Two large-scale solar parks in Turkey with 2 GW initial capacity
Saudi Arabia will invest $2 billion in two major solar parks in Turkey, with an initial combined capacity of 2 GW. The announcement was made by Turkey’s Energy Minister Alparslan Bayraktar following the signing of the agreement during President Recep Tayyip Erdogan’s visit to Riyadh.
Under the deal, Saudi companies will build one solar park in the eastern province of Sivas and another in the central province of Karaman. According to Bayraktar, total photovoltaic and wind capacity developed by Saudi investors is expected to reach 5 GW in the coming phases, as outlined in the intergovernmental agreement.
The projects are expected to supply electricity to more than 2 million households across Turkey.
Local content requirement and industrial impact
The agreement includes a 50% localization clause, meaning that half of the equipment, including solar panels and electrical components, as well as related services, must be sourced from Turkish companies.
Bayraktar stated that the projects will make a significant contribution to Turkey’s electrical equipment and services sectors, supporting domestic manufacturing and strengthening the national renewable supply chain.
Record-low power purchase prices
The projects will be financed through external funding, including international financial institutions, without placing pressure on Turkey’s public budget.
Turkey will purchase electricity generated by the Sivas project for 25 years at 2.3415 euro cents per kWh, and at 1.995 euro cents per kWh for the Karaman project. According to Bayraktar, this represents a record-low price for renewable energy in Turkey.
Saudi company ACWA Power will oversee construction of the solar facilities.
Following the announcement, shares of Turkish renewable energy companies rose sharply. Kalyon Gunes Teknolojileri Uretim AS gained 10%, while Alfa Solar Enerji Sanayi ve Ticaret AS increased by 6.7%, according to Bloomberg.
Solar parks in Turkey aligned with Ankara’s 2035 renewable targets
The investment in solar parks in Turkey supports Ankara’s strategy to reach 120 GW of installed solar and wind capacity by 2035 and achieve net-zero emissions by 2053. The agreement also deepens economic cooperation between Turkey and Saudi Arabia, where the Public Investment Fund holds a 44% stake in ACWA Power.
Turkey aims to quadruple its wind and solar capacity from 32 GW in 2024 to 120 GW by 2035. By 2030, the target for installed wind and solar capacity stands at 51 GW.
To reach this milestone, Turkey plans to commission an average of 3.1 GW of wind and solar capacity annually until 2030. However, according to analysis by Ember, installed capacity will need to increase by 13.8 GW per year after 2030 to meet the 2035 target, highlighting the scale of the challenge.
The report suggests that the 2030 interim target may need to be raised to ensure the 2035 objective remains achievable.
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