28 July 2010


Turkey: insights into an emerging Solar PV market

When asked about the global outlook, Dr. Kuban predicted a total market size of 18-25 GW by the end of 2013, a growth that will for a significant part be stimulated by today’s second tier markets. By this time, large swathes of the world will have reached grid parity with consumer electricity wholesale prices. During the coming year, we will see even greater thin-film penetration and the full coming of age of CI(G)S technologies.

As mentioned before, Turkey’s current capacity comes down to about 3 MW, mostly off-grid. The government’s approach is exclusively focused on large-scale supply by solar parks. Although this will be the starting point, we can expect hitches with licensing and permits processes. Over the coming three years, Turkey will be a steadily developing small-medium market as ASPs continue to drop.

The current system of subsidies for photovoltaics is far from optimal. The solar industry theoretically benefits from the RES-law, which was basically established to support wind-energy at an extremely unsatisfactory 5.5 Ec/kWh. Although this law stipulated some extra support for renewable energy investments and R&D, it has proved insufficient for PV start-ups. There has, however, been a parliamentary energy commission working on a new support structure. While many related bodies are demanding more attention for solar energy and several ministers have pledged support, not much has changed in the past five years. There is currently talk of a 13 Ec/kWh support scheme with a couple of extra cents for local content. Dr. Kuban senses an atmosphere of weariness concerning government support. Still, hopes are high that a new FIT regulation will be announced this year.

Turkey’s opportunities

  Even taking into account the slow nature of governmental support, Turkey profiles itself as one of Europe’s most promising emerging markets, one that simply cannot be neglected. There are, as in most cases, some obstacles to be overcome in Turkey. Short term problems include the current absence of a FIT and secondary legislation for grid-connection, an information gap and weak human resource base. Over the long-term, the country will struggle with the absence of a stable policy overseeing the sector and the lack of consistent rules and regulations for steady, sustainable growth.

Fortunately, there are many factors that, despite these difficulties, make Turkey a highly promising market. Turkey is a large country with a population that’s about the size of Germany and a population growth that is unrivalled in Europe. The country has one of the highest economic growth rates, the highest long-range energy demand, a strong industrial base and, not unimportantly, very good solar irradiation. Due to a hugely problematic and unstable energy supply, with unreliable sources and fluctuating prices, there is also a widespread desire for autonomy from the grid among Turkey’s population.

Turkey's Solar Map

Furthermore, the prospect of EU-membership, combined with close relationships with Middle Eastern and Asian markets, successful business examples in different sectors (including energy), and probable grid parity within two to three years make it a PV market with large potential. The initial boom is expected to be seen in solar parks. Cleanglobe’s analysts expect medium size systems to become feasible shortly, and show good growth if the initial grid connection problems are overcome. The southern sunbelt provides plenty of opportunity for thin-film technologies, while rooftop applications in the northern part of Turkey will provide possibilities for crystalline applications.

All in all, we can conclude that Turkey is one of Europe’s most promising emerging markets, providing business and investment opportunities that can and should not be ignored.

Dr. Baha Kuban holds a PhD in Materials Science and has gained a lot of experience in the PV world during his work as a research scientist in the U.S. and his efforts in research, strategic planning and innovational initiatives in his home country of Turkey. Dr. Kuban is managing partner with Cleanglobe, a consulting and EPC company, and has over sixteen years’ experience in Turkey and abroad.
During Solarplaza’s Fourth Global Demand Conference on September 6 and 7, 2010 in Valencia, Spain, Dr. Kuban will give an overview of the Turkish market as one of the keynote speakers on the Emerging Markets day.

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