Netting Procedures in Unlicensed Electricity Generation
The Procedures and Principles on the Netting Transactions of Unlicensed Electricity Generation Facilities and Their Associated Consumption Facilities (“Procedures and Principles”) entered into force upon its publication in the Official Gazette dated 5 May 2026 and numbered 33244. The regulation in question sets out the technical and operational framework governing the netting processes carried out under Article 26 of the Regulation on Unlicensed Electricity Generation in the Electricity Market (“Regulation”). In this context, the scope of netting, the categories of facilities included in the system, the role of the market operator, as well as the core concepts and data structures to be considered in practice are elaborated in detail. The Procedures and Principles also address hourly and monthly netting mechanisms, the treatment of surplus energy, the relationship with the Renewable Energy Resources Support Mechanism (“YEKDEM”), and the operational structure of group-based models. In this respect, we are of the view that the Procedures and Principles constitute an important secondary legislation instrument aimed at establishing a more centralized, data-driven, and systematic structure for netting processes within unlicensed generation activities.The provisions of the Procedures and Principles will be examined below on an article-by-article basis.PurposeArticle 1 sets forth that the purpose of the Procedures and Principles is to determine the way netting transactions relating to generation and/or consumption facilities falling within the scope of Article 26 of the Regulation on Unlicensed Electricity Generation shall be carried out.The express stipulation that netting transactions will be conducted directly by the “market operator” demonstrates that the system is no longer designed merely as a technical process operating at the level of distribution companies, but rather as a centralized market mechanism integrated with the systems of EPİAŞ. Furthermore, the fact that the regulation simultaneously considers both generation and consumption facilities indicates that the unlicensed generation model is structured around a balancing approach linked to consumption.Within this framework, the core logic of the netting mechanism is based on comparing the electricity drawn from the grid by the consumption facility with the electricity injected into the system by the associated generation facility over specified periods. Accordingly, it may be stated that the concepts of “net consumption” and “net generation” constitute the foundation of the system.ScopeArticle 2 regulates both the generation and consumption facilities to which the Procedures and Principles shall apply and the structures that shall remain outside their scope.The regulation covers the netting transactions of generation and/or consumption facilities falling within the scope of Article 26 of the Regulation and, in this respect, reflects an approach under which generation facilities established for self-consumption purposes and consumption-associated structures are assessed within the same netting system.That said, certain categories of facilities are expressly excluded from the scope. Facilities falling under Article 23 of the Regulation are subject to a separate netting regime, while generation facilities that have completed their ten-year support period are also excluded from the system. Likewise, facilities falling within the scope of the eighth paragraph of Article 30 of the Regulation are subject to a different assessment framework.The regulation further provides that the Procedures and Principles shall not apply where multiple unlicensed generation facilities subject to netting under Articles 23 and 26 of the Regulation are included within the same netting structure.Overall, the regulation appears to aim at defining the scope of the netting system through clearer boundaries, establishing distinct regimes for different categories of facilities, and adopting a more controlled implementation approach particularly with respect to multi-facility structures.Definitions and AbbreviationsArticle 4 sets out the principal concepts and definitions forming the basis for the implementation of the regulation. In particular, the definitions relating to the netting system, generation limits, distribution regions, and digital infrastructure appear to establish the overall framework of the implementation.The concept of “subscriber group” refers to the subscriber categories set out under the tariffs of distribution companies and incumbent supply companies. In this respect, it is understood that netting and tariff practices may produce different outcomes depending on the relevant subscriber group.The term “remunerated generation limit” refers to the amount of generation that may be subject to netting and sale. The regulation thereby reflects that the unlicensed generation model continues to be fundamentally based on the principle of self-consumption.“Distribution region” refers to the region defined under the licence of the relevant distribution company or the holder of an Organized Industrial Zone(“OIZ”)/Industrial Zone (“IZ”) distribution licence. The requirement that generation and consumption facilities be located within the same distribution region appears to carry particular significance in terms of the netting relationship.The Unlicensed Generation Module (“LÜM”) refers to the digital infrastructure through which netting transactions are carried out within the Market Management System (“PYS”). It is envisaged that the processing of generation and consumption data, the calculation of netting transactions, and settlement processes will all be conducted through this infrastructure.The concept of “netting” itself refers to the hourly or monthly netting transactions carried out on a group basis. The definition also suggests that netting is directly linked to the billing period.Among the other definitions, it is specified that the relevant system operator may refer to TEİAŞ, the distribution company, or the holder of an OIZ/IZ distribution licence, while the market operator is identified as EPİAŞ. In addition, the “amount of generation subject to system usage charges” refers to the portion of generation exceeding consumption needs, whereas YEKDEM denotes the renewable energy support mechanism.Overall, the regulation appears to establish a system architecture centred on data management, supported by digital infrastructure, and based on group-based netting. At the same time, it may be observed that the regulation seeks to preserve the self-consumption principle while keeping excess generation within certain limits.General PrinciplesArticle 5 regulates the core operational principles of the netting system. The regulation appears to establish a more centralized, data-driven, and traceable framework for the netting structure. While generation and consumption relationships are subjected to stricter rules, the group-based netting approach is positioned at the centre of the system.Pursuant to Article 5/1, generation and consumption facilities are required to be associated with persons holding the same Tax Identification Number (“TIN”). It is further stipulated that, where a change in the TIN occurs, such change will only be considered in the netting process as of the following calendar year.Article 5/2 allows real and legal persons, under certain conditions, to establish one or more groups. However, the freedom to form groups is not left entirely unrestricted and remains subject to the conditions set out under the Regulation and the Procedures and Principles.Under Article 5/3, consumption facilities included within the same group are required to belong to the same subscriber group. Accordingly, the combination of different tariff structures and consumption profiles within the same netting system is restricted.Article 5/4 permits facilities associated with the same TIN to be linked to different groups during different periods within the same year. However, in the event of a group change, the remaining limit is required to be transferred to the new group.Within the scope of Article 5/5, certain consumption facilities are required to procure electricity from a single supplier.Article 5/6 provides that the relevant legislation and Board decisions concerning activity-based tariff schedules shall be taken into consideration in netting transactions.Article 5/7 stipulates that the netting mechanism shall apply solely to facilities and groups falling within the scope of Article 26 of the Regulation.Under Article 5/8, generation exceeding the installed capacity is expressly excluded from consideration within the netting calculation.Article 5/9 sets out that, in respect of facilities connected at the transmission level, group formation procedures shall be carried out by the relevant distribution company. It is further regulated that such procedures shall be conducted through the Unlicensed Generation Module (“LÜM”).Articles 5/10 and 5/11 contain provisions regarding transfer transactions. Accordingly, transferred generation and consumption facilities may be incorporated into the netting system; however, it is envisaged that the remunerated generation limit shall be recalculated for the new user.Article 5/12 refers to Article 23 of the Balancing and Settlement Regulation (“DUY”), thereby establishing the connection between the netting system and market operation and settlement processes.Article 5/13 requires generation and consumption data to be recorded within the Market Management System (“PYS”).Overall, Article 5 appears to transform the netting system into a structure based on group-oriented and centralized data management, operating under a stricter set of rules. In this respect, it may be stated that the regulations aim to ensure that limit tracking, data management, group structures, and netting processes are carried out within a more controlled and standardized framework.Association ProceduresArticle 6 regulates the technical and operational infrastructure of the netting system. The provision sets out how generation and consumption facilities will be associated, on what basis group structures will be established, and which data will be recorded within the central system.It is stipulated that initial association procedures shall be carried out through applications submitted to the relevant system operator using Annex-1 forms. It is further provided that information such as the group number, resource type, installed capacity, hourly generation amount, contracted capacity, the European Transmission System Operators (“ETSO”) code, and the remunerated generation limit shall be recorded within the Unlicensed Generation Module (“LÜM”).Generation amounts are envisaged to be monitored and recorded within LÜM on an hourly basis, by resource type and group number. In addition, the remunerated generation limit is required to be registered within the system, while other generation facilities connected to the same metering point must also be notified. The regulation further provides that generation deemed to constitute an uncompensated contribution to YEKDEM will also be recorded in the LÜM system.The regulation limits the possibility of making amendments relating to past periods. However, in respect of material errors such as ETSO codes or group numbers, corrective actions may be carried out in subsequent periods.Article 6 also contains provisions regarding the relationship between subparagraphs 5/1(ç), 5/1(h), and 5/1(d) of the Regulation. It appears that broader association opportunities are preserved for facilities that submitted applications prior to 2 April 2026, whereas the scope of association possibilities has been narrowed for new applications.While the requirement to be located within the same distribution region is maintained for certain categories of facilities, it is observed that this condition is not sought for some other facility types. Furthermore, the regulation provides that, in certain cases within the same system operator region, the requirement to submit a new application may be waived.Overall, Article 6 appears to establish a group-based netting model founded upon centralized registration and data transfer infrastructure, incorporating strict registration and verification mechanisms. In this respect, elements such as the LÜM system, ETSO codes, remunerated generation limits, restrictions on retroactive amendments, and the requirement to remain within the same distribution region may be regarded not only as technical components of the netting system, but also as mechanisms of economic and regulatory control.Remunerated generation limitArticle 7 regulates the monitoring of the remunerated generation limit within the netting system and the principles applicable in cases where such limit is exceeded. The regulation sets out how the concept of the “remunerated generation limit” will be monitored, on what basis the limit will be calculated, and which mechanisms will apply where the limit is exceeded.Within the scope of the provision, the remunerated generation limit is to be monitored through the infrastructure of the Unlicensed Generation Module (“LÜM”) and the market operator. It is expressly stipulated that the limit shall not remain as a fixed value determined only at the outset; rather, the remaining portion within the same calendar year will continue to be calculated and monitored during subsequent periods. The calculation and monitoring of the remaining limit are placed under the responsibility of the market operator.The regulation further provides that any amendments relating to the remunerated generation limit must be recorded within the system together with their underlying justifications. In this respect, it is understood that not only the final data itself, but also the reason, legal basis, and historical record of the amendment will be maintained within the system.One of the notable aspects of Article 7 is the proportional limit reduction mechanism applied on a group basis. Although netting is carried out at the group level, it is regulated that limit usage will continue to be monitored individually for each consumption facility. Accordingly, even where netting is conducted on a group basis, the limit utilisation of each consumption facility will continue to be tracked separately.It is also expressly stipulated that the remunerated generation limit shall not apply to unlicensed generation facilities associated with residential subscribers.The regulation clearly provides that the expiration of the remunerated generation limit shall not mean the complete termination of the netting relationship. Generation and consumption will continue to be netted even after the limit has been exhausted; however, surplus generation exceeding consumption needs will thereafter be treated as an “amount subject to system usage charges.”Article 7 further provides that the limit shall be monitored on the basis of the “same calendar year.” Accordingly, limit calculations will be carried out annually, and the utilisation of the limit will be assessed within the relevant calendar year.Overall, Article 7 appears to establish a structure in which the remunerated generation limit is monitored through the infrastructure of LÜM and the market operator, while preserving individual limit control within the group-based netting mechanism and systematically managing the economic consequences of surplus generation. When considered together with the system usage charge approach, limit monitoring, registration obligations, and the exemptions applicable to residential subscribers, it may be stated that the regulation seeks both to preserve the self-consumption principle and to maintain control over the financial impacts of surplus generation and the economic balance of the netting system.Incumbent Supplier Company Responsible for Netting OperationsArticle 8 regulates the duties of the incumbent supplier company responsible within the netting system, the principles governing its designation, and its obligations relating to data access. The regulation further determines through which structure payments for surplus energy shall be carried out and which incumbent supplier company shall bear responsibility within group-based netting processes.Under Article 8/1, the responsible incumbent supplier company is designated as the entity responsible for making payments to the generator in respect of surplus energy amounts arising as a result of the netting process.Article 8/2 sets out the procedure for determining the responsible incumbent supplier company. Accordingly, the principal criterion is the incumbent supplier company operating within the system operator region where the highest total installed capacity is located. In this way, payment processes within the group structure are envisaged to be conducted through a single responsible incumbent supplier company.The phrase “as of January” included in the provision indicates that the determination of the responsible incumbent supplier company is based on the status existing as of January of the relevant year. In respect of groups established for the first time during the year, however, the first month subject to the netting process is taken as the basis.Pursuant to Article 8/3, the responsible incumbent supplier company is determined only once during the relevant calendar year. Even if the distribution of generation facilities or installed capacity within the group subsequently changes, the same incumbent supplier company will continue to perform its duties until the end of the year.Article 8/4 further provides that the responsible incumbent supplier company is not only responsible for payment processes, but also for the other obligations regulated under Article 14.Within the scope of Article 8/5, provisions regarding data access and netting reports are regulated. Accordingly, the responsible incumbent supplier company may access facility-based netting reports prepared by the market operator, provided that it obtains the consent of the holder of the unlicensed generation facility and declares such consent through the Unlicensed Generation Module (“LÜM”).Overall, Article 8 appears to consolidate payment processes, data access, and group-based operations within the netting system under a single responsible structure. When the annual fixed designation model, the highest installed capacity criterion, the consent-based data access mechanism, and the facility-based netting reports are assessed together, it may be stated that the regulation seeks to transform the netting system into a more centralized, traceable, and operationally integrated structure.Calculation of Amounts Subject to NettingArticle 9 regulates in detail the technical functioning of the netting system and determines which generation amounts shall be regarded as surplus generation, which portion shall fall within the scope of remunerated generation, and based on which data and methodology netting calculations shall be carried out. In this respect, the regulation appears to transform the netting mechanism, particularly for commercial groups, into a structure operating largely on an hourly, data-driven basis through centralized digital infrastructures.First, the regulation prevents the operational consumption of the generation facility itself from being automatically included within the netting mechanism. In the absence of an associated consumption facility within the same distribution region, the internal consumption of the generation facility cannot be netted. Accordingly, it appears that the regulation limits the inclusion of the generation facility’s own internal consumption within the scope of netting.The provision further establishes that netting processes shall be conducted entirely through digital data infrastructures. Data derived from the Unlicensed Generation Module (“LÜM”) and the Market Management System (“PYS”) form the basis of the calculations, while metering points, hourly data flows, and automated data processing systems constitute the foundation of the calculation methodology. In this respect, it is understood that centralized data infrastructures and a centralized data management approach have been further reinforced within the calculation process.One of the most significant changes introduced by the regulation is the broader adoption of hourly netting. Generation, consumption, and surplus energy calculations are assessed separately for each hour. In this way, generation profiles, consumption behaviour, and grid impacts may be monitored with greater precision.Where meter data cannot be read on an hourly basis, the “profiling” method is applied. In cases such as missing data, communication failures, or meter malfunctions, the system is not entirely suspended; instead, netting operations may continue through an alternative calculation methodology.The provision also sets out the fundamental mathematical logic underlying the netting mechanism. Hourly total generation is compared against hourly total consumption, and only the remaining energy following consumption is treated as surplus generation. Where generation remains below consumption, surplus generation is deemed to be zero.The methodology for applying the remunerated generation limit is also regulated. The netted energy amount is deducted from the remunerated generation limit and, where the limit is exceeded, certain generation amounts are classified as “generation subject to system usage charges.” Accordingly, it appears that the remunerated generation limit functions as an economic threshold mechanism.The regional allocation mechanism is likewise regulated under the provision. Generation amounts subject to system usage charges are allocated among the regions within the group in proportion to their hourly generation amounts. In this manner, cost-sharing is intended to be balanced in accordance with each region’s contribution to generation.A separate regime is envisaged for residential subscribers. In the case of residential subscriber groups, netting shall be carried out monthly, and the remunerated generation limit shall not apply. Furthermore, provided that no circumstance requiring uncompensated contribution to YEKDEM arises, the entirety of the generation is treated as remunerated generation.Article 9 also establishes special netting mechanisms for certain facility categories falling within the scope of Article 5 of the Regulation. Generation is first netted against the facility’s own consumption, after which the remaining portion may, subject to certain conditions, be associated with other facilities. However, important limitations are also introduced, including the same metering point requirement, the condition of being located within the same distribution region, distinctions based on call letter dates, and the risk of uncompensated generation.The sanctions applicable in cases of non-compliance are likewise regulated. Where the netting requirements are not fulfilled or incomplete data is submitted, no netting operation is carried out, and the relevant generation may instead be evaluated within the scope of “uncompensated generation.” For OIZ and IZ structures, on the other hand, a different calculation methodology is applied based on separate metering and settlement data.Finally, the progressive tariff system is integrated into the netting mechanism. Hourly netting calculations are performed by considering the distinction between lower and higher tariff tiers, thereby aiming to ensure more precise pricing of consumption behaviour.Overall, Article 9 appears to establish a next-generation netting model operating on an hourly basis, utilizing intensive data flows, managed through centralized digital infrastructures, and incorporating economic threshold mechanisms. In this respect, it may be considered that the regulation aims to ensure real-time monitoring of the generation-consumption balance, more precise management of grid impacts, and enhanced data-driven supervisory capacity, while also seeking to place commercial usage limits under tighter regulatory control.Entry of Data into Virtual MetersArticle 10 regulates under which economic and technical categories the generation amounts resulting from the completion of netting calculations shall be recorded within the system. While the preceding provisions determine how netting shall be carried out, how surplus generation shall be calculated, and which generation amounts shall be regarded as paid or uncompensated generation, this article establishes how those outcomes will be transferred into the market registration system. In this respect, it may be stated that the provision establishes the settlement, financial obligation, and digital registration infrastructure of the netting system.At the core of the regulation lies the “virtual meter” system. Independently from physical meters, the generation categories arising as a result of netting, the generation amounts forming the basis of settlement, and the categories of energy giving rise to financial obligations are monitored within separate digital registration layers. Accordingly, the system enables not only the monitoring of physical electricity flows, but also the tracking of the economic character of generation, its netting status, and its financial consequences.The first significant category regulated under the article is the “paid virtual meter.” The netted consumption amount and the portion of surplus generation remaining within the remunerated generation limit are recorded under this virtual meter category. In this way, energy having economic value and falling within the payment mechanism is monitored as a separate generation category.In addition, through the “virtual meter subject to system usage charges” mechanism, surplus generation exceeding the remunerated generation limit is separately classified. Generation exceeding the limit is not entirely excluded from the system; however, it is treated as a distinct category subject to additional financial obligations. In this respect, it may be considered that the regulation aims both to impose additional costs on generation exceeding the prescribed limits and to prevent unlimited economic benefit.One of the notable mechanisms introduced by Article 10 is the “uncompensated virtual meter” application. In situations giving rise to non-compliance with the legislation, all generation amounts within the relevant group may be recorded under the uncompensated virtual meter category. Accordingly, it may be stated that this mechanism is intended to prevent structures contrary to the legislation and uses of the netting system that fall outside its intended purpose.The article further provides that generation amounts shall be recorded under separate virtual meters on the basis of resource type. Through the separate tracking of different resource categories such as solar, wind, and biomass, it appears that a data infrastructure capable of supporting resource-based support and reporting processes is being established.Another important aspect of the regulation concerns the centralized sharing of data through the Unlicensed Generation Module (“LÜM”). Netting results are required to be transferred to LÜM on the basis of tax identification number, group number, system operator, and resource type. In this way, the regulation appears to establish a structure reinforcing centralized data sharing. The calculated generation amounts are directly reflected in settlement processes, virtual meter records, and market transactions.Article 10 also demonstrates that the netting system has become directly integrated with the settlement infrastructure. The data recorded under virtual meters no longer serves merely as technical registration data, but also carries direct implications for payment processes, financial calculations, revenue flows, market costs, and system usage charges.Overall, Article 10 appears to transform the netting system into a structure based on centralized data management, operating through digital platforms, divided into financial categories, and fully integrated with the settlement mechanism. Through the distinctions between paid virtual meters, virtual meters subject to system usage charges, and uncompensated virtual meters, it is understood that the regulator can separately monitor which generation amounts possess economic value, which generation amounts give rise to additional costs, and which generation amounts fall within the scope of sanctions. In this respect, the regulation may be regarded as signalling the evolution of the unlicensed generation regime toward a highly data-driven structure with enhanced centralized monitoring capabilities.Calculation of Amounts Subject to NettingArticle 11 regulates the financial dimension of the netting mechanism and sets out the methodology for calculating the payments to be made by the market operator to incumbent supplier companies and unlicensed generators. In this respect, the article gives concrete financial effect to the hourly netting system and the distinction between paid and uncompensated generation established under the preceding provisions.One of the principal characteristics of the regulation is that calculations are carried out not only on the basis of total consumption, but also with reference to the tax identification number (“TIN”), group structure, system operator region, applicable tariff, consumption facility, and hourly intervals. Accordingly, the system appears to evolve into a highly detailed, data-intensive structure operating on the basis of hourly data processing.The first scenario addressed under the article concerns situations where total hourly generation is equal to or greater than total hourly consumption. In such cases, the netted consumption amount is taken as the basis, and the amount payable to the incumbent supplier company is calculated on the basis of the relevant tariff price. Accordingly, the system primarily considers the portion of generation covering consumption and establishes the corresponding financial value for that energy.In scenarios where generation remains below consumption, the total generation amount is distributed in proportion to pre-netting consumption ratios, and the netted consumption amount is calculated accordingly. This mechanism, which is particularly significant for group-based structures, determines the netted consumption amount according to the pre-netting consumption ratios of the relevant consumption facilities.The article further regulates the method for calculating payments to be made to unlicensed generators in respect of surplus generation. In this regard, it appears that the “relevant tariff prices” determined under Article 28 of the Regulation form the basis of the payment calculation. Accordingly, the financial value of surplus energy generation is determined within the framework of tariff-based parameters.The “Total Amount Payable to Unlicensed Generators” (“LÜYTOB”) mechanism set out under the fourth and fifth paragraphs demonstrates that the netting system is not limited solely to the producer-consumer relationship. It is envisaged that payments to be made by incumbent supplier companies to suppliers and unlicensed generators shall be calculated within the LÜYTOB system. Accordingly, it is understood that the netting structure is also integrated into the financial reconciliation processes between the market operator and incumbent supplier companies.One of the significant elements of Article 11 concerns the provisions relating to tiered tariffs. For consumption facilities subject to tiered tariffs, the tariff structure approved by the Board is considered in the calculation of tariff prices. In particular, the distinction between lower-tier and upper-tier tariffs for residential subscribers may directly affect the economic outcome of the netting mechanism.The regulation also contains important provisions regarding system usage charges and the Renewable Energy Resources Support Mechanism (“YEKDEM”). The relevant charges are calculated based on generation amounts subject to system usage charges. Furthermore, in respect of energy considered as uncompensated contribution to YEKDEM, it is expressly stated that no separate invoice shall be issued to the owner of the unlicensed generation facility.Overall, Article 11 appears to constitute one of the core provisions establishing the financial infrastructure of the netting system. Hourly data processing, intra-group allocation, tariff differentiation, surplus generation payments, LÜYTOB integration, and the effects of tiered tariffs are all brought together within a single financial structure. In particular, the formula-based calculation methodology demonstrates that the system relies heavily on automation and data accuracy. Accordingly, the proper management of metering data, group structures, and tariff classifications may become increasingly significant from an implementation perspective.Supply of Electricity under the Last Resort Supply TariffArticle 12 regulates the financial structure applicable where consumption facilities within the scope of the netting system procure electricity under the last resort supply tariff. In particular, the regulation clarifies the pricing mechanism through which generation amounts remaining after netting shall be evaluated for high-consumption subscribers. It also introduces a separate implementation framework for OIZs and IZs.Under the article, for consumers subject to the last resort supply tariff, the portion of generation corresponding to the consumption amount subject to netting is calculated on the basis of the last resort supply tariff. Generation remaining after the netting process is evaluated under the relevant tariff price framework within the scope of the remuneratedenergy limit. Accordingly, it is regulated that the generation amount remaining after netting shall be calculated on the basis of the applicable tariff price, provided that it remains within the remunerated energy limit.The regulation also establishes the calculation principles applicable to consumption facilities subject to the last resort supply tariff in relation to the netting mechanism. Particularly for high-consumption commercial and industrial subscribers, the financial consequences of netting become directly linked to the applicable tariff structure. It is expressly stated that the remunerated energy limit mechanism shall also apply to such subscribers.The second paragraph introduces a special provision regarding Organized Industrial Zones and Industrial Zones. Where the main OIZ/IZ meter falls within the relevant categories, the same provisions shall also apply to consumption facilities procuring electricity from the OIZ/IZ and exceeding the last resort supply limit. Accordingly, it is regulated that the calculation principles set out under the first paragraph shall likewise apply to such consumption facilities.Overall, Article 12 appears to clarify the financial consequences of netting for consumers subject to the last resort supply tariff. The regulation determines the pricing structure through which netting revenues shall be calculated, clarifies the relationship between the remunerated energy limit and the tariff system, and establishes a separate implementation framework particularly for large-scale consumers and OIZ/IZ structures.Responsibilities of the Network OperatorArticle 13 regulates the duties and responsibilities of the network operator within the operation of the netting mechanism. The regulation demonstrates that the netting process is not merely a calculation system operated by the market operator, but that distribution companies and other network operators also assume an active role in data management, meter records and application procedures.Within the scope of the article, the network operator is obliged to verify the accuracy of the information included in Annex-1 forms, ensure that the association processes comply with the legislation, and notify the outcome of the application within five business days following the application. In addition, the creation of meter records for consumption facilities within the scope of subparagraphs (a), (b), (c) and (ç) of the second paragraph of Article 17 of the Electricity Market Balancing and Settlement Regulation (“DUY”), the creation of meter records for consumption facilities procuring electricity within the boundaries of OIZs and IZs, the submission of consumption data in accordance with the DUY calendar for use in electricity market settlement and/or netting processes, and the maintenance of up-to-date Market Management System (“PYS”) records are also included among the responsibilities of the network operator. It is further stipulated that applications must be submitted to the market operator for the performance of the necessary virtual meter procedures for each new resource type in relation to new group registrations or group updates.The regulation also places emphasis on data accuracy and record management with respect to Unlicensed Generation Management System (“LÜM”) records. The timely submission of data to the system in the correct format, the monitoring of LÜM notifications, and the implementation of the necessary corrections are listed among the obligations of the network operator.The article also includes provisions concerning users’ rights to request information and file objections. The network operator is required to respond within five business days to requests relating to hourly generation and consumption data, remunerated and uncompensated generation quantities, generation quantities subject to system usage charges, and the used and remaining remunerated generation limit amounts on a consumption facility basis. In addition, the obligation to calculate the generation quantities subject to system usage charges and share such calculations with the incumbent supplier has also been regulated.With respect to generation and consumption facilities connected to the transmission grid, it is separately stipulated that certain procedures will be carried out by the relevant distribution company.Overall, Article 13 positions the network operator not merely as a technical data provider, but as a central actor assuming multifaceted responsibilities such as data accuracy, meter management, responding to user requests, and carrying out calculations relating to system usage charges. It may be considered that the regulation aims to strengthen data management and operational coordination within the netting system.Responsibilities of Incumbent Supplier CompaniesArticle 14 regulates the operational, financial and administrative responsibilities of incumbent supplier companies within the scope of the netting mechanism. The regulation demonstrates that incumbent supplier companies are not merely passive actors implementing the results of netting calculations but also assume an active role within the system in terms of monitoring data flows, conducting financial calculations, managing payment processes and responding to user requests. It aims to ensure the monitoring of processes carried out through the Unlicensed Generation Management System (“LÜM”) infrastructure and the timely implementation of netting results.Within the scope of the article, incumbent supplier companies are obliged to notify the market operator, in the prescribed format, of receivable and payable amounts relating to facilities located within their respective service areas, monitor notifications received through LÜM, carry out the necessary control and correction procedures, and follow the final netting results published in LÜM. Accordingly, it may be considered that the regulation aims to ensure the orderly operation of data flows and the standardization of payment processes within the netting system.The regulation further requires that the amounts determined in LÜM be paid to the relevant suppliers and/or unlicensed generators within the prescribed period. In addition, incumbent supplier companies are expected to respond, within specified time periods, to requests for information and objections relating to netted consumption amounts, surplus generation amounts and the relevant financial amounts. The inclusion of system usage charges within the “Total Amount Payable to Unlicensed Generators” (“LÜYTOB”) mechanism, as well as the transfer of collected charges to the relevant grid operator, are also listed among the responsibilities of incumbent supplier companies.The article also stipulates that no financial claim may be asserted in respect of generation quantities recorded under the virtual meter created within the scope of subparagraph (c) of the first paragraph of Article 10. It may be considered that this approach is based on the treatment of such generation quantities within the system as uncompensated contribution.Overall, Article 14 positions incumbent supplier companies not merely as market participants supplying electricity, but as central actors undertaking key roles in data management, financial calculations, payment processes and objection mechanisms. It may be considered that the regulation aims to make the financial and operational functioning of the netting system more standardized, transparent and traceable.Correction ProceduresArticle 15 regulates the procedures and principles regarding the subsequent correction of data used in the netting system. The regulation demonstrates that the netting mechanism is designed not as a fixed and immutable structure, but rather as a dynamic system capable of being updated within the framework of certain procedures. It aims to eliminate metering errors, correct incomplete or inaccurate data entries, and ensure consistency between netting results and settlement data.Within the scope of the article, network operators are granted the authority to make corrections to data recorded in the Unlicensed Generation Management System (“LÜM”). It is envisaged that errors arising from measurement or recordkeeping relating to hourly generation and consumption data, as well as various data used within the scope of netting, may subsequently be corrected.The regulation further provides that corrections relating to the current period shall be made by considering the Electricity Market Balancing and Settlement Regulation (“DUY”) calendar and the settlement-relevant injection and withdrawal values. Final netting results are also envisaged to be published in LÜM in parallel with the final settlement notification calendar. Accordingly, a direct connection is established between the netting system and settlement processes, with the objective of reconciling financial liabilities.The article also permits corrections relating to previous periods. Within certain periods and under specified conditions, historical data may be updated through LÜM, and metering errors, incomplete data entries or incorrect classifications may be retrospectively updated. In addition, by specifying that correction data must be recorded within defined calendar limits, the regulation seeks to prevent the emergence of a constantly changing netting structure.It is further regulated that corrections may affect not only the relevant period, but also subsequent netting periods. In line with the updated data, netting calculations and the related financial liabilities may be recalculated accordingly.Overall, Article 15 aims to enhance data accuracy within the netting system, correct erroneous calculations, and ensure the harmonized operation of the settlement system and the netting mechanism. The regulation demonstrates that the system has been designed in a manner that allows updates within the framework of specific procedures to ensure that final financial outcomes can be generated in a manner that more accurately reflects actual conditions.General Assessment and Transitional ProvisionsArticle 16 stipulates that the previous regulations are repealed upon the entry into force of the new Procedures and Principles. The regulation does not merely introduce a technical amendment; rather, it demonstrates that the netting system has been transformed into a new model based on centralized data management, a LÜM-centred data flow structure and a group-based structure. It is understood that a structure departing from the previous netting approach has been envisaged. Accordingly, relevant stakeholders may need to align their operational processes, data management methods and contractual structures with the new system.Provisional Article 1 regulates how remunerated generation limits relating to the year 2026 will be transferred within the scope of the transition to the new system. Accordingly, the remaining remunerated generation limit data relating to consumption facilities included in existing and newly established groups must be transferred to LÜM by the relevant grid/network operators. Through the regulation, it is aimed to integrate the remaining remunerated generation limits relating to both existing and newly established groups into the new system. In addition, it is envisaged that group records, consumption facilities and the used and remaining limit information will be processed into the system in a manner compatible with the LÜM data structure.From a general perspective, it may be considered that the regulation does not merely constitute a technical update to the netting mechanism. It may be stated that the new system establishes a new structure based on centralized data management and a group-based netting approach. In addition, it is also considered that the regulation may give rise to additional operational harmonization processes in practice in terms of data transfer, limit tracking, correction procedures and coordination between grid/network operators and incumbent supplier companies.In ConclusionIn our view, the Procedures and Principles aim to transform the netting mechanism in unlicensed electricity generation into a more centralized, data-driven structure operating in integration with digital infrastructures. It appears that the regulation seeks to establish a more traceable, standardized and auditable framework for netting processes through LÜM- and PYS-based data management, the hourly netting approach, the group-based association system and virtual meter mechanisms. In addition, we are of the opinion that the distinction between remunerated generation limits, generation subject to system usage charges and uncompensated generation is intended to enable the economic consequences of surplus generation to be managed in a more controlled manner.On the other hand, the regulation may also give rise to significant operational obligations for market participants in terms of data transfer, group management, hourly metering infrastructure, settlement processes and financial calculations. It may be expected that the technical and operational implications of the new system for network operators, incumbent supplier companies and unlicensed generators will become clearer during the implementation phase. Within this framework, the Procedures and Principles may be regarded as constituting an important secondary regulation aimed at moving the netting system in the unlicensed generation regime toward a more controlled and centralized structure.
