Introduction: why YEKDEM still matters for bankable renewables
In Turkey, the Renewable Energy Resources Support Mechanism—widely known as YEKDEM—has been one of the most influential policy tools shaping the economics and financeability of renewable power plants. Whether your project is solar (GES), wind (RES), hydro, geothermal, or biomass, YEKDEM can determine:
- how predictable your revenue stream is,
- whether lenders view the project as financeable,
- how equity investors price risk and plan exits,
- what compliance duties you carry throughout the support period.
YEKDEM is often described simply as a “feed-in tariff,” but that label is incomplete. In legal terms, YEKDEM is a statutory and regulatory framework that ties together: (i) eligibility via Renewable Energy Resource (YEK) Certificates, (ii) government-set support prices and durations, (iii) a market settlement methodology run through the electricity market operator, and (iv) a cost-sharing structure borne by suppliers and reflected in market transactions.
This guide explains the mechanism with a practical legal lens: where YEKDEM comes from, how it operates, how participants join, how settlement works, and which disputes and risks most often threaten revenue—so developers, investors, and corporate buyers can structure projects and contracts accordingly.
1) Legal foundations: the “three-layer” framework behind YEKDEM
1.1 Primary legislation: Renewable Energy Law No. 5346
The core statutory basis for YEKDEM is Law No. 5346, which introduced and evolved Turkey’s renewable support approach and created the legal infrastructure for renewable certification and support. (LEXPERA)
For investors, the most important concept under Law No. 5346 is the YEK Certificate: in practice, projects typically need an appropriate certification status and must meet the operational/technical criteria to be treated as eligible within the support mechanism.
1.2 Primary legislation: Electricity Market Law No. 6446 (system architecture + regulator powers)
YEKDEM does not operate in a vacuum. It sits inside Turkey’s electricity market architecture under Electricity Market Law No. 6446, which defines market roles and the regulator’s powers and anchors the broader market structure in which YEKDEM settlement operates. (EPDK)
1.3 Secondary legislation: the YEKDEM Regulation (certification + operation + settlement duties)
YEKDEM’s operational rules are detailed in the Regulation on the Certification and Support of Renewable Energy Resources, which governs certification, participation rules, rights and obligations, and the settlement logic used in the mechanism.
This regulation is not “informal guidance.” It is the binding rule-set that courts, auditors, the market operator, and EMRA rely on when disputes arise—especially around eligibility, settlement corrections, and payment obligations.
1.4 The price-setting layer: Presidential Decisions (support prices, periods, and update method)
YEKDEM prices and durations have been set and revised through Presidential Decisions issued under the authority granted by Law No. 5346. The widely cited Decision No. 3453 (published in the Official Gazette No. 31380 on 30 January 2021) established a TRY-based support design for plants entering operation within a defined window and described how prices are updated. (LEXPERA)
Subsequently, Decision No. 7189 (Official Gazette No. 32177, 1 May 2023) updated the regime for plants entering operation in the period 1 July 2021 to 31 December 2030, and public materials note that the earlier Decision No. 3453 was repealed and replaced for those periods. (İklim Politika Radarı)
Practical takeaway: when modeling revenue, due diligence must always confirm (i) the project’s commissioning date, (ii) which Presidential Decision table applies, and (iii) how update methodology operates for that specific category.
2) What YEKDEM does in practice: the commercial logic (without oversimplifying)
At a high level, YEKDEM is designed to encourage renewables by providing a defined support price (for an applicable period) for electricity generated by eligible renewable facilities holding the required status/certification.
However, YEKDEM is not merely “the government pays the generator.” It is implemented through market settlement mechanics: renewable generation participates in the market and the mechanism allocates costs and revenues via the settlement chain. The Regulation explains how the applied price is calculated and reflected in the final lists, and how cost and revenue allocation is determined through formulas.
For a project company, this means YEKDEM is both:
- a revenue stabilizer (relative to full merchant risk), and
- a compliance regime with documentation, reporting, and audit exposure.
3) Eligibility: who can benefit, and what typically breaks eligibility
3.1 The role of the YEK Certificate and facility qualification
The mechanism is linked to the certification framework established under the Regulation on Certification and Support of Renewable Energy Resources. This regulation governs the issuance and use of certificates and how the support mechanism is administered.
In disputes, eligibility often turns on:
- whether the facility is properly classified by resource (wind/solar/hydro etc.),
- whether commissioning/acceptance milestones are met as required,
- whether installed capacity increases are treated correctly in settlement (the regulation includes coefficients and formula mechanics for installed capacity increases).
3.2 Commissioning and acceptance documentation (a frequent “silent killer”)
In practice, one of the most litigated issues is what counts as “entering operation” for support eligibility and how acceptance is evidenced. EMRA’s current application notice for the 2026 mechanism year emphasizes that applicants must have entered operation after a specified date and must have provisional acceptance completed (fully or partially) as of the application date, and it requires specific acceptance record pages to be uploaded to the system. (EPDK)
Even sophisticated projects stumble here because different authorities, contractors, and consultants generate acceptance documentation—yet a mismatch between technical milestones and administrative records can create revenue gaps or eligibility denial.
4) How to join YEKDEM: annual application process and deadlines (example: 2026 participation)
YEKDEM participation is not a “one-time forever” election. Participation follows an application process governed by the Regulation and EMRA procedures. For the 2026 mechanism year, EMRA published a specific notice setting out the application timeline and procedural requirements.
Key points from EMRA’s notice include:
- Applications are taken electronically; paper submissions are not considered for the application itself. (EPDK)
- Applicants must apply by 30 November 2025, but because that date fell on a holiday, the deadline extended to 1 December 2025 (next working day) based on administrative procedure timing rules. (EPDK)
- Companies must ensure the correct authorized persons are defined in the electronic system, and authorization documents must be delivered properly (original or notarized copy) as required. (EPDK)
- EMRA states that applications are examined under the Electricity Market Law, the Renewable Energy Law, the YEKDEM Regulation, and broader electricity market rules. (EPDK)
Why investors should care: annual application discipline is not “administrative housekeeping.” Missed deadlines or defective authority records can disrupt revenue recognition and create financing covenant stress. For acquirers, reviewing the target’s application history and internal authorization controls is a standard due diligence item.
5) Settlement mechanics: how EPİAŞ calculates payments and allocates costs
5.1 EPİAŞ’s role and monthly settlement
EPİAŞ publicly explains that, within YEKDEM, it performs calculation of the production-based amounts and cost allocation for both YEKDEM participants and suppliers, and that YEKDEM settlement is performed monthly. (epias.com.tr)
This is crucial because it frames YEKDEM not as a “grant” but as a market-settlement process where:
- eligible generation is priced under the mechanism rules, and
- the associated costs are allocated through supplier payment obligations and market rules.
5.2 The Regulation’s formula structure: payment obligations, revenue, and collaterals
The Regulation contains detailed formulas for:
- calculating suppliers’ payment obligation ratios,
- calculating YEK costs payable to participants,
- calculating portfolio revenue and distribution of amounts,
- handling tolerance coefficients,
- and addressing collaterals and market operator duties.
For contract drafting and financing, two points matter most:
- Settlement can be corrected. Market settlement systems typically include correction windows and dispute pathways; parties should draft payment and reconciliation clauses that anticipate changes rather than assume settlement is always final on first issuance.
- Collateral/liquidity planning is real. The Regulation contemplates collateral use in relevant circumstances, reinforcing why suppliers and portfolio managers treat YEKDEM cash-flow timing seriously.
6) Domestic component premium (“Yerli Aksam”): bonus value with high compliance exposure
Alongside base support prices, Turkey has maintained domestic production incentives for certain equipment/components.
The Ministry’s official information pages explain that domestic component support involves determining, documenting, and auditing domestic contribution prices in line with Law No. 5346 and the relevant Presidential Decision table. (Enerji Bakanlığı)
Why this attracts disputes: domestic component claims can become a high-value revenue line, but they are also audit-heavy. Documentation, manufacturing verification, and compliance with the applicable domestic component regulation are essential. The Ministry notes there are structured steps, including planned manufacturing submissions and inspection of manufacturers by domestic component determination teams, plus application timing (e.g., a deadline such as 1 December in the referenced process summary). (Enerji Bakanlığı)
For investors, the domestic component premium creates two parallel diligence tasks:
- confirm upside: whether the project legitimately qualifies for the premium; and
- confirm downside: whether documentation gaps could lead to repayment demands, settlement revisions, or allegations of unjustified payments.
7) Key legal risks in YEKDEM projects (and how to manage them)
Risk 1: Wrong “window” or wrong table (commissioning date mistakes)
Support price tables depend on the commissioning window and applicable Presidential Decision. Public materials highlight that Decision No. 7189 (Official Gazette No. 32177) defines prices/durations for facilities entering operation from 1 July 2021 through 31 December 2030 and replaced earlier arrangements for those facilities. (İklim Politika Radarı)
A project that misclassifies its window can produce an incorrect financial model, false revenue expectations, and post-closing disputes in M&A.
Mitigation: confirm commissioning and acceptance records and align them with the applicable decision table before any investment committee approval.
Risk 2: Acceptance and documentation gaps (provisional acceptance, partial acceptance)
EMRA’s 2026 notice explicitly ties application eligibility to having provisional acceptance completed and uploading the correct acceptance record pages. (EPDK)
Mitigation: treat acceptance records as “financial documents,” not just engineering outputs; maintain a document map that matches EMRA’s upload requirements.
Risk 3: Settlement disputes (metering, profile errors, reconciliation)
Because YEKDEM settlement is monthly and formula-based, metering and data integrity are central. EPİAŞ’s YEKDEM page highlights the monthly settlement and the regulatory article basis used in settlement. (epias.com.tr)
Mitigation: implement periodic meter audits, data reconciliation protocols, and an internal “settlement challenge” calendar aligned with the market operator’s timelines.
Risk 4: Domestic component premium disputes (audit exposure)
Domestic component incentives can be challenged if the documentation does not support the claim or if manufacturing/audit criteria are not satisfied. The Ministry’s process descriptions underline the inspection and verification logic behind domestic component support. (Enerji Bakanlığı)
Mitigation: include strict compliance warranties and indemnities in EPC/procurement contracts where domestic component premium is part of the financial model, and preserve audit-ready evidence.
Risk 5: Corporate actions and financing security (share transfers, pledges, restructuring)
Renewable projects often change hands between development, construction, and operation. While the YEKDEM mechanism is primarily about support payments and settlement, many disputes arise because corporate actions (share transfers, pledges, control shifts) are not planned in harmony with licensing rules and regulator expectations under electricity market legislation.
Mitigation: coordinate M&A and finance documents with regulatory counsel early—especially where project-level lenders require share pledges and account pledges.
Risk 6: Change in law and economic shocks (hardship vs. force majeure)
Even with support mechanisms, projects face change-in-law risk (e.g., market settlement rule updates, new technical requirements, taxation impacts). Where the contract does not allocate these risks clearly, disputes can shift to Turkish contract law tools such as adaptation/hardship arguments. Your safest approach is proactive contract design (change-in-law clause + price review + renegotiation timetable) rather than relying on litigation after economics collapse.
8) Bankable contract design around YEKDEM (what sophisticated projects do)
8.1 EPC and O&M contracts: align legal milestones with support eligibility
In YEKDEM-backed projects, the single most important EPC drafting principle is to align:
- construction schedule and
- acceptance/commissioning deliverables
with the support window and application schedule.
If the EPC contract is written purely around “mechanical completion,” but EMRA expects provisional acceptance documentation in a specific form by a specific date, the project can suffer revenue loss even if it is technically functional.
8.2 Offtake/corporate PPAs: do not double-count support value
Some corporate buyers want renewable claims and long-term pricing. The contract must clearly address whether the project is:
- fully within YEKDEM and sells through market settlement logic, or
- partially merchant with corporate offtake overlay, or
- using certificates (like YEK-G) separately.
Double-counting the same MWh value in two different contractual “benefits” is a common dispute trigger.
8.3 M&A and financing: diligence “YEKDEM hygiene,” not only permits
For acquisitions, a buyer’s diligence should cover:
- which decision table applies (pricing/duration),
- acceptance and commissioning files,
- application history and authorization records,
- settlement challenge history,
- domestic component premium documentation (if claimed),
- compliance with any special conditions.
For lenders, an early risk memo should test:
- whether YEKDEM cash flows are stable enough for DSCR modeling,
- how settlement corrections could affect debt service,
- and whether additional reserves are needed for periodic volatility.
9) Practical checklists
For developers (before applying to YEKDEM)
- Confirm commissioning date and applicable Presidential Decision window. (İklim Politika Radarı)
- Prepare provisional acceptance records exactly as required by EMRA’s application notice and system. (EPDK)
- Validate electronic authorization and signature workflow. (EPDK)
- If claiming domestic component premium, assemble an audit-ready file and verify Ministry process steps. (Enerji Bakanlığı)
For investors and acquirers (transaction diligence)
- Map YEKDEM eligibility and window classification.
- Review settlement statements and any objections/history with EPİAŞ.
- Check whether domestic component premium was claimed and whether documentation is defensible.
- Review EMRA application and authorization records (especially for recent years). (EPDK)
Conclusion: YEKDEM is a revenue tool—but also a compliance and litigation landscape
YEKDEM remains central to renewable investing in Turkey because it merges public policy with market settlement to support renewable generation under defined price and duration rules. The mechanism’s legal basis is built on:
- Renewable Energy Law No. 5346, (LEXPERA)
- Electricity Market Law No. 6446, (EPDK)
- the Regulation on Certification and Support of Renewable Energy Resources,
- and the applicable Presidential Decisions setting support prices and durations (including Decision No. 7189 published in Official Gazette No. 32177). (İklim Politika Radarı)
For developers, the winning formula is simple but demanding: document discipline + timeline control + settlement governance. For investors, the key is to diligence “YEKDEM hygiene” with the same seriousness as permits and land rights—because small administrative missteps can threaten large revenue streams.
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