Rönesans Holding/Hatem: The support period in YEKDEM should be increased from 10 years to 20 years

Rönesans Holding Energy Group President Emre Hatem, in his interview with Bloomberg HT at COP31 held in Antalya, said that the group plans to commission its first battery investment within a few days and start the construction of the first storage wind power plant in Kırşehir next month. Hatem suggested increasing the support period from 10 years to 20 years to accelerate renewable energy investments.

Hatem stated that the group has a portfolio of 1,400 megawatts consisting of 21 projects in 12 cities. He stated that 1,000 megawatts of the portfolio consists of renewable energy production and 400 megawatts of battery capacity. He also noted that they have a portfolio of 800 megawatts, consisting mainly of wind power plants, within the scope of renewable energy investments.

Stating that they have put approximately 650 megawatts of the portfolio into operation and the construction of the 250 megawatts section is continuing, Hatem said that they aim to start the construction of the remaining projects soon. Hatem stated that they completed and put into operation the three wind projects they started in 2022 in approximately 30 months and that they commissioned hybrid solar power plants that work integrated with hydroelectric power plants.

The capacity of the wind power plant in Osmaniye will increase to 200 megawatts

Hatem stated that they are carrying out one of the most comprehensive turbine renewal projects in Türkiye at the 130 megawatt wind power plant in Osmaniye. He said that by replacing old turbines with new ones, the efficiency of the power plant will increase, its capacity will reach 200 megawatts and electricity production will approximately double.

Stating that the tests are continuing in the group's first battery investment, Hatem noted that they plan to put the battery into operation in a few days.

Hatem said that the market clearing price decreased by approximately 30 percent this year compared to last year, due to the effect of the production of hydroelectric power plants. Stating that whether the price will remain at this level and long-term price expectations are important for the course of investments, Hatem stated that they will direct the investments by monitoring the financing conditions and interest rates.

"YEKDEM support should be increased to 20 years"

Stating that Türkiye's capital resources are limited, Hatem said that foreign capital should be attracted for renewable energy investments. Hatem noted that thanks to the Renewable Energy Resources Support Mechanism (YEKDEM) implemented since 2005, Türkiye's renewable energy installed capacity increased from 12 thousand megawatts to 80 thousand megawatts, and significant investments were made in wind, hydroelectric and geothermal power plants in this process.

Stating that YEKDEM is in its third term, Hatem said that the fourth term of the mechanism should be redesigned and put into practice. Hatem stated that banks tend to keep loan maturities short and that increasing the support period from 10 to 20 years may facilitate access to longer-term financing.

Stating that the current mechanism provides guarantees in dollars, Hatem said that offering guarantees in euros will create an advantage in terms of financing provided from Europe. Hatem also suggested that support prices be indexed to inflation, stating that nominally determined prices lose their purchasing power over time.

Grid needs to be strengthened for wind and solar target

Hatem stated that within the scope of the National Energy 2040 Plan, Türkiye aims to reach a capacity of 175 thousand megawatts in wind and solar energy. Noting that the current installed capacity is 45 thousand megawatts, Hatem said that in order to achieve the target, an additional investment of 130 thousand megawatts should be made and the electricity network should be strengthened to meet this capacity.

Stating that Türkiye competes with European countries and other countries for capital and financing, Hatem stated that investors look at the difference in returns between countries and that Türkiye should offer more attractive investment conditions.

Hatem said that electricity prices are approximately 40 euros in Türkiye and approximately 120 euros in Europe. Stating that the difference between the electricity price and the ceiling price is approximately 90 dollars in Türkiye and approximately 4 thousand 600 dollars in Europe, Hatem stated that this difference, which is approximately 50 times higher in Europe, opens a wider area for battery investments. Hatem noted that Türkiye needs to make market conditions more competitive in order to accelerate investments.

Meetings were held with foreign investors at COP31

Hatem said that of Türkiye's approximately 500 thousand megawatts of renewable energy potential, 150 thousand megawatts of wind energy and 250 thousand megawatts of solar energy. Stating that Türkiye has a developed energy sector, Hatem stated that COP31 provided the opportunity to explain the country's potential to foreign banks and investors and that they received strong interest in the meetings within the summit.

Stating that agreements regarding the supply of wind turbines, solar panels, batteries and transformers have been announced, Hatem said that they expect important agreements to be signed in the field of financing. Hatem noted that an agreement was also announced for a foreign investor to establish a 300 megawatt wind power plant with storage in Türkiye.

Hatem stated that within the scope of the energy cooperation agreement signed between Türkiye, Azerbaijan, Georgia and Bulgaria, it is envisaged that the energy to be produced from marine resources will be delivered to Europe primarily through the route created by these four countries. Hatem said that the agreement is important for clean energy trade and energy supply security of consumers in Europe.

Stating that Türkiye can meet its own needs and export by using its renewable energy potential, Hatem stated that the energy produced from low-cost sources can be exported to the European market and neighboring countries where prices are higher. Hatem said that there may be a change in Türkiye's agenda from energy imports to energy exports and that COP31 offers an important opportunity in this direction.