Turkey Transmission Sector is Dominated by TETAS, Informs Kuick Research05 Feb 2013 • by Natalie Aster
The power sector in Turkey is a highly evolved and efficient sector, being supported by an extremely favorable and facilitative government policy and regulatory regime. The power sector is divided into three sub-sectors in Turkey, namely the generation, transmission and distribution sectors.
The regulatory framework is structured to attract the private sector and promotes a healthy, competitive, stable and a transparent market structure. Thanks to the Government’s fast privatization program, which has led to a gradually and steady rise in the share of private sector in the electricity market of Turkey.
Last but not the least, the Turkish Government is fully aware of the potential and need of using renewable to produce power, both in present and more in times to come. Therefore, the country already has big plans for the growth of contribution of renewable sources of power in the overall power generation capacity, promising lucrative returns for those planning to invest in the Turkey renewable market.
The electricity sector was under Turkish Electricity Authority (TEK) till 1993 when it was brought together under two roofs of TEIAS, to handle electricity generation &transmission, and TEDAS, to manage distribution. According to the report “Turkey Power Sector Analysis” by Kuick Research, transmission sector is dominated by the state (TETAS) due to the importance of this sector for safe and effective transmission of electricity.
Turkey Power Sector Analysis
Published: February, 2013
Price: US$ 800.00
TEDAS along with its 21 distribution companies (most of which are now privatized) has been given the complete charge of the electricity distribution in Turkey. Even though the distribution companies were privatized, the ownership of distribution assets continued to remain with TEDAS. Private investors were given the right to operate the distribution assets through signing of an appropriate agreement. Further, to form a legal infrastructure close to the European Union “Electricity Directive” for establishment of a liberal electricity market in Turkey, the companies were divided into the four separate entities of EUAS (Generation), TEIAS (Transmission), TETAS (Wholesale) and TEDAS (Distribution) in 2003.
EUAS was given the ownership and the operation of the Turkish Government’s thermal power plants from TEIAS and the hydroelectric power plants from Government hydroelectric company named State Water Works or the Devlet Su Isleri. EUAS was also given the charge of building, leasing and operating new power generation plants in line with Government’s objectives.
TEIAS was given ownership of all transmission facilities owned by the State and was held responsible for transmission system operations and maintenance, developing transmission investment plans for new facilities and also for operating the market balancing and settlement center.
The role of TETAS was to conduct wholesale power operations and take over the existing energy sale and purchase agreements from TEIAS and TEDAS. It was also made responsible for managing the stranded costs associated with the Build Operate (BO), Build Operate Transfer (BOT) and Transfer of Operating Rights (TOR) generation contracts.
According to the Turkish electricity regulatory framework, private generators are also allowed to sell electricity to the public distribution company (TEDAS) and regional distribution companies. Thus the sector is gradually moving towards a complete privatization set up.
The Electricity Market Balancing and Settlement Regulation were implemented in 2006, which was the first step was taken towards a competitive market structure for Turkish power sector. Initially only generation was opened up for private sector participation but from 2008, even distribution was brought under the same ambit. Distribution attracted good private sector investment despite being endowed with the problem of high investment costs.
More information can be found in the report “Turkey Power Sector Analysis” by Kuick Research.
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