Executive summary

Turkey needs to pursue its transition to a low-carbon economy

Turkey has made progress in relatively decoupling its strong economic growth from air emissions, energy use, waste generation and water consumption. However, these pressures are increasing as economic and population growth continue. Turkey’s energy demand growth is among the highest in the OECD.

Fossil fuels represent 88% of the energy mix, with most of these being imported. Turkey plans to reduce import dependency and ensure energy security by diversifying imports; increasing domestic production of coal, renewables and nuclear energy; and promoting energy efficiency. The country is among the top world performers in installed capacity of renewable energy sources. Still, the share of renewables in the energy mix has not increased since 2005, with continued development of coal-fired power plants. Energy efficiency policies have yet to be translated into measurable targets and implementation measures.

Climate change mitigation and adaptation efforts need to be strengthened to reduce risks and costs to the environment and society

Turkey’s increase in greenhouse gas (GHG) emissions over the past decade was the largest in the OECD. Although there has been a relative decoupling in emissions in recent years, they are expected to more than double between 2015 and 2030. The decline in emissions intensity due to accelerated renewable energy development and improvements in energy efficiency is lower than in other member countries. GHG emissions per capita are rapidly increasing.

Turkey has signed, but not yet ratified, the Paris Agreement. The country needs a long-term low-emission and resilient development strategy that would integrate climate and energy objectives. Its National Climate Change Strategy and Action Plan would benefit from an updated sector-by-sector plan with GHG emissions reduction goals, and regular monitoring and evaluation.

Turkey is experiencing an increase in annual mean temperature and changes in precipitation patterns resulting in serious floods and droughts. Projected climate change impacts are likely to put further pressure on the water sector. Adaptation efforts to date have concentrated on modelling these future changes. There is considerable scope for better mainstreaming climate change adaptation into public sector operations such as policy or project appraisal. Efforts to improve scientific knowledge on climate change vulnerability and impacts need to continue to make the economic case for action. This will also be important for supporting local authorities in preparing their climate change adaptation plans.

Urban wastewater services need better planning and management tools

Turkey is moving towards regulating and monitoring water pollutants based on conditions of receiving water bodies at the river basin level, in line with European Union (EU) requirements. It has made significant progress in urban wastewater management as a result of continuous investments of national and international funds. Access to wastewater collection network and treatment facilities has increased, but remains among the lowest in the OECD. There is, however, a risk of overinvestment to reach stringent national effluent standards that in some aspects go beyond EU requirements. This may lead to excessive capital costs, technology lock-in, a knock-on increase of operation and maintenance costs and, ultimately, rising consumer tariffs. River basin planning could be used as a tool to determine the level of ambition, priorities and financing needs for water infrastructure development and management. National guidelines would be helpful in improving water supply and sanitation services, promoting better utility performance and keeping tariffs affordable.

More action is required to address air pollution from fine particulate matter

Air quality is a major concern, especially in large cities and industrialised regions. Limit values for most air pollutants are expected to align with EU standards by 2024, but not for fine particulate matter. Population exposure to dangerous levels of particulate matter, emitted mostly by power generation and transport, is higher than the World Health Organization’s guidelines. To reduce these health impacts, Turkey needs to retrofit old coal power plants with efficient and clean technology or close them down, and gradually substitute coal with natural gas in residential heating, as envisaged. In the transport sector, reducing air pollution calls for a modal shift from private vehicles to public transportation, renewal of the truck fleet and promotion of clean vehicles.

Resource efficiency and recycling need to grow as part of a transition to a circular economy

Turkey has made progress by aligning with waste-related EU directives and by reducing the generation of municipal and hazardous waste. However, most municipal waste is still sent to landfills, and only a small quantity is composted or recovered. Domestic material consumption has not decoupled from economic growth. The government needs to adopt a comprehensive and dedicated material resource policy going beyond waste management while promoting separate collection and recycling of different types of municipal solid waste.

Regulatory tools need to be strengthened

Turkey has made remarkable progress in bringing its environmental regulatory framework closer to the European Union’s environmental acquis. As a result, regulatory standards in many environmental domains have been strengthened. However, there is significant room for improving the implementation of several key regulatory instruments. Strategic environmental assessment does not cover local spatial plans, leaving an important evaluation gap in land-use planning. Consolidated environmental permits have yet to be based on best available techniques. Turkey is implementing risk-based inspection planning, scoring regulated facilities based on their environmental impact and compliance record. However, with less than 20% of inspections that are planned, much remains to be done to make compliance monitoring more efficient.

Environmental information should become more accessible

Environmental information held by public institutions is accessible upon request, with only a small amount available on the environment ministry’s website. The government needs to remove restrictions and fees for access to environmental information and give the public access to environmental permits and compliance records using recently created electronic information systems. It should also follow through on its plans to establish a pollutant release and transfer register that would open data on environmental impacts by individual companies to the public.

Better tax incentives and reduced harmful subsidies will stimulate cleaner energy production and use

Turkey has among the highest rates of environmentally related taxes as a percentage of gross domestic product in the OECD, largely as a result of high taxes on gasoline and diesel fuel. Energy taxes in other sectors of the economy, including industry, remain low. Turkey’s vehicle taxation system provides some environmental incentives, but generally pushes consumers towards older, used vehicles that are likely to have higher emissions. Integrating emissions criteria into motor vehicle tax rates would help to encourage the purchase of cleaner vehicles.

Turkey continues to provide substantial environmentally harmful subsidies. A subsidy for water use in agriculture has been eliminated, but fuel tax exemptions for petroleum products and a new fuel price stabilisation mechanism are counterproductive. Subsidies for poor families to use coal for heating remain significant despite the ongoing transition to natural gas heating. Gradually phasing out fossil fuel subsidies would help to promote investment in cleaner alternatives.

Stronger support for innovation will enhance the market for environmental goods and services

To capture greater economic benefits from a transition to green growth, Turkey needs to scale up its eco-innovation policies. Feed-in-tariffs have encouraged investment in renewable electricity. The government is supporting an industrial consortium developing a Turkish electric car. There is also potential to expand a burgeoning solar thermal sector. Increasing spending on environmental research and development and supporting technology demonstration and commercialisation with targeted clean technology incubators would help expand the domestic market for environmental goods and services and support Turkish innovators and entrepreneurs developing environmental solutions.