Turkey introduces “guarantees of origin” regulation for renewables
Posted in Energy
The Energy Market Regulatory Authority (“EMRA”) issued the Regulation on Renewable Energy Resource Guarantee Certificates in the Electricity Market (the “Regulation”) on November 14, 2020. Simultaneously with the issuance of the Regulation, EMRA also amended the Regulation on Certification and Support of Renewable Energy Resources in order to reflect the new concepts introduced by the Regulation in the renewable energy legislation.
“Renewable Energy Resource Guarantee Certificates” (“YEK-G Certificates”), which are similar to the Guarantee of Origin, or GoO, certificates defined under EU Directive 2009/28/EC, attest that a certain amount or proportion of electricity supplied to consumers has been generated from renewable energy sources.
In addition to the issuance of YEK-G Certificates, the Regulation also outlines the establishment and management of a registration database for YEK-G system users. All transactions (issuance, transfer, redemption and cancellation) relating to YEK-G Certificates will be conducted by the Energy Exchange Istanbul (EPİAŞ) as the market operator.
YEK-G Certificates will be issued by EPİAŞ based on the generation of electricity from renewable energy resources by licensed generation facilities and upon the request of the relevant generation license holder. Separate YEK-G Certificates will be issued electronically for each 1 MWh of electricity generated from renewable energy resources. The certificates will be in both Turkish and English and will be valid for 12 months from the end date of the energy generation period.
EPİAŞ is appointed by the Regulation as the market operator and will undertake, among others, the following:
- to establish an organized market for registering and trading YEK-G Certificates;
- to define the terms of trade in the organized market (including pricing, margin requirements, settlement terms, invoicing, payments, etc.);
- to organize trades, clearance and settlement processes; and
- to define the rights and obligations of market participants, the market operator and the “central counterparty”.
Further details regarding the certification process and the operation of the organized trading market will be clarified in the near future under principles and procedures to be published by EPİAŞ.
YEK-G Certification, which is considered to be an effective way to increase momentum for renewable energy, is a very new concept in the Turkish energy market. It is anticipated that the certification process will create transparency, and foster the development of a robust market for trading YEK-G Certificates, thus providing new, stronger incentives for the further development and use of renewable energy.