Can environmental markets support solar energy development in Turkey?

Abstract

As stated in Intended Nationally Determined Contribution (INDC) that has been communicated regards to the Climate Action Plan, Turkey aims to increase production capacity of electricity from solar power to 10 GW and production capacity of electricity from wind power to 16 GW while tapping the full hydroelectric potential until 2030. Among the alternative clean energy resources in Turkey, solar energy is the most important one considering the advantageous position in the Middle East and Southeast Europe. Solar capacity has soared up in recent years due to both technological improvements which leads to cost reductions and government policies that support renewable energy progress. Law on the Use of Renewable Energy Resources for the Purpose of Generating Electrical Energy was accomplished on May 18, 2005 has brought the Renewable Energy Support Mechanism which provides a fixed and secure purchase price for the generated electricity from renewable energy. The government is planning to end the current mechanism by 2020 and it is still uncertain what will happen after its termination. The uncertainty brings to mind the question, “Could environmental markets such as carbon markets, consumer-based power purchase agreements (PPAs) and green certificates support maintaining and increasing electricity supplies from solar energy?” This study will analyze the role of support mechanisms and innovative market-based applications for solar energy development and thus promotion of carbon emission reduction targets of Turkey.