"A situation has emerged whereby unlicensed projects, because they are subject to little governance, have become more attractive than larger scale licensed projects" - Muzaffer Yosmaoğlu former general manager, Koç Holding -- Transmission tower manufactured by BTE Energy. Photo courtesy of BTE Energy. ments, in addition to those in generation. Of particular concern has been the Turkish government's continued role in electricity transmission and the impact that this has had on infrastructure renewal and expansion. Elvan Tugsuz Guven, general manager of Çiltuğ, a leader in heavy manufacturing for Turkey's energy sector which also operates in generation through its subsidiary Tektuğ, explained: "When market liberalization first began in Turkey, we held great hope that we would see an increase in greenfield investment, especially for wind power projects. Even following the initial failures of the government during the first tender process it executed for wind licenses in 2007, we believed that we would see the investments in transmission required to facilitate the expansion of these projects made and dismissed the notion that this event indicated the nature of the state's involvement in the market. Having expanded into the construction of wind towers in anticipation of these investments, Çiltuğ has been sorely disappointed. TEİAŞ, charged within managing Turkey's electricity transmission network, has yet to meet their commitments to improving connectivity; our energy infrastructure remains underdeveloped and many of the targets which the govO Global Business Reports 1 , ·ı ; , i,; 'İ f IL 1 ernment initially set for correcting this have not been met. in addition, renewable energy investors that made power house and transmission investments on behalf ofTEİAŞ, have been disappointed due to long years of connection investment offsetting. lssues associated with transmission continue to detract from the feasibility of investments made into generation as many, especially, in wind, must either undertake the cost of these expansions or otherwise see their ability to supply power to the market limited by poor infrastructure." Less obvious but equally powerful, the second vestige of the old regime is observed in the way in which the legacy of the country's bureaucracy has shaped the energy sector's project development and licensing processes. Dr. Rüçhan Bülent Hamamcı, deputy general manager of Sancak Energy, which currently holds four licenses for wind power projects, explained how the regulatory structures governing licensing as handled by Turkey's Energy Market Regulatory Authority (EMRA) have halted the development of their site in lzmir: "The way in which licenses are administered in Turkey must be restructured. The current licensing process requires that, in order to even apply, investors must go back and forth between as many as 30 agencies. Yet even once licenses are administered, this does not necessarily guarantee that one has a license to operate. in the case of our project in lzmir, though we have received a license, the development of our project has been halted by the local community. The only recourse we have had is in judicial proceedings. There must be a department within EMRA to handle postpermitting issues. Especially in lzmir, these situations are common. Post-tender support is necessary and EMRA must develop as a coordinating body - otherwise investors will begin to turn away from the energy sector." However, perhaps posing a more direct threat to the perceived stability of future investments in Turkey's energy sector has been TEİAŞ and its tender process for licensed projects in renewable energy. Designed to facilitate the development of large-scale renewable projects within Turkey, the system employed by TEİAŞ has been characterized by both poorly developed regulatory structures and erratic market behavior. These problems first became evident in 2007, during the country's first tender for wind energy
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