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Turkey

Turkey

Turkey announces series of projects

Nearly 500 MW in 17 wind power projects are due to be built in Turkey before the end of 2002. The wind plant, chosen along with 12 other energy projects, are the last to be developed under Turkey's doomed Build Operate Transfer (BOT) arrangements. The uptake of the power from the 494 MW of wind projects and payment for the electricity are backed by treasury finance guarantees.

Turkey's BOT system for building new power plant -- under which a developer builds and operates a plant before selling it to the state -- was initiated when concessions were required for the right to generate electricity for sale. The concession requirement for natural energy sources was removed in July 1999, but the BOT system lingered on. The 17 wind projects, proposed by mainly Turkish project developers, appear to have been picked out of 71 BOT wind applications for a total capacity of 2400 MW, lodged with the energy ministry last year.

The BOT arrangement was a makeshift system, comments Mehmet Hanagasioglu of Swiss wind developer Interwind, which has projects underway in Turkey. It originally served to allow private companies to generate electricity from wind and other natural resources which were defined by law as public property. But after changes in the law, pressure from the World Bank and the International Monetary Fund helped to persuade the Turkish government of the inefficiencies of companies relying on the state to back energy contracts.

The 29 BOT energy projects, including the wind stations, for a combined capacity of 1379 MW, are the last to be initiated under the system. It is not yet clear what market framework will replace it.

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