In recent years, the regulatory framework governing storage activities in the electricity market has been undergoing a comprehensive transformation, driven by objectives such as enhancing system flexibility, strengthening the integration of renewable energy resources, and ensuring security of supply. Within this context, the Regulation on Amending the Regulation on Electricity Market Storage Activities (“Amending Regulation”) was published in the Official Gazette dated 29 December 2025 and numbered 33122.

Alongside the amendments introduced to the Regulation on Electricity Market Storage Activities (“Storage Regulation”), several secondary legislative instruments concerning the electricity market, as well as two separate Energy Market Regulatory Authority (EMRA) Decisions, were published simultaneously in the same Official Gazette. In our view, this development indicates that storage activities are no longer treated merely as a demand-side element of the market, but rather as a structural component that directly affects market functioning.

Specifically with respect to the Storage Regulation, the amendments introduced to Articles 4, 5, 6, and 7, together with the new connection and technical arrangements set out in the annexes, substantially redefine the applicable regime in terms of the legal status of storage facilities, the principles governing energy injection to and withdrawal from the system, and the regulatory treatment applicable to different types of facilities. In particular, the linkage of unlicensed electricity generation facilities with storage activities may be interpreted as signalling the beginning of a new phase in practice.

In this assessment, we aim to outline a general framework for the relevant amendments on an article-by-article basis, and to share our preliminary observations regarding the new approach introduced by these regulations with respect to licensed and unlicensed facilities, as well as the connection configurations regulated in the annexes. We will continue to evaluate how these amendments will be reflected in practice and how they will be received in market operations, in parallel with the issuance of further secondary legislation and the progress of the implementation process.

Installation and Connection Principles for Electricity Storage Units and Facilities

Article 4/1

A new paragraph has been added to Article 4/1 governing the installation and connection principles for electricity storage units and facilities. Through this paragraph, it is envisaged that the activities that may be carried out by means of electricity storage units or facilities shall be performed within the limits set forth under the Storage Regulation.

Within this framework, it has been stipulated that electricity storage facilities established by unlicensed electricity generation facilities shall also be assessed within the scope of the regulations applicable to electricity storage units and facilities.

Article 4/3

Within the framework of the Regulation on Unlicensed Electricity Generation in the Electricity Market (“LÜY”), it is possible to establish electricity storage facilities at unlicensed electricity generation facilities that have received a call letter and are subject to monthly netting under Article 26 of the LÜY.

However, electricity storage facilities to be established within this scope are required to satisfy the conditions set forth under Article 37/6 of the LÜY. Pursuant to the said provision, it is regulated that the materials used in electricity generation facilities and connection equipment established within the scope of the LÜY must be manufactured in compliance with the relevant legislation and standards, be covered by warranty, and have been produced within the last five years.

On the other hand, it has been explicitly stipulated that the said five-year production requirement shall not be applicable to facilities falling within the scope of Article 5/1-d of the LÜY.  Under Article 5/1-d of the LÜY, it is regulated that cogeneration facilities meeting the efficiency criteria to be determined by the Ministry may be established without being subject to pre-license and license requirements and without the obligation to establish a company.

Within this framework, if energy is supplied to the grid from electricity storage facilities established under Article 4/3, no payment shall be made for the surplus energy remaining after netting, corresponding to the amount of energy supplied from storage. Where it is not possible to determine the amount of energy supplied from storage, no payment shall be made for the entirety of the surplus energy. Such energy shall be deemed to have been generated by the supplier company acting as the YEKDEM participant and shall be deemed as a contribution to YEKDEM without renumeration.

Article 4/4

Article 4/4 has been amended to define the “operational readiness” status of the electricity storage units installed within electricity generation facilities with storage as the state of being capable of operating in accordance with the connection configurations set out in Annex-1. Through this amendment, particular emphasis has been placed on the connection configurations applicable to such storage units.

Electricity Storage Unit Integrated with a Generation Facility

Article 5/7

In generation facilities incorporating storage-integrated electricity generation facilities and integrated electricity storage units, the amount of energy that may be injected into the system during the settlement period is limited by the total installed capacity and generation capacity of the main source units that have completed provisional acceptance.

Following the amendment, in facilities where the main source has not yet been partially or fully commissioned, provided that the system operator deems it technically appropriate and that the prescribed conditions are complied with, energy may be injected into the grid up to the accepted capacity of the storage unit or the accepted portion of the storage facility, on the condition that the installed capacity of the main source specified in the generation licence is not exceeded.

Article 5/8

The connection configuration of a storage unit within a storage-integrated electricity generation facility and electricity storage unit integrated with the generation facility shall be made in accordance with the configuration set out in Annex-1. The electricity storage unit integrated with the generation facility connection figuration shall be made in accordance with the configuration set out in Annex-1 and Annex-2.

Article 5/9 (repealed)

Article 5/9 had envisaged a framework under which electricity generated in storage-integrated electricity generation facilities would be transferred to the grid through the electricity storage unit rather than being directly injected into the system. Within this framework, in the specified connection configurations, energy injected into the system was deemed to have been injected through the storage unit; and the establishment of the metering, operation and monitoring infrastructure required to fulfil this obligation was assigned to the responsibility of the relevant grid operator. We observe that Article 5/9, which contained these arrangements, has been repealed by the amendment introduced.

Article 5/10

Article 5/10 governs the method by which electricity storage units established within the scope of storage-integrated generation facilities may participate in the markets. Accordingly, storage units may participate in ancillary services, provided that they satisfy the conditions stipulated under the relevant legislation; and, where they qualify as balancing units, they may participate in the balancing power market through the settlement metering units associated with the generation facility.

Article 5/11

Article 5/11 has been introduced to regulate how energy injection and withdrawal in storage-integrated electricity generation facilities shall be assessed for settlement purposes. Accordingly, during settlement periods in which energy is withdrawn from the grid, where the storage facility records a withdrawal, the energy withdrawn from the grid is deemed, as a matter of priority, to have been withdrawn by the storage facility; likewise, during settlement periods in which energy is injected into the grid, where the storage facility records an injection, the energy injected into the grid is deemed, as a matter of priority, to have been injected by the storage facility.

Integrated Electricity Storage Facilities with Consumption Facilities

Article 6/4

Under the previous version of the Article, permission was granted solely for electricity storage facilities established within organized industrial zones. With the amendment introduced in Article 6/4, industrial zones have also been brought within the scope; accordingly, it has been explicitly stipulated that electricity storage facilities established within the boundaries of organized industrial zones and industrial zones shall be deemed and assessed as integrated electricity storage facilities with consumption facilities.

Article 7 – Standalone Electricity Storage Facilities

Article 7/2 regulates that the grid connection of standalone electricity storage facilities shall be carried out in accordance with the connection configurations set forth in Annex-3 of the Storage Regulation.

Article 7/3 limits the amount of energy that standalone electricity storage facilities may supply to the system based on the settlement period, by reference to the installed electrical capacity of the storage facility that has been commissioned and the amount of energy it can supply. If this limit is exceeded, the excess energy shall be deemed to have been generated by the supplier company acting as the YEKDEM participant and shall be deemed as a contribution to YEKDEM without remuneration.

Annexes

Annex-1 regulates the connection configuration applicable to electricity generation facilities with integrated electricity storage units and to electricity storage units integrated with generation facilities and entered into force upon its publication in the Official Gazette dated 19/11/2022 and numbered 32018.

Annex-1a, Annex-1b, Annex-1c, Annex-1ç, Annex-2, Annex-3a and Annex-3b were published in the Official Gazette dated 29/12/2025 and numbered 33122 and shall enter into force on 1/1/2026.

Under Annex-1c, it is stipulated that, within this connection configuration, the electrical installed capacity of the electricity storage unit must be at least equivalent to the electrical installed capacity of the generation unit. Furthermore, it is explicitly regulated that, for electricity generation facilities with integrated storage, the conditions requiring the electrical installed capacity to be at least equivalent to the electrical installed capacity of the generation unit and the presence of a separate storage unit for each generation busbar shall not be sought.

In conclusion

The amendments published in the Official Gazette dated 29/12/2025 and numbered 33122 demonstrate that the scope of the regulatory approach governing storage activities in the electricity market has been expanded and structured in a more comprehensive manner encompassing different types of facilities. The amendments introduced in the Storage Regulation between Articles 4 and 7, together with the regulations set out in the annexes, have established a clearer and more technical framework with respect to the installation and operation of storage facilities and their relationship with the market.

In particular, the provisions concerning storage facilities that may be established within or in connection with unlicensed electricity generation facilities significantly expand the practical scope of the storage regime, which to date has been shaped predominantly around licensed projects. At the same time, matters such as how energy injection and withdrawal will be assessed from a settlement perspective, the implications under the YEKDEM scheme, and contribution mechanisms without consideration give rise to new obligations that must be carefully addressed by investors and existing facility owners.

Through the regulations introduced in the annexes, the technical principles that will guide implementation, particularly with respect to the installed capacity of storage units, their integrated structure with generation facilities, and related connection configurations, have been clarified. While this framework aims to reduce uncertainties that may arise in practice, projects must nevertheless be carefully assessed in terms of compliance with the legislation, especially regarding effective dates and transition processes.

Accordingly, the amendments to the Storage Regulation in question clearly demonstrate the transformation of storage from a complementary element in the electricity market into an active component of the system. In this new period, we are of the view that addressing the legal and technical aspects of storage investments in an integrated manner will be decisive for market participants.

@Zeynep EMİROĞLU