Turkey as a member of the Energy Community

JANEZ KOPAČ – MEHMET EKİNCİ

Due to its favorable geographical location as a bridge between a supply-demand line and its dependence on energy imports, Turkey’s vision is to become an energy hub of the “region.” As an energy hub, Turkey would enhance its economic and geopolitical power in the region as well as decrease its dependency on certain energy sources and create more competitive pricing schemes. The liberalization of Turkey’s energy market and its progressive integration with the European market are compulsory steps for achieving this vision. Yet, Turkey cannot become a regional energy hub without a legal framework harmonized with its neighbors. The same goes for Turkey’s desire to attract investment and promote technology in the sectors of renewable energy and energy efficiency.

The most important prerequisites are transparency and openness of the energy market. While certain reforms were undertaken, Turkey’s attempt to adopt the necessary legal framework unilaterally is not persuasive enough. The European Union’s know-how and experience, as the most competitive and liberalized energy market in the world, could be an asset in this respect. However, EU-Turkey relations, despite going back almost to the origins of European integration in the 1950s, have borne little fruit. Membership negotiations to join the European Union have stalled. As far as the opening of the energy chapter is concerned, there is no doubt that its blockage is caused by a “political” bottleneck, resulting from EU internal issues. This severely damages EU-Turkey relations. Moreover, the lack of clear and enforceable legal commitments and rights may be considered the most important shortcoming in EU-Turkey energy relations today.

Yet Turkey can adopt the necessary legal framework independently of the EU accession process. Turkey is partly transposing the EU energy acquis but the real compliance has never been monitored as it is for other Energy Community contracting parties. Membership of the Energy Community would set Turkey on a direct path toward implementation of the required reforms, including the necessary monitoring of the reform process to ensure transparency and competitive market conditions. What makes the Energy Community stand out from purely political bilateral relations are its legal foundations.

Entering the Energy Community as a fully fledged member amounts to much more than the beginning of asymmetrical negotiations. It entails the full implementation of EU energy law according to a country-specific transitional period as well as full access to the EU internal energy market and the markets of other Energy Community contracting parties (the Western Balkans, Ukraine, Moldova and soon Georgia). The Energy Community contracting parties enjoy the same treatment and rights as EU member states. Energy Community members are even entitled to propose new legislation, which is binding on all members, including the EU. Furthermore, Energy Community membership would give Turkish companies the possibility to participate in EU institutions on equal terms with EU member states. Turkey would be treated as an equal partner of the EU in the energy field.

Turkey’s membership in the Energy Community would have a leverage effect on EU accession talks. Yet in formal terms, the process of energy cooperation in the framework of the Energy Community has nothing to do with EU accession. One does not prejudge the other or vice versa. Article 103 of the Energy Community Treaty stipulates: “Any commitment taken in the context of negotiations for accession to the European Union shall not be affected by this Treaty.”

While Turkey actively supported the creation of the Energy Community and entered into negotiations to become a fully fledged member of the organization, it decided to withdraw from the process in the last moment and kept only an observer status.

It is high time for Turkey to reconsider its approach to Energy Community membership. Turkey’s reasoning for not joining the Energy Community, namely the fear of weakening its negotiation position in the EU accession process, should not be the only motive considered. Energy Community membership and market integration will increase the interdependency between the EU and Turkey. As a result, Turkey will attain a more important position as a future gas hub. In turn, this position will give Turkey increased bilateral negotiation power and leverage for any future accession to the EU.

Janez Kopač is the director of the Energy Community Secretariat, while Mehmet Ekinci is a research fellow at the Energy Community Secretariat.