Renewable energy policy database and support: single

Tenders (Renewable Energy Zones (YEKA-zones))

Updated: 23.01.2019

Author: Tim Sternkopf

The General Directorate of Renewable Energy (GDRE) under the MENR declares Renewable Energy Zones (YEKA-zones) where renewable energy capacities are to be tendered. Another option is the tender of a fixed renewable energy capacity, for which the winning bidder has to search for adequate zones to develop the project. Tender participants bid for a feed-in tariff, which was granted for 15 years. In the beginning of the bidding procedure, each bidding party bids for a price in an envelope. Then the price is reduced by the five parties with the lowest bids in the envelope until no party is offering a lower one. All holders of a YEK-license are eligible to participate in the tenders, which are regularly announced in the Official Gazette. All sources of renewable energy are eligible, however there have only been tenders for solar and wind power in 2017 under the YEKA-scheme.

Eligible technologies and support requirements

The tender system aims to accelerate the deployment of renewable energies in Turkey with a high share of locally manufactured technologies (§ 1, YEKA). All renewable energy sources are eligible, however there have only been tenders for solar and wind power in 2017 under the YEKA-scheme (§ 3, art. 8, YEK). The fixed feed-in tariff has been granted for 15 years in the tenders in 2017 and started from the day of signing the YEKA agreement (YEKA Solar Tender; YEKA Wind Tender). The requirements of the tenders are specified in each tender announcement in the Official Gazette. These specifications include the share of Turkish nationals in ownership, support periods, security guarantees, technical requirements etc.

Wind energy	The wind tender in March 2017 had the following specifications. As they are announced together with the tender, they can change in the upcoming tenders. Guaranteed FiT Support duration: 15 years Tendered capacity: 1 GW Ceiling price: USDct 7 (€ct. 6.2 as of December 2018) per kWh Share of Turkish ownership: 25% Establishment of a R&D center and a PV production facility of 500 MW per year 2 GW of produced wind power plants between 01.01.2014 – 31.12.2016
Solar energy	The solar tender in January 2019 has the following specifications. As they are announced together with the tender, they can change in the upcoming tenders. Guaranteed FiT Support duration: 15 years Tendered capacity: 1 GW Ceiling price: USDct 6.5 (€ct. 5.7 as of November 2018) per kWh The solar tender in March 2017 had the following specifications. As they are announced together with the tender, they can change in the upcoming tenders. Guaranteed FiT Support duration: 15 years Tendered capacity: 1 GW Ceiling price: USDct 8 (€ct. 7.0 as of December 2018) per kWh Share of Turkish ownership: 25% Establishment of a R&D center and a PV production facility of 500 MW per year 3 GW of produced PV panels between 01.01.2014 – 30.06.2016
Geothermal energy	Eligible.
Biogas	Eligible.
Hydro-power	Eligible.
Biomass	Eligible.

Tender characteristics

Pre-qualification criteria	In order to qualify to participate in the tenders, the bidders have to certify a specific capacity of developed projects in the field. Furthermore, a participation fee needs to be paid in advance and a guarantee deposit established. In case of a successful bid another guarantee deposit needs to be established (YEKA Wind Tender; YEKA Solar Tender). With regards to licenses, the bidding party needs to fulfill the requirements to apply for an associate degree at the Energy Market Regulatory Authority (EMRA). To be eligible for participation in the tender the bidding parties need to include the documents specified in § 7 art. 5 YEKA. These have to be submitted to the GDRE before the deadline announced in the tender specifications.
Bidding procedure	The tenders are set for a fixed date when the bidders and the General Directorate of Renewable Energy (GDRE) meet. At first, the bids are evaluated in a sealed bid format where the offer envelopes of the bidders are opened and ranked. The 5 lowest offers continue to bid in an open format until no lower bid is offered. (§ 10 YEKA)
Tender constraints	There exists both a ceiling price and a capacity cap, which is announced in the tender specification in the Official Gazette. The ceiling price for the solar tender in January 2019 is USDct 6.5 (€ct. 5.7 as of December 2018) per kWh and a fixed capacity of 1 GW and the ceiling price for the offshore wind tender in October 2018 was USDct 8.0 (€ct. 7.0 as of December 2018) per kWh and a fixed capacity of 1.2 GW.
Pricing rules	A pay as bid pricing rule is in place as each tender only brings forth one single winning bidder (§ 10 art. 4 YEKA).
Lead time	In the solar tender of March 2017, the R&D facility has to be established within 18 months after signing the contract. The solar power plant has to be finalised 36 months after the opening of the PV production facility. (YEKA Solar Tender)
Frequency of tenders	The tender frequency depends on the General Directorate of Renewable Energy (GDRE).

Addressees

Procedure

Process flow and deadlines	There are two ways in defining the YEKA-zones. In the first one, the ministry declares areas as renewable energy zones with a subsequent tender process (§ 5 art. 2, YEKA) (1). In the second, a capacity is tendered and the relevant site found afterwards by the winning company (§ 5 art. 3, YEKA) (2). The procedures are defined as follows: GDRE conducts preliminary studies for renewable energy potentials and takes the view of TEIAS into account with regard to capacity allocation. Afterwards the area can be declared as a candidate YEKA zone. The total installed power capacity is evaluated and potential answers by different stakeholders considered. The GDRE installs various stations for energy potential measurements are installed, conducts technical and economic analysis and decides whether to continue to support the YEKA zone. If considered eligible, the decision is announced in the Official Gazette and the acquisition process for the land permits initiated (§ 5 art. 2, YEKA). The process is started by the Ministry announcing tender for a power capacity assigned to certain connection zones. The winning legal entity is obliged to plan 90% of the planned power plants within the defined connection zones. Furthermore, the capacity allocation process has to be started by the winning legal entity within the terms of the agreed YEKA Usage Contract and the relevant specifications, supported by the Ministry. All related costs are borne by the winning party (§ 5 art. 3, YEKA). The eligible YEKA-zones are announced in the Official Gazette by the General Directorate of Renewable Energy (GDRE) (§5 (h) YEKA). Further requirements with regards to technical criteria, locally manufactured parts, deadlines etc. are published in the tender announcement (§ 6 YEKA). To participate in the tender process, the documents listed in § 7 YEKA need to be submitted to the GDRE. This contains i.a. certificates proving the technical specifications as defined in the offer, certificates with regard to the local content specifications, letter of guarantee etc. (§ 7 art. 5 YEKA). The legal entity winning the tender process is obliged to apply for an associate degree in EMRA within 45 calendar days (§ 12 art. 3 YEKA). This also includes an application for a production licence (§12 art. 6 YEKA). Furthermore, every calendar quarter a progress report needs to be submitted by a third supervisory party to the GDRE. If the delay surpasses 18 months, the YEKA usage contract is cancelled (§ 12 art. 12 YEKA).
Competent authority	MENR, GDRE, EMRA

Process flow and deadlines

There are two ways in defining the YEKA-zones. In the first one, the ministry declares areas as renewable energy zones with a subsequent tender process (§ 5 art. 2, YEKA) (1). In the second, a capacity is tendered and the relevant site found afterwards by the winning company (§ 5 art. 3, YEKA) (2). The procedures are defined as follows:
- GDRE conducts preliminary studies for renewable energy potentials and takes the view of TEIAS into account with regard to capacity allocation. Afterwards the area can be declared as a candidate YEKA zone. The total installed power capacity is evaluated and potential answers by different stakeholders considered. The GDRE installs various stations for energy potential measurements are installed, conducts technical and economic analysis and decides whether to continue to support the YEKA zone. If considered eligible, the decision is announced in the Official Gazette and the acquisition process for the land permits initiated (§ 5 art. 2, YEKA).
- The process is started by the Ministry announcing tender for a power capacity assigned to certain connection zones. The winning legal entity is obliged to plan 90% of the planned power plants within the defined connection zones. Furthermore, the capacity allocation process has to be started by the winning legal entity within the terms of the agreed YEKA Usage Contract and the relevant specifications, supported by the Ministry. All related costs are borne by the winning party (§ 5 art. 3, YEKA).

The eligible YEKA-zones are announced in the Official Gazette by the General Directorate of Renewable Energy (GDRE) (§5 (h) YEKA). Further requirements with regards to technical criteria, locally manufactured parts, deadlines etc. are published in the tender announcement (§ 6 YEKA).
To participate in the tender process, the documents listed in § 7 YEKA need to be submitted to the GDRE. This contains i.a. certificates proving the technical specifications as defined in the offer, certificates with regard to the local content specifications, letter of guarantee etc. (§ 7 art. 5 YEKA).

The legal entity winning the tender process is obliged to apply for an associate degree in EMRA within 45 calendar days (§ 12 art. 3 YEKA). This also includes an application for a production licence (§12 art. 6 YEKA). Furthermore, every calendar quarter a progress report needs to be submitted by a third supervisory party to the GDRE. If the delay surpasses 18 months, the YEKA usage contract is cancelled (§ 12 art. 12 YEKA).

Competent authority

MENR, GDRE, EMRA

Penalties

Amount of the fee	If the project’s delay exceeds 18 months, the contract as well as the associate degree at EMRA is annulled and the deposited guarantee confiscated (§ 12 art. 12 YEKA). The guarantee amounted to USD 50 million (€ 44.0 million as of December 2018) in both wind and solar tender in 2017 (YEKA Wind Tender, YEKA Solar Tender).

Distribution of costs

Consumers	The costs of the feed-in tariff are borne by the consumers via their electricity bills (§ 6 art. 1 YEK).
Distribution mechanism	The costs of the support scheme are borne by the grid operator. The total amount will be determinate by the PMUM and then invoiced to the supplier (§ 6 art. 6 YEK). The grid operators are obliged to pay that amount pro rata to the plant operators (§ 6 art. 6 YEK). The costs of the grid operators are borne by the consumers in terms of their electricity bills (§ 6 art. 6 YEK).

Consumers

The costs of the feed-in tariff are borne by the consumers via their electricity bills (§ 6 art. 1 YEK).

Distribution mechanism

The costs of the support scheme are borne by the grid operator. The total amount will be determinate by the PMUM and then invoiced to the supplier (§ 6 art. 6 YEK).
The grid operators are obliged to pay that amount pro rata to the plant operators (§ 6 art. 6 YEK).
The costs of the grid operators are borne by the consumers in terms of their electricity bills (§ 6 art. 6 YEK).

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