Privatization of power plants to ‘earn $13 billion’

ANKARA

Minister of Foreign Affairs Ahmet Davutoğlu (2nd R), Mİnister of Energy Bakanı Taner Yıldız (R) and Finance Mİnister Mehmet Şimşek (2nd L) attend the signing ceremony for the Kangal Thermal Power Plant’s privatization. DAILY NEWS photo / Selahattin SÖNMEZ

Turkey has earned $13 billion from the privatization of electricity distribution grids, Energy Minister Taner Yıldız said yesterday, adding that the same amount was expected to be gained from the privatizations of electricity generation plants.

The privatization of Kangal Thermal Power Plant was concluded yesterday with a signing ceremony for the sale and operating rights transfer agreement, attended by ministers and officials in Ankara. Konya Şeker, a local sugar producer but also active in the food, agriculture-breeding and energy sectors, had offered the tender with $985 million for the plant’s privatization.

During his speech at the ceremony, Yıldız stated that the privatization of electricity generation plants was expected to earn $13 billion, as much as the privatization of electricity distribution grids had done. However, Energy Market Regulatory Authority (EPDK) head Hasan Köktaş said the privatization of the production sector had begun from local resources, adding that they aimed to provide a perfectly competitive market in this sector. Köktaş pointed out that a production surplus was necessary for this to take place, adding that they had added installed power worth as much as “two Atatürk dams” (Turkey’s largest dam has around 2,500 mW installed power).

16,000 mW to be privatized

Privatization Authority (ÖİB) Deputy President Ahmet Aksu said the Electricity Generation Corporation (EÜAŞ) had 25,000 mW installed power and that they would lead the privatization procedure for 16,000 mW of the total.

Aksu also said Kangal Thermal Power Plant, in the Central Anatolian province of Sivas, had 457 mW installed power, which amounted to 2 percent of the EÜAŞ’s installed power and 0.75 percent of Turkey’s installed power. The plant’s electricity generation made up 1.1 percent of the country’s generation last year.

However, Energy Minister Yıldız also noted that the target was to increase the share of coal-fired power stations in electricity generation. “We will give more place to local coal in Adana, Kütahya, Manisa, Eskişehir and Konya,” he said.

The Energy and Natural Resources Ministry discovered 1.8 billion tons of lignite reserves in the Central Anatolian province of Konya in January. Yıldız recalled that a tender would be held for building a thermal power plant with 5,000 mW capacity in the Karapınar district of Konya, and it was hoped that local entrepreneurs would benefit from this.

Meanwhile, Finance Minister Mehmet Şimşek said they wanted to use the private sector’s dynamism in thermal power plants in Turkey. He said Konya Şeker would increase the generation capacity of the Kangal Thermal Power Plant. “This is an important step for solving one of Turkey’s main structural problems,” he said.

Şimşek noted that Turkey’s energy import costs had increased to $60 billion last year, from $9 billion in 2002. He said the Energy Ministry had conducted studies on these structural problems but needed a longer period for nuclear power plants and hydroelectric power plants to come into operation. “Turkey has considerable thermal power plant capacity and we want to use the dynamism of the private sector,” he said.

Şimşek stressed that the private sector could operate the enterprises more efficiently compared to the state.