Turkey looks set to become a renewables powerhouse sooner or later. Its proximity to energy-hungry Europe is an additional strategic advantage when it comes to monetizing this potential. Total installed capacity in the country is 7.8 gigawatt in solar and 10.7 gigawatt in wind. Before the end of the year, the Turkish Ministry of Energy wants to conclude tenders of additional 3 GW renewable energy projects. the country has focused chiefly on roof PV installations. It had traditionally invested in hydropower and to a lesser extent in geothermal technology. The country has achieved an impressive increase in renewable energy generation capacity, reaching 44% in 2020. Hydropower is the most prominent renewable energy source, accounting for 20% of electricity production.
Experts argue that the country needs additional baseload capacity to increase investments in renewables, as the electricity grid might otherwise not be stable. The government has invested in gas infrastructure and a new nuclear power station. Difficulties remain, though. Russia could have an incentive to push the facility’s inauguration past its 2023 deadline. Imports of gas at spot prices will be equally limited over the coming months: Prices will remain high as the European Union will buy as much non-Russian gas as possible. Last year, Turkey renewed its gas contracts with Russia. They were linked to the Dutch gas trading point TTF, Ellinas explained. EU prices are soaring, and Russian gas will also be more expensive. Despite Turkey logging 11% growth in 2021, economists expect a tumultuous year for the country: The local currency has crashed, inflation is rising, and the Russian war on Ukraine is taking a toll on tourism. Turkish companies are investing in the Balkans, including Kosovo and Albania. The focus is on gas markets, as Turkey can bank on its four (soon five) LNG terminals, usually idle in spring and summer. Additionally, Turkish and Balkan companies could develop joint electricity projects. Turkey has a strategic advantage due to its infrastructure, including ports and the Southern Gas Corridor. It tested blending hydrogen in the gas grid in 2021, and the Turkish Ministry of Energy is currently working on its hydrogen strategy. Local experts suggest reaching a minimum of 10% hydrogen transport in gas pipelines by 2025-2030.