties access to public squares for their pre-election rallies, and removing opposition campaign materials. This means there is little chance that the ruling Justice & Development Party could be ousted, despite questions over their fiscal competence; and, if the party wins convincingly, it is set to hand more power to President Erdogan.

This likely result also means there is little chance of a shake-up in Turkish energy policy, to step up the pace of growth in the wind sector. Turkey is promoting wind, and backing it through policy mechanisms like feed-in tariffs (as we saw in our Middle East report earlier this year), but it could do so much more.

After all, the fast-growing country has some decent targets. It has 4GW currently installed, and is looking to grow this fivefold to 20GW over the next eight years. It is also aiming that wind should be around 10% of the electricity mix by 2023, up from 3% now.

But government policies are also restricting the pace of growth, and this is forcing investors into tough and unpredictable auctions.

In the last week of April, for instance, the Energy Market Regulatory Authority invited bids for wind capacity of 3GW, but received bids for more than 14 times that (42GW). This clearly shows that there are investors ready and willing to push on with schemes.

If Turkey wanted faster growth then it could easily achieve it by simply letting more investors pursue more of these schemes. Not all 42GW of projects will be any good, but more than 3GW will be.

This would enable the country could provide more of the power that is desperately needed by its fast-growing population with increasing demands for energy. It would also help the nation to reduce its reliance on expensive foreign fuel imports. Sounds simple, right?

Unfortunately, though, wind is not the government’s priority.

The problem for wind investors is that Turkey’s leaders are aiming to meet growing energy needs with a huge and environmentally-damaging rollout of fossil fuels, as well as nuclear. This coal programme will also be hugely damaging to people’s health.

Last month, European non-governmental organisation, the Health and Environment Alliance, put out a report called ‘The Unpaid Health Bill: How coal power plants in Turkey make us sick’.

This reported that air pollution from Turkey’s 19 coal-fired power stations that were operational in 2012 cost the country €3.6bn a year in premature deaths, lung diseases and heart conditions. Now the government is planning 80 more such power stations, which is the third-highest number being planned by any country, and the amount spent on fixing health problems is expected to “skyrocket”.

The fact that such a health scandal is being reported should give hope to wind investors. The risks of fossil fuels are plain for all to see. But, unless Turkey’s leaders take these warnings seriously and act on them, they are unlikely to rein in their fossil fuel plans.

Turkey still has great potential as a wind market, but investors cannot expect many favours. They will have to battle hard with both policies and their rivals if they are to gain their hoped-for returns.

We just hope they are ready for the fight.

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