Lenders are advised to base their project financing on revenue prospects to support Turkey's solar market growth versus seeking guarantees to give loans, according to a senior executive of the Solar Energy Society -Turkey Section (GUNDER).
“Banks now ask for guarantees from the investor to finance renewable and solar energy projects,” Faruk Telemcioglu, general secretary of GUNDER, a non-profit organization promoting the more widespread usage of solar energy, told Anadolu Agency.
“The guarantee should actually be the expected revenue from the electricity generated and sold to the government. Project financing methods in Turkey should evolve to support the market’s growth,” he said.
Telemcioglu said Turkish banks are currently focusing on leasing to finance renewable and solar projects, but more tools in project financing are expected to develop as the renewables market expands.
"Municipalities should also support and lead the way in the development of the market to set an example," Telemcioglu said.
Councils could use solar power as a source of energy for their cold storage depots or slaughter houses, Telemcioglu suggested.
“Solar power should be used more in buildings owned by the public sector so the private sector can be inspired by it. For example the energy ministry or the renewable energy general directorate should use renewable energy in their own premises to meet their own needs,” he said.
Solar capacity can reach double ministry estimate
Turkey’s installed capacity in solar energy could reach over 10,000 megawatts (MW) by 2023 as compared with the Energy Ministry’s estimate of 5,000 MW, according to Telemcioglu.
The Renewable Energy Resources Area Regulation (YEKA) foresees the creation of large-scale renewable energy regions by allocating both state-owned and private property to investors.
“Installed capacity is expected to surpass 850 MW in 2016. There is a YEKA auction launched for a project which will become operational by 2018. There is also about a 8,000 MW YEKA area allocated. If you add the rooftop installations, I think we will easily exceed 10,000 MW by 2023,” he said.
Telemcioglu said depending on these figures, GUNDER expects about 1,000 MW more of installed capacity in solar each year.
Solar energy comprises 1 percent of Turkey’s energy mix but this ratio can increase to 7 or 8 percent in the next five years, along with new investments, Telemcioglu argued.
"Investor interest in solar projects is rampant, due to the high feed-in tariffs provided by the government and Turkey’s ample sun potential,” he said.
“In addition, the costs of investment are dropping at a steady rate,” he added.
Costs for investing in solar energy are projected to drop by about 50 percent up until 2025, after having already fallen by 50 percent from 2009 to 2015, Telemcioglu said, adding that solar investments have also become more attractive with rising efficiency.
“Efficiency has gone up, with panels converting more than 20 percent of the sunlight to energy as compared with about 18 percent only a short time ago,” he said.
He projected that solar energy would become more commonly used by both the public and industrial players as storage techniques develop.
To promote the more wide-spread usage of solar power, better legislation and government support for installing solar energy for either domestic consumption or industrial use should be differentiated.
“The prices of electricity and subsidies provided should be different, depending on whether the investment is industrial or individual,” he said.
It should also be possible to rent rooftops for the installment of solar panels, including factory roofs, to promote the usage of solar power in industry, Telemcioglu said.
Sibel Akbay
Anadolu Agency
sibel.akbay@aa.com.tr