Increasing Industrial Competitiveness and Hedging against Fossil Price Volatility with Renewables in Turkey: Assessing the Co-Benefits of Decarbonising Turkey's Power Sector

Executive Summary 

Prospects of decarbonising Turkey’s power sector following ratification of the Paris Agreement

As of 6 October 2021, the Turkish Parliament has ratified the Paris Agreement. In line with the ratification, the Turkish Government announced its intent for a national net-zero target by 2053. This pledge needs to be formulated into bold actions in the next cycle of nationally determined contributions in order to support transformation of the power sector and industrial sectors, which are responsible for the majority of the emissions. Aspiring to net-zero by 2053 not only recognises the opportunities facilitated by a climate-neutral economy and society but also anticipates the risks of continued dependence on fossil fuels. Turkey is heavily reliant on fossil fuel imports. In 2019, more than 98 % of fossil gas and more than 97 % of hard coal used by Turkey were imported. High dependence on fuel imports represents a threat to Turkey’s future energy security while also exacerbating the country’s current account deficit. Turkey spends around USD 45 – 50 billion each year on energy imports, which accounts for a quarter of total imports. Recent record-high power prices in Turkey have again emphasised the economy-wide risks of dependency on fossil fuels, which ultimately manifests as high energy bills and severe electricity shortages for the industrial sector.