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Turkey’s Ratification of the Paris Climate Agreement and Green Deal Action Plan

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EMI
General

Recent Development

The Turkish government is planning to submit the Paris Climate Agreement (“Paris Agreement“) to the Turkish Parliament for ratification within October 2021.

What would change for Turkey with the ratification of the Paris Agreement?

Upon ratification by the Turkish Parliament and completion of the procedures as required under the Paris Agreement, the agreement would become effective for Turkey, which would lead Turkey to assume more responsibility regarding the global climate crisis.

Let’s remember the main targets under the Paris Agreement:

  • Limiting the global temperature increase to 2 degrees Celsius compared to the “preindustrial period” of the years between 1850 and 1900, and to 1.5 degrees Celsius if possible (the current increase is approximately 1.2 degrees).
  • Ultimately, lowering greenhouse gas emissions produced by human activities to a point where trees, soils and oceans can naturally absorb them, beginning at some point between 2050 and 2100.
  • Providing climate financing to support the fight against climate change and ensure transition to renewable energy in developing countries.

Compliance with the Green Deal Action Plan

The Green Deal declared by the EU in December 2019 to fight against climate change is also very important for Turkey due to its relationship and trading volume with the EU. The Green Deal sets further targets in addition to the ones provided under the Paris Agreement with the aim to make Europe carbon neutral by 2050 and reduce greenhouse gas emissions by 55% compared to 1990 levels by 2030.

To achieve its objectives under the Green Deal, the EU has presented numerous policies, one of them being the carbon border adjustment mechanism (“CBAM“). Officially proposed by the European Commission on 14 July 2021, CBAM expects EU importers to pay a carbon tax for their goods’ carbon emissions as if they were manufactured under EU carbon pricing regulations. This mechanism aims to block carbon leakage and create an incentive globally for environmentally sensitive production. The mechanism is expected to be fully applicable as of 2026 following the transitional period between 2023 and 2025.

Following the declaration of Green Deal and CBAM, the Turkish Republic Ministry of Trade released an action plan for compliance with the Green Deal. The action plan mainly provides the following targets:

  • enabling green investment through green financing,
  • allocating 1 GW capacity per each year until 2027 for new solar and wind power plants,
  • usage of a cleaner energy supply model,
  • transmission for an internationally competitive, sustainable, efficient and technological farming policy,
  • transmission for a sustainable and intelligent transportation system, and
  • harmonization with the EU’s environmental regulations.

The action plan aims to research ways to limit the relevant costs through bilateral treaties, analyze which sectors will be most affected by the CBAM policy, and, most crucially, introduce a national carbon pricing mechanism to mitigate any additional costs to its exporters to the EU.

The action plan also sets out, under the “Combatting Climate Change” headline, that Turkey’s position regarding the Paris Agreement “will be evaluated in a multidimensional way”, signaling the recent news to ratify the Paris Agreement.

Conclusion

Turkey’s plan for ratification of the Paris Agreement indicates that Turkey will embrace a more ecological policy agenda that energy, manufacturing, transportation and farming sectors in Turkey will go under a transition process accordingly. It is inevitable that this new outlook will lead to new opportunities and investments within the Turkish renewable energy sector and increase sustainability studies.