Draft Terms of Reference for the DÜRES Competition Published

The Ministry of Energy and Natural Resources has published the draft terms of reference for the Offshore Wind Energy competition, which is scheduled to take place this year. According to the Ministry’s statement, the draft will be open for public comment until August 17, 2026.

According to the information in the terms of reference, the competition will be held for 1,000 MW of capacity rights, and the winning bidder will receive a 27-year power purchase guarantee starting from the contract date.

The competition will be based on the purchase price of electricity per kilowatt-hour (kWh), with a minimum price of 7.00 U.S. cents/kWh and a maximum price of 11.00 U.S. cents/kWh.

The competition will proceed on an open bidding basis among the five lowest bidders after the sealed financial bids are opened; if one bidder offers the minimum price, bids will be solicited from the other bidders in turn.

If there are multiple bids at the minimum price, the process will transition to an open-bid auction; at this stage, the second bidder will be deemed to have agreed to pay at least 10 million U.S. dollars, and the auction will continue until the highest contribution bid is reached.

At the end of the bidding process, the winning bid will be deemed the “most economically advantageous price,” submitted based on a 43% capacity factor, and will be designated as the “Contract Price.”

For DÜRES, the price obtained by updating the Contract Price to the value corresponding to a 40% capacity factor will be applied for the first four years starting from the date of initial acceptance.

However, if the initial acceptance occurs within the first seven years from the contract signing date, a purchase price of 12.00 U.S. dollars-cents/kWh will be applied for the first seven years from the contract signing date.

For every one-unit decrease in the capacity factor, the purchase price will be increased by 2.5%. If the capacity factor falls below 40%, the price determined based on a 40% capacity factor will apply. If this value reaches 43% or higher, the Contract Price will apply.
However, revenues from carbon credits and renewable energy source guarantee certificates related to the power plant will be excluded from the scope of the contract.

The winning party will also be required to provide a 10-year, $200 million performance bond no later than one day prior to the contract signing date.

The contract may be terminated if the capacity factor falls below 40%

The winning party must begin measurements no later than one year from the contract signing date and must conduct measurements continuously for a period of 12 months.

If the capacity factor is found to be below 40% during these measurements, the winning party may request termination of the contract—provided it submits a justification report—by waiving its rights arising from the contract.

Additionally, geophysical and geotechnical surveys of the seabed must begin no later than two years from the contract signing date. If, following this study, the justification report submitted to the General Directorate and the feasibility report prepared by accredited organizations indicate that a modification of up to 50% of the capacity is necessary, the winning party may request termination of the contract by waiving its rights under the contract.

The winning party may exercise its rights regarding both situations within the first four years from the contract signing date.

The construction period may not exceed 48 months

The pre-license period for the power plant to be constructed will be a maximum of 36 months, and the construction period will also be a maximum of 36 months from the date the license is obtained.

If construction work is not completed within the period specified in the contract, an additional 12-month extension may be granted. If construction work is not completed within this extended period, the contract may be terminated.

The local content requirement will be 25% of the total investment amount

The project will be subject to a local content requirement of 25% of the total investment amount. If this percentage is not met, a penalty of 5 million U.S. dollars will be imposed for each percentage point shortfall.

Investments in the necessary power transmission facilities and transmission lines up to the connection point to be determined by the relevant network operator of DÜRES will be carried out under the Electricity Market Law; the cost of the power transmission line to be constructed by the winning party will be paid by TEİAŞ within one year.