The Renewable Energy Law (Law No. 5346) has been amended by the Amendment Law (Law No. 6094) (published in the Official Gazette dated 8 January 2011 and numbered 27809) and approved by the National Assembly on 29 December 2010 (“Amendment Law”). The Amendment Law sets forth a new mechanism and incentives with respect to prices, timetables and payment terms for legal entities engaged in generation activities at facilities based on renewable energy resources (“Renewable Energy Resource Support Mechanism”). The prices shall be applicable for a period of 10 years to the generation license holders subject to the Renewable Energy Resource Support Mechanism, which initiate operations by 31 December 2015. The license holders willing to be subject to the Renewable Energy Resource Support Mechanism must apply to the Energy Market Regulatory Authority before 31 October 2011 and obtain the relevant certificate (“Renewable Energy Resource Certificate”).

Furthermore, as per the Amendment Law, legal entities engaged in generation activities at facilities based on renewable energy resources shall benefit from the prices provided in Chart No.1 (annexed to the Amendment Law) for a period of 10 years, in cases where they supply electricity power exceeding their needs to the distribution system. Moreover, the Amendment Law envisages an incentive for five years for electricity power supplied to the distribution system from energy generated in generation facilities whose operations commenced before 31 December 2015 and operate with mechanic or electro-mechanic components/devices manufactured in Turkey. Pursuant to the Amendment Law, the total installed capacity of the certificated generation facilities based on solar power to be connected to the transmission system by 31 December 2013 shall not exceed 600MW. The amount of total installed capacity for facilities to be connected to the transmission system after 31 December 2013 shall be determined by the Council of Ministers. As a substantial incentive, a reduction of 85% shall be applicable on the fees of permits, lease, servitude rights and occupancy permits of generation facilities, connection roads and energy transmissions lines (including the ones to be transferred to the Turkey Electricity Transmission Joint Stock Company (“TEIAS”) and distribution companies) for the first 10 years following the investment and operation of the facilities. (See Pekin & Pekin Legal Alert 01/2011)