Turkey's energy market and its legal principles

Restructuring and opening for competition of the electricity sector that started all around the world in early 1980s has also influenced electricity sector of our country. Primary objective of said restructuring is to increase market efficiency. Electricity market law, which has been accepted in 2001, increased the momentum towards privatization of the sector and reforms that are being made. In addition to that this legislation also led to establishment of Energy Market Regulation and Supervision Board, privatization of production and distribution activities and the start of the operation of the day-ahead market. With the new Electricity market law, which was accepted in 2013, important steps towards institutional structure and achieving well balanced structure and functioning in market have been taken. With the establishment of EPIAS, regulations regarding intra-daily and derivative markets and increase on the numbers of eligible consumers, significant progress has been made in the reform period. Major setbacks that got in the way of success on said reform period are structure and functioning of public institutions that are operating on the market and lack of regulations to ensure and enforce compliance of said structures and functions and negative effects of build-operate-transfer, build-operate, operate-right-transfer agreements, which have been made prior to any reform period, being in force until 2018-2019. In addition to these points, lack of progression for liberalization of natural gas market, eligible consumer limits, technical and non-technical losses, nature of relation between regulatory body and competition authority, lack of policies on reliability of supply, disproportionally provided incentives to renewable energy, nuclear and coal power plants are an obstacle to achieving an electricity market that has the ability to operate according to private law provisions in a competitive environment. Elimination of market disruptions and competition obstacles in the process will pave the way for consumers to obtain electricity at low cost in a competitive market environment operating according to the provisions of private law. Key Words : Electricity Market, Security of Supply, Capacity Remuneration Mechanisms JEL Kods : L11, L94, D40, K23, L51