The evaluation of feed-in tariff regulation of Turkey for onshore wind energy based on the economic analysis

Abstract

Renewable energy sources have become popular with the technological developments, the increase in the price of fossil fuels and the environmental concerns. These factors have also prompted Turkey to utilize her rich renewable energy sources to meet her increasing electricity demand which is around 7% annually. Therefore, the Renewable Energy Law was enacted in 2005 to incentivize the utilization of domestic renewable sources with feed-in tariffs. In this study, onshore wind energy potential of Turkey is analyzed to find out whether these regulations and incentives will help the utilization of onshore wind energy potential. To that end, some background information about technology and cost of onshore wind power plants, the wind energy potential of Turkey and the current regulatory framework related to wind energy are explained. Then, a model is set up to conduct economic analysis by calculating NPV for the base case scenario and under the uncertain environment. The results show that an onshore wind energy potential of about 13GW having a wind speed of 7.5m/s or higher can be utilized profitably with the current feed-in tariff as the wind capacity of more than 100GW cannot be utilized economically.