Türkiye rises to 5th place in Europe in renewable energy investments

Stating that Türkiye is accelerating its renewable energy investments, IBS Sigorta ve Reasürans Brokerliği CEO Murat Çiftçi said, "Following the new regulation implemented in recent days, we will witness further acceleration of investments in this field. This situation also holds a strategic position for the insurance sector. Türkiye is Europe's 5th country in renewable energy investments. With the provision of necessary conditions, there will be an opportunity to climb rapidly to higher rankings in this order. With the increase in these investments, we anticipate that the insurance sector's growth in this field will reach double-digit rates."

The accelerated expropriation decision published in the Official Gazette in recent days brings with it a major opportunity and transformation process in terms of renewable energy investments. Renewable energy projects generally require large amounts of land. With the acceleration of the expropriation process, these projects are expected to be completed on time, investment returns will materialize faster, and significant contributions will be made to country growth. This decision, which will provide substantial support to energy supply security, is also expected to present major opportunities for the insurance sector.

New insurance products and services to be developed

IBS Sigorta ve Reasürans Brokerliği CEO Murat Çiftçi noted that following the new regulation, renewable energy projects will gain momentum, leading to an increase in risk assessment and management processes. Murat Çiftçi stated, "The insurance sector holds strategic value in the energy field. Such investments provide long-term and stable cash flows, offering sustainable growth potential to both companies and the country's economy. Particularly, new products and services will need to be developed in the area of insuring developing investments in this field and managing project-based risks. While this regulation presents an important opportunity for the insurance sector, it is important for the sector to adapt quickly to these new dynamics. Our expectation is that as renewable energy investments increase, the business volume in the sector will also expand. In line with Türkiye's energy transition targets, renewable energy investments are expected to reach significant magnitude. The total value of projects to be expropriated could open the door to billion-dollar investments. These projects hold great potential for the insurance sector. Renewable energy investments will create growth potential in areas such as construction insurance, business continuity, property insurance, environmental liability, and cyber security insurance. The insurance sector will play an important role in providing risk management and financial security alongside renewable energy projects, thus contributing to Türkiye's economy," he said.

Ranked 5th in Europe

Noting that Türkiye's energy investments stand out as a strategic growth area for 2024 and beyond, Murat Çiftçi said: "According to the International Renewable Energy Agency's installed capacity statistics, China, the United States, and Brazil rank first. These three countries are followed by India, Germany, Japan, Canada, Spain, France, and Italy. Türkiye, with 58,462 MW, ranks 11th globally and 5th in Europe. Increasing investments in renewable energy strengthens Türkiye's energy supply security while aiming to reduce dependency on energy imports. These investments will provide significant contributions in terms of economic growth, job creation, and reducing energy costs. For the insurance sector, this magnitude means more business volume and new product opportunities. Energy investments, particularly with the increase in renewable energy projects, will create serious growth potential in areas such as technical insurance, liability insurance, and environmental risk insurance in the sector. After 2024, with continued energy investments, we expect exponentially increasing contributions to the insurance sector. Insuring energy projects will be an important tool supporting financial security and sectoral growth."

Energy crisis triggers investments 

Noting that the recent global energy crisis has positively influenced interest in renewable energy investments, Murat Çiftçi stated, "This crisis led countries to place greater emphasis on energy security and sustainability. The supply chain vulnerabilities triggered by the energy crisis and energy price fluctuations highlighted the need for energy independence, while also increasing the attractiveness of investments in renewable energy sources. Additionally, the crisis once again demonstrated the impact of environmental factors on economic stability, which directed investors not only toward profitability but also toward investments that consider environmental and social impacts. The insurance sector's greatest expectations in the energy field focus on ensuring the sustainability and security of investments. With the increase in renewable energy projects, the insurance sector faces the need to develop products that will minimize long-term risks of these projects. Specifically, more comprehensive and specific insurance solutions are expected for protecting energy sources such as wind, solar, and geothermal against environmental risks and managing disruptions in operational processes," he said.

From construction to operations, every risk 

Murat Çiftçi pointed out that the sector needs more cooperation and information sharing regarding new regulations and technological developments, adding, "The diversity of insurance products for energy investments and the level of risk management awareness are still insufficient. Necessary information must be provided during the insurance stage, and insurance must be integrated into the project development process. Additionally, financial incentives and support for energy projects should be increased. Our expectation as a sector is that regulatory frameworks in this area become clearer, risks are properly evaluated, and more innovation is encouraged in the sector. Although the insurance sector's share in renewable energy projects in Türkiye has increased, it continues to hold development potential," he said.

To contribute double-digit growth to insurance 

Pointing out that renewable energy insurance has a well-developed structure in Europe, Murat Çiftçi said, "In countries such as Germany, Denmark, and Spain, the insurance sector plays an important role through the financial support and innovative solutions it provides to energy projects. Türkiye, as a rapidly growing market in this field, competes with leading countries. In the coming period, as Türkiye accelerates its investments in renewable energy projects, the insurance sector's growth in this field will reach double-digit rates. Particularly with state incentives, public-private partnerships, and international fund support, the insurance sector's share in the renewable energy field will increase further, providing substantial contributions to sectoral growth," he said.