Power market glossary

Active energy charge

The bill item for consumed energy; the part that differs between suppliers.

Aggregation Regulation

Published 17 December 2024; sets a 2,000 MW cap for generation in an aggregator portfolio, of which 500 MW can be unlicensed.

Aggregator

A licensed company taking several sites to market as one portfolio, responsible for imbalance and KÜPST at portfolio level.

Ancillary service certificate

A certificate showing, with tested parameters, that a unit can provide an ancillary service.

Ancillary services

Services procured for secure system operation besides energy, such as frequency control and reactive power.

Ancillary Services Market

The TEİAŞ process procuring frequency reserves with hourly and block offers; settlement is published monthly by EPİAŞ.

Arbitrage

Buying energy at a low price and selling it at a high price, as batteries do across hours.

Asset management

Integrated management of an asset’s output, positions, imbalance, settlement and commercial operations.

Automatic generation control

The automatic set-point signal TEİAŞ sends to units in secondary control.

Automatic Meter Reading System

A system that reads meter data remotely and hourly.

Auxiliary source

A second source added to the main source, such as solar at a wind site.

Available capacity

The capacity actually available for use in a given period.

Balance responsible party

The participant financially responsible for its own and its group’s imbalances.

Balancing and Settlement Regulation

The regulation governing the spot and balancing markets, imbalance and settlement.

Balancing instruction

An up- or down-regulation order issued by TEİAŞ against balancing offers, paid as bid.

Balancing Power Market

The TEİAŞ market where up- and down-regulation offers are used to balance the system in real time.

Balancing Responsible Group

A group combining several participants’ imbalances; from 2026 a member with an individual imbalance ratio above 5% bears its own imbalance.

Balancing unit

A generation, consumption or storage unit qualified to bid into and receive instructions in the balancing market.

Baseload

A product profile delivering the same volume in every hour of the period.

Battery Energy Storage System

A system storing electricity chemically and releasing it on demand, earning from arbitrage, frequency control and balancing.

Bilateral contract

An agreement in which two parties freely set the volume, profile, term and price of electricity; volumes are notified to EPİAŞ.

Biomass plant

A plant generating from organic waste; 2,424 MW at the end of August 2026.

Block bid

A day-ahead bid covering several consecutive hours at one price and quantity, accepted or rejected as a whole.

Board decision

A regulatory decision of the EPDK Board, published in the Official Gazette.

Board-set coefficient

The coefficient applied to PTF plus YEKDEM in the last resort tariff: 1.05 for households and 1.0938 for others in 2026.

Capacity factor

The ratio of actual output to the output at full capacity over the same period.

Capacity mechanism

A mechanism under which TEİAŞ pays selected plants for capacity to secure supply.

Capacity payment

Payment for capacity held in reserve, in TL/MW for frequency control.

Capture price

The output-weighted average price a plant actually receives; for solar it can fall below the daily average PTF.

Capture rate

The ratio of capture price to the period’s average PTF.

Carbon Border Adjustment Mechanism

The EU mechanism pricing the carbon content of imports, relevant for Turkish exporters.

Cash settlement

Closing a derivative by paying the difference between the contract and reference price instead of physical delivery.

Central counterparty

An entity that becomes buyer to every seller and seller to every buyer; Takasbank on VİOP.

Collateral

Cash, bank guarantees or other assets provided to secure market obligations.

Combined renewable plant

A plant using several renewable sources; net output is valued under YEKDEM at the lowest applicable price.

Commercial operation

A plant starting to produce and trade after provisional acceptance.

Connection agreement

The agreement setting the terms for connecting a site to the grid.

Connection capacity

The maximum power a site can inject or withdraw, set in its connection agreement.

Consumer Services Regulation

The regulation setting minimum terms for supply contracts, billing and withdrawal rights.

Consumption-integrated storage

Storage installed at a consumption site, including storage inside industrial zones.

Continuous trading

Trading where orders match instantly and each trade executes at its own price, as on the intraday market and VEP.

Counterparty risk

The risk that the other party fails to pay or deliver.

Curtailment

A plant feeding in less than it could because of grid or connection limits.

Cycle

One full charge and discharge of a battery.

Daily advance payment

Daily payment and collection of day-ahead and intraday trades ahead of monthly settlement.

Day-Ahead Market

The EPİAŞ single-price auction for each hour of the next day; bids close at 12:30 on D−1 and results are published at 14:00.

Degradation

Loss of battery capacity with use and time.

Demand-side response

Consumers or aggregators reducing load to support balancing or capacity.

Deviation charge from final generation plan

A charge generators pay for deviations from the final plan beyond a tolerance band set by source type.

Distribution charge

The EPDK-set charge for carrying power over the distribution grid, the same whichever supplier is chosen.

Distribution company

The licensed company running the grid in a region, reading meters and handling faults; reached on 186.

Distribution system

The medium- and low-voltage grid delivering power to consumers; Türkiye has 21 distribution regions.

Down-regulation

A TEİAŞ instruction to reduce output or increase consumption, issued when the system is long.

Duck curve

The daily net load shape created by midday solar, explaining the gap between midday and evening prices.

Electricity consumption tax

A municipal tax on the active energy charge: 1% for industry, 5% for households and commercial users.

Electricity Market Law

Law No. 6446, the main law of the Turkish power market.

Electricity Market Licensing Regulation

The regulation on pre-licence and licence types, applications and amendments.

Eligibility threshold

The minimum annual consumption for supplier choice: 950 kWh in 2024, 750 kWh in 2025, 500 kWh in 2026.

Eligible consumer

A consumer whose current or previous-year consumption exceeds the EPDK threshold and can choose its supplier; 500 kWh in 2026.

Emissions Trading System

A cap-and-trade system for greenhouse gas allowances.

Energy Exchange Istanbul

The market operator running the day-ahead, intraday, futures and YEK-G markets and handling settlement.

Energy fund levy

A levy formerly charged on the active energy charge; removed from electricity bills together with the TRT levy on 1 January 2022.

Energy imbalance

The difference between energy traded and energy actually produced or consumed in a settlement period.

Energy Market Regulatory Authority

The independent regulator of the electricity, gas, oil and LPG markets.

EPİAŞ Transparency Platform

The EPİAŞ platform publishing price, generation, consumption and ancillary data openly.

Final Day-Ahead Generation/Consumption Schedule

The hourly schedule balancing units submit to TEİAŞ after the day-ahead results.

Final settlement notice

The notice containing final settlement results for an invoicing period; for August 2026 published on 15 September.

Final settlement period generation plan

The generation plan finalised for each settlement period, against which KÜPST is calculated.

Flexibility

An asset’s ability to change output or consumption quickly in response to prices or system needs.

Flexible bid

A day-ahead bid offering a quantity under a price condition and leaving the matching hour to the algorithm.

Forward / futures contract

A contract fixing today the price for a future delivery period; it reduces price risk but not volume risk.

Generation forecast

Predicting a plant’s hourly output from weather and plant data.

Generation licence

The licence to build and operate a power plant.

Generation-integrated storage

Storage at a plant’s connection point; grid energy cycled through it does not benefit from the plant’s incentives.

Geothermal plant

A plant generating from underground heat; 1,798 MW at the end of August 2026.

Gigawatt

A unit of power equal to 1,000 MW.

Green tariff

A tariff option for buying fully renewable energy, backed by YEK-G certificates.

Grid emission factor

The average carbon emissions per MWh drawn from the grid.

Hedging

Fixing prices in advance through futures or bilateral contracts to limit the effect of price moves.

Hourly bid

A day-ahead bid made of price-quantity pairs for a single hour.

Hourly netting

Netting an unlicensed site’s generation and consumption hour by hour, in force since 1 May 2026 except for households.

Hydroelectric plant

A hydro plant; at 32,331 MW the largest source of capacity in Türkiye.

I-REC

An international renewable energy certificate standard.

Imbalance coefficients (k and l)

Coefficients in the imbalance price; since 1 January 2026, 6% when deviating with the system and 3% when against it.

Imbalance price

The price at which imbalance settles: MAX(V, PTF, SMF) × (1 + k) for shortfall, MIN(PTF, SMF) × (1 − l) for surplus.

Incumbent supplier

The supplier obliged to serve non-eligible and last resort consumers in a region.

Installed capacity

Total generating capacity; Türkiye’s stood at 126,944 MW at the end of August 2026.

Instruction tag

The code showing why an instruction was issued: 0 energy balancing, 1 transmission constraint, 2 ancillary service.

Intraday Market

A continuous market opening at 18:00 on D−1, where each contract trades until 60 minutes before delivery.

Invoicing period

The one-month period over which settlement is run and invoices issued.

Kilowatt-hour

Energy equal to one kilowatt over one hour; used on bills and consumer thresholds.

Last resort supply

Supply by the incumbent to consumers without a contract or whose supplier has left the market.

Last Resort Supply Tariff

A tariff for consumers above the threshold without a contract, priced daily at (PTF + YEKDEM) × KBK.

Layered hedging

Pricing parts of the volume at different times and tenors to spread price risk.

Licence

EPDK permission for generation, supply, aggregation, distribution or transmission activities.

Load profiling

Allocating monthly consumption of non-hourly metered consumers to hours with approved profile coefficients.

Local content premium

An extra YEKDEM price for plants using domestically produced components.

Low-consumption eligible consumer

An eligible consumer below 100,000 kWh a year, with a 3-year contract cap, 14-day withdrawal right and mandatory pre-contract information.

Main source

The primary source of a multi-source plant; output cannot exceed the main-source units’ accepted capacity.

Marginal pricing

Applying the price of the last accepted bid to all matched trades in the hour, as in the day-ahead market.

Market Clearing Price

The hourly price set where supply and demand meet in the day-ahead market; the reference price of the Turkish power market.

Market participant

A licensed legal entity registered with EPİAŞ and trading in the organised markets.

Maximum price limit

The highest bid price allowed in the day-ahead and balancing markets: 4,500 TL/MWh since 4 April 2026 under EPDK decision 14459.

Maximum settlement price

A temporary 2022–2023 mechanism capping settlement prices by source.

Megawatt

A unit of power equal to 1,000 kW; installed capacity is expressed in MW.

Megawatt-hour

Energy equal to one megawatt over one hour, or 1,000 kWh; wholesale prices are quoted in TL/MWh.

Message Management System

The national registry of consents for commercial electronic messages.

Meter

The device measuring generated or consumed electricity; reading and maintenance are done by the distribution company.

Metering point

The physical point where energy is measured for settlement.

Minimum price limit

The lowest bid price allowed in the day-ahead and balancing markets: 0 TL/MWh, so prices cannot go negative.

Ministry of Energy and Natural Resources

The ministry setting energy policy and publishing installed capacity statistics.

Monthly netting

Netting generation and consumption over a month; since 2026 only for households.

Multi-source (hybrid) plant

A plant combining several sources at one connection point under one licence.

National Load Dispatch Centre

The TEİAŞ centre operating and balancing the transmission system in real time.

National tariff

The regulated EPDK tariff for non-eligible consumers below the last resort threshold.

Negative imbalance

Producing less than sold or consuming more than bought; settled at MAX(V, PTF, SMF) × (1 + k).

Negative price

A price at which generators pay to sell; it cannot occur in Türkiye because the price floor is 0 TL/MWh.

Net instruction volume

The net of 0-tagged up and down instructions in a settlement period, which sets the system direction.

Net load

Total demand minus variable renewable output.

Netting

Opposite deviations of plants in a portfolio offsetting each other and reducing total imbalance.

Off-peak hours

Hours of low demand and usually low prices.

Official Gazette

The official publication in which laws, regulations and Board decisions take effect.

Open position

Volume whose price is not yet fixed and remains exposed to the market.

Organised industrial zone

An area hosting industrial sites; licensed zones can run their own distribution.

Organised wholesale electricity markets

Markets organised by the market operator, including the day-ahead, intraday, futures and organised YEK-G markets.

Organised YEK-G market

The EPİAŞ market for YEK-G certificates; 2026 fees are 1.00 TL/MWh and 3,000 TL a year.

Outage notification

A plant notifying TEİAŞ that it cannot follow its schedule because of a fault.

Over-the-counter market

Power trades done directly between parties outside the organised markets.

Pay-as-bid

A method paying each instructed unit its own bid price, used for balancing instructions.

Pay-as-produced offtake

An offtake model buying a plant’s actual output under an agreed formula, moving volume risk to the buyer.

Peak

The time band with the highest demand and usually price; 17:00–22:00 in the three-rate tariff.

Personal Data Protection Law

Law No. 6698 governing how suppliers process customer, invoice and meter data.

Physical delivery

Settling a contract through actual delivery of energy, as with VEP contracts.

Planned and unplanned outage

Supply interruptions for maintenance or faults, handled by the distribution company.

Portfolio

The set of generation, consumption and storage assets managed together.

Portfolio registration

A supplier adding a consumer’s meter to its portfolio in the EPİAŞ system.

Position

The net of energy bought and sold for a given hour or period.

Positive imbalance

Producing more than sold or consuming less than bought; settled at MIN(PTF, SMF) × (1 − l).

Post-10-year purchase price

For unlicensed plants past 10 years: 90% of the current YEKDEM price for licensed plants, capped at hourly PTF (Decision 11415).

Post-YEKDEM period

The period after a plant’s ten-year YEKDEM term ends and it must choose its own sales channel.

Power Futures Market

The EPİAŞ market for physically delivered monthly, quarterly and yearly power contracts; the 2026 trading fee is 3.00 TL/MWh.

Power Purchase Agreement

A long-term contract to buy a generator’s output under an agreed price formula.

Pre-licence

A time-limited preliminary permit to obtain approvals before a generation licence.

Preliminary settlement notice

The notice EPİAŞ publishes before final settlement, open to objections; for August 2026 it was published on 11 September.

Price risk

The risk that spot prices move against an open position.

Primary frequency control

Reserve responding automatically to frequency deviations within seconds, paid a capacity price in TL/MW.

Profile risk

The risk that the hourly shape of output or load differs from the contracted or price profile.

Project finance

Financing a project against its own cash flows; revenue predictability is key.

Provisional acceptance

Official confirmation that a completed plant is fit for operation.

Reactive compensation

Capacitor or reactor systems installed to offset reactive energy.

Reactive energy

Non-working energy from the phase difference between voltage and current; consumption above set limits is charged.

Reactive power control

An ancillary service adjusting reactive power to keep voltage within limits.

Renewable energy certificate (YEK)

A certificate showing a plant is renewable, required to join YEKDEM.

Renewable Energy Guarantee of Origin

An electronic certificate showing one MWh came from a renewable source, issued by EPİAŞ.

Renewable Energy Resource Area

Large renewable sites designated by the ministry and allocated through tenders.

Renewable Energy Support Mechanism

A feed-in mechanism buying output of YEK-certified plants at a set price for a fixed term; its cost is passed to suppliers.

Reservoir hydro

A dam-based plant that can store water and shift output into high-price hours.

Revenue stacking

Combining revenue from arbitrage, ancillary services and balancing; the same capacity cannot be sold twice in one hour.

Right of withdrawal

The right of a low-consumption eligible consumer to withdraw within 14 days without reason or fee.

Round-trip efficiency

The ratio of energy discharged to energy charged.

Route-to-market

Setting up the commercial model and channel through which an asset sells into the market.

Run-of-river hydro

A hydro plant with little storage, generating with the river flow.

Secondary frequency control

Reserve following TEİAŞ’s automatic generation control signal; capacity held for it cannot be offered elsewhere in the same hour.

Settlement

Calculating and finalising receivables and payables from market activity using meter data, run monthly by EPİAŞ.

Settlement injection-withdrawal unit

The unit, made of one or more metering points, on which settlement is calculated.

Settlement period

The time unit for imbalance and settlement calculations; one hour in Türkiye.

Single-rate tariff

A tariff with one energy price for all hours.

Solar power plant

A PV plant; solar capacity reached 27,914 MW, 22% of the total, at the end of August 2026.

Source share

A source’s share of installed capacity; renewables were 62.9% and solar plus wind 34.2% at the end of August 2026.

Spot market

Short-term power trading close to delivery on the day-ahead and intraday markets.

Spread

The price difference between two hours, markets or tenors.

Standalone storage facility

Grid-connected storage not tied to a generation or consumption site, built under a supply or aggregator licence with at least 2 MW.

State of charge

The share of a battery’s capacity currently stored.

Storage Activities Regulation

The regulation on generation-, consumption-integrated, standalone, grid and unlicensed storage, amended effective 1 January 2026.

Storage duration

How many hours a battery can discharge at rated power; MWh divided by MW.

Storage-integrated generation plant

A model giving a tender-free pre-licence for wind or solar equal to committed storage; 28,592 MW across 568 projects by July 2026.

Supplier switch

An eligible consumer moving to another supplier; registered by the last business day before the 6th, it takes effect on the 1st of the following month.

Supply licence

The licence to buy and sell electricity wholesale or retail, also allowing standalone storage.

Surplus energy

Energy fed to the grid above consumption after netting; annual output may be at most twice consumption.

System direction

Whether the system is short, long or balanced in a settlement period, set by net instruction volume.

System frequency

The operating frequency of the grid; nominal 50 Hz in Türkiye.

System long

A state where generation exceeds consumption and TEİAŞ issues net down-regulation; SMF is usually below PTF.

System Marginal Price

The hourly price set by 0-tagged balancing instructions in the net direction; equals PTF when the system is balanced.

System short

A state where consumption exceeds generation and TEİAŞ issues net up-regulation; SMF is usually above PTF.

System use agreement

The agreement governing the terms and charges for using the grid.

Takasbank

The institution handling collateral and cash settlement for organised power trades; central counterparty on VİOP.

Tariff group

The consumer’s tariff class, such as residential, commercial, industrial or agricultural.

TEİAŞ connection tender

A tender allocating grid capacity when demand exceeds it; not required for storage-integrated pre-licences.

Terawatt-hour

A unit of energy equal to one million MWh; 229.9 TWh matched in the day-ahead market in 2025.

Three-rate tariff

A tariff with separate prices for daytime, peak and night hours.

Tolerance band

The deviation from the final plan accepted without charge in the KÜPST calculation, set by source type.

Transmission constraint

A grid capacity limit preventing free flow between regions; related instructions carry tag 1.

Transmission system

The high-voltage grid operated by TEİAŞ.

Transmission tariff

EPDK-approved charges for using the transmission system; the 2026 tariffs were approved by decision 14204.

Turkish Electricity Transmission Corporation

The system operator running the transmission grid, real-time balancing and ancillary services.

Unlicensed generation

Generation without a licence, mainly to meet the owner’s own consumption.

Unlicensed-site storage

A storage category, since 1 January 2026, for storage built by unlicensed plants.

Unlicensed-to-licensed transition ruling

A Constitutional Court ruling annulling the licence fee provision from 10 December 2026, which ends the transition route unless new law is passed.

Up-regulation

A TEİAŞ instruction to increase output or reduce consumption, issued when the system is short.

V unit price

A unit price set by Board decision and compared with PTF and SMF in the shortfall imbalance price; initial value 150 TL/MWh.

Value added tax

VAT on the bill total: 10% for households and agricultural irrigation, 20% for others.

Variable renewable energy

Sources such as wind and solar whose output varies with the weather.

VİOP power futures

Cash-settled power contracts on Borsa İstanbul’s derivatives market, closed against the average PTF of the delivery period.

Volume risk

The risk that actual output or consumption differs from the contracted volume.

Weighted Average Price

The volume-weighted average price of trades in an intraday contract.

Wind power plant

A wind farm; capacity stood at 15,434 MW at the end of August 2026.

YEKDEM cost

The per-MWh cost of YEKDEM purchases above market value; EPDK publishes monthly estimates.

YEKDEM price

The TL price, within a US dollar floor and cap, for YEK-certified plants commissioned between July 2021 and 2030.

Zero-price hours

Hours when PTF clears at the 0 TL/MWh floor, typically spring middays.

186 power fault line

The distribution companies’ fault and outage hotline.