Recent Amendments to the Electricity Market Law No.6446


Turkish electrical energy market has recently undergone significant changes that are introduced by the Law Amending the Electricity Market Law No. 6446 (“EML”) and Certain Other Laws (“the Omnibus Bill”) that was published in the Official Gazette dated 17.06.2016 and numbered 29745. Significant amendments also have been made to the Law No. 5346 on the Use of Renewable Energy Resources for Electricity Production (“REL”) and the Law No. 3154 on the Organization and Functions of the Ministry of Energy and Natural Resources. Within the context of amendments to the EML, a new procedure for privatising certain assets of the Electricity Generation Corporation (“EÜAŞ”), or its affiliates, as appropriate for the purposes of developing power plants based on renewable energy resources and coal of local origin has been introduced. Moreover, retail sale companies are now empowered by law to charge their customers special fees for technical and non-technical line losses. Apart from the foregoing, some of the rules governing licensed and unlicensed generation have been amended. Some of these major changes in law are;

 

·    Wind and solar measurement data for pre-license applications is now required to be obtained for the last 5 years preceding the subject application. As an exception to the above measurement requirement, if any wind or solar power plant was proposed to be installed on any designated “renewable energy resource area” as defined in the regulation, then no pre-license application phase measurement data shall be required.


·    In case there are multiple applications for connecting to the same connection point and/or to the same connection site within the grid, Turkish Electricity Transmission Corporation (“TEIAS”) will now organize a competition for determining the winner who will qualify for connecting to the grid up to the announced capacity. In determining the winner, the lowest electricity sale price offered over the legally permissible maximum sale prices i.e., the feed-in tariffs, as set forth under Annex I of the REL will be taken as a basis. Previously, the winner of the competition was the applicant who proposed to pay the highest total contribution fee per megawatt to TEIAS within a maximum period of 3 years following the commissioning.


·   To underpin the latest amendments which were made to the Unlicensed Electricity Generation Regulation on 23 March 2016, it is stipulated that shareholders in unlicensed generation companies operating wind or solar power plants of maximum 1MW capacity, each are prohibited from doing any share transfers until the provisional acceptance of the subject power plant by the Ministry of Energy and Natural Resources. In case of a breach of this prohibition, the invitation letter sent to the generation company concerned for executing a grid connection agreement with the related network operator may be cancelled.

 

·     Prohibitions from applying for unlicensed wind and solar power generation have been introduced in respect of those persons and entities who are described by law as being “related” to distribution companies or to designated supply companies, as the case may be, which operate in any given distribution region.