2015 International Energy Raw Materials
and Energy Summit (INERMA) Istanbul
October 1 – 3, 2015
THE IMPORTANCE OF COAL IN TURKEY AND
THE ROLE OF TURKISH COAL ENTERPRISES
Mustafa AKTAŞ
Mining Eng.; General Manager of TKI, Turkish Coal
Enterprises, Ankara, TURKEY
Email: aktasm@tki.gov.tr, Tel: +903125401600, Fax:
+903125401612
Metin AKTAN
Mining Eng. M.Sc., PhD Candidate; Tech. Consultant of General Manager
of TKI, Turkish Coal Enterprises, Email: aktanm@tki.gov.tr, Tel: +93125401006,
Fax: +903125401612
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ABSTRACT In meeting the increasing
energy needs, increasing the utilization of Turkey’s domestic lignite
resources both in the generation of electrical energy as well as in heating
and industry, it has always been one of Turkish Coal Enterprises’ fundamental
policies in relation to natural resources to conduct the exploration, and
production of local lignite resources in a manner that is compliant with the
environment by using latest clean coal technologies and to exploit them in a
manner that would provide the highest added value, while converting these
resources into final product by processing the produced raw materials in a
manner that would benefit the economy. Turkey’s annual domestic coal
production is about 80 million tons and approximately %45 percent of this
production belongs to General Directorate of Turkish Coal Enterprises (TKI).
TKI is in the 8th place as having most employees of total and also it is in
3th place as being most profitable companies between the first 500 industrial
companies in Turkey.
Turkish Coal Enterprises (TKI),
the most experienced authority in coal mining sector in Turkey, was
established in 1957 and has been contributing lots of experience to mining
sector for 58 years.
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In this study, the importance of
coal in Turkey will be explained and adding to that general information the
role of the Turkish Coal Enterprises will be investigated and the history of 58
years’ will be given in details.
1
THE IMPORTANCE OF
COAL IN TURKEY
1.1
Energy
in Turkey
According to the
data of the International Energy Agency (Coal Information 2014), there are 1,05
trillion tons of coal reserves worldwide, while 769 million tons thereof is
hard coal.[i]
Global coal production in 2014 was 7,8 billion tons.
Almost half of that (i.e. 3,56 billion tons) was produced by China alone. In
the same period, China imported 312 million tons of coal and consumed a total
of 3,872 billion tons. China’s coal production in 2013 was 3,53 billion tons.
According to many resources, coal is expected to hold
the biggest share in global power generation projections for the year 2030 by
several agencies. Likewise, it is forecasted that electric power generation
from fossil fuels will be 20 trillion kWh (IEA, 2013). According to different
resources, it is forecasted that, despite the leaps in renewable energy, the
fossil fuels will gain predominance with ever-increasing speed.
1.2
Place
of Coal in Energy
According to the
Domestic Resource Based Energy Production Program Action Plan elaborated within
scope of the Tenth Development Plan (2014 – 2018), it is known that 62 percent
and 49 percent of the trade deficit resulted from net energy imports in 2012
and 2013 respectively, that oil, natural gas and hard coal imports are
continuously increasing to meet rapidly growing energy demand, and that this
situation leads to continuation of high import dependency in energy and creates
pressure on current account balance and energy supply security.
To establish high and stable growth in Turkish economy, utilization of
all possible domestic resources in energy production is deemed as a priority,
which is of crucial importance for enabling sustainable development.
In this scope, the aim is to increase the share of domestic resources,
including domestic and international oil and natural gas drillings, in primary
energy production to 35 percent by the end of 2018 which was 27 percent at the
end of 2012.
It is also aimed at increasing electricity generation from domestic coal
sources to 57 billion kWh in 2018 which was 32 billion kWh in 2013.
Hence, the existing coal resources are quite important for Turkey,
considering that the country has neither natural gas nor oil, which leaves coal
as the only energy resource to decrease the country’s current deficit.
Turkey’s coal reserves make up 1% of the 1,05 trillion tons of coal
reserves worldwide. 14,1 billion tons of our coal reserves reaching up to 15,4
billion tons together with the reserves recently discovered by MTA is lignite
coal, whereas the remaining 1,3 billion tons is hard coal.
When looking at the distribution of lignite coal
according to establishments, it can be seen that;
• EUAŞ holds a share of 55%
with 7,3 billion tons,
• the General Directorate of
Turkish Coal Enterprises holds a share of 27% with 3,7 billion tons;
• the private sector holds a
share of 11% with 1,6 billion tons; and
• MTA holds a share of 10%
with 1,5 billion tons.
The installed electric power generation capacity of
Turkey, which was 2.234 MW back in the 1970’s, increased by 32-fold in the last
43 years to reach 72.156 MW by October 2015. Approximately 56,4 million tons of
coal were produced in our country in 2014, while thereof 85% was consumed by
thermal power plants, 7,4% by the industry, and 7,6% by households.
2
TURKISH COAL
ENTERPRISES (TKı)
TKI was established in 1957 under Law No: 6974.
It is a State-Owned Economic Enterprise operating according to provisions of
Statutory Decree No. 233. Turkish Coal Enterprises was established with the aim
to make use of energy raw materials such as lignite, peat, shale and asphaltite
in line with the State’s General Energy and Fuel Policy, meet the country’s
requirements, and make utmost contribution to the economy of the country.
Turkish Coal Enterprises is the relevant establishment affiliated to the
Ministry of Energy and Natural Resources.
TKI has a capital of 1 Billion TL, with 800 Million TL therefrom
currently paid-in.
Turkey’s total coal reserves are 15,4 billion tons, while thereof 1,3
billion tons is hard coal and the remaining 14,1 billion tons is lignite coal.
3,7 billion tons of the 14,1 billion tons of lignite coal reserves is owned by
TKI.
Turkish Coal Enterprises has 2 Enterprise Directorates and 1 Directorate
of Operations affiliated to them. Besides, TKI carries on its activities with 6
Control Directorates which are affiliated to the General Directorate. TKI is
providing employment to 19 thousand people in total, comprising 5 thousand
directly employed staff and 14 thousand employed through service procurement
from the private sector.
In 2013, TKI made a turnover of 2,5 billion TL and gained 178 million TL
profit.
75% of its activities are carried out through service procurement from
the private sector.
From among ISO 500 industrial enterprises, TKİ is ranking 4th
in terms of profitability in the public sector, 5th in employment,
and 5th in turnover.
2.1
Importance
of TKI with regard to Coal Mining
Having achieved a growth rate of annually 5% in average during the
period 2002-2010, our country ranked 17th among the world’s biggest
economies in 2010 with a growth rate of 8,9%. Moreover, Turkey is a country of
high potential in terms of the increase in power consumption. For instance, the
country’s power consumption is estimated to reach approximately 390.000 GWh,
i.e. 390 billion kWh by 2020, which means that there is a need for additional
capacity in power generation of about 3.000-4.000 MW annually.
What needs to be done first and foremost to solve the problem of
security of supply is to make more use of domestic resources, and then to
diversify both the imported energy resources and the countries which these
energy resources are imported from.
Turkey is one of the countries
that have managed to overcome the global economic crisis quickest and suffered
least from the recent economic uncertainty worldwide. It is the fastest growing
economy across Europe, with an average growth rate of 6% during the period 2002-2011.
In 2011, the Turkish economy achieved a growth rate of 8,5% exceeding the
expectations of IMF which had estimated it to be 7,5%.
Per capita income has increased three-fold in the last 10 years, from
USD 3.492 to USD 10.444. According to the Purchasing Power Parity (PPP), per
capita income has increased to almost 16 thousand USD.
By means of the “Electricity Energy Market and Supply Security Strategy
Paper” which was put into effect in 2009 by Resolution of the Higher Board of
Planning in order to reduce external dependency of our country in energy supply,
it has been decided to put in use the entire domestic coal potential of our
country by 2023 and, in this scope, to increase the country’s electric energy
production capacity to 100.000 MW and the domestic coal based power generation
capacity to 30.000 MW.
The domestic coal based thermal power plants in our country have
currently an installed capacity of about 8.729 MW.[ii]
To reach the targets for 2023, there is need for additional capacity of 21.300
MW in addition to the currently available capacity.
Turkey’s total coal reserves are 15,4 billion tons, while thereof 1,3
billion tons is hard coal and the remaining 14,1 billion tons is lignite coal. Previously,
TKİ owned 2,1 billion tons of the 14,1 billion tons of lignite reserves, but
increased to a total of 3,7 billion tons through the new coal sites (approx.
1,6 billion tons) taken over from MTA.
Adopting a new approach which can be summarized as “collecting share
from unit electric power generated from coal (royalty)”, TKİ has opened its
coal sites to the use by private sector, with the condition to construct
thermal power plants.
Within scope of this new method which is employed in tenders that have
been and will be made and is summarized above as “collecting share from unit
electric power generated from coal”, the investor is given 6 years to construct
a power plant without collecting any fee for the use of coal sites put at the
disposal of the investor. Starting from the end of that period, a share will be
collected in return for the unit electric power (kWh) that will be generated at
the constructed power plant.
The thermal power plant investment period is about 5-6 years. In order
to accomplish the targets set for 2023, it is required that the foundations of
these coal-based power plants are laid until 2016 at the latest.
Within scope of the
mentioned targets and for the purpose of increasing the share of our country’s
electric power requirement met from domestic resources, the coal site number IR-5359
(Bolu-Göynük-Himmetoğlu village) with reserves reaching up to 39 million, the
ownership of which is held by the General Directorate of TKI, is being operated
by AKSA Göynük Enerji Üretim A.Ş since 04.08.2006 under a royalty granted to
the company with the condition to construct a thermal power plant. Construction
of the thermal power plant’s 1st unit with a capacity of 2x135 MW
was completed by AKSA Göynük Enerji Üretim A.Ş. in the first half of 2015. The
company started to generate power under the royalty in July 2015, while the
power plant’s opening ceremony took place on August 14th, 2015. The
dam constructed in order to procure the water that will be used for power plant
cooling activities has been completed to 99% and has a capacity of 2,25 million
mᶟ.
With the 2nd unit to be commissioned by year end, the power
plant will provide employment to 600 people directly, and 6000 people
indirectly. This project will allow for the generation of electric power of 1,9
billion kWh annually, which is more than the 2-fold of the electricity that was
consumed in the entire province of Bolu in 2014.
Other power plant projects, which are currently under construction at
sites the license of which is held by TKI, are as follows:
Owned by TKI and located at Adana-Tufanbeyli:
- The site with 323 million tons coal
reserves was contracted out on 29 May 2012 under the condition to construct a
thermal power plant with a minimum capacity of 600 MW;
Owned by TKI and located at Bursa-Keles;
- The site with 61 million tons coal
reserves was contracted out on 1 November 2012 under the condition to construct
a thermal power plant with a minimum capacity of 270 MW;
Owned by TKI and located at Kütahya-Tunçbilek;
- The site with 117 million tons coal
reserves was contracted out on 26 March 2013 under the condition to construct a
thermal power plant with a minimum capacity of 300 MW;
Lastly, owned by TKI and located at Bingöl-Karlıova;
- The site with 80 million tons coal
reserves was contracted out on 30 May 2013 under the condition to construct a
thermal power plant with a minimum capacity of 150 MW.
Another power plant with fluidized bed, which is currently under construction
at coal sites the license of which are held by TKI in Manisa-Soma, is the Kolin
Soma Thermal Power Plant which is constructed in an environment-friendly manner
in terms of emission values, under a contract signed with Hidrogen A.Ş on 03.10.2012.
Although the foundations of the plant were laid on 19 March 2014 with the
participation of the Turkish Minister of Energy and Natural Resources after the
licensing and EIA procedures had been completed for the project, which will
have a capacity of 510 MW with 153 million tons of coal reserves capable to
generate 3,7 billion kWh electric power annually whilst creating direct
employment to ca. 2.600 people along with indirect employment to 26.000 people,
the location of the plant had to be changed due to certain environmental
problems such as olive grow law etc. EIA of the new plant location has been
completed and the plant foundations have been laid in no time. Once power
generation is started, the entire amount of electricity consumed in the
province of Manisa in 2012, corresponding to 3,5 billion kWh will be met by
this project alone.
After the contracts signed with the relevant companies, site delivery
was made in line with applicable procedures.
The construction of thermal power plants with fluidized bed, which are
currently under construction at coal sites the license of which are held by
TKI, in an environment-friendly manner in terms of emission values, are also
about to finish.
These include the following plants:
Under construction in Eskişehir-Mihalıççık:
- The plant with reserves of 41 million
tons and a capacity of 290 MW (2X145 MW) (to be commissioned in 2016);
Under construction in Silopi-Harbul:
- The plant with asphaltite reserves of 30
million tons and a capacity of 405 MW (3X135 MW) (1st unit
commissioned in 2009, 2nd unit commissioned in 2015; the 3rd
unit will be commissioned in 2016 due to security problems);
To be constructed in Silopi-Üçkardeşler:
- The plant with asphaltite reserves of 22
million tons and a capacity of 135 MW (plant foundations to be laid in 2016);
Located at Şırnak-Silopi-Sereder Sırtı Region:
- The license of the plant with asphaltite
reserves of 28 million tons and a project capacity of 270 MW was revoked by
court order, but a new process has been commenced in order to complete the
project.
Plant capacities that could be potentially installed at new sites taken
over by TKI from MTA are as follows:
• Eskişehir- Alpu;
approximately 3345
MW from 1,5 billion tons of proved reserves at a quality of 2,050 Kcal/kg quality;
• Kırklareli-Pınarhisar-Vize;
approximately 300
MW from 140 million tons of proved reserves at a quality of 1,875 Kcal/kg;
• Konya-Ilgın;
approximately 135
MW from 30 million tons of proved reserves at a quality of 2,300 Kcal/kg.
The total capacity at new sites is approximately 3780 MW.
Apart from contracts awarded under the condition to construct a thermal
power plant, there are also sites which are privatized or decided to be
privatized by Resolution of the High Board of Privatization.
The plant with 457 MW capacity located at Sivas-Kangal within the body
of EÜAŞ was privatized in early 2013, together with sites that have reserves of
100 million tons.
Similarly, the coal site owned by TKI with 176 million tons of reserves
located at Kütahya Seyitömer was privatized by tender dated 28.12.2012,
together with 600 MW power plants owned by EUAŞ.
Besides, a Resolution by the High Board of Privatization, requiring that
the coal sites with 405 million tons of reserves located in Muğla Yatağan and Yeniköy
owned by TKI shall be privatized by the end of 2016 together with the 1680 MW
capacity plants procuring coal from those sites, was published in the Official
Gazette dated 27.08.2013. The tender for the Yeniköy Thermal Power Plant and
coal sites and the tender for the Yatağan Thermal Power Plant and coal sites
did take place in 2014 at different dates. Contracts awarded in both of these
two tenders have already been signed.
Besides, by Resolution of the High Board of Privatization dated 07.08.2014
number 2014/76, the BLI Directorate of Operations, which used to be affiliated
to the GLİ Enterprise Directorate, was transferred to Soma Elektrik Üretim ve
Tic. A.Ş., free of charge, together with all rights and liabilities pertaining
thereto pursuant to Law No. 4046 on Privatization Practices.
In order to reach our targets for 2023 by making use of coal as the only
domestic resource available to us, all necessary efforts are made at great pace
to make sure that the foundations of relevant thermal plants are laid until
2016.
Thereby, TKİ will be the direct coal supplier of thermal plants which
will reach approximately 7.919 MW capacity together with the new additional
units that will provide 6.200 MW capacity in addition to the 1.719 MW plants
owned by EUAŞ, for which TKI is already providing coal supply. All domestic
lignite and asphaltitee coal based power plants to be constructed will be
state-of-the-art, in other words environment-friendly in terms of their
emission values.
3
CONCLUSION
Having produced 1,67 billion tons of coal in 2003, China produced 3,872
billion tons of the total amount of coal (7,8 billion tons) produced worldwide
in 2014. Thus, China has pioneered the global coal sector in electric power
generation all alone in recent years. Along with the excessive production of
coal, a rapid increase has been observed in China’s production and consumption
of energy. However, considering that developing economies will be determinative
for the future “energy supply” dynamics, it must be taken into consideration
that the power consumption speed in India, Indonesia, Brazil, and Middle East
might get higher than that of China.
The fact that sustainable energy policies and security of energy supply
are the fundamentals of a country’s development as well as economic and
national security is nowadays acknowledged by almost everybody. Therefore, it
is a requirement for each and every country to secure energy supply from
uninterrupted, reliable, cheap, clean, and diversified resources, and to make
efficient use of them.
It is necessary to adopt as a Basic Policy a standing which requires
most efficient exploration and production of domestic coals in order to reduce
the external dependency of our country in energy supply, while taking all environmental
measures that might be necessary when making use of them.
In line with the target to put in use the entire domestic coal potential
of our country by 2023 pursuant to the “Electricity Energy Market and Supply
Security Strategy Paper” which was put into effect in 2009 by Resolution of the
Higher Board of Planning;
it is of crucial importance to be a close follower of improvements
achieved in clean coal technologies worldwide (improvements in coal firing
technologies, coal gasification, coal mining etc.), taking into consideration
the fact that our coal resources, among and above all fossil fuels, are
“A RESOURCE THAT MUST BE PUT IN USE WITH PRIORITY”
As a matter of fact, considering that our country has rich lignite
reserves and that future explorations might create the opportunity to discover
and develop new coal deposits, it can be seen that making maximum use of coal
in future for power generation purposes is quite inevitable.
REFERENCES
[i] IEA, COAL INFORMATION 2014
[ii] http://www.teias.gov.tr/yukdagitim/kuruluguc.xls
