Türkiye Records Lowest-Ever Electricity Price in Solar Deal with Saudi Arabia
Türkiye Records Lowest-Ever Electricity Price in Solar Deal with Saudi Arabia
On February 20, 2026, Türkiye signed major investment and power purchase agreements with Saudi Arabia for the construction of two large-scale solar power plants in Sivas and Karaman-Taşeli. The total investment amounts to $2 billion.
The projects, implemented in partnership with ACWA Power, will have a combined capacity of 2,000 megawatts (MW). Construction is set to begin this year, with commercial operations expected in early 2028.
Record-Low Tariffs
The agreed electricity purchase prices have set historic lows for Türkiye:
- Sivas: 2.35 euro cents per kWh
- Karaman-Taşeli: 1.99 euro cents per kWh — the lowest price ever recorded in the country
The fixed tariff will remain valid for 25 years, with a total power purchase term of 30 years. During the first five years, a support mechanism similar to the YEKA model will apply, offering a tariff of 4.75 euro cents per kWh — still below the average market price.
Strategic Energy Partnership
According to Energy and Natural Resources Minister Alparslan Bayraktar, the agreement represents a strategic step for both countries. Saudi Arabia plans to develop 5,000 MW of solar and wind capacity in Türkiye under the broader framework of cooperation.
A second phase is expected to add another 3,000 MW, potentially including energy storage systems and data center projects.
Supporting Türkiye's 2035 Energy Goals
Over the past 23 years, Türkiye's installed solar and wind capacity has grown from nearly zero to over 40,000 MW. By 2035, the country aims to reach 120,000 MW in renewable energy capacity.
The new 2,000 MW projects alone are expected to supply electricity to approximately 2.1 million households. At least 50% of production will rely on local manufacturing, reinforcing Türkiye's localization strategy in the renewable energy sector.
"The agreement represents a strategic step for both countries."
Project Highlights
- Investment: $2 billion total
- Capacity: 2,000 MW combined
- Locations: Sivas and Karaman-Taşeli
- Partner: ACWA Power
- Commercial operations: Early 2028
- Power purchase term: 30 years
- Fixed tariff duration: 25 years
- Households served: ~2.1 million
- Local manufacturing requirement: At least 50%
YEKA model: A Turkish renewable energy zone model that provides long-term purchase guarantees and encourages local manufacturing.
Record-breaking milestone: The 1.99 euro cents per kWh tariff in Karaman-Taşeli represents the lowest electricity price ever recorded in Türkiye's history, setting a new benchmark for renewable energy competitiveness.
"By 2035, the country aims to reach 120,000 MW in renewable energy capacity."
The agreement marks one of the largest renewable energy deals in Türkiye's history and strengthens the country's long-term transition toward clean energy and carbon neutrality targets. With record-low prices, strategic international partnership, and a strong localization component, this project sets a powerful precedent for future renewable investments in the region.
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