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Kivanc Zaimler, the President of Sabancı Holding Energy Group, shared his suggestions and evaluations on the latest situation, developments and expectations in energy markets in general and the electricity market in particular. Zaimler said Turkey’s energy market moved in the right direction, but there may be shifts in our rate of progress and route.
Zaimler stressed the need for a predictable market for electricity. “We do not mean that the prices are foreseeable in terms of predictability. We also do not demand high or low prices. What we mean by predictability is knowing that the price will always come out in the free market dynamic and the costs are re
Re-establishing the free market
He said healthy price formation in electricity will lead to the most realistic source and production composition. “If we do not make energy investments Turkey will need in the coming period fully based on purchase guarantee, we should provide confidence in the free market again and we need to revitalize the market,” he added.
Zaimler stated that electricity prices will reflect the supply and demand more accurately in seasonal and hourly terms if electricity production company EUAS acts with a commercial pricing approach. “The fact that there is no difference between day and night prices and the pricing of ancillary services are priced way under their actual value reduces the value added of production and trade companies.”
Incentives should not disturb competition
Kivanc Zaimler stressed that not only the level of electricity prices, but also the distribution of hours during the day is also very important for the formation of a healthy market. “In other words, the price profile is also very important. While the average price is the same, the market is much lower, even minus prices at off peak times and higher prices at peak times,” he said.
He also underlined the importance of financial sustainability for many companies in the sector. “We support the effective implementation of temporary interventions that do not affect the market, such as Capacity Mechanism. However, while ensuring the sustainability of companies, we also ask the regulators to avoid the steps that will take them out of the market or disrupt competition between equals.”
Zaimler stated that one of the musts of free price formation in the electricity market is that consumers should become an active player on their side. “If big consumers manage their risks in the market will contribute to the maturing of the market. The Regulation on Demand-Side Participation, which will enable consumers to contribute to supply security and system costs in return for their cost by enabling their flexibility, should become operational as soon as possible,” he noted.