Energy Policies and Their Impact on Investments

Abstract

Energy deficit is one of the most important reasons behind the current account deficit figures. Not able to create a sufficient value added on non- energy items, Turkey is left to deal with an increase in energy imports as well as a current account deficit fluctuating with global energy prices. One clear example is the recent 70 percent drop in oil prices positively affecting the relation between growth and current account deficit rates in 2014 and 2015. The stable share of domestic resources in total energy supply, dependence on country of origin with regards to energy imports and the economic fragility as a result of energy imports despite the ever- rising demand for energy is giving rise to Turkey’s energy policy design that puts emphasis on the priority of Turkey’s domestic and renewable energy resources. In this context, while the use of lignite resources is supported within the definition of domestic resources, solar, wind, geothermal and hydro- electric plants are supported within the framework of renewable energies.