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Electricity Generation Privatization Implementations

The Electricity Market Law No.4628 became effective in 2001 and stipulated the principles of the Turkish electricity market. Within this framework, on 17.3.2004 the Electricity Energy Sector Reform and Privatization Strategy Paper (“2004 Strategy Paper”) and on 18.5.2009. the Electricity Energy Market and Supply Security Strategy Paper (“2009 Strategy Paper”) depicting the road map for the liberalization and security of supply in the market, were publicized.

According to the 2004 Strategy Paper, for the purpose of restructuring the electricity generation assets of Turkey and of privatizing them through grouping, firstly, the energy generation divisions of all hydroelectric power plants “constructed and commissioned by the General Directorate of State Hydraulic Works (DSİ)” and the inseparable immovable assets of these, were transferred to EÜAŞ by May 2004 on the basis of their actual cost without any charges being paid to DSİ. Additionally, the generation facilities to be privatized were identified and grouped on the basis of “prevention of market dominance and financial viability” criteria in order to determine portfolio generation groups within the scope of the 2004 Strategy Paper. 

As per decision of the Privatization High Council dated 27.12.2006. and numbered 2006/100, it has been decided that Tercan, Kuzgun, Mercan, İkizdere, Çıldır, Ataköy, Beyköy Hydroelectric Power Plants (HPPs) and Denizli Geothermal Power Plant and Engil Gas Turbine Power Plant shall be included in the scope and program of privatization. The aforesaid power plants have been incorporated into Ankara Natural Electricity Generation and Trade Co.Inc. whose equity is wholly owned by the PA and the privatization of 9 Power Plants with a total installed capacity of 141 MW was concluded in 2008.

In 2009, as per decision of the Privatization High Council dated 19.10.2009 and numbered 2009/59, it has been decided that 56 Run-of-River Power Plants shall be included in the privatization program and privatized via the “Transfer of Operating Rights” method. The Run-of-River Power Plants were grouped into 19 portfolios, but the tender of Koyulhisar HPP in portfolio-12 did not go ahead because the plant is located in the disaster area. The tender process for 18 portfolios with a total installed capacity of approximately 140 MW has been concluded as of June 2010 and the tenders have been approved by the decisions of HPB. Transfers of 10 portfolios of the aforesaid Run-of-River Power Plants have been realized, tenders of 4 portfolios (2, 7, 18 and 19) have been cancelled and transfer processes of 4 portfolios (3, 6, 8 and 15) are still in progress.

The abovementioned 19 portfolios are set out below:

Group 1 : İznik-Dereköy, İnegöl-Cerrah, M.Kemalpaşa-Suuçtu

Group 2 : Haraklı-Hendek, Pazarköy-Akyazı, Bozüyük

Group 3 : Kayaköy

Group 4 : Kovada I, Kovada II

Group 5 : Turunçova-Finike

Group 6 : Anamur, Bozyazı, Mut-Derinçay, Silifke, Zeyne

Group 7 : Bozkır, Ermenek, Göksu

Group 8 : Dere, İvriz

Group 9 : Kayadibi,

Group 10 : Bünyan, Çamardı, Pınarbaşı, Sızır

Group 11 : Değirmendere, Karaçay, Kuzuculu

Group 12 : Koyulhisar, Ladik-Büyükkızoğlu

Group 13 : Besni, Derme, Erkenek, Kernek

Group 14 : Bayburt, Çemişgezek, Girlevik

Group 15 : Esendal, Işıklar (Visera)

Group 16 : Çağ Çağ, Otluca, Uludere,

Group 17 : Adilcevaz, Ahlat, Malazgirt, Varto-Sönmez

Group 18 : Engil, Erciş, Hoşap, Koçköprü

Group 19 : Arpaçay-Telek, Kiti

A tender was initiated by the PA on 13.07.2012 in 10 portfolios for the Run-of-River Power Plants of which their transfer operations could not be realized in the first tender and for Kısık, Berdan and Hasanlar HPPs which were included in the scope and program of privatization. 

The aforesaid portfolios have been determined as:

Group 1 : Engil, Erciş, Hoşap

Group 2 : Koçköprü

Group 3 : Kısık

Group 4 : Göksu

Group 5 : Bozkır, Ermenek

Group 6 : Haraklı-Hendek, Pazarköy-Akyazı, Bozhöyük

Group 7 : Hasanlar

Group 8 : Ladik-Büyükkızoğlu, Durucasu

Group 9 : Arpaçay, Telek-Kiti

Group 10              : Berdan

and the offers were received on 05.10.2012. Final negotioations of these tenders were completed on 19.10.2012. As of June 2013, all the groups have been  privatized.

The preliminary studies for the privatization of 46 power plants including 28 HPPs and 18 thermal power plants belonging to EÜAŞ with a total installed capacity of 16,200 MW are also being carried out in coordination with the PA and the Ministry of Energy and Natural Resources. As a result of the studies conducted in relation to these 46 power plants, 4 priority power plants were identified (Hamitabat, Soma, Seyitömer and Kangal) and the remaining power plants were structured in 9 portfolio groups. The studies of tender with regard to privatization of Çatalağzı,Kemerköy,Yeniköy and Yatağan  thermal power plants continue. The studies with regard to the privatization strategies of the portfolios and priority power plants are currently in progress, and amendments may be made to the portfolios and priority power plants by taking the developments in the industry and international markets into account.

As for the priority power plants,

 

Ø  The Seyitömer Thermal Power Plant owned by Elektrik Üretim A.Ş. and immovable properties used by the plant, as well as movable and immovable properties used by Seyitömer Lignite Corporation have been  privatised by the “asset sale” method, while Licenses no. 2594, 31743 and 200702650 and mine fields covered by these licenses have been  privatised by the “transfer of operating rights” method as a whole. Sale and transfer of operating rights  agreement  was  signed on 17.06.2013 with the comparation of  Çelikler Seyitömer Elektrik Üretim A.Ş. , EÜAŞ and PA.

 

Ø  The Kangal Thermal Power Plant owned by Elektrik Üretim A.Ş. and immovable properties used by the plant and owned by Elektrik Üretim A.Ş. and the Treasury have been  privatised by the “asset sale” method, while Licenses no. 53318 and 72760 and mine fields covered by these licenses have been  privatised by the “transfer of operating rights” method as a whole. Sale and transfer of operating rights  agreement  was signed on 14.08.2013 with the comparation of  Kangal Termiksantral Elektrik Üretim A.Ş., EÜAŞ and PA.

 

Ø  Hamitabat Elektrik Üretim ve Tic. A.Ş. a subsidiary of Elektrik Üretim A.Ş.  have been privatised through a block sale by using the sale method of 100 % of  the shares . Sale agreement  was signed on 14.08.2013 between  Limak Doğalgaz Elektrik Üretim A.Ş.  and  PA.

 

 

T.C. Başbakanlık Özelleştirme İdaresi Başkanlığı 2013