Yekdem rule driving Turkish intra-day power market
Yekdem rule driving Turkish intra-day power market
Print article09 Jun 16, 17:40 - Electricity, Renewables, Fundamentals, Corporate, Trading
London, 9 June (Argus) — Turkey's intra-day market monthly volumes hit a record high in May, possibly on support from new rules for Turkey's renewables support scheme Yekdem that took effect 1 May.
Traded volumes on the intra-day exchange organized by market operator Epias hit 7.2GWh in May, up by 28.1GWh month on month and 14.3GWh above the previous high set in March.
Yekdem's new rules allow plants to sell power on the organized day-ahead, intra-day and balancing markets for the first time. But they also penalizes plants for differences between actual and projected generation, which could be pushing excess generation from hydropower and wind into the intra-day market.
The rules also change the way Yekdem's feed-in-tariff is paid that gives added incentive for plants to sell on the intra-day market when hourly prices are at a premium to the day ahead. Some market participants have said this has led to hydro plants holding back some generation for the summer months when peak demand for cooling can cause hourly balancing prices to climb.
On 1 June the first intra-day volumes were traded on Turkey's over-the-counter (OTC) market. It is believed that intra-day OTC volumes could continue to grow as it is easier to find counterparties for hourly blocks and for buyer and seller to negotiate.
Intra-day volumes could also see a rise in activity from gas-fired plants that are pushed out of the day-ahead merit order amid intensifying supply competition, one participant said. Turkey has added almost 1.9GW of capacity between January and May. But average hourly demand between January and May has increased by only 0.9GW compared with the same period last year.
Several upcoming power plant projects could add to this supply pressure. The first 700MW unit of Turkish utility Eren's 1.4GW coal-fired Zetes 3 plant is expected to go online by the end of June, with the second 700MW unit by August. And the first 280MW unit of Gama Enerji's 840 Kirikkale gas-fired combined-cycle plant has started testing, with full operations expected by the fourth quarter.