Turkey Renewables Report Q4 2012

Includes 3 FREE quarterly updates

BMI View: Turkey's wind sector dominates the non-hydro renewables industry, and we anticipate that it will be wind generated electricity driving the renewables expansion during our forecast period. With an ambitious renewable energy target and subsidy programme in place, we anticipate strong growth for the industry. However, we believe that financial uncertainty for renewables projects and a relatively unattractive business environment could hinder the industry significantly.

Despite the predominance of thermal generated electricity, Turkey's renewables sector presents significant growth potential across most technologies, including wind, geothermal and solar power generation. We expect the non-hydro renewables industry to grow considerably over our 10-year forecast period, registering an annual average growth rate of 23.56% between 2012 and 2021, contributing 9.7% to total electricity generation by 2021, at 39.24 TWh.

The key trends and developments in the Turkish renewables market are:

• Turkey's non-hydro renewables installed capacity is to surge nearly five-fold between 2012 and 2021, primarily from wind power.
• Turkey's decision to simplify the process for developing solar power projects of up to 500kW is likely to spur installations, with solar companies including Germany's Phoenix Solar and Gehrlicher Solar already joining with local companies to get a foot in the market.
• Currently, Turkey seems to favour wind power over the expansion of geothermal for electricity, however the 60MW Kizildere Geothermal power plant is due to come online in 2013, which will redress this imbalance somewhat.
• In January 2012, the German government promised to guarantee a EUR39mn loan to a Turkish wind developer that is buying turbines from Nordex, in an effort to boost exports and support the company.
• Turkey has adopted a Feed-in-Tariff (FiT) programme, which came into force in 2011 and is applicable to biomass, landfill gas, geothermal, hydropower, solar and wind. The programme offers tariffs for electricity generated from renewable sources until 2015.