In its quest to become a self-sufficient regional energy hub and a hydrocarbon bridge between the Middle East and Europe, Turkey still hasn't made that one big discovery, but the ambition is there and it also has a hungry appetite for renewables.
Click map to enlarge.
This is an area of investment in Turkey that is often overlooked, as the majors explore the potential offshore bonanza in the Black Sea and Mediterranean, and both juniors and majors continue to explore conventional and unconventional plays onshore.
Renewables tend to get lost in the frenzy, but here's the unique situation: Unlike most of its European counterparts, in Turkey retail electricity consumption lags BEHIND income growth. This is the key aspect that makes Turkey an ideal venue for renewable investment. Annual demand growth for the power industry is forecast at 6.3% over the next two decades.
Ankara hopes to spend $10 billion on new power generation ANNUALLY over the next 20+ years. The goal is to double power generation capacity from what is now only 55 gigawatts. To that end it's eyeing renewables across the board-wind, solar, hydropower, biomass and geothermal.
General Electric Co. (GE) and Siemens AG (SIE) see the potential, and Turkey is doing all it can to lure more investors. GE is moving forward fast with a 22.5-megawatt wind farm (Sares) and a smaller, 10-megwatt farm at Karadag. These farms are already online, and now the electricity giant is pursing another…
In its quest to become a self-sufficient regional energy hub and a hydrocarbon bridge between the Middle East and Europe, Turkey still hasn't made that one big discovery, but the ambition is there and it also has a hungry appetite for renewables.
Click map to enlarge.
This is an area of investment in Turkey that is often overlooked, as the majors explore the potential offshore bonanza in the Black Sea and Mediterranean, and both juniors and majors continue to explore conventional and unconventional plays onshore.
Renewables tend to get lost in the frenzy, but here's the unique situation: Unlike most of its European counterparts, in Turkey retail electricity consumption lags BEHIND income growth. This is the key aspect that makes Turkey an ideal venue for renewable investment. Annual demand growth for the power industry is forecast at 6.3% over the next two decades.
Ankara hopes to spend $10 billion on new power generation ANNUALLY over the next 20+ years. The goal is to double power generation capacity from what is now only 55 gigawatts. To that end it's eyeing renewables across the board-wind, solar, hydropower, biomass and geothermal.
General Electric Co. (GE) and Siemens AG (SIE) see the potential, and Turkey is doing all it can to lure more investors. GE is moving forward fast with a 22.5-megawatt wind farm (Sares) and a smaller, 10-megwatt farm at Karadag. These farms are already online, and now the electricity giant is pursing another project that involves supplying wind turbines to a local company. Siemens is second on the scene, also filling orders for turbines by Turkish companies.
Economic indicator comparisons with Europe tell the real story and indicate the greater potential for renewable payback in Turkey: Turkey is expected to see 4% growth this year, while Europe should experience a decline of around 0.2%.
Beyond the economic indicators, though, ask any junior or major energy company working in Turkey: This is a government ready to do business: the bureaucratic pains are only minor, and the fiscal arrangements highly attractive. That's why North American companies are hitting this scene hard-at least in terms of fossil fuels-and why they are there to stay despite the fact that everyone's still waiting for that one BIG FIND. The renewable sector offers even more promise. It doesn't depend on a big find, only an attractive investing environment and economic indicators that demonstrate viability. Both of these exist, and Turkey is indeed the regional trend-setter.
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