Turkish solar module maker SmartSolarTechnology said it will build a 2 GW vertical integrated photovoltaic manufacturing facility in Izmir, Turkey's third largest city. The so-called vertical integrated photovoltaic manufacturing base, that is, the production line covers the main links of silicon wafer, cell wafer, module photovoltaic manufacturing end. The plant is expected to become the largest photovoltaic manufacturing facility in Turkey.
According to SmartSolarTechnology, the project has strong support from the Turkish government. The Turkish government has pledged $400.9 million for the integration plant. The construction period is about four years. After the project is put into operation, the imported raw materials will also be exempt from VAT and customs duties.
It is understood that in order to achieve the goal of carbon neutrality, Turkey in recent years, more and more attention to the development of renewable energy industry, represented by photovoltaic. In the face of increased international geopolitical risks this year, Turkey hopes to further accelerate the development process of the photovoltaic industry. To this end, it has also introduced a series of favorable policies, such as encouraging investment in the construction of major photovoltaic manufacturing lines such as modules, relaxing the installation standards of distributed photovoltaic power stations, and providing financial subsidies for related projects.
According to Ember, a clean energy think tank, electricity prices in Turkey have soared recently in response to a general trend of rising natural gas prices around the world. In 2021, the country's total natural gas consumption reached 61.6 billion cubic meters, a new record. Increasing the use of renewable energy can reduce the dependence on fossil fuels and reduce the scale and use of imports. Turkey needs to accelerate investment and deployment of renewable energy sources such as photovoltaics.
Expanding photovoltaic production capacity is one of the Turkish government's main goals. According to Fatih Denmez, Minister of Energy and Natural Resources of Turkey, the proportion of installed power generation from renewable energy has increased rapidly since 2002, and the photovoltaic industry has grown rapidly since 2014, from 4,000 kW to 8 GW. The results are clear, but Turkey's goal is not only to increase the share of electricity generated from renewable sources, but also to localize photovoltaic manufacturing. Turkey has become the largest solar panel manufacturer in Europe and the fourth largest in the world. Turkey hopes to become one of the world's top three panel-makers.
To that end, Turkey's renewable energy policy has become increasingly aggressive. This year, the Turkish government organized two tenders for renewable-energy power projects, under which developers are required to source a certain percentage of their power electronics from within Turkey. Coupled with substantial government subsidies for tenders, this will not only incentivize companies to invest in the development of renewable energy generation projects, but also expand their investment in manufacturing.
With this combination, Turkey's renewable energy industry has risen rapidly. In July, Turkey's photovoltaic and wind power generation reached 2.07 billion KWH and 4.2 billion KWH respectively, accounting for 21.6 percent of Turkey's total power generation, a record high.
However, some in the industry believe that these measures will not help Turkey to resist its dependence on fossil fuels in the short term. Foreign media quoted energy analysts as predicting that Turkey's natural gas consumption this year will continue to grow compared to last year and is expected to reach 62 to 63 billion cubic meters.