Electricity Market Reform in Turkey: Developments and Lessons Learned from 2001 to 2013
Turkey made a radical decision in 2001 to liberalize its electricity sector, establishing a competitive market under the regulation and monitoring of an independent regulatory agency (EMRA). Currently, the electricity market operates within the legal framework established by the Electricity Market Law No. 6446 (Law No. 6446). The main market law was Electricity Market Law No. 4628 (Law No. 4628) from March 2001 to March 2013. The Turkish Grand National Parliament introduced a new market law in March 2013 and the Law No. 4628 became an organizational law of EMRA. The main purpose of the Law No. 6446 is to unbundle and liberalize electricity market activities, privatize state owned enterprises, and establish a competitive market. Unlike other countries, the liberalization, privatization, and regulation processes have been carried out together in Turkey and still continue to be carried out in the market. Regarding unbundling of network utilities, initially dense regulations, rather than gradual implementation, were put into effect. The liberalization process in Turkish electricity market, which started in 2001, is still continuing. With the privatization of state owned generation assets, the final stage will be reached in the process of establishing a competitive electricity market envisioned in the Law No. 6446. Among other things, the key lesson learned from 12 year regulation is that reform process in the electricity market needs continuous effort. Moreover, it has to be better implemented gradually and can only be succeeded via public support.