The long-awaited regulation on aggregation activities, whose foundations were laid with the amendments to the Electricity Market Law published in the Official Gazette No. 32057 dated 28 December 2022, has been issued in the Official Gazette. The regulation sets out the principles of aggregation activities and introduces significant provisions regarding license-exempted generation facilities. The Electricity Market Aggregation Activity Regulation (“Aggregation Regulation”) was published in the Official Gazette No. 32755 on 17 December 2024. Aggregation Regulation brings significant changes to the electricity market and introduces extensive amendments to existing legislation. Below is a summary of the fundamental principles introduced by the Aggregation Regulation and the associated changes to the electricity market legislation. Aggregation Activities Aggregation refers to market activities carried out by combining and managing the production and/or consumption of one or more users – referred to as grid users – connected to the transmission or distribution grid. Aggregators collect portfolios they are responsible for managing, contributing to the electricity market by ensuring optimal trading conditions and maintaining system balance. In this framework, aggregation service agreements – subject to the approval of the Energy Market Regulatory Authority (“EMRA”) – are signed between aggregators and licensed generation companies, independent storage facility owners, free consumers, and individuals or entities operating under the License-exempted Generation Regulation. According to Article 34/A added to the Licensing Regulation, aggregators are granted the following rights:
Entities Authorized to Conduct Aggregation Activities Aggregation activities may be carried out by entities holding an aggregation license or by legal entities with a supply license that includes authorization for aggregation activities. Operational Principles Aggregators may operate in organized wholesale electricity markets and ancillary services under the framework of aggregation service agreements signed with grid users. Within this scope, they can manage production and consumption facilities, as well as electricity storage facilities in their portfolios, while monitoring and analyzing real-time production and consumption data. Aggregators are responsible for supplying electricity to free consumers in their portfolios when consumption facilities are added. However, aggregators providing demand-side participation services may allow existing supply agreements of these facilities to remain in effect. Aggregators are accountable for all regulatory obligations, including collateral and imbalances, related to market operations for the grid users in their portfolios. While they are prohibited from engaging in wholesale trading activities, transactions made to balance their portfolios are exempt from this restriction. Additionally, entities with supply licenses are prohibited from entering aggregation service agreements with users in their portfolios. Aggregators can include consumption facilities connected to the distribution or transmission grid in their portfolios to provide demand-side participation services. If these facilities choose not to have their energy supply managed by the aggregator, this must be reported to the market operator. Consumption facilities may be classified as balancing or ancillary service units. However, facilities not supplied by the aggregator cannot be registered as balancing units and are ineligible to participate in the balancing power market. Participation of Licensed Electricity Generation Facilities in Aggregation Aggregators can include licensed and operational electricity generation facilities and storage facilities in their portfolios. However, generation facilities must have an installed capacity of less than 100 MW. Facilities meeting regulatory requirements may be designated as balancing or ancillary service units. Facilities within the same balancing region that do not already qualify as balancing units can also be considered balancing or ancillary service units, provided they meet the necessary conditions. Participation of License-exempted Electricity Generation Facilities in Aggregation As of 2023, license-exempted electricity generation facilities account for 22% of the total renewable energy capacity. This highlights the increasing importance of integrating these facilities into the electricity market. Aggregators may include license-exempted generation facilities that have completed their ten-year purchase guarantee period to manage surplus energy. While no capacity limits are currently imposed on these facilities, EMRA has the authority to set lower or upper capacity limits if needed. Facilities in the same balancing region that meet regulatory requirements may qualify as balancing or ancillary service units. Portfolio Limits The total operational installed capacity of licensed and license-exempted electricity generation facilities within an aggregator’s portfolio cannot exceed 2000 MW, with license-exempted facilities limited to 500 MW within this cap. If these limits are exceeded during any billing period, the aggregator must remove facilities from the portfolio in the following billing period to comply. If the aggregator fails to do so, the market or grid operator will enforce the necessary adjustments. No consumption or contractual capacity limits are applied to consumption facilities. Similarly, no operational capacity limits are currently imposed on independent electricity storage facilities, but EMRA is authorized to set such limits if deemed necessary. Additional Provisions Related to Aggregation Activities
The Aggregation Regulation came into effect on 1 January 2025. The full text of the Aggregation Regulation can be reached via this link (Only available in Turkish). You can access our article on other amendments to the electricity market legislation published in the Official Gazette on 17 December 2024 via this link. |