Türkiye’s $8.7 B coal subsidy undermines renewable targets
Analysts warn that coal incentives could delay grid upgrades and hinder Türkiye’s 2035 goal of 120 GW in wind and solar capacity.
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Türkiye: A government plan to provide a purchase guarantee in US dollars for domestic coal power plants by 2030 could undermine the country’s renewable energy ambitions, according to recent analysis.
The scheme allocates $8.7 B over four years to coal facilities, offering them a guaranteed price of $75 USD/MWh – 12 % above the average market rate and 36 % above the generation cost of domestic coal. Even non-operating plants will continue receiving subsidies under the capacity mechanism.
Experts note that diverting these funds toward grid modernisation and substation construction could unlock capacity for new renewable projects and address one of the main obstacles to wind and solar expansion.
Türkiye’s electricity generation from solar energy has become significantly cheaper than coal, following a 77 % fall in installation costs over the past decade. Similarly, the cost of wind power installations has dropped by 40 %, further improving the competitiveness of renewables.
Redirecting the coal budget to upgrade the grid could help Türkiye achieve its target of 120 GW of installed wind and solar capacity by 2035, while removing bureaucratic barriers to rooftop, floating, hybrid, and storage-integrated solar projects would accelerate progress without compromising energy security.
Analysts argue that prioritising grid investments over coal incentives would better align with Türkiye’s long-term energy transition and decarbonisation goals.
Source: Ember
#coal#Grid modernisation#renewable energy#Solar#Türkiye#wind