EPDK Responds to Allegations Regarding Wind/Solar Energy Pre-license Applications with Storage; Legal Proceedings Initiated
The Energy Market Regulatory Authority (EPDK) responded to claims regarding pre-license applications for energy storage facilities, stating that legal proceedings have been initiated. EPDK issued a statement addressing the allegations made by Fatih Altaylı and Uğur Emek, which claimed that the EPDK management was involved in corrupt practices and the distribution of profits related to energy storage pre-license applications.
The statement from EPDK refuted the allegations and mentioned, "Legal proceedings have been initiated, including claims for material and moral damages, against the individuals who made these accusations against our president and executives."
Details regarding the claims were provided in the announcement:
Claim 1: "EPDK issued regulations overnight and distributed pre-licenses without anyone's knowledge." Firstly, it is not possible for EPDK to issue regulations overnight and enforce them by publishing in the Official Gazette, as this would violate our laws and related regulations. The pre-license process for energy storage began with the law that came into effect on July 5, 2022, which was assigned as a task to our agency. The law stipulates that "no bidding or competition will be required" for pre-license applications related to energy storage facilities.
The purpose of the relevant law is to facilitate the connection of electricity produced from wind and solar sources to the grid and to increase the share of renewable energy in electricity generation by storing it. The process became official and was published in the Official Gazette "4 months" prior to receiving the pre-license applications, making the entire country aware of the situation.
A draft containing the technical details of the process was prepared "2 months" before the receipt of pre-license applications and was opened to public consultation. Contributions were obtained from everyone interested in the energy sector before finalizing this draft, which was completed transparently in front of the public.
The final version of the regulation, shaped with the contributions of our citizens, was discussed and approved by our authority and subsequently published in the Official Gazette to come into effect. As observed, it is not true that a regulation was issued overnight and pre-licenses were distributed quietly. A total of 5,968 applications have been made to our institution between November 19, 2022, and September 28, 2023.
During the pre-license process, EPDK frequently informed the public, sharing the investors' interest in this field. These 5,968 applications were made by approximately 1,500 different companies. The applications were meticulously evaluated by our agency, with 663 pre-licenses granted to the 263 companies that completed their preparations without deficiencies.
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Claim 2: "EPDK management only accepted online applications to grant pre-licenses to close associates... Investors who wanted to prepare their documents were not given enough time." All industry players are aware that pre-license applications to our agency have been made online since May 2019, when the topic of energy storage investments was not even on the agenda. In other words, pre-license applications have been collected online for the past 5.5 years to prevent investors from dealing with paperwork and wasting time. The required documents for the pre-license process have been available on our agency's website for over 10 years, a fact known to all industry players.
In other words, there has been no special application for energy storage pre-license applications in the online application processes. Everyone had the opportunity to apply for a pre-license following the four-month period consisting of the enforcement of the related law, the opening of the draft regulation to public consultation, and finally the publication and entry into force of the regulation in the Official Gazette.
There are no secret dealings or favoritism on the part of our agency regarding this matter; it cannot be possible. There is no physical or legal means to intervene in online applications. All applications have been received in order, without discrimination, in accordance with the principle of corporate neutrality.
Claim 3: "With the regulation change on November 19, EPDK exceeded its authority by granting pre-licenses for energy storage investments… The Minister of Energy is angry about this, so a new tender was announced." There is absolutely no authority overreach in the pre-license process related to energy storage investments, which was mandated to our agency by the law that came into effect on July 5, 2022. The energy license allocation tender announced by our Ministry of Energy and Natural Resources in November has no connection with the pre-license process for energy storage investments.
Our Ministry of Energy and Natural Resources conducts capacity assignments and YEKA tenders when deemed appropriate. The purchase guarantees and durations are determined within the scope of these tenders. No purchase guarantees, prices or durations have been provided by our agency for energy storage investments.
Additionally, the pre-license process that the EPDK is responsible for, which began with the regulation change on November 19, is overseen by our Minister of Energy and Natural Resources, Mr. Fatih Dönmez. In the tender process announced in November, Minister Alparslan Bayraktar was in charge. Therefore, the accuser shows a lack of awareness regarding the energy sector.
Claim 4: "While Turkey can consume electricity half of its installed capacity, EPDK has decided to increase installed capacity in electricity." Comparing installed capacity with consumption in electricity is a malicious effort and reveals ignorance in the field of energy. The sources claimed to have decided to increase installed capacity are "domestic and renewable energy sources," which contribute to reducing our dependency on foreign energy.
It is also essential to note that the authority to increase installed capacity or create connection capacity does not lie within our agency. Increasing installed capacity and ensuring energy supply security is the responsibility of the Ministry of Energy and Natural Resources. The capacity at which energy production facilities can connect to the grid is calculated and planned by our country's system operator TEİAŞ. For this purpose, both our Ministry and TEİAŞ work hard to enhance our country's energy capabilities, taking necessary steps. EPDK is known to support every decision made and to be made within this context.
Claim 5: "Realizing that the President would go, EPDK management hastily distributed pre-licenses under a tariff of 6 cents. This figure could have been 3.375 cents. Due to this difference, an electricity bill of $129.6 billion will be paid over 30 years. This figure could have been $56 billion lower? The EPDK management made a $56 billion profit." The 6 cents tariff determined by the Presidential Decree published in the Official Gazette on May 1, 2023, was not set by the EPDK. As those with even minimal interest in the energy sector will know, this regulation covers the prices and durations applicable to renewable energy generation facilities based on YEK certificates that will enter operation between July 1, 2021, and December 31, 2030. Determining these prices and durations is not within the purview of EPDK, and the agency also has no authority to set prices and durations in this field.
The mention of a 30-year term in the Presidential decision, accessible to everyone, does not exist, and the applicable term is set for 10 years. Furthermore, in the decision, tariff ranges have been established for wind and solar between $4.95-6.05, and for storage-based wind and solar between $5.85-7.15.
In the upcoming tender that the Ministry of Energy and Natural Resources will conduct for YEKA projects, the floor price for solar is set at $3.25 and for wind at $3.5, with a ceiling price of $5.50 for both.
In this light, the calculations of $129.6 billion and $56.7 billion are entirely fictitious. It is clear that these figures are reached through a non-existent 30-year purchase term and incentives. Additionally, it should not be forgotten that no purchase guarantees are provided by EPDK; no regulatory authority can provide guarantees as they lack such authority. Our agency has not provided such guarantees to any investor, nor is it possible.
Legal proceedings, including claims for material and moral damages, have been initiated against the individuals who made these accusations against our president and executives. A necessary correction statement will also be sent to the media outlets that published these unfounded allegations without obtaining our agency's opinion or investigating their accuracy, despite the requirements of responsible journalism.