Turkish energy regulator vows to phase out costly power deals

Turkey's energy regulator said it would allow no one to sell power to the state expensively, vowing to scrutinize sell-off deals in the energy sector for that purpose. "This country doesn't have to pay extreme prices for electricity for 20 years," Energy Market Regulation Agency chairman Yusuf Gunay told a business gathering in Ankara.
"We are not planning to give licenses to anyone who attempts to sell electricity to the state at prices that are twice the world prices. We will scrutinize every provision including the price, the term and purchase guarantees in contracts for transfer of operation rights (TOR), build-own-operate (BOO) and build-operate-transfer (BOT) power stations," Gunay said.

The BOT and BOO models guarantee that the Treasury will buy at a fixed price the electricity produced by power stations operated by the private sector for a certain period. International lenders have urged Turkey to cancel power contracts that have been negotiated at expensive prices, as electricity prices are already higher in Turkey than in most countries.
The head of the energy watchdog pledged not to allow any element in energy prices that deters economic growth, stifles free competition and boosts costs. "We might face some trials on principle due to rights that were granted in the past. But we want our Treasury to support us in this respect as it did with the Banking Regulation and Supervision Agency," Gunay added.