Privatization of two power grids completed

Privatization of two power grids completed

Today Zaman / 04.09.2010
The Uludağ and Çamlıbel electricity distribution companies were handed over to their new owner, the Limak, Kolin and Cengiz consortium, at a ceremony held in Ankara on Friday. 

Turkey has now privatized six electricity distribution companies. Speaking at the event, Finance Minister Mehmet Şimşek said 37 percent of Turkey’s electricity distribution is now privatized after the transfer of Uludağ and Çamlıbel. "This rate will rise to 76 percent with the completion of transferring processes that are still continuing with other enterprises," he stated, adding that the government is planning to complete the privatization of the remaining electricity distribution companies by the beginning of next year. So far, Turkey has earned $10.8 billion of revenue with electricity privatization bids. 

Uludağ had 2.4 million subscribers and sold 11 billion kilovvatt hours (kWh) of electricity last year. Çamlıbel, on the other hand, has 700,000 subscribers and 2.1 billion kWh of electricity were consumed in the same year in the area it provides electricity to. The Uludağ Electricity Distribution Company, serving Bursa, Balıkesir, Çanakkale and Yalova provinces, was privatized in return for $940 million, whereas the Çamlıbel Electricity Distribution Company that provides electricity to Sivas, Tokat and Yozgat provinces was sold to the consortium for $258.5 million. 

Privatizations proof of trust in Turkey 
Recalling the $10.8 billion Turkey earned so far from the privatization of electricity distribution grids, Şimşek said this number proves the trust in the country’s economic and political stability. "The interest shovvn by the private sector in those distribution companies indicates the trust in Turkey and in economic and political stability. Sometimes people ask me why foreign participation in the sale auctions of electricity distribution companies remains limited. Certainly, the main source of our global investment is Europe and there are serious economic problems now. There are serious problems in the private sector, banks and most importantly in states’ budgets," he explained. 

Şimşek also said vvith the privatizations, electricity distribution in Turkey vvill be much more effective and efficient. He referred to the UK and Italy as examples of where privatized companies succeeded in significantly reducing their operational costs vvhile also dramatically decreasing blackouts. 

Also speaking during the ceremony, Limak Holding Executive Committee Chairman Nihat Özdemir said they have created a very efficient group with Kolin and Cengiz that will serve the best interests of people in the regions Uludağ and Çamlıbel are operating in. "We believe we will provide a much better quality of service to our customers. We are aware that privatization was not intended primarily for the earnings. it is certain that the primary target is to sustain the security of the nation’s supply and to increase the quality of the service provided. From now on, our aim is to rapidly realize the necessary investments the state could not make because of its limited resources," he explained.