Activity Fields

Energy

Energy Sector in 2020

With our investments, strong brands and customer focus, we are the energy of a growing Turkey.  

The Brent oil price started the year 2020 at USD 66.1 /barrel. With the fight over oil supply coming at the same time as the demand shock brought about by the Coronavirus pandemic, a rapid decline in oil prices was seen with prices sliding to as low as USD 13.2 /barrel, the lowest levels in the last 20 years. However, the compliance of the OPEC+ members with the cut off agreement, the economic measures announced and increased used of personal vehicles supported crude oil prices. The upward trend which began in June continued until the end of August. Brent oil prices, which maintained their volatile course due to the renewed surge in Coronavirus cases and the delayed recovery in the aviation sector, closed the year at USD 50.5 /barrel. The average annual crude oil price for the year stood at USD 41.7 /barrel, 35% lower than the 2019 average.

Demand for petroleum products got off to a weak start in 2020 due to the slowdown in the global economy and the relatively mild winter weather with temperatures above their seasonal norms. Subsequently, lockdown measures taken to tackle COVID-19 precipitated an unprecedented contraction in demand. With global aviation activities grinding to a halt with the cancellation of international and regional flights, the severest negative impact was observed in demand for jet fuel. The decline in demand for road fuels resulting from the lockdown measures suppressed product margins throughout the year. According to figures released by the Energy Market Regulatory Authority (EMRA), the steepest decrease was seen in consumption of jet fuel, which declined to 2.4 million tons, marking a 54% decrease. Consumption of gasoline decrease of 3% compared to the previous year to 2.4 million tons with diesel consumption increasing by 1% to 25.2 million tons.

Companies in the Energy Sector

Koç Group in Energy Sector

Koç Group continues to play a leading role to meet Turkey’s demand for petroleum fuel products.

Tüpraş
Turkey’s biggest refining capacity

Aygaz
#1 LPG distribution company 
#1 Cylinder gas 
#1 Autogas

Opet
#2 fuel distribution company

Entek
The growing player in power generation

Developments in the Electricity Sector

According to Turkish Electricity Transmission Corporation (TEİAŞ) data, in 2020 Turkey’s installed power generation capacity increased by 5% to 95,891 MW. Private sector generation facilities operating in the free market comprised the lion’s share with 67.5% of this amount, of which public generation plants accounted for a 22.3% share, and unlicensed plants had a 7.1% share in the total. The share of generation plants operating with the Build-Operate and the Build-Operate-Transfer model is 3.1%.

Of the installed power generation capacity, 32.3% consists of hydroelectric power plants, 26.8% of natural gas power plants, 21.2% of coal power plants, 9.2% of wind power plants, 7% of solar power plants and 3.6% of other renewable and thermal power plants.

The decision was taken to maintain the limit applied for the Last Resource Supply Tariff at 7 million kWh. In addition, with the decision taken at the end of 2020, the free consumer limit was reduced to 1,200 kWh.

At Enerji Piyasaları İşletme A.Ş. (Energy Markets Operations Inc.), the upper limit application on the market swap price was put in place with this figure to be twice the average price over the last 12 months starting from two months in advance, to be effective from October. This regulation restricted the ability of electricity producers to reflect their costs to their bid prices.

Developments in the LPG Sector

Turkey is the 10th largest LPG market in the world and the 2nd largest in Europe. Turkey became the world’s largest market for autogas, also having the world’s largest vehicle fleet and widest LPG and station network.

According to EMRA’s data in 2020, which was shaped by the effects of the pandemic, LPG consumption stood at 3.9 million tons - a decrease of 7% compared to the same period of the previous year. The autogas market contracted by 9% to 3.1 million tons, while cylinder gas market decreased by 1% to 0.7 million tons.

As of end of 2020, Turkey’s total LPG demand was split as 79% autogas, 19% cylinder gas and 2% bulk.