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In-Depth Review of Energy Efficiency Policies of Turkey (2014)

Published in 2013



The Turkish economy has achieved high GDP growth rates after it overcame the deepest economic crisis of its history in 2001. This is mainly due to regulations and audits to decrease the banking sector's fragility, sound fiscal policies and mass privatizations of public enterprises. The average yearly growth rate of GDP was about 5% between 2002 and 2012.

Turkish import and export activities have been increasing from the early 2000s, except during the global economic crisis in 2009. The average annual growth rate between 2002 and 2013 was approximately 14% for exports and 15% for imports. During the same period, trade volume in services has been increasing as well.

The current account deficit was $75.1 billion in 2011, about 10% of the GDP, before decreasing to $48.5 billion (about 6% of GDP) in 2012. The current account deficit increased again in 2013 to $64.9 billion, about 8% of GDP.

As a result of the "open door" policy of the country, the number of foreign and joint ventures has increased up to today. Foreign investments remain an important factor for the continuation of stable social and economic development in the country. Average net inflows of foreign direct investment to the country have been 1.8% of GDP for the period 2002–2012.

The In-depth Review of Energy Efficiency Policies and Programmes of Turkey is available in English and Russian.

Summary of the Overall Assessment of Progress

Privatisation in the power and gas sector continues: power distribution company privatisations are completed and generation asset privatisation is ongoing. The privatisation of generation assets has been preceded by a large-scale rehabilitation of power plants, and this process is expected to continue after privatisation. Moreover, most gas distribution companies are privatised as well. The eligible customer limit has been reduced to 5 GWh since January 2013. Also, due to the distribution company privatisations, a process is now in place to reduce theft and losses from 14.6% on average in 2011 to around 12.1% with separate targets for each distribution company in 2015.

The main objective of the Government of Turkey in the field of energy has been to become less dependent on imports for meeting energy demand. To meet this objective, a strategy document was published in 2009 which set targets for 2023: to achieve 30% of power generation from RES and to reduce the share in power generation of natural gas below 30%.

Under the "European Union – Turkey Progress Report 2013" which was concluded as part of the EU accession policy, Turkey’s efforts were in the following areas: security of supply, internal energy market, renewable energy, energy efficiency, and nuclear safety and radiation protection.

International Financial Institutions (IFI) have set up large funds for energy efficiency investments together with renewable energy investments. The size of these funds is impressive with over $3 billion. Currently, the government does not treat energy efficiency projects as a special category of investments.

Concerning energy pricing, Turkey is well on track. The introduction of the Automatic Pricing Mechanism (APM) in early 2008 has improved the cost reflectiveness of energy prices considerably. Nevertheless, actual import costs are not always directly reflected in consumer prices as dictated by the APM. Hence, the APM is not always implemented as planned, which leads to temporary price subsidisation.

The government is commended for their work on the EE strategy paper of 2012. This paper has set out seven strategic goals, which are further subdivided into concrete actions and timelines.

In-Depth Review of Energy Efficiency Policies and Programmes of Turkey (2003)

Published in 2003


Turkey is characterised by significant growth in energy demand in the last decade. As a result, the country's energy policy is dominated by concerns related to security of supply. It is in this context of soaring energy demand and import dependence that improving energy efficiency became increasingly important, and it is recognised as such in Turkey's Eighth Five-Year Development Plan (2001-2005). However, while the Government gives priority to meeting this demand growth by focusing on increasing supply, it appears to have overlooked necessary demand-side measures.

In the opinion of the review team, Turkey is making progress in developing an energy efficiency policy and implementing PEEREA, but a number of issues still require attention, particularly in the area of integrating energy efficiency concepts with market liberalisation policies, especially in such end-use sectors as building construction and transport. The review contains specific recommendations in areas such as energy pricing, organisation of institutions, specific policies and instruments, and financing of energy efficiency.

The In-Depth Review of Energy Efficiency Policies and Programmes of Turkey is available in English and Russian.