MPs and campaigners warn new amendment could open the door to dirty, harmful coal projects with no means to demand environmental assessments

This article is more than 4 years old

This article is more than 4 years old

Turkish coal plants are in line for eye-watering public subsidies and exemptions from environmental regulations, under an amended energy package delivered by the country’s parliament, late last week.

Turkey is a member of the G20, whose two leading economies – the US and China – agreed to ratify the Paris climate change agreement on Saturday.

The G20 summit which ended in Hangzhou, China, yesterday also came under pressure to put a deadline to an old pledge to phase out fossil fuel subsidies.

But MPs and campaigners say that the new amendment known as Article 80 could instead open Turkey’s door to extraordinary largesse for the coal sector and other big energy projects, unfettered by environmental considerations.

Utku Çakırözer, an MP for the opposition Republican party (CHP) said: “This bill will give the government a huge mandate to bypass environmental impact assessments. We made it very clear in committee meetings and general assembly discussions that [some projects under consideration] would mean killing the environment. They would have consequences that it would be impossible to repair.”

Turkey plans to build as many as 80 new coal plants in the next few years, on top of 25 that already exist, belching an extra 200m tonnes of CO2 emissions into the atmosphere each year.

Under the new plan, any project deemed a “strategic investment” can be exempted from corporate taxes, tariffs, stoppages, and the duty to carry out environmental risk assessments, or even permitting applications.



Coal operators could be leased state lands for free, receive a 50% discount on electricity bills, and pocket state funding for wage subsidies, insurance premiums and interest on investment loans.

The government is also offering a guaranteed €0.05 per kilowatt hour (kWh) coal-generated electricity price and commitment to buy 6bn kWh’s of coal-generated electricity annually.

The cost of an earlier proposal for financial support was estimated in June at between $1.1bn and $2bn a year by the Institute for Energy Economics and Financial Analysis (Ieefa), who also said it would raise electricity prices up to 29%.

Elif Gündüzyeli, a spokeswoman for Climate Action Network in Istanbul said: “We fear that if Article 80 enters into force, there will be no legal instrument to prevent massive subsidies for large, dirty and harmful coal projects in Turkey, and there will be no means to demand environmental and social impact assessments of planned projects.”



The fall out from an Anatolian coal boom could also be felt in Turkey’s negotiations for accession to the EU. A commission spokeswoman said: “Turkey’s cross-subsidies are still a concern as it means that a fully functioning cost-based electricity market does not yet exist”.

The Turkish government did not respond to requests for comment.

Is it too late to stop Turkey's coal rush? Read more

The opposition CHP party said last week that it would appeal to the Turkish supreme court against the bill. But few analysts expect a policy reversal after a purge of judges, which followed a failed military coup in July.

“It is very unlikely that the constitutional court will challenge this law, in the post-coup environment,” said Aslı Aydıntaşbaş, a Turkey analyst for the European Council on Foreign Relations.

Two of the court’s judges were sacked after the military action, in a move condemned as “unacceptable” by the EU and widely seen as eroding the separation of state powers.

Seasoned observers expect President Erdoğan to support his energy minister, Berat Albayrak, who is also his son-in-law, and a close confidante.

Turkey’s coal reserves are mostly low-grade lignite, and the subsidies scheme was intended to cut extraction and processing costs, making it competitive with coal and other energy imports.



Underlying the plan is an imperative to ringfence energy security, given Turkey’s dependence on Russia for natural gas. Relations between the two countries went into a tailspin after Turkey shot down a Russian jet over Syria last winter.

“We have seen how countries that depend on Russia for their fuel supplies have been vulnerable to pressure,” Aydıntaşbaş said. “Everyone felt the need to diversify so we did not become entirely beholden to the Russian regime.”

Despite this, the Ieefa report said that Turkish investment in new coal plants could lock the country’s banking sector into a carbon asset bubble, and prevent the growth of other sources of indigenous energy, such as renewables.

The country’s has acquired just 0.3GW of installed solar capacity compared to Spain’s 7GW and Germany’s 40GW, according to the Ieefa study.

“Turkey, among the sunniest countries in Europe, is not investing seriously enough in its renewable energy potential,” the paper says. “By increasing renewables’ share of power generation and by limiting investments in fossil-fuel fired electricity, Turkey would also be guarding against likely financial defaults and the risk of expensive investments in coal and lignite plants becoming stranded-assets.”

However, analysts note that Turkey’s coal mining history and extant infrastructure may make upfront investments cheaper. Campaign finance and the country’s coal lobby are also cited as factors mitigating against an Anatolian turn to renewables.

• This article was amended on 16 September 2016 to clarify that an Ieefa report on the cost of subsidising Turkish coal plants was issued in June and based on a proposal being considered at that time.

