Our Deputy Minister of Energy and Natural Resources and Chairman of EXIST, Mr. Abdullah Tancan, was the guest of the BloombergHT Focus program. Tancan, who made evaluations on the Power Futures Market (PFM) and Renewable Energy Resource Guarantees System (YEK-G) to be opened on June 1, also shared Turkey’s steps towards becoming an energy trade center and its predictions on this issue.

PFM and YEK-G will open on June 1

Abdullah Tancan stated that with EXIST’s first futures product, the Power Futures Market, and market participants will be offered the opportunity to trade electricity with physical delivery of future dates. Stating that with PFM, EXIST assumes the role of central counterparty, Tancan added, “Thus, we will provide market participants with the opportunity to protect themselves against price risk and to see price expectations for the future.” said.

Emphasizing that the software works were completed with domestic and national resources within EXIST, Tancan said, “We opened all modules of PFM to virtual application on April 1, 2021. As of May 17, 2021, applications from market participants who want to participate in PFM have started to be collected and with the first session to be held on June 1, 2021, and we will activate the Power Futures Market in a live environment. ”

Tancan stated that the YEK-G market, commonly known as the green certificate, will start operating on the same date, and he also added that they aim to expand the use of renewable energy resources in the production and consumption of electricity, to create a new resource for the sector and to protect the environment. Tancan emphasized that the YEK-G System, the electrical energy supplied to consumers will be provided with the opportunity to document that the electrical energy produced from renewable energy sources is consumed from renewable energy sources by monitoring, proving and disclosing that the electrical energy supplied to consumers is produced from renewable energy sources by the licensed legal entities and the opportunity to monitor this in an EXIST approved system will be provided to consumers.  

With the Natural Gas Futures Market, market participants will be able to manage their portfolios more flexibly

Tancan, who made evaluations about PFM and YEK-G markets as well as the Natural Gas Futures Market (VGP) planned to be opened in the last quarter of 2021, Tancan added, “When futures contracts start to be traded, they will not only contribute to transaction volume and liquidity, but also increase predictability in the market. With VGP, our market participants will be able to manage their portfolios more flexibly. ”

We are the 4th most traded in Europe in terms of volume in the spot markets.

Stating that, as of the end of April 2021, the installed capacity of electricity generation in our country reached 97,376.5 MW, Tancan said that the share of renewable resources in the total installed power is around 52 percent. He then emphasized that they aim to reach 65% of the share of domestic and renewable energy sourced electricity installed power in total installed power by 2023. Tancan emphasized that there was a 15-20% decrease in consumption in the first three months of the pandemic period, but an increase in consumption, especially industrial consumption, in June-July 2020.

Emphasizing on the role of EXIST in the vision of making our country an energy trade center, Tancan said, “We are the 4th stock exchange with the highest number of transactions in Europe in terms of volume in spot markets. A reliable price must be established and international investors must rely on this price. I believe we have achieved this reputation with our spot market.” Stating that the products and services offered to market participants with VEP and VGP will reach the same level with the European markets in terms of product diversity, Tancan added, “As a result of these studies, our country score in the regional trade center evaluations prepared by EFET increased as a result of the developments we have made in our market every year and our ranking is in the upper levels due to this.”

Stating that the electricity infrastructure was strengthened by TEİAŞ and synchronous connections were developed with ENTSO-E with the capacity increasing works carried out in the sense of energy supply security, Tancan said that in line with the studies carried out by BOTAŞ in recent years, TANAP and Turkish Stream Projects were put into use and the gas storage capacity in 2023 will be increased to 10 billion m3 and that there will be many entry points for natural gas in Turkey with FSRU ships and ports built. Stating that there are future connections with many countries regarding pipe gas and LNG gas to ensure supply security, Tancan added, “Our steadily growing gas market will enable us to be more selective in new contracts and will play a role in increasing our bargaining power. All components will come together to become a trade center with our spot and futures gas markets. In addition, the discovered gas will make very important and very positive contributions to Turkey’s vision of becoming an energy trading center.”

Support prices in YEKDEM will be updated quarterly

Tancan said that YEKDEM’s new TL-based support prices have been announced and these support prices will be updated quarterly with the determined formulation. He stated that while determining these prices, they also take into account the support given for similar investments in the world, they are trying to reach the optimum point in terms of making the investments feasible and a bearable price for the consumers, and that they think that renewable energy investments will continue in this context. Giving detailed information about YEKA competitions, Tancan said, “These days, a total of 2000 MW wind YEKA competition and a new 1000 MW solar YEKA competition will be announced. I hope it will be beneficial for our industry and country, ”he said.