Evaluation of Suitability of Emissions Trading System for Turkey Project Completed and Analytical Report Published

Turkey has received a grant from the World Bank Partnership for Market Readiness (PMR) for the preparation of analytical reports to support the political decision-making period on market-based instruments, that is one of the methods for abatement of greenhouse gas emissions. Executives of this project are; Ministry of Environment and Urbanisation – General Directorate of Environmental Management – Presidency of Climate Change Department, PMR Turkey Team and the World Bank. The executives of the project are Ecofys, FutureCamp, Life Enerji and Lawyer Özlem Değerlioğlu.

This project, which started its activities in November 2015, was completed with the closing conference that was held on December 2016. Meanwhile, many meetings and workshops have been organized with the participation of public and private sector. Capacity increase was accomplished on the subjects of; emissions trading system design elements, scenario studies for a pilot emission trading system in Turkey, policy interaction, legal and institutional infrastructure. The main purpose of the project is to map towards the consideration of establishment and operation a greenhouse gas emission trading system in Turkey.

The main output of the project is the first analytical report that prepared in the scope of PMR Turkey. The report of “Roadmap for the Consideration of Establishment and Operation of a Greenhouse Gas Emissions Trading System in Turkey” and “Emissions Trading in Turkey – Guidance for Plant Operators” have been prepared. English versions of the reports were published. Turkish versions will also be published when the translation is completed.

For English versions of the reports, please click on the link below.

http://pmrturkiye.org/pmr-turkiye/

The report focuses on eight design elements, which policymakers need to decide on emissions trading systems:

  1. Determination of scope, in other words, determining which sectors and facilities will be included in ETS.
  2. Determination of emission cap, in other words, the determination of the amount of emissions that are allowed to be released from the facilities within the scope of ETS.
  3. Allocation of allowances, in other words, determining how the emission allowances will be allocated to the participants.
  4. Whether or not allowing the usage of offsets, in other words, determining the use of emission reductions of projects whether to allow or not that is outside of the scope of ETS to meet ETS obligations.
  5. Deciding on time-dependent flexibility, in other words, giving participants flexible options on when emission reductions will be performed.
  6. Price estimation and cost containment, in other words, determining measures that interfere with ETS by directly or indirectly controlling the price of allocations.
  7. Ensuring the compliance with surveillance and legislation, in other words, ensuring that everyone follows the ETS methods and procedures and the market operates well.
  8. Choosing the option to connect to other ETS’s, in other words, deciding on whether or not to allow units (equations or allocations) belonging to other systems to adapt to the legislation under ETS.

The report focuses on the policy environment in Turkey, which is the next stage of the work. A possible ETS should be compatible with current policies of the country, especially with energy and climate change policies. Ideally, being a basic policy for emission reduction, ETS needs to be supported by other policies to ensure long-term abatement. In this part of the report, the question of how Turkey will interact with existing policies is answered, in the case of an ETS coming in to force.

Thereafter the report offers basic information about the legal and institutional requirements for an ETS configurations in Turkey. Existing legislation in Turkey that may concern the possible legal structure of an ETS and main institutions that can play a role in the implementation of ETS are being examined.

Lastly, the report outlines an action plan to guide towards a pilot Turkish emissions trading system. In this work, a pilot ETS design that is suitable for the conditions in Turkey is introduced. Recommended pilot ETS design, if Turkey decides to implement the ETS in the political future, aims to create a reference point for discussions with benefiting from experience gained with the MRV system in Turkey.

The prepared private sector guide includes basic information about the emission trading system and useful tips, as well as checks for preparing an emission trading system.

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