Determinants of energy production: An empirical analysis on the Turkish energy market

Energy plays a strategic role not only in sustaining modern life but also in facilitating economic development. The increasing demand for energy, driven by population growth, industrialization, and urbanization, has made securing energy supply a critical necessity for countries. Especially, electricity production holds critical importance as both a driver and consequence of economic growth. In this context, ensuring a timely and sustainable electricity supply emerges as a fundamental requirement for maintaining macroeconomic stability. It is emphasized that energy investments and production policies should be designed in alignment with the dynamics of economic growth. Accurate modeling of the relationship between electricity production and economic growth, along with the analysis of price effects within production processes, contributes to the development of rational policy recommendations aimed at achieving sustainable development goals. Accordingly, in developing countries such as Turkey face significant challenges in ensuring supply security and formulating effective energy policies to meet rising demand. This study analyzes the relationship between electricity production, macroeconomic indicators, and raw material prices in Turkey for the period 2008–2023. The estimations obtained through the ordinary least squares and bootstrap standard error methods were supported by lasso and robust regression techniques. The findings revealed that GDP, labor force, and electricity imports have statistically significant and determinant effects on electricity production. Moreover, it was identified that these effects vary depending on the type of energy source. The positive impact of GDP suggests that economic growth increases energy demand, thereby stimulating electricity production. An increase in the labor force also supports production. However, this effect appears to vary depending on the type of energy source and the method of production. The negative impact of electricity imports puts pressure on domestic production, increases external dependency, and makes the sustainability of energy production more difficult. This situation may encourage a shift toward clean energy. These results underscore the need to design energy policies that support economic growth while providing valuable insights for future investment strategies and policy reforms.