Turkey’s energy regulator granted its first ever solar license in late 2015. It is a 49-year generation license granted to Turkish developer Solentegre Enerji Yatirimlari, for an 8 MW facility to be installed in the eastern province of Elazig.Turkish regulators held tenders for solar capacity in various regions of the country in 2014. and 2015. Where multiple applications were received for the same substation, a bidding process determined the winner. For the Elazig project the developer bid TL 827,000 (present equivalent of US$280,000) per MW for the license. The market generally believed the bid was very high, but it was not far off from other bids submitted in other regions of the country. Overall, interest in the tenders was very high, with a total of 9 GW of solar projects being proposed for the 600 MW of tendered capacity. The 600 MW capacities is actually a national cap, and total licensed solar production cannot exceed that capacity.
However, Turkish policy makers have set a target of 5 GW of solar capacity by 2023. This begs the question of when the 600 MW cap will be increased (or lifted), and when the next round of license tenders will take place. Some market players say the cap will be increased when the transmission system is ready. Others claim that Turkey has no grid concerns and that new tenders will follow in due course. After winning a tender for capacity, developers need to go through a permitting process before a generation license can be granted. During this pre-licensing period, developers must collect and submit measurement data for at least one year, submit a letter of guarantee in an amount calculated based on the installed capacity of the project, secure land rights, and obtain required permits to start construction (such as zoning permits and environmental clearances). This pre-licensing period is limited to 24 months, unless there is a force majeure event or it is otherwise extended by the regulator. During this period, any sale of the generator’s shares is not allowed. The main incentive for solar in Turkey is a $133 USD/MWh feed-in tariff, which is available for 10 years for projects that commence operations by December 31, 2020.
There is an incremental tariff of up to $67 USD/MWh for using domestic content. The local manufacturing sector is currently underdeveloped and generators are heavily dependent on imported products. Turkey does not provide tax credits, treasury grants, or loan guarantees for renewable energy generation. Nor does it have set-aside programs or solar renewable energy certificates (SRECs). However, renewable energy generators enjoy other incentives in addition to the feed-in tariff, including reduced licensing fees and permitting costs, and priority in grid connection. Various tax credits and exemptions, as well as support on interest payments, are available for eligible manufacturers of turbines, blades and generators used in hydro, wind, biomass and geothermal power projects. While similar incentives are not applicable for solar panels or other solar components, this may be an area for enhanced regulatory support of the industry. Another indirect regulatory support for solar may come in the form of privatization of state-owned generation assets.
While these assets are not in solar (they are mostly hydro and thermal plants), they are known to depress the market price as they still make up a large portion of the country’s generation capacity. Separate and apart from the licensed generation market discussed above, distributed generation (or so-called unlicensed generation in Turkey) is also gaining more interest in the market. Facilities with a capacity of up to 1 MW are exempted from the pre-licensing requirements summarized above. The Council of Ministers, without any legislative action, is authorized to raise this limit up to 5 MW. Each unlicensed facility is required by law to be connected to a consumption unit, and any excess power not consumed in this unit can be sold to the grid. It is not clear whether the same generator may set up multiple facilities (for instance 10 facilities each having an installed capacity of 1 MW each) within the same region, and sell the excess power to the grid. So what is next? Turkey has high solar capacity and needs the installed power capacity from solar. Turkey has an average annual total sunshine duration of 2,640 hours (a total of 7.2 hours per day), which gives it the largest potential among European countries after Spain. At the same time, Turkey is largely dependent on oil and natural gas imports to fuel its growing power generation needs, and needs to diversity its energy sources. The combination of these realities should see further solar licenses being issued.
Source: www.renewableenergyworld.com
Stora Enso Timber Ab and KPA Unicon Oy have signed a contract of a biomass-fired hot water boiler plant delivery to Stora Enso sawmill Ala in Ljusne, Sweden. The new Unicon Biograte 15 MWth boiler plant will utilize bark and wood residues from the Ala sawmill as fuel, and it will produce hot water to the sawmill´s drying kilns. The new biomass boiler plant is scheduled to be in operation in November 2016. The value of the contract will not be disclosed.
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Vestas chief Runevad says UK rules shut out the latest hi-tech turbines, leaving Britain behind as the global wind boom spreads. The world’s biggest producer of wind turbines has accused Britain of obstructing use of new technology that can slash costs, preventing the wind industry from offering one of the cheapest forms of energy without subsidies. Anders Runevad, chief executive of Vestas Wind Systems, said his company’s wind turbines can compete onshore against any other source of energy in the UK without need for state support, but only if the Government sweeps away impediments to a free market. While he stopped short of rebuking the Conservatives for kowtowing to ‘Nimbyism’, the wind industry is angry that ministers are changing the rules in an erratic fashion and imposing guidelines that effectively freeze development of onshore wind. “We can compete in a market-based system in onshore wind and we are happy to take on the challenge, so long as we are able to use our latest technology,” he told the Daily Telegraph.
“The UK has a tip-height restriction of 125 meters and this is cumbersome. Our new generation is well above that,” he said. Vestas is the UK’s market leader in onshore wind. Its latest models top 140 meters, towering over St Paul’s Cathedral. They capture more of the wind current and have bigger rotors that radically change the economics of wind power. “Over the last twenty years costs have come down by 80pc. They have come down by 50pc in the US since 2009,” said Mr Runevad. Half of all new turbines in Sweden are between 170 and 200 meters, while the latest projects in Germany average 165 meters. “Such limits mean the UK is being left behind in international markets,” said a ‘taskforce report’ by Renewable UK. The new technology has complex electronics, feeding ‘smart data’ from sensors back to a central computer system. They have better gear boxes and hi-tech blades that raise yield and lower noise. The industry has learned the art of siting turbines, and controlling turbulence and sheer. Economies of scale have done the rest. This is why average purchase prices for wind power in the US have fallen to the once unthinkable level of 2.35 cents per kilowatt/hour (KWh), according to the US energy Department.
At this level wind competes toe-to-toe with coal or gas, even without a carbon tax, an increasingly likely prospect in the 2020s following the COP21 climate deal in Paris. American Electric Power in Oklahoma tripled its demand for local wind power last year simply because the bids came in so low. “We estimate that onshore wind is either the cheapest or close to being the cheapest source of energy in most regions globally,” said Bank of America in a report last month. A study by Bloomberg New Energy Finance concluded that the global average for the ‘leveled cost of electricity’ (LCOE) for onshore wind fell to $83 per megawatt/hour last year compared to $76-$82 for gas turbine plants in the US, or $85-$93 in Asia, or $103-$118 in Europe. Yet the size of the new wind turbines is precisely the problem in Britain, though the industry says they are less intrusive than more numerous smaller towers. Rural activists vehemently oppose further onshore expansion for a mix of reasons, often to protect the countryside and migrating birds. One application was turned down on fears that blade-noise would startle race-horses. It is understood that up 100 backbench Tory MPs wish to stop development of onshore wind altogether and that is effectively now happening. While there is no fixed height limit, the guidelines for local governments imply a 125 meter cap. This is often beaten down to nearer 100 meters, and the planning obstacles have become a nightmare for the industry.
Amber Rudd, Secretary of Energy and Climate Change, drastically revised policy last year, announcing that support for onshore wind would be cut from April 2016. She said 250 wind farms in the planning phase were unlikely to be built as a result but insisted that Britain was “reaching the limits of what is affordable, and what the public is prepared to accept”. Mr Runevad has other fish to fry in a booming global wind market. The Vestas share price has soared twentyfold since 2012, when the company flirted with bankruptcy after a debt-driven expansion, and faced cu At the time, critics said the wind bubble had played itself out, but the epitaphs were premature. The company’s plant in the Isle of Wight producing blades – shut in the crisis – has opened again. Vestas has raised its revenue guidance for this year to a record €8bn to €8.5bn, with a profit margin (EBITDA) of 9pc to 10pc. It has a mounting backlog of orders for South Korea, China, Brazil, India, Turkey, the US, Finland, and Greece. The world added a record 51 gigawatts (GW) of wind power capacity last year. Almost 40pc of this was in China, where the vast plains of the “three Norths’ have become the epicentre of the global industry – though the US midwest from the Dakotas to Iowa and Texas is no slouch either.
The country will also close more than 1,000 coal mines next year, taking out 60 million metric tons of unneeded capacity, according to the Xinhua report. China shuttered a similar number of mines this year, wiping out 70 million tons of production, according to a separate statement from the NEA dated Dec. 29. The country is on track to produce 3.58 billion tons of coal this year, down 0.5 percent from 2014, according to the NEA. China plans to increase wind and solar power capacity by more than 21 percent and have at least 20 gigawatts of new wind power installations and 15 gigawatts of additional photo voltaic capacity next year, according to the NEA statement.
China’s total coal production capacity including under mines construction is estimated at more than 5 billion tons while its coal output for next year will probably reach 3.7 billion tons, leaving more than 20 percent of its capacity idle, according to David Fang, a director with China Coal Transport and Distribution Association in Beijing. “We expect to see less downside pressure on coal prices in view of ongoing production cuts in 2016 and demand recovery, albeit at a slow pace,” said Helen Lau, an analyst with Argonaut Securities (Asia) Ltd. “China is still oversupplied.” The NEA estimates China next year will consume 3.96 billion tons of coal, 550 million tons of oil and 205 billion cubic meters of natural gas, according to the Xinhua report.
