Design of a Financing Program for Scaling-up Rooftop Solar PV

Turkey has significant renewable energy potential, including solar, mainly as a result of its geographic location. As a result, the solar market in Turkey has grown exponentially over the last few years, with installed solar capacity growing from 40 MW in 2014 to about 5,063 MW at the end of 2018. Recognizing this, the Ministry of Energy and Natural Resources of Turkey (MENR), supported by the World Bank, needed to identify and develop business models and financial support mechanisms to support the scale-up of rooftop solar photovoltaic (RSPV) systems for four customer segments: (1) residential buildings including single-family and multifamily apartment buildings (MABs); (2) commercial buildings; (3) industrial facilities; and (4) government buildings.   This initiative was aimed at attracting private-sector solutions, particularly in the form of private financing already available on the market, to unlock the potential of distributed renewable energy generation (dREG) in the country.

The assignment served to explore the impacts of the updated regulatory framework on the scale-up of RSPV, as well as provide recommendations to MENR on both business models and the design of specific financial products for the scale-up of rooftop PVs. With its partners, Econoler carried out the following tasks:

• Reviewed the updated RSPV regulatory framework and established an updated financial viability analysis;
• Defined  viable business models adapted to the revised regulatory framework;
• Provided recommendations to MENR on the design of dedicated financial products and incentive schemes for the various RSPV market segments;
• Provided recommendations on the design of capacity building programs and awareness raising campaigns.

  Addressing the problem of untapped RSPV investment opportunities was expected to unlock the potential of distributed renewable energy generation and support the scale-up of RSPV in Turkey.  Econoler’s analysis revealed how existing regulations and interest rates created opportunities particularly for multifamily buildings and industrial and large commercial segments. In response to these results, the project team then developed concessional financing, technical assistance, awareness raising campaigns as well as a monitoring and evaluation program.