Turkey is definitely in the midst of its energy transition. Both energy efficiency and renewable energy are gaining in importance in the overall energy strategy. Increasingly, Turkey is also aligning itself with EU energy directives. The Daily Sabah website writes about the approval of the National Energy Efficiency Action Plan that is an obligation for EU member states. The European Bank for Reconstruction and Development has provided support for its preparation in Turkey. The article explains how the Turkish government will now commit funds for the action plan’s implementation.
EBRD welcomes Turkey’s national energy efficiency plan, says ready to provide support
Committed and continuing to engage in Turkey’s infrastructure and development projects, the European Bank for Reconstruction and Development (EBRD) has welcomed Turkey’s National Energy Efficiency Action Plan (NEEAP), which will put the country on course to implement a reduction of 14 percent in primary energy consumption by 2023, and said it was ready to provide support. The Turkish government aims to invest around $11 billion in energy efficiency measures to reduce primary energy consumption.
The plan is a major step toward making a rapidly expanding economy much more energy efficient, EBRD Managing Director for Turkey Arvid Tuerkner said in a statement, adding that the plan builds on the realization that a sustainable, efficient, and prudent generation and the consumption of energy is crucial for both economic growth and a sound environment.
“The action plan addresses the need to balance both aspects with detailed measures and where possible and feasible the EBRD stands ready to support this crucial effort,” Tuerkner added.
A large number of measures combining the general energy efficiency framework and crosscutting sectorial measures are included within the framework of the action plan, which it was said will be implemented from 2017 to 2023.
They include steps like greater use of renewable energy and district heating in buildings and encouraging the use of combined heat and power across industries. The plan also envisages the development of a national energy efficiency financing mechanism and a regulatory framework for the creation of a heating and cooling market.
The plan includes 55 actions in various sectors, including industry, transport, construction, heating and cooling, agriculture and energy generation and transformation itself.
According to the NEEAP, the share of road transport will be reduced from 90 percent to 60 percent in freight transportation, and from 89 percent to 72 percent in passenger transportation by the end of 2023.
The plan also said combined transport applications for freight and passenger transportation will be developed in order to ensure a balanced distribution among the modes in the transportation sector.
It is meant to increase the share of rail freight transportation by 15 percent and the share of passenger transportation by 10 percent in order to increase the share of rail and maritime transportation and to move to the corridor approach in transportation planning.
According to the information compiled from the 2017-2023 NEEAP, a cumulative 23.9 million-ton equivalent of petroleum (MTEP) is projected to be saved and an investment of around $10.9 billion is expected to be carried out by 2023.
The cumulative savings to be provided by 2033 are expected to be around $30.2 billion and the effect of some savings will continue until 2040, the plan said.
The bank said in a statement that Turkey has become one of the fastest growing economies in the world with real gross domestic product (GDP) growth expected to reach around 7 percent in 2017, adding that the government expects the growth to average around 5.5 percent a year for the coming three years.
“With increased growth comes increased energy consumption: According to government figures, Turkey has the highest growth rate of energy demand among all OECD [The Organization for Economic Co-operation and Development] countries. However, it is able to meet only around 26 percent of its total energy demand from domestic resources, and is dependent on imports for over 90 percent of its oil and gas needs; this dependency contributes heavily to the country’s external imbalances. Consequently improving energy efficiency is extremely important for Turkey,” the bank said.
“Developed with the help of the EBRD and funded by the European Union, the NEEAP closely follows and mirrors the activities and policies of the European Union in the area of energy and energy efficiency,” a statement read.
The EBRD also said Turkey is investing heavily in developing its potential in renewable sources of energy such as wind, solar, hydro and geothermal energy generation, adding that the country is seeking to develop 30 percent of its total installed capacity from renewable sources by 2023.
The objective is to add 34 gigawatts (GW) of hydropower, 20 GW of wind energy, 5 GW of solar energy, 1.5 GW of geothermal and 1 GW of biomass. Turkey also aims to have 10 percent of its transport sector needs met by renewable energy, it said.
The EBRD also said it has been supporting this foray into green energy as an investor as well as through its work with the government. The bank also assisted the development of the National Renewable Energy Action Plan (NREAP), which was financed by the government of Spain. Under the plan, the bank is currently supporting the Turkish government in strengthening and streamlining the regulatory framework for the development of the renewable energy sector.
The EBRD’s investment in green energy in Turkey includes large-scale stand-alone projects such as the Enerjisa Bares wind power plant in Balıkesir, a rotor wind farm in Osmaniye, and geothermal plants Efeler and Kızıldere, both in Büyük Menderes Graben, are the areas in Turkey with the greatest potential for geothermal energy, the statement read. EBRD said it also finances mid-sized and small-scale renewable energy generation in the private sector through dedicated credit lines to Turkish banks, the Turkey Mid-size Sustainable Energy Financing Facility (MidSEFF), and the Turkey Sustainable Energy Financing Facility (TurSEFF), respectively. The EBRD is also financing sustainable energy in the residential sector through the Turkey Residential Energy Efficiency Financing Facility (TurEEFF).
“To date, the bank’s financing under these three frameworks in the amount of 1.8 billion euros has reached over 1,000 companies and 1,500 households,” the statement said, adding that “green” projects account for half of the bank’s portfolio in Turkey. To date, the bank has invested 10 billion euros in various sectors of the country’s economy, with almost all investments being in the private sector.