Turkey’s ministry of energy and natural resources has launched a competitive tender for a 1.2 GW offshore windfarm, a tender that will require a high level of local content.
Speaking exclusively to OWJ, Invest in Turkey renewables director Zeynel Kılınç, and head of Invest in Turkey in the UK Murat Ozdemir explained that the ministry wants to create a pathway to local manufacturing of offshore wind components in the country.
Under the winner-takes-all renewable energy designated area auction system, known by its Turkish acronym Yeka, an award will be made by late 2018 or early 2019 for a 1.2 GW offshore windfarm in the Aegean or, possibly, the Black Sea. Three potential offshore wind zones have been identified: two in the Aegean (Gelibolu and Saros) and one in the Black Sea (Kiyiköy).
Tenders for onshore wind and for solar were awarded using the Yeka scheme in 2017. The onshore wind competition saw a consortium consisting of Siemens Gamesa Renewable Energy and Turkish partners Kalyon Enerji and Türkerler Holding win out and obtain a tariff of US$0.0348/kWh.
The Yeka schemes for onshore wind and solar specified a Turkish content of around 60%. The Yeka for offshore wind will also require a high level of domestic production, although probably not quite as high as in the onshore and solar awards.
Invest in Turkey’s experts said they anticipate that established developers with experience of bidding for projects in Europe can be expected to form joint ventures with Turkish developers and companies including, potentially, some of those who bid for the onshore wind tenders in 2017.
The Turkish authorities are understood to want to use the process to create an R&D centre for offshore wind in Turkey. The government has also indicated its willingness to provide incentives for local manufacturing, such as tax breaks, interest rate support, customs duty exemptions and social security premium support.
Once preferred tenders have been identified the contractors for the project will be determined using a reverse auction.
In the medium to long term, the ministry anticipates further tenders for large-scale offshore wind projects, including, potentially, some in deeper water in the Mediterranean, which could make use of floating windfarms. Long-term plans also anticipate that supply chain companies established in Turkey could target export opportunities in the region.
The Turkish government has established a target for wind energy as a whole of 20 GW by 2023. It currently has 7 GW on onshore wind with more under construction. A 2015 study identified potential for up to 32 GW of offshore wind in Turkish waters. Some estimates put the potential higher, at around 40 GW.
Turkish companies are already in a position to build foundations, towers and components, and LM Wind Power has begun building blades for turbines for onshore wind in the country. It is anticipated that a Turkish transmission system operator will be responsible for grid connection.
Apart from providing access to clean energy, helping to develop a new industry in Turkey and creating jobs, Invest in Turkey’s representatives said offshore wind energy and other forms of renewable energy will help the country overcome dependence on imported fossil fuels and reduce its trade deficit.
As of early 2014, Turkey was the 16th largest economy in the world and achieved an average growth rate of 5% in the decade between 2003 and 2013. The same period also saw an average annual growth rate in primary energy consumption of 4% per annum. Turkey’s electricity industry has been growing robustly for more than a decade, with a compound annual growth rate of more than 5%.
Increasing investment and energy infrastructure remains a priority, due to the country's strong demographic growth and the government's commitment to enhance energy security.
Although the government has expressed strong support for domestic coal, oil and natural gas exploration, it has also given a firm commitment to utilise local and renewable energy resources in electricity generation to reduce reliance on imported fuels.