Emerging CSP Markets: Banking on the Middle East and North Africa

2 November 2009

The world’s financial powerhouses are already queuing up to back the next big concentrated solar power market.

By Oliver Balch

In Arabic, Maghreb literally translates as: ‘Land of the sunset’. But a new project under consideration by the World Bank could see this expansive region of Arab-speaking North Africa become better known for sunup rather than sundown. Blessed with high direct normal irradiation (DNI) and on Europe’s doorstep, the Middle East and North Africa hold potential as a pivotal CSP market.

The Clean Technology Fund, which provides scale-up financing for low carbon technologies, is finalising a proposal to develop one gigawatt (GW) of concentrated solar power (CSP) in the region over the next six to eight years.

The Bank’s regional investment plan envisions between eight and ten commercial-scale power plants in the Maghreb and neighbouring Mashreq, the area of the Middle East between Iran and the Mediterranean.

The project’s proponents say the initiative will provide a catalyst for private sector investment, leading to 5GW of installed CSP capacity by 2025.

Under the Clean Technology Fund’s initial investment plan, the World Bank would provide around $750mn in co-financing – roughly 10 percent of the project’s US$6-8bn (€4 – 5.4bn) total funding requirement.

The Fund’s governing committee is scheduled to consider the project in early December, the World Bank’s senior environment specialist Chandrasekar Govindarajalu tells CSP Today. The proposal follows a similar investment plan for CSP in South Africa, which gained approval on 28 October.

Funding opportunities

At present, Morocco, Algeria, Tunisia, Egypt, Lebanon and Jordan are all eligible for project financing under the terms of the World Bank’s Clean Technology Fund. Syria and Libya are excluded, but they could potentially access technical assistance from the World Bank for a solar scale-up programme.

The World Bank is working closely with the African Development Bank to get the project off the ground. The list of other finance partners includes multilateral and bilateral lenders such as the Arab and Islamic Funds, the European Investment Bank and Germany’s Kreditanstalt für Wiederaufbau.

Other potential sources of financing might include public and private debt and equity, European Union neighbourhood funds, bilateral lending from within the region and tax breaks by domestic governments.

If the idea sounds far-fetched, then recent developments may persuade otherwise. Three combined-cycle pilot projects are already underway: Iberdrola’s 40MW Kuraymat facility in Egypt and its 25MW Hassi R’Mel plant in Algeria, plus Aberner’s 20MW Ain-Beni-Mathar facility in Morocco.

Domestic governments in the region are also getting in on the act. Egypt, Morocco and Tunisia all recently introduced renewable energy development plans that hold potential for advanced solar technologies.

“These countries already have experience. Now they are looking to develop CSP on a large scale”, says Govindarajalu.

The International Renewable Agency;s (IRENA) decision earlier this year to set up its headquarters in the United Arab Emirates provides further indication of the region’s emergence as a serious player in the non-conventional energy sector. IRENA will base its headquarters in Abu Dhabi’s Masdar City, a US$22bn (€15bn) construction project that is due to become the world’s first entirely renewable-powered city when completed in 2015.

Private sector buy-in

Signals from the private sector further substantiate the role the Middle Eastern and North African markets will likely play in the development of CSP.

A consortium of major European companies and banks recently launched a three-year feasibility study to assess the potential of a string of CSP projects across the region. Known as the Desertec Industrial Initiative, the group counts German energy giants RWE and E.ON as well as Spain’s CSP developer Abengoa Solar among its dozen participants.

“These are serious companies. If anyone can do this, it’s them”, argues Gerry Wolff, a representative of the non-profit organisation Desertec UK.

The international consortium, which established a formal holding company in October, anticipates investments of nearly $600mn over the next 40 years.

A number of reasons are attracting developers and policy makers to CSP’s potential in North Africa and the Middle East. The region’s physical attributes are almost unparalleled for CSP: almost undisturbed sunshine, high radiation, low precipitation and plenty of uninhabited flat land.

Demand side factors are catching investors’ attention. Since the 1980’s, total energy consumption by MENA countries has grown faster than any other global region, according to a recent World Bank report. Energy intensity (per capita energy demand as a percentage of GDP) is a staggering 40 percent higher than the global average.

CSP ties therefore ties into the objective of the region’s governments to obtain long-term energy security through energy diversification, explains Govindarajalu.

The proximity of the Maghreb and Mashreq countries to continental Europe makes the market additionally attractive. Most notably, a scale-up CSP programme would have close synergies with efforts by southern European states to trade green electricity with their neighbours.

CSP developers in North Africa and the Middle East would be particularly well placed to take advantage of the so-called Mediterranean Solar Plan. If successful, this energy integration scheme would see large-scale solar power production linked to enhanced transmission networks in the Mediterranean region.

Multilateral development banks “could play a key role in financing” CSP’s development given the dependency of the Mediterranean Solar Plan on sharing costs and benefits between all partners, notes a preliminary paper by the World Bank.

Needless to say, the ambitious project faces some hurdles. Chief among them are access to finance, commitment by national governments and access to European markets, says Govindarajalu.

Other systemic barriers exist. Not least of these are fossil fuel energy subsidies. The absence of specific policies to promote the commercialisation of CSP also features highly.

Nevertheless, a ‘yes’ vote from the Clean Technology Fund’s trust fund committee in December would catapult the Maghreb and Mashreq regions onto the CSP world map. There is a famous Arabic saying that runs: “Every sun has to set”. In this case, CSP could just be the exception.

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Solar Millennium AG – Company Statement

7 juillet 2009

(c)2009, Global Markets Direct.

Overview

Solar Millennium AG Company Statement

A joint statement by Mr. Christian Beltle, the Chairman and the Cheif Executive Officer, Mr. Thomas Meyer, the Chief Financial Officer and Dr. Henner Gladen, the Chief Technology Officer of Solar Millennium AG is given below. The statement has been taken from the company’s 2008 Annual Report.

We made it! In December 2008 Andasol 1, the world’s largest solar power plant, was connected to the grid. With this, we have managed to realize our vision and, together with our partners, carried out an idea that only existed in the heads of a few idealistic founding shareholders just a couple of years ago. With Andasol 1, Solar Millennium underscores its pioneering role in the field of solar-thermal power plants. This is something to be proud of.

The two sister projects Andasol 2 and 3 are under construction in the direct vicinity. While Andasol 2 will be connected to the grid towards the middle of the year, preparations have begun for Andasol 3. A major investor will soon be involved. In 2011, the power plant triad with an overall area of about 6 km2 will convert a total of more than 500 GWh of solar energy into sustainable electricity for up to 600,000 people. In doing so, up to 450,000 tons of carbon dioxide emissions will be saved over conventional coal power plants. Thus, we managed to make the vision come true that we had made our cause 10 years ago when founding the Company.

Against the background of globally rising energy demand in connection with scarcer resources, many decision-makers in politics and business have now realized that electricity from solar energy is one of the most important alternatives to the energy mix so far. The “Solar Plan” that came into being in 2008 under the French EU Council Presidency as part of the new Union for the Mediterranean is one of the best examples. Large-scale solar-thermal plants such as the hybrid power plant in Egypt, which our subsidiary Flagsol is equipping with a solar field, are the first flagship projects for a number of solar power plants that will form a line along the North African states bordering the Mediterranean and cover their own need for energy in addition to supplying Europe. Our experts are being consulted by many of the respective committees, thus making them the architects of a new transnational energy policy from the start.

However, solar energy is also experiencing a renaissance in the US, a country where parabolic trough power plants have reliably been generating electricity in the Californian desert for more than 20 years. At the end of the Bush administration, tax incentives for investment in solar energy, the so-called Investment Tax Credits, were extended for another eight years. Moreover, the state of California recently raised the benchmark for renewable energy generation that is fixed in the Renewable Portfolio Standards from 20% to 33% for 2020. Considering that president Barack Obama has announced massive investment in the establishment of renewable energy supply within the context of his stimulus plan providing for a total of nearly US$ 790 billion overall, it becomes clear why the US is believed to be the next boom market for solar-thermal power plants.

Solar Millennium has an excellent starting position in the US thanks to its involvement there for many years and its own branch in Berkeley, California. We have secured land for approximately 5,000 MW in power plant capacities within these regions, which feature the world’s best solar radiation conditions. Furthermore, Solar Millennium has been short-listed for the realization of approximately six power plants with a total capacity of 1,500 MW by American utilities. We expect to sign contracts for one to two projects with a total capacity of 250 MW to 500 MW as early as this year.

Other countries have likewise become aware of the vast economic and ecologic potential of solar-thermal power plants. In Israel, the United Arab Emirates and Morocco, tenders for solar-thermal power plants can now be made, and the Solar Millennium Group is of course involved. Italy and Greece determined their fixed feed-in tariffs last year. Australia, one of the most attractive regions in the world given its high level of direct normal radiation and its resources of free land, has also opened up to the large-scale solar-thermal power plant market despite its low energy prices.

According to a survey by the German Aerospace Center (DLR), electricity from most renewable energy sources will be cheaper than fossil fuels by 2025. Accordingly, renewable energy will have largely superseded fossil energy sources in the Mediterranean by the middle of this century. In 2050, the survey further reads, the output of solar-thermal power plants will be double the amount of wind, photovoltaics, biomass and geothermal power plants put together.

Consequently, the prospects are outstanding and, with a well-filled project pipeline in Spain and the US as well as the possibility of acquiring additional projects through tenders, our Company is excellently positioned in the expanding market for solar-thermal power plants. Solar Millennium also enjoys a distinguished reputation among suppliers as well as partners and customers as an expert in the planning and realization of top-quality solar-thermal power plants. As a mark of recognition for its contribution to sustainable energy supply, Solar Millennium AG was awarded the internationally-renowned Energy Globe Award in May 2008 in Brussels.

We are looking forward to the next few steps in this exciting growth sector and would like to thank our employees for their enormous commitment as well as our shareholders and investors for the confidence you have bestowed in us along this path.

MOROCCO: Dakhla Wind Farm Attracts Small Fry

Played up in Morocco’s pro-government press, projects for wind farms in the Dakhla region are being promoted by companies of very modest proportion. Representing a total investment of over DH 17 billion (EUR 1.5 billion), and covering many thousands of hectares, the programs ought to generate several hundred MW of wind power.

Will the output be exported to Europe?

Up to now, Germany’s Altus AG, which wants to build two wind farms with a total capacity of 672 MW with Morocco’s A.M. Wind, has carried out a dozen wind projects in Germany with a combined capacity of under 100 MW. The company will need to raise no less than EUR 1.3 billion if it wants to push through its Moroccan projects which cover 15,000 hectares. And, for the moment, nobody knows the names of investors behind Africa Renewal Energy and A.M. Wind, the Moroccan concerns keen on building wind farms at El Faro and Tawarta.

As for Gotoga Brokers, registered in Valladolid in Spain, it is known primarily at the moment for being involved in a land dispute against another firm specializing in renewable energy, Pevafersa. Gotoga Brokers plans to invest DH 753 million to build a wind farm covering 900 hectares.

Turkey Is Getting Ready to Harvest Its Renewable Energy Potential.

When we talk about wind, solar and geothermal power, geographical conditions such as surface areas and sunny latitudes are very important. Turkey offers excellent conditions for all of these renewable energy sources. Its young population of 70 million – 61% are under the age of 35 – and its strategic location between Europe and the Middle East, add to Turkey’s potential for a leading green power nation.

As Turkey aims at taking its place among the top-ten biggest economies by 2050, an increase in its energy consumption is inevitable. Electricity demand has been growing with an annual rate of 6.5% since 2002, up to current levels of 198,000 GWh/y. Scenarios forecast a 6% growth rate until 2020, compared to growth rates of 1-3% in developed countries. However, Turkey’s growth of electricity supply barely matches its fast growth of demand. The country began experiencing shortages already, and power has become a more popular daily topic. Total installed capacity is at 42,000 MW, with foreign natural gas (48%), coal (29%) and hydro power (17%) providing the biggest shares of resources. So far, the share of renewable energy is close to 1% of the total installed capacity.

In 2006, the government passed a set of incentives to stimulate the renewable energy sector. The efforts successfully resulted in substantial increases in the wind power capacity to 433 MW in 2009 from 50 MW levels in 2006. From 2007 to 2008, the capacity almost quadrupled. Currently, there is additional 450 MW construction to be completed by the end of 2009. Roof-top solar panels, which are commonly used for water heating in the Mediterranean region, produce energy equivalent to almost 4800 GWh/y, however installed photovoltaic capacity is only 2 MW. Turkey is the 5th in the World in operating geothermal energy applications with equivalence of 1380 MW capacity used in direct district heating and tourism industry. Geothermal power production capacity is currently 30 MW. So far, only modest steps have been taken since the government has not set clear targets or competitive incentives on new technologies yet.

According to studies, Turkey has around 48,000 MW of wind power potential (see REPA) with speeds higher than 7 m/s. The geothermal energy potential of the country is around 31,500 MW -one of the highest in Europe- which could be used for both heating and electricity production purposes. As Turkey is the second sunniest country in Europe after Spain, it can draw 380,000 GWh/y of solar energy – almost double the total electricity consumption of the country in 2008.

Turkey has signed the UNFCCC Kyoto Protocol this year, and the country is going to be assigned a reduction of greenhouse gases for the post-2012-phase, which will eventually turn into clearer targets in its renewable energy sector.

It is expected that the Parliamentary General Assembly will pass an amendment to “Renewable Energy Resources Law 4628″ in July, effectively setting a purchase price, or feed-in-tariff, for renewable energy. While the renewable energy can be sold to the public at rates shown in Graph-1, the prices are still not competitive enough to make solar favorable against natural gas. The tariffs for photovoltaics are set at EUR 0.25/kWh only for the first 10 years of operation, and then decrease to EUR 0.20 for the next 10 years.

While rates in other European countries are much more attractive (see Graph-2), particularly in countries like Greece and Italy trying to catch up to their western neighbors, it is the first serious step towards setting a long-term purchase price incentive for renewable energy producers. The mechanism is expected to increase developments in the Turkish renewable energy sector, and investors are already beginning to position themselves in the market.

There are still many unclear issues regarding regulations and their execution. While this problem is not unique to Turkey, the country’s transmission grid needs extensive upgrades. Despite this and other much needed developments, EU directives, feed-in-tariffs, Kyoto mechanism obligations, and technological developments in the solar and wind industries are pushing the country onto the right track. Setting up and achieving goals may need more time than planned, but it is clear that Turkey is becoming more aware of its natural conditions.

[photo credit: UweBKK]

Related Links :

Ministry of Energy and Natural Ressources (Enerji ve Tabi Kaynaklar Bakanlığı)
http://www.enerji.gov.tr

General Directorate of Electrical Power Ressources Survey (Elektril İşleri Etüt İdaresi Genel Müdürlüğü)
http://www.eie.gov.tr

EPDK (Enerji Piyasası Düzenleme Kurumu)
http://www.epdk.gov.tr

TEIAS (Türkiye Elektrik İletim A. Ş. Genel Müdürlüğü)
http://www.teias.gov.tr

Union of Chambers of Turkish engineers and architects, TMMOB
http://www.tmmob.org.tr/

Wind Power and Hydropower Plants Businessmen’s Association (Rüzgar Enerjisi ve Su Santralleri İşadamları Derneği)

http://www.ressiad.org.tr

The Chamber of Electrical Engineer (Dünya Enerji Konseyi Türk Milli Komitesi)

http://www.emo.org.tr/genel/bizden_detay.php?kod=50979&tipi=50&sube=0

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Turkey Is Getting Ready to Harvest Its Renewable Energy Potential.

When we talk about wind, solar and geothermal power, geographical conditions such as surface areas and sunny latitudes are very important. Turkey offers excellent conditions for all of these renewable energy sources. Its young population of 70 million – 61% are under the age of 35 – and its strategic location between Europe and the Middle East, add to Turkey’s potential for a leading green power nation.

As Turkey aims at taking its place among the top-ten biggest economies by 2050, an increase in its energy consumption is inevitable. Electricity demand has been growing with an annual rate of 6.5% since 2002, up to current levels of 198,000 GWh/y. Scenarios forecast a 6% growth rate until 2020, compared to growth rates of 1-3% in developed countries. However, Turkey’s growth of electricity supply barely matches its fast growth of demand. The country began experiencing shortages already, and power has become a more popular daily topic. Total installed capacity is at 42,000 MW, with foreign natural gas (48%), coal (29%) and hydro power (17%) providing the biggest shares of resources. So far, the share of renewable energy is close to 1% of the total installed capacity.

In 2006, the government passed a set of incentives to stimulate the renewable energy sector. The efforts successfully resulted in substantial increases in the wind power capacity to 433 MW in 2009 from 50 MW levels in 2006. From 2007 to 2008, the capacity almost quadrupled. Currently, there is additional 450 MW construction to be completed by the end of 2009. Roof-top solar panels, which are commonly used for water heating in the Mediterranean region, produce energy equivalent to almost 4800 GWh/y, however installed photovoltaic capacity is only 2 MW. Turkey is the 5th in the World in operating geothermal energy applications with equivalence of 1380 MW capacity used in direct district heating and tourism industry. Geothermal power production capacity is currently 30 MW. So far, only modest steps have been taken since the government has not set clear targets or competitive incentives on new technologies yet.

According to studies, Turkey has around 48,000 MW of wind power potential (see REPA) with speeds higher than 7 m/s. The geothermal energy potential of the country is around 31,500 MW -one of the highest in Europe- which could be used for both heating and electricity production purposes. As Turkey is the second sunniest country in Europe after Spain, it can draw 380,000 GWh/y of solar energy – almost double the total electricity consumption of the country in 2008.

Turkey has signed the UNFCCC Kyoto Protocol this year, and the country is going to be assigned a reduction of greenhouse gases for the post-2012-phase, which will eventually turn into clearer targets in its renewable energy sector.

It is expected that the Parliamentary General Assembly will pass an amendment to “Renewable Energy Resources Law 4628″ in July, effectively setting a purchase price, or feed-in-tariff, for renewable energy. While the renewable energy can be sold to the public at rates shown in Graph-1, the prices are still not competitive enough to make solar favorable against natural gas. The tariffs for photovoltaics are set at EUR 0.25/kWh only for the first 10 years of operation, and then decrease to EUR 0.20 for the next 10 years.

While rates in other European countries are much more attractive (see Graph-2), particularly in countries like Greece and Italy trying to catch up to their western neighbors, it is the first serious step towards setting a long-term purchase price incentive for renewable energy producers. The mechanism is expected to increase developments in the Turkish renewable energy sector, and investors are already beginning to position themselves in the market.

There are still many unclear issues regarding regulations and their execution. While this problem is not unique to Turkey, the country’s transmission grid needs extensive upgrades. Despite this and other much needed developments, EU directives, feed-in-tariffs, Kyoto mechanism obligations, and technological developments in the solar and wind industries are pushing the country onto the right track. Setting up and achieving goals may need more time than planned, but it is clear that Turkey is becoming more aware of its natural conditions.

[photo credit: UweBKK]

Related Links :

Ministry of Energy and Natural Ressources (Enerji ve Tabi Kaynaklar Bakanlığı)
http://www.enerji.gov.tr

General Directorate of Electrical Power Ressources Survey (Elektril İşleri Etüt İdaresi Genel Müdürlüğü)
http://www.eie.gov.tr

EPDK (Enerji Piyasası Düzenleme Kurumu)
http://www.epdk.gov.tr

TEIAS (Türkiye Elektrik İletim A. Ş. Genel Müdürlüğü)
http://www.teias.gov.tr

Union of Chambers of Turkish engineers and architects, TMMOB
http://www.tmmob.org.tr/

Wind Power and Hydropower Plants Businessmen’s Association (Rüzgar Enerjisi ve Su Santralleri İşadamları Derneği)

http://www.ressiad.org.tr

The Chamber of Electrical Engineer (Dünya Enerji Konseyi Türk Milli Komitesi)

http://www.emo.org.tr/genel/bizden_detay.php?kod=50979&tipi=50&sube=0

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• Deep in Bedrock, Clean Energy and Quake Fears (nytimes.com)
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• Clinton aims to renew Turkey ties (news.bbc.co.uk)
• Turkey Resumes Criticized Ilisu Hydroelectric Dam Project (cleantechies blog)
  

Turkey Is Getting Ready to Harvest Its Renewable Energy Potential.

When we talk about wind, solar and geothermal power, geographical conditions such as surface areas and sunny latitudes are very important. Turkey offers excellent conditions for all of these renewable energy sources. Its young population of 70 million – 61% are under the age of 35 – and its strategic location between Europe and the Middle East, add to Turkey’s potential for a leading green power nation.

As Turkey aims at taking its place among the top-ten biggest economies by 2050, an increase in its energy consumption is inevitable. Electricity demand has been growing with an annual rate of 6.5% since 2002, up to current levels of 198,000 GWh/y. Scenarios forecast a 6% growth rate until 2020, compared to growth rates of 1-3% in developed countries. However, Turkey’s growth of electricity supply barely matches its fast growth of demand. The country began experiencing shortages already, and power has become a more popular daily topic. Total installed capacity is at 42,000 MW, with foreign natural gas (48%), coal (29%) and hydro power (17%) providing the biggest shares of resources. So far, the share of renewable energy is close to 1% of the total installed capacity.

In 2006, the government passed a set of incentives to stimulate the renewable energy sector. The efforts successfully resulted in substantial increases in the wind power capacity to 433 MW in 2009 from 50 MW levels in 2006. From 2007 to 2008, the capacity almost quadrupled. Currently, there is additional 450 MW construction to be completed by the end of 2009. Roof-top solar panels, which are commonly used for water heating in the Mediterranean region, produce energy equivalent to almost 4800 GWh/y, however installed photovoltaic capacity is only 2 MW. Turkey is the 5th in the World in operating geothermal energy applications with equivalence of 1380 MW capacity used in direct district heating and tourism industry. Geothermal power production capacity is currently 30 MW. So far, only modest steps have been taken since the government has not set clear targets or competitive incentives on new technologies yet.

According to studies, Turkey has around 48,000 MW of wind power potential (see REPA) with speeds higher than 7 m/s. The geothermal energy potential of the country is around 31,500 MW -one of the highest in Europe- which could be used for both heating and electricity production purposes. As Turkey is the second sunniest country in Europe after Spain, it can draw 380,000 GWh/y of solar energy – almost double the total electricity consumption of the country in 2008.

Turkey has signed the UNFCCC Kyoto Protocol this year, and the country is going to be assigned a reduction of greenhouse gases for the post-2012-phase, which will eventually turn into clearer targets in its renewable energy sector.

It is expected that the Parliamentary General Assembly will pass an amendment to “Renewable Energy Resources Law 4628″ in July, effectively setting a purchase price, or feed-in-tariff, for renewable energy. While the renewable energy can be sold to the public at rates shown in Graph-1, the prices are still not competitive enough to make solar favorable against natural gas. The tariffs for photovoltaics are set at EUR 0.25/kWh only for the first 10 years of operation, and then decrease to EUR 0.20 for the next 10 years.

While rates in other European countries are much more attractive (see Graph-2), particularly in countries like Greece and Italy trying to catch up to their western neighbors, it is the first serious step towards setting a long-term purchase price incentive for renewable energy producers. The mechanism is expected to increase developments in the Turkish renewable energy sector, and investors are already beginning to position themselves in the market.

There are still many unclear issues regarding regulations and their execution. While this problem is not unique to Turkey, the country’s transmission grid needs extensive upgrades. Despite this and other much needed developments, EU directives, feed-in-tariffs, Kyoto mechanism obligations, and technological developments in the solar and wind industries are pushing the country onto the right track. Setting up and achieving goals may need more time than planned, but it is clear that Turkey is becoming more aware of its natural conditions.

[photo credit: UweBKK]

Related Links :

Ministry of Energy and Natural Ressources (Enerji ve Tabi Kaynaklar Bakanlığı)
http://www.enerji.gov.tr

General Directorate of Electrical Power Ressources Survey (Elektril İşleri Etüt İdaresi Genel Müdürlüğü)
http://www.eie.gov.tr

EPDK (Enerji Piyasası Düzenleme Kurumu)
http://www.epdk.gov.tr

TEIAS (Türkiye Elektrik İletim A. Ş. Genel Müdürlüğü)
http://www.teias.gov.tr

Union of Chambers of Turkish engineers and architects, TMMOB
http://www.tmmob.org.tr/

Wind Power and Hydropower Plants Businessmen’s Association (Rüzgar Enerjisi ve Su Santralleri İşadamları Derneği)

http://www.ressiad.org.tr

The Chamber of Electrical Engineer (Dünya Enerji Konseyi Türk Milli Komitesi)

http://www.emo.org.tr/genel/bizden_detay.php?kod=50979&tipi=50&sube=0

Related articles by Zemanta

• Deep in Bedrock, Clean Energy and Quake Fears (nytimes.com)
• Startups: Opportunity in Renewable Energy (startupprofessionals.com)
• Clinton aims to renew Turkey ties (news.bbc.co.uk)
• Turkey Resumes Criticized Ilisu Hydroelectric Dam Project (cleantechies blog)
  

Turkey Is Getting Ready To Harvest Its Renewable Energy Potential.

When we talk about wind, solar and geothermal power, geographical conditions such as surface areas and sunny latitudes are very important. Turkey offers excellent conditions for all of these renewable energy sources. Its young population of 70 million – 61% are under the age of 35 – and its strategic location between Europe and the Middle East, add to Turkey’s potential for a leading green power nation.

As Turkey aims at taking its place among the top-ten biggest economies by 2050, an increase in its energy consumption is inevitable. Electricity demand has been growing with an annual rate of 6.5% since 2002, up to current levels of 198,000 GWh/y. Scenarios forecast a 6% growth rate until 2020, compared to growth rates of 1-3% in developed countries. However, Turkey’s growth of electricity supply barely matches its fast growth of demand. The country began experiencing shortages already, and power has become a more popular daily topic. Total installed capacity is at 42,000 MW, with foreign natural gas (48%), coal (29%) and hydro power (17%) providing the biggest shares of resources. So far, the share of renewable energy is close to 1% of the total installed capacity.

In 2006, the government passed a set of incentives to stimulate the renewable energy sector. The efforts successfully resulted in substantial increases in the wind power capacity to 433 MW in 2009 from 50 MW levels in 2006. From 2007 to 2008, the capacity almost quadrupled. Currently, there is additional 450 MW construction to be completed by the end of 2009. Roof-top solar panels, which are commonly used for water heating in the Mediterranean region, produce energy equivalent to almost 4800 GWh/y, however installed photovoltaic capacity is only 2 MW. Turkey is the 5th in the World in operating geothermal energy applications with equivalence of 1380 MW capacity used in direct district heating and tourism industry. Geothermal power production capacity is currently 30 MW. So far, only modest steps have been taken since the government has not set clear targets or competitive incentives on new technologies yet.

According to studies, Turkey has around 48,000 MW of wind power potential (see REPA) with speeds higher than 7 m/s. The geothermal energy potential of the country is around 31,500 MW -one of the highest in Europe- which could be used for both heating and electricity production purposes. As Turkey is the second sunniest country in Europe after Spain, it can draw 380,000 GWh/y of solar energy – almost double the total electricity consumption of the country in 2008.

Turkey has signed the UNFCCC Kyoto Protocol this year, and the country is going to be assigned a reduction of greenhouse gases for the post-2012-phase, which will eventually turn into clearer targets in its renewable energy sector.

It is expected that the Parliamentary General Assembly will pass an amendment to “Renewable Energy Resources Law 4628″ in July, effectively setting a purchase price, or feed-in-tariff, for renewable energy. While the renewable energy can be sold to the public at rates shown in Graph-1, the prices are still not competitive enough to make solar favorable against natural gas. The tariffs for photovoltaics are set at EUR 0.25/kWh only for the first 10 years of operation, and then decrease to EUR 0.20 for the next 10 years.

While rates in other European countries are much more attractive (see Graph-2), particularly in countries like Greece and Italy trying to catch up to their western neighbors, it is the first serious step towards setting a long-term purchase price incentive for renewable energy producers. The mechanism is expected to increase developments in the Turkish renewable energy sector, and investors are already beginning to position themselves in the market.

There are still many unclear issues regarding regulations and their execution. While this problem is not unique to Turkey, the country’s transmission grid needs extensive upgrades. Despite this and other much needed developments, EU directives, feed-in-tariffs, Kyoto mechanism obligations, and technological developments in the solar and wind industries are pushing the country onto the right track. Setting up and achieving goals may need more time than planned, but it is clear that Turkey is becoming more aware of its natural conditions.

[photo credit: UweBKK]

Related Links :

Ministry of Energy and Natural Ressources (Enerji ve Tabi Kaynaklar Bakanlığı)
http://www.enerji.gov.tr

General Directorate of Electrical Power Ressources Survey (Elektril İşleri Etüt İdaresi Genel Müdürlüğü)
http://www.eie.gov.tr

EPDK (Enerji Piyasası Düzenleme Kurumu)
http://www.epdk.gov.tr

TEIAS (Türkiye Elektrik İletim A. Ş. Genel Müdürlüğü)
http://www.teias.gov.tr

Union of Chambers of Turkish engineers and architects, TMMOB
http://www.tmmob.org.tr/

Wind Power and Hydropower Plants Businessmen’s Association (Rüzgar Enerjisi ve Su Santralleri İşadamları Derneği)

http://www.ressiad.org.tr

The Chamber of Electrical Engineer (Dünya Enerji Konseyi Türk Milli Komitesi)

http://www.emo.org.tr/genel/bizden_detay.php?kod=50979&tipi=50&sube=0

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Turkey Is Getting Ready To Harvest Its Renewable Energy Potential.

When we talk about wind, solar and geothermal power, geographical conditions such as surface areas and sunny latitudes are very important. Turkey offers excellent conditions for all of these renewable energy sources. Its young population of 70 million – 61% are under the age of 35 – and its strategic location between Europe and the Middle East, add to Turkey’s potential for a leading green power nation.

As Turkey aims at taking its place among the top-ten biggest economies by 2050, an increase in its energy consumption is inevitable. Electricity demand has been growing with an annual rate of 6.5% since 2002, up to current levels of 198,000 GWh/y. Scenarios forecast a 6% growth rate until 2020, compared to growth rates of 1-3% in developed countries. However, Turkey’s growth of electricity supply barely matches its fast growth of demand. The country began experiencing shortages already, and power has become a more popular daily topic. Total installed capacity is at 42,000 MW, with foreign natural gas (48%), coal (29%) and hydro power (17%) providing the biggest shares of resources. So far, the share of renewable energy is close to 1% of the total installed capacity.

In 2006, the government passed a set of incentives to stimulate the renewable energy sector. The efforts successfully resulted in substantial increases in the wind power capacity to 433 MW in 2009 from 50 MW levels in 2006. From 2007 to 2008, the capacity almost quadrupled. Currently, there is additional 450 MW construction to be completed by the end of 2009. Roof-top solar panels, which are commonly used for water heating in the Mediterranean region, produce energy equivalent to almost 4800 GWh/y, however installed photovoltaic capacity is only 2 MW. Turkey is the 5th in the World in operating geothermal energy applications with equivalence of 1380 MW capacity used in direct district heating and tourism industry. Geothermal power production capacity is currently 30 MW. So far, only modest steps have been taken since the government has not set clear targets or competitive incentives on new technologies yet.

According to studies, Turkey has around 48,000 MW of wind power potential (see REPA) with speeds higher than 7 m/s. The geothermal energy potential of the country is around 31,500 MW -one of the highest in Europe- which could be used for both heating and electricity production purposes. As Turkey is the second sunniest country in Europe after Spain, it can draw 380,000 GWh/y of solar energy – almost double the total electricity consumption of the country in 2008.

Turkey has signed the UNFCCC Kyoto Protocol this year, and the country is going to be assigned a reduction of greenhouse gases for the post-2012-phase, which will eventually turn into clearer targets in its renewable energy sector.

It is expected that the Parliamentary General Assembly will pass an amendment to “Renewable Energy Resources Law 4628″ in July, effectively setting a purchase price, or feed-in-tariff, for renewable energy. While the renewable energy can be sold to the public at rates shown in Graph-1, the prices are still not competitive enough to make solar favorable against natural gas. The tariffs for photovoltaics are set at EUR 0.25/kWh only for the first 10 years of operation, and then decrease to EUR 0.20 for the next 10 years.

While rates in other European countries are much more attractive (see Graph-2), particularly in countries like Greece and Italy trying to catch up to their western neighbors, it is the first serious step towards setting a long-term purchase price incentive for renewable energy producers. The mechanism is expected to increase developments in the Turkish renewable energy sector, and investors are already beginning to position themselves in the market.

There are still many unclear issues regarding regulations and their execution. While this problem is not unique to Turkey, the country’s transmission grid needs extensive upgrades. Despite this and other much needed developments, EU directives, feed-in-tariffs, Kyoto mechanism obligations, and technological developments in the solar and wind industries are pushing the country onto the right track. Setting up and achieving goals may need more time than planned, but it is clear that Turkey is becoming more aware of its natural conditions.

[photo credit: UweBKK]

Related Links :

Ministry of Energy and Natural Ressources (Enerji ve Tabi Kaynaklar Bakanlığı)
http://www.enerji.gov.tr

General Directorate of Electrical Power Ressources Survey (Elektril İşleri Etüt İdaresi Genel Müdürlüğü)
http://www.eie.gov.tr

EPDK (Enerji Piyasası Düzenleme Kurumu)
http://www.epdk.gov.tr

TEIAS (Türkiye Elektrik İletim A. Ş. Genel Müdürlüğü)
http://www.teias.gov.tr

Union of Chambers of Turkish engineers and architects, TMMOB
http://www.tmmob.org.tr/

Wind Power and Hydropower Plants Businessmen’s Association (Rüzgar Enerjisi ve Su Santralleri İşadamları Derneği)

http://www.ressiad.org.tr

The Chamber of Electrical Engineer (Dünya Enerji Konseyi Türk Milli Komitesi)

http://www.emo.org.tr/genel/bizden_detay.php?kod=50979&tipi=50&sube=0

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