Government decree signals Turkey's intention to start ETS
Turkey may introduce an emissions trading system (ETS) as early as 2016, a move that could see the launch of a dedicated Istanbul-based exchange, ICIS understands.
Under a decree published in the Turkish Official Gazette last week, more than 2,000 polluting installations are required to monitor, report and verify their greenhouse gas emissions.
Although the government has not given any official indications that it was looking to adopt an ETS, Gürkan Bayraktar, managing partner at Gaia Carbonfinance, a Turkish carbon financing and consulting company, said the latest decree could be seen as a first step towards introducing such a mechanism.
"We expect to see a more concrete plan in 2013 or 2014," Bayraktar said. "However, we think that an ETS can be introduced as early as 2016 or 2017."
He added that given Turkey's EU accession plans, it would be natural for the country to link its own ETS to that of the EU, although he conceded that the issue was subject to political discussions.
An emissions exchange could offer both allowance and project-based credits in Istanbul where Turkey is actively pursuing plans to launch a complex NASDAQ-type bourse.
The country's energy sector is going through profound changes, prompted by its recent economic boom. The electricity market is expected to fully liberalise by 2015 and the natural gas sector may follow suit.
Despite Turkey's economic progress, little had been achieved regarding its alignment to international emission standards. This was caused mainly by legal ambiguities in the Annex 1 of the Kyoto Protocol, which meant that the country missed out on existing flexibility mechanisms that would allow it to attract fund and technology transfers from developed countries.
Although Turkey signed the convention on the UN Framework Convention on Climate Change, the parliament did not ratify the Kyoto Protocol until 2009. AS
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