Europeanisation of the Turkish Energy Sector: a Case Study on the Electricity Market
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EUROPEANISATION OF THE TURKISH ENERGY SECTOR: A CASE STUDY ON THE ELECTRICITY MARKET A THESIS SUBMITTED TO THE GRADUATE SCHOOL OF SOCIAL SCIENCES OF MIDDLE EAST TECHNICAL UNIVERSITY BY SERHAN ÜNAL IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF MASTER OF SCIENCE IN THE DEPARTMENT OF INTERNATIONAL RELATIONS JULY 2013 Approval of the Graduate School of Social Sciences Prof. Dr. Meliha B. ALTUNIŞIK Director I certify that this thesis satisfies all the requirements as a thesis for the degree of Master of Science. Prof. Dr. Hüseyin BAĞCI Head of Department This is to certify that we have read this thesis and that in our opinion it is fully adequate, in scope and quality, as a thesis for the degree of Master of Science. Assoc. Prof. Dr. Oktay F. TANRISEVER Supervisor Examining Committee Members Prof. Dr. Ramazan GÖZEN (YBU, IR) Assoc. Prof. Dr. Oktay F. TANRISEVER (METU, IR) Prof. Dr. Fatih TAYFUR (METU, IR) 2 I hereby declare that all information in this document has been obtained and presented in accordance with academic rules and ethical conduct. I also declare that, as required by these rules and conduct, I have fully cited and referenced all material and results that are not original to this work. Name, Last Name : Serhan ÜNAL Signature : iii ABSTRACT EUROPEANISATION OF THE TURKISH ENERGY SECTOR: A CASE STUDY ON THE ELECTRICITY MARKET Ünal, Serhan M.Sc., Department of International Relations Supervisor: Assoc. Prof. Dr. Oktay F. Tanrısever July 2013, 110 pages This thesis analyses Europeanisation process of the Turkish energy sector by comparing and contrasting the current situation of the sector with the European standards and by using the Turkish electricity market as a case study. In order to do this, it first focuses on the meaning of Europeanisation in energy sector and reveals the fundamentals of it by moving from several European energy strategy documents and 15 Turkey progress reports. The three pillars of Europeanisation in the energy sector are identified as security, competitiveness and sustainability. These three pillars are decomposed into seven principles as diversification of sources and routes, integration with the others, having storage capacities, liberalisation, green energy production and energy efficiency. Compatibility of the Turkish electricity market with the European standards is analysed and exemplified in accordance with the three pillars-seven principles structure upon which Europeanisation depends. Keywords: Turkey, European Union, Europeanisation, Electricity Market iv ÖZ TÜRK ENERJİ SEKTÖRÜNÜN AVRUPALILAŞMASI: ELEKTRİK PİYASASI ÜZERİNE ÖRNEK BİR İNCELEME Ünal, Serhan Yüksek Lisans, Uluslararası İlişkiler Bölümü Tez Yöneticisi: Doç. Dr. Oktay F. Tanrısever Temmuz 2013, 110 sayfa Bu çalışma, Türk enerji sektörünün Avrupalılaşmasını, sektörün mevcut durumunu Avrupa standartları ile karşılaştırarak ve elektrik piyasasını örnek bir inceleme olarak kullanarak analiz etmektedir. Bunu yapmak için önce, Avrupalılaşmanın enerji sektöründeki anlamına odaklanmakta ve çeşitli Avrupa enerji stratejisi belgeleri ile 15 Türkiye ilerleme raporundan yararlanarak Avrupalılaşmanın temellerini açığa çıkarmaktadır. Enerji sektöründeki Avrupalılaşmanın üç sütunu güvenlik, rekabetçilik ve sürdürülebilirlik olarak belirlenmektedir. Bu üç sütun, kaynak ve güzergah çeşitlendirmesi, komşularla bütünleşme, yeterli depolama sığasına sahip olma, serbestleşme, yeşil enerji üretimi ve enerji verimliliği olmak üzere yedi ilkeye ayrıştırılmaktadır. Türk elektrik piyasasının Avrupa standartlarıyla uyumluluğu, Avrupalılaşmanın dayandığı üç sütun-yedi ilke yapısına uygun şekilde incelenmekte ve örneklendirilmektedir. Anahtar Kelimeler: Türkiye, Avrupa Birliği, Avrupalılaşma, Elektrik Piyasası v To My Beloved Parents vi ACKNOWLEDGEMENTS I would like to express my deep gratitude to my supervisor Assoc. Prof. Dr. Oktay F. Tanrısever for his guidance, advice, criticism, encouragement and insight throughout the research. Without his guidance and intellectual insight, this thesis would not have been completed. I would also like to thank Prof. Dr. Ramazan Gözen and Assoc. Prof. Dr. Fatih Tayfur for sparing their precious time. Lastly, special thanks go to Tazegül Ünal and Prof. Dr. Basri Ünal who have inspired in me love for my country, given technical assistance for the thesis and have supplied me with any kind of vital logistics, such as tea. vii TABLE OF CONTENTS PLAGIARISM...........................................................................................................iii ABSTRACT .............................................................................................................. iv ÖZ .............................................................................................................................. v DEDICATION .......................................................................................................... vi ACKNOWLEDGMENTS ...................................................................................... vii TABLE OF CONTENTS ........................................................................................ viii LIST OF TABLES ................................................................................................ viiii LIST OF FIGURES .................................................................................................. x LIST OF ABBREVIATIONS .................................................................................. xi CHAPTER 1. INTRODUCTION ........................................................................................... 1 2. WHAT DOES EUROPEANISATION MEAN IN ENERGY SECTOR ........12 2.1 Energy 2020: A Strategy for Competitive, Sustainable and Secure Energy ...................................................................................................14 2.2. Energy Roadmap 2050 ..........................................................................19 2.3. Progress Reports (1998-2012) ..............................................................23 2.4. Three Pillars of Europeanisation ...........................................................34 3. EVOLUTION OF THE ELECTRICITY GENERATION IN TURKEY ......42 3.1 Electricity Generation During the Ottoman Era ...................................43 3.2 Electricity Generation During the Republican Era ...............................46 4. EUROPEANISATION AND THE TURKISH ELECTRICITY SECTOR...60 4.1. Security in the Turkish Electricity Sector .............................................61 4.2. Competitiveness in the Turkish Electricity Sector .............................. 74 4.3. Sustainability in the Turkish Electricity Sector ....................................83 5. CONCLUSION ...............................................................................................92 LITERATURE CITED ..............................................................................................99 APPENDIX ..............................................................................................................111 viii LIST OF TABLES TABLES Table 3.1. Electricity Production Figures (1930-1939) .............................................49 Table 3.2. Electricity Production Figures (1940-1949) .............................................50 Table 3.3. Electricity Production Figures (1950-1959) .............................................51 Table 3.4. Electricity Production Figures (1960-1969) .............................................52 Table 3.5. Electricity Production Figures (1970-1979) .............................................53 Table 3.6. Electricity Production Figures (1980-1989) .............................................55 Table 3.7. Electricity Production Figures (1990-1999) .............................................56 Table 3.8. Electricity Production Figures (2000-2009) .............................................57 Table 3.9. Electricity Production Figures (2010-2012) .............................................59 Table 4.1. Storage Facilities in Turkey ......................................................................71 Table 4.2. Integration Capacities of Turkey ..............................................................73 Table 4.3. Turkish Potential in Renewable Sources ..................................................85 Table 4.4. Rate of Losses in Some European Countries in 2010 ...............................90 ix LIST OF FIGURES FIGURES Figure2.1. Change in Progress Reports ......................................................................34 Figure 4.1. Share of the Primary Sources in the Electricity Generation in 2011 .......63 Figure 4.2. Share of the Primary Sources in the Electricity Generation in 2008 .......63 Figure 4.3. Shares of Natural Gas Suppliers of Turkey in 2011 ................................65 Figure 4.4. Volume of Traded Electricity Between Turkey-Greece/Bulgaria ...........74 Figure 4.5. The Evolution of the State’s Role ...........................................................80 Figure 4.6. Evolution of the Limit For Free Consumers ............................................82 Figure 4.7. Attractiveness of Turkey .........................................................................87 Figure 4.8. Rate of Losses Between 1998-2011 ........................................................89 x LIST OF ABBREVIATIONS ABB Ministry for European Union Affairs BOTAS Petroleum Pipeline Corporation CCS Carbon Capture and Storage CEER Council of European Energy Regulators DEKTMK World Energy Council Turkish National Committee