Renewable Energy Investment in Türkiye: Licensing and the YEKA Model
Yes — a foreign investor can build, own and operate a solar or wind plant in Türkiye (Turkey), and the sector is one the country actively courts foreign capital for. There is no general rule barring foreigners from owning a Turkish energy company; you invest the same way a Turkish investor does, through a Turkish project company that holds the licences and land. The real work is regulatory. Every grid-connected renewable project sits inside the electricity-market framework run by the energy regulator, and you have to decide early which route you are taking: a fully licensed power plant, a smaller unlicensed one, or a large project won through the state's competitive YEKA tender. Each route has its own permits, its own support mechanism, and its own local-content strings attached. This guide maps the routes, explains how the YEKDEM support scheme and the YEKA auctions actually work, walks through the permits a project needs, and shows where the legal risk really sits — so you can size a Turkish renewables investment before you commit capital.
Can foreign investors own renewable energy projects in Türkiye?
In short, yes. Türkiye does not impose a general foreign-ownership ban on energy companies, and renewable generation — solar, wind, hydro, geothermal and biomass — is expressly open to foreign capital. In practice you do not invest as a foreign individual or foreign company directly; you set up (or acquire) a Turkish project company that holds the generation licence, signs the grid-connection and land agreements, and owns the plant. That company can be wholly foreign-owned.
So the entry question is rarely "am I allowed in?" It is "which regulatory route fits the size and type of plant I want to build?" Getting that choice right at the start shapes every permit, deadline and support payment that follows. If you are structuring the vehicle from scratch, our guide to setting up a Turkish company covers the incorporation step, and our energy and natural resources team pairs that with the licensing side.
For the wider picture of how Türkiye regulates its energy and natural-resources sectors and where foreign investors fit, see our overview of Turkish energy law for foreign investors.
Which of these describes your project?
Licensed or unlicensed: which generation route fits your project?
The first fork in the road is whether your plant will be licensed or unlicensed generation. This is not a marketing label — it is a legal distinction under Law No. 6446 that changes the whole approval path.
A licensed power plant goes through EMRA's two-stage process: first a pre-licence (önlisans), during which the company completes its land, zoning, environmental and grid-connection steps within a set period, and then the full generation licence (üretim lisansı), which lets it build and sell power at scale. This is the route for utility-scale solar farms and wind projects that feed large volumes into the grid.
Unlicensed generation is a lighter regime for smaller plants below a capacity threshold set by regulation — typically used for rooftop and on-site solar that mainly offsets a facility's own consumption, with surplus fed to the grid. It skips the EMRA licence but still needs a connection agreement with the local distribution company and the other permits below.
| Licensed generation | Unlicensed generation | |
|---|---|---|
| Typical use | Utility-scale solar / wind selling into the market | Smaller on-site / rooftop plants, mostly self-consumption |
| EMRA licence | Pre-licence then generation licence required | No EMRA generation licence; connection approval instead |
| Capacity | Large, no upper cap in principle | Capped at the threshold fixed by regulation |
| Grid / offtake | Sells on the market or under a support mechanism | Connection with the distribution company; surplus rules apply |
| Approval burden | Heavier: staged, deadline-driven | Lighter, but permits still apply |
What is YEKDEM, and how does the renewable support mechanism work?
Türkiye supports renewable generation mainly through a state-backed purchase guarantee known as YEKDEM — the Renewable Energy Resources Support Mechanism, built on Law No. 5346. The core idea is simple: an eligible renewable plant can sell its output under a guaranteed purchase scheme for a fixed support period, instead of taking its chances entirely on the open market. That predictability is what makes a project financeable.
Two points matter for a foreign investor planning the numbers. First, the support price and the currency it is paid in have changed over time: earlier plants were supported under a foreign-currency-denominated schedule, while newer capacity has moved to a domestically referenced pricing formula. Second, there is usually a local-content bonus — an additional payment where the plant uses domestically manufactured components — and a defined eligibility window to enter the mechanism. Because these figures are set and revised by secondary legislation and Presidential Decision, you should confirm the rate, the support duration and the entry window in force for your project rather than rely on a headline number.
How does the YEKA tender model work for large projects?
For big, utility-scale renewables, Türkiye runs a distinct competitive route: YEKA — Renewable Energy Resource Areas (Yenilenebilir Enerji Kaynak Alanları), operated under the electricity-market framework and the YEKA Regulation. Instead of every developer separately hunting land and grid capacity, the state designates large areas or allocates blocks of capacity and puts them out to a competitive tender (a reverse auction). Developers bid, and the winner earns the right to build the project and sell its output under a long-term purchase arrangement at the awarded price.
YEKA is attractive because it bundles land, grid capacity and a long-term offtake into one award — the three things that are otherwise the hardest to secure. The trade-off is that YEKA awards typically come with local-content and domestic-manufacturing commitments (using Turkish-made equipment, and sometimes building manufacturing capacity or transferring technology), plus firm construction milestones. It is a route built for serious, well-capitalised players, often bidding as a consortium.
| Standard licensed route | YEKA tender route | |
|---|---|---|
| How you get in | Apply to EMRA and secure your own land and grid | Win a state-run competitive auction |
| Land & grid | You source and secure them yourself | Bundled into the YEKA award |
| Offtake | Market sales and/or YEKDEM | Long-term purchase at the awarded price |
| Local content | Optional (bonus under YEKDEM) | Usually mandatory manufacturing / content commitments |
| Best suited to | Mid-size and smaller developers | Large, well-funded investors / consortia |
Whether you bid solo or join a consortium, the shareholding, funding and exit terms need to be locked down before the bid — which is corporate and contract work as much as energy work. Our corporate and M&A and commercial contract teams handle the consortium agreement, the project-company structure and the construction contracts behind a YEKA bid.
Foreigners cannot own a power plant in Türkiye, or need a local partner to hold the licence.
Türkiye imposes no general foreign-ownership ban on energy companies, and renewable generation is expressly open to foreign capital. You invest through a Turkish project company that holds the licence, land and grid agreement — and that company can be wholly foreign-owned. The entry question is which regulatory route fits your plant, not whether you are allowed in.
The YEKDEM support price I found online is the price my project will get.
YEKDEM sits under Renewable Energy Law No. 5346, but the support price, the currency it is paid in, the length of the support period and any domestic-component bonus are all fixed by secondary legislation and Presidential Decision, and they have changed. Earlier plants were supported under a foreign-currency-denominated schedule; newer capacity moved to a domestically referenced formula. Model your project on the scheme open to new capacity in your target year, not on legacy terms.
If the plant is small and unlicensed, there is nothing much to approve.
Unlicensed generation only removes the EMRA generation licence. You still need a connection agreement with the local distribution company, and the surrounding permits still apply: environmental clearance under the EIA (ÇED) Regulation, zoning (imar) and land rights, and construction and occupancy permits. The capacity threshold that keeps you in the unlicensed regime is set by regulation and has been revised more than once.
Winning a YEKA tender is simply a matter of bidding the lowest price.
A YEKA award typically carries local-content and domestic-manufacturing commitments — using Turkish-made equipment, and sometimes building manufacturing capacity or transferring technology — together with firm construction milestones. Those obligations vary from tender to tender, so the price you bid is only one part of what you are committing to.
What permits and approvals does a renewable project need?
Beyond the EMRA licence (or the unlicensed connection approval), a renewable plant in Türkiye has to clear a stack of separate permits. Missing or mistiming one of these is the most common reason projects stall, so it is worth mapping them at the feasibility stage.
| Approval | What it covers |
|---|---|
| Grid connection agreement | The right to connect and the capacity allocated, with the transmission or distribution operator. |
| Environmental Impact Assessment (ÇED) | Whether the project needs a full EIA or an exemption, under the EIA (ÇED) Regulation. |
| Zoning / land-use (imar) & land rights | That the land is zoned for the plant, plus ownership, lease or usage rights over it. |
| Construction & occupancy permits | The building-side approvals for the plant and its structures. |
| EMRA licence / connection approval | The core right to generate — pre-licence then generation licence, or the unlicensed connection. |
The land and zoning layer catches foreign developers out most often, because a technically perfect site is worthless if it is not zoned for generation or if the land rights are defective. The same title-and-zoning diligence that protects a property buyer protects a project developer — see how we approach the legal risks of entering Turkey's energy sector and, on the land side, our energy and natural resources practice.
Contracts, tax and getting your returns out of Türkiye
Once the regulatory route is set, a renewable project lives or dies on its contracts. The main ones are the EPC contract (engineering, procurement and construction) that builds the plant, the offtake or purchase arrangement that sells the power, the connection agreement with the grid, and — where financed — the loan and security package. Each allocates risk (construction delay, grid curtailment, price and currency risk), and each is negotiable. Getting the risk allocation right in the EPC and offtake contracts is what makes a project bankable; our commercial contract team drafts and negotiates these alongside the energy licensing.
On tax and incentives, renewable projects can qualify for investment-incentive support (customs and VAT relief on equipment, and other incentives depending on the region and technology), on top of the YEKDEM support price. The precise incentives depend on the investment-incentive certificate and the current programme, so they should be confirmed for your specific project. Our guide to corporate tax for foreign-owned companies sets out the tax baseline.
Finally, a foreign investor cares about getting returns home. Türkiye does not trap profit in the country, but dividends, loan repayments and sale proceeds each have their own tax and banking mechanics — covered in our guide to repatriating profits and dividends to a foreign parent. Plan the exit and the cash-out route at the same time as the entry.
How a lawyer helps structure a Turkish renewables investment
Renewable investment in Türkiye is rarely blocked outright; it is slowed, mispriced or de-risked badly by decisions taken too late. A Türkiye-qualified lawyer, working with your technical and tax advisers, adds value at three points. First, at route selection — licensed, unlicensed or YEKA — because that single choice sets your permits, timeline and support terms. Second, at diligence and permitting: checking the land, zoning, grid capacity and EIA position before capital is committed, and sequencing the deadline-driven pre-licence steps so nothing lapses. Third, at contracts and structure: the project company, any consortium or joint-venture agreement, the EPC and offtake contracts, the incentive certificate, and the route for taking returns out.
For US and other foreign investors in particular, coordinating the Turkish licensing, the local-content commitments and the home-country tax and financing picture at the same time is what keeps a promising site from becoming a stranded one. Our energy and natural resources, corporate and company formation teams handle a renewables investment end to end — from the first feasibility check to the first megawatt sold.
Governs the electricity market, including who may generate power and under which licence, and sets the licensed/unlicensed distinction that shapes your whole approval path.
The renewable-specific support and incentive framework, and the basis of the YEKDEM purchase-guarantee mechanism that underpins a project's bankability.
What to prepare before you take advice
The route you choose — licensed, unlicensed or YEKA — sets every permit, deadline and support term that follows. These are the facts that let that choice be made properly.
Frequently asked questions
Can a foreigner own a solar or wind power plant in Türkiye?
Yes. Turkey (Türkiye) does not impose a general foreign-ownership ban on energy companies, and renewable generation is open to foreign capital. In practice you invest through a Turkish project company that holds the generation licence, land rights and grid agreement; that company can be wholly foreign-owned. The main work is regulatory — choosing the right licensing route and clearing the permits — not overcoming an ownership restriction.
What is the difference between licensed and unlicensed generation in Türkiye?
Licensed generation is the full route under the Electricity Market Law No. 6446: the company obtains a pre-licence (önlisans) and then a generation licence from the energy regulator EMRA, and is used for utility-scale plants. Unlicensed generation is a lighter regime for smaller plants below a capacity threshold set by regulation, typically for on-site or rooftop solar that mainly offsets a facility's own use. The threshold that divides them is fixed by regulation and has changed, so confirm the current figure before sizing the plant.
What is YEKDEM?
YEKDEM is Türkiye's Renewable Energy Resources Support Mechanism under Law No. 5346 — a state-backed purchase guarantee that lets an eligible renewable plant sell its output under supported terms for a fixed period, which is what makes projects financeable. The support price, the currency it is paid in, the support duration and any domestic-component bonus are set by secondary legislation and have changed over time, so they must be confirmed for the year you enter rather than assumed from older figures.
What is the YEKA tender model?
YEKA (Renewable Energy Resource Areas) is a competitive tender route for large projects. Instead of each developer sourcing land and grid capacity separately, the state designates areas or capacity and runs a reverse auction; the winner builds the project and sells power under a long-term purchase arrangement at the awarded price. YEKA awards bundle land, grid and offtake together, but usually carry local-content and domestic-manufacturing commitments and firm construction milestones, so they suit large, well-funded investors or consortia.
What permits does a renewable energy project need in Türkiye?
Beyond the EMRA generation licence (or the unlicensed connection approval), a project typically needs a grid connection agreement, an environmental clearance under the EIA (ÇED) Regulation, zoning/land-use (imar) confirmation and secure land rights, and construction and occupancy permits. The land and zoning layer causes the most problems, and the pre-licence stage is deadline-driven, so the permits should be mapped and sequenced at the feasibility stage.
Can I take the profits from a Turkish energy project back to my home country?
Yes. Türkiye does not trap profit inside the country; once profit is lawfully distributable it can be sent abroad through a Turkish bank. Dividends, loan repayments and sale proceeds each have their own tax and banking steps, and a double tax treaty may reduce withholding on dividends. Plan the route for taking returns out at the same time as the investment structure, not afterwards.
