Report On The Energy Sector And Challenges It Is Facing

The last quarter of 2006 and the first half of 2007 set the scene for a number of developments in the energy sector, including the initiation and then cancellation of the privatization process concerning the electricity distribution companies and electricity generation facilities. This time frame also encompassed legislative developments concerning renewable energy as well as new steps towards the establishment of the first nuclear power plant in Turkey.

The privatization process for the State-owned electricity distribution companies was initiated by the Privatization Authority (the "PA") in August 2006. Accordingly, the subsidiaries of TEDAS, responsible for the distribution of electricity to various geographic territories, were planned to be privatized in groups. Although the bidding date for the first three distribution companies was set as 19 January 2007, the government decided to stop the procedure and postponed the