Volume 8 Issue 35 - Energy Special Issue

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58

PUBLISHER TurkofAmerica, Inc.

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EDITOR Patricia Russo,

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Cover Photo: Dieter Hawlan, www.istockphoto.com

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INDEX

8

62

8 MURAT YALCINTAS: GREEN REVOLUTION AND COOPERATION POSSIBILITIES Along with the rest of the world, the energy needs of growing

Turkey are increasing, as well. The monetary value of energy

use is approximately $65 billion for the country. The projects

initiated in the last few years are expected to bear their first

results from 2012 on.

16 WIND ENERGY IS COMING ON STRONG IN TURKEY Among the 76 countries that generate wind energy on a

commercial basis, Turkey ranks 25th, with around 600

megawatts, according to World Wind Energy Association

(WWEA) reports, and produces 1% of its total energy from wind.

20 WILL ECO IMPERIALISM SAVE THE WORLD? Dr. Gurcan Gullen: “It is unfortunate that the developed world

is trying to dictate developing countries what kind of energy

they can use due to climate change concerns. Some call this

eco imperialism; sounds pretty fitting to me.”

26 HOW TO EXPAND YOUR COMPANY Created with support from NYSERDA, the 61-page Clean Tech

Asset Guide is a ‘one-stop’ directory with listings of assets

including university and academic research programs,

specialized facilities, support organizations, and funding

programs.

34 WORLD ENERGY OUTLOOK According to Fatih Birol, Chief Economist of the International

Energy Agency, some global strategic challenges are the

security of energy supplies, the threat of environmental

damage caused by energy use, uneven access of the world’s

population to modern energy, and investment in energy-

supply infrastructure.

42 CLEAN TECHNOLOGY PRACTICES MAKE A DIFFERENCEBThe town of Greenburgh’s PV system will generate

approximately 6,840 kWh of electricity annually. The

estimated annual output of the Farm & Granary system is

4,900 kWh.

58 THE GLOBAL PHARMACEUTICAL MARKET EXCEEDS $825 BILLIONU.S. market growth in 2009 is now expected to be 4.5 - 5.5

percent, and 3 - 5 percent in 2010. Despite economic

conditions significantly affecting some markets – notably

Russia, Turkey, South Korea and Mexico – the seven

pharmerging countries are expected in aggregate to grow

by 12 - 14 percent in 2010

62 THE FUTURE OF THE BIOMEDICAL INDUSTRIES IS INNEW YORK STATE There are 1,473 biotechnology companies in the United

States, of which 371 are publicly held. In 2008 the revenues

of the publicly traded global biotechnology industry

increased by 12%, from US $80.3 billion in 2007 to

US$89.7 billion.

Countries that have taken steps toward deve-lopment or that are developing have certain

characteristics that differentiate them from ot-her countries. Japan is a country of islandswith limited natural resources, and Korea a pe-ninsula with the same lack of resources, andthey have developed their strengths in techno-logy. Italy has its fashion and design, Germanyits heavy industry and engineering, Saudi Ara-bia its oil, Turkmenistan its natural gas, andthe USA its production and consumption po-wer. These countries stand out.

So what does Turkey possess in order to makethe necessary attempt for development in the21st century? Turkey is a country of textiles,but this is not sufficient to give it special statusin the region. As a matter of fact, countriesthat have been lately accepted to the EU, alongwith some developing countries such as Jor-dan, Egypt, and Pakistan, have shaken Tur-key’s throne in this sector.

Also, although auto-parts, iron-steel, or natu-ral stone sectors all provide employment ingreat levels and are important for exports, Tur-key cannot become special by relying only onthese, because the technology necessary forautomotive parts, and the raw materials for thesteel and iron are provided from abroad. As forbecoming a country of natural stones or marb-le, there is no need to have a special quality.Selling the stones that are readyly available innature won’t make Turkey special.

Currently, the biggest trump card Turkey has,which would also enable it to excel in the 21stcentury, is energy. Especially since renewableenergy is now gaining more importance and co-untries around the world are implementing po-licies that would decrease oil dependency, al-ternative resources are being given priority.Turkey has a great potential with regards to al-ternative energy resources.

As a matter of fact, in the energy plan for the

years 2010 through 2014, increasing the usageof natural resources is among the first thingson the list. If the strategic plan can be imple-mented as desired, 30% of the energy Turkeyproduces will be coming from recyclables.

In addition to the energy it would provide, Tur-key is also a key country where pipelines thatdirectly affect the world’s energy map passthrough. The Blue Stream (Mavi Ak›m) projectthat transports natural gas from Russia to Tur-key through the passageway under Black Se-a; the Baku-Tblisi-Ceyhan pipline that carriesthe oil of Azerbajan and Kazakstan to theworld; the Bosphorous and the DardanelleStraits through which 4% of the oil used in theworld get transported; the Baku-Tblisi-Erzu-rum pipline that is planned to be used to carrynatural gas from Azerbajan, Turkmenistan andKazakstan to the world; the NABUCCO pipelinethat carries natural gas from the Caspian toEurope through Bulgaria, Romania, Macedoni-a, and Austria are all projects that have increa-sed the impact Turkey has on the world’s ener-gy policies. As EU countries have turned toNABUCCO in order to avoid Russia’s Gazprom,Turkey has served as a bridge between thetwo continents and become the key country inNABUCCO.

There are plans to build natural gas pipelinesbetween Turkey, Greece, and Italy, which wo-uld transport natural gas from Iran and Iraq toEurope, another project Turkey plans to bringinto life in the future.

All of these routes and projects put Turkey inthe forefront due to its geography. If Turkeycan rise as a powerful country in the world inthe 21st century, energy will be the strengthbehind this. Turkey would, meanwhile, keepproducing textile materials, spare parts, andsteel and iron; however, in order to strike andrise up to the upper level, it would inevitablyhave to adjust its energy policies in the rightdirection.�

Turkey’s B›ggest

Trump Card ›n the

21st Century

FROM EDITOR

By Cemil Ozyurt [email protected]

Turkey would,

meanwhile, keep

producing textile

materials, spare

parts, and steel and

iron; however,

in order to strike and

rise up to the upper

level, it would

inevitably have to

adjust its energy

policies in the right

direction.

TurkofAmerica • 07

08 • TurkofAmerica

As the President of the Istanbul Chamber of Com-merce, one of the most important organizations

representing the Turkish business community, I fe-el great happiness to address you once again inthis issue of the magazine TURKOFAMERICA.On these pages, I will try to cover the options toincrease the possibility f cooperation between ourcountries.

The visit President Obama paid to Turkey within hisfirst months of taking office was a turning point inthe relations between Turkey and the United Sta-tes. From our point of view, the most importantshift in the discourse was the words the Presidentused in defining the relationship between thecountries, words that added a new dimension tothis relationship.

He did not stress a single area like “strategic part-nership,” which is more commonly associated withmilitary issues. Instead, he used the expression“model partnership” which shows that the two coun-tries now understand each other much better andwill henceforth cooperate in many more areas thanthey did in the past. For us, first and foremost amongthese is cooperation in commerce and technology.By this, I do not mean activities confined to buyingand selling only. What I mean is cooperation in keyand niche sectors with high added-value and largescale technology and know-how transfer.

I believe that cooperation on this scale is very mea-ningful and important, especially at the time of con-tinuing global crisis. Keeping in mind the contractionin global output, especially in the developed econo-mies; the dramatic situation in conventional sectorssuch as automotive, textiles, and finance; and theloss of jobs which is expected to reach 25 million atthe end of 2010; we suggest energy and related gre-en business as the promising sectors with a growthpotential.

BY 2030 ENERGY NEEDS WILL HAVE INCREASED BY 120%According to World Bank data, unless we take a stepforward in energy efficiency, by 2030, overall energyneeds will have increased by 120 per cent and theprimary sources of supply will remain the conventio-nal (fossil fuel-based) sources of oil, natural gas andcoal. The threat posed by the use of fossil fuels forenvironment and health, expressed in monetaryterms, is over $5 trillion. Moreover, this forms thechain consisting of rising carbon dioxide emissionvalues, global warming and a threat to life itself.

Along with the rest of

the world, the energy

needs of growing

Turkey are increas-

ing, as well. The mon-

etary value of energy

use is approximately

$65 billion for the

country. The projects

initiated in the last

few years are expect-

ed to bear their first

results from 2012 on.

GREEN REVOLUTION AND COOPERATION POSSIBILITIES

By Murat Yalç›ntafl,

President of the Istanbul

Chamber of Commerce

ENERGY AND GREEN

BUSINESS ARE

TURKEY’S

PROMISING

SECTORS WITH A

GROWTH POTENTIAL


TURKEY: ENERGY CORRIDORAs you may be know, Turkey is now being characterized as an “ener-gy corridor” thank to its geographical position and the nature of itsneighboring countries. It holds a key position in transporting the oiland natural gas from the countries of the region, starting with Russi-a and Azerbaijan, but also including those of Central Asia, of Iran andIraq, of Egypt, Syria, and Qatar to Europe. Pipeline projects kicked offwith the Baku-Ceyhan pipeline in the 1990’s continued with the Blu-e Stream. Among the projects that are now either to be imminentlysigned or under construction are Samsun-Ceyhan, Blue Stream 2,South Stream, and the Southern European Gas Ring. Taking up NA-BUCCO alone, we see that it provides jobs to 5,000 people, involves

Along with the rest of the world, the energy needs of growing Turkeyare increasing, as well. The monetary value of energy use is approxi-mately $65 billion for the country. The projects initiated in the last fewyears are expected to bear their first results from 2012 on. Currently, ofthe total annual demand of app. 200 billion kWh, the private sector isable to meet less than 20%. Energy market experts claim that in orderto meet the expected supply shortage, an additional investment in 25-30 GW is necessary in the coming decade, which corresponds to an in-vestment of $35 billion. And it is estimated that until 2020, a total in-vestment of $130 billion has to be made in the entire energy sector, ofwhich $105 billion would go to electricity alone. The share of the priva-te sector here is expected to be an investment of $3-4 billion a year.

an investment of 4.5-5 billion and brings in tax revenue of 400-450million to Turkey alone, thus proving that such projects act as a sti-mulus to the economy even at the stage of construction. The cons-truction of these projects is undertaken by gigantic consortia formedby local and international partners and financed by international or-ganizations and thus offers considerable opportunities to our Ameri-can friends. While these sources of energy will be the primary sources until 2030,the star of the future will definitely be renewable energy sources.

“GREEN REVOLUTION”Industry is undergoing a revolution that nobody can afford to ignoreany longer. The business world labels this the “green revolution”: aneconomy based on energy sources that are clean, renewable, safe,economical and sustainable rather than those based on carbon is onthe agenda of all countries. Energy and reduction of carbon emissi-ons top the agenda at fora such as the United Nations, the G-20, orthe EU Summits; banks design credit lines for such investments; ta-xation penalties are envisaged for giants of the world economy thatdisplay a lack of concern for this area.

While being in a key position in the supply of conventional energysources, as I already pointed out, our country offers a considerablepotential in the area of renewable sources, as well, which attractsthe attention of local and international investors. In our domesticproduction; natural gas ranks first in terms of installed power, follo-wed by hydraulic sources of an installed power of approximately14,000 MW. A glance at the totality of projects that are at the licen-sing or investment stages shows that hydroelectric and wind powerstations are going to challenge the rule of fossil fuels. And when welook at the medium-term objectives of the firms in the sector, we se-e that, over time, they are planning to increase the share of renewab-le sources in their power generation. This is best indicated by thecredit demands which are dominated by the projects on hydraulic aswell as wind centrals.

RENEWABLE ENERGY LAWRenewable sources are supported through laws and incentives inTurkey as in the rest of the world. In particular, the investment incen-tives and the purchase guarantees that the government providesthrough the Renewable Energy Law, enacted in 2007, instills confi-dence in banks and facilitates the extension of credit to firms thatplan to invest in this area. Many banks provide financing for suchprojects, either by lending from their own resources or through inter-mediation for international financial organizations such as the Euro-pean Bank for Reconstruction and Development, the World Bank, theCouncil of Europe Development Bank, the French DevelopmentAgency, the German Development Fund, and the International Finan-ce Corporation (IFC). The most significant among these is the creditline resulting from the agreement between the World Bank and theMinistry of Energy. Alongside the ordinary criteria taken into consi-deration in the financing of a project, this requires an additional con-dition of strict compliance with environmental requirements.

Looking at the profile of companies that have entered this industry,we see, on the one hand, the energy groups of the top companies inTurkish industry and, on the other, small scale firms that have speci-fically been started for this industry and are at the beginning of thejourney. One even comes up on enterprising individuals in the co-

untryside who generate their own power through a system they ha-ve installed by their own means on a brook that flows through theirplot of land. These tiny success stories make us happy by revealingthe consciousness in the grassroots.

INNOVATIVE TECHNOLOGIESAs you are all aware, the world of science strives to generate innova-tive technologies aiming at a smaller consumption of resources in theprovision of our needs for living and producing, technologies that willmake it possible for us to harm the environment to a lesser degree.While the world of science had been working on this for decades, thebusiness community has only recently grasped the importance of thisand realized that without sustainable development, momentary pro-fits and economic growth will not take us anywhere. Thus emergedgreen business. It is the name given to economic activities that pay at-tention to environmental concerns, sustainable growth and socialwell-being in the process of the growth of the economy. Hence, greenbusiness is a new business model and a new industry that insists onconcepts such as clean technology, low carbon footprints, energy ef-ficiency, renewable resources, eco-innovation and recycling.

GREEN MARKET GROWTHExperts estimate the value of this “green market” at ?1,000 billion.And by 2020, it is expected to reach ?2,200 billion. The United Nati-ons Environment Program defines this market as the totality of envi-ronmental products and services, efficiency, recycling and sustainab-le transportation.

“Green collar” workers will form the employment base of this mar-ket, in contrast to the blue and white collar workers of the past. Theindustry currently employs 2.3 million, directly or indirectly. By 2030,thanks to investments totaling $630 billion, the industry is expectedto create 20 million new jobs. When the renewable energy industry istaken up together with areas of energy efficiency, the United Statesalone is expected to employ 37 million people in this whole sphere in2030. Hence, “green jobs” rise as a sphere full of promises againstthe projected loss of 25 million jobs I mentioned before.

“SUPPORTING WORTHY CAUSES”Let us also look at the consumption side of the issue: as you are awa-re, one of the strongest-felt effects of the economic stagnation thatwe are going through is the shift in consumption patterns. Preciselyfor this reason, the current financial crisis is an extremely importantopportunity to shift to a low-carbon economy. The economic andecological preferences of consumers for products and services func-tion as the most important factor in greening the economy. In a sur-vey conducted with 6,000 consumers from ten countries, 68% of theconsumers responded that, even in times of crisis, they remain com-mitted to brands “supporting worthy causes” and that they are wil-ling to pay more for these products. On this list of “worthy causes”,concern for the environment ranks first, at 88%. As long as consu-mers display this kind of awareness, producers are sure to shift the-ir production accordingly.

Besides the situation of the economy, investment opportunities, in-centives, and consumers’ preferences. legislation is another factor indeciding to go into the sector. In Turkey, the Renewable Energy Lawwas enacted in 2005 and the Geothermal Law and the Energy Effici-ency Law in 2007. In the wake of this, a National Energy Efficiency

GREEN REVOLUTION AND COOPERATION POSSIBILITIES


Movement (EN-VER) was started with a view to increase the aware-ness of the public concerning energy efficiency issues. In order to ha-ve the public sector lead this movement, the decision was made tobegin implementing efficient energy use practices in premises belon-ging to public institutions, municipalities and professional organiza-tions. As a first step, people were informed about the beneficial im-pact of simply changing the type of light bulbs used.

ENERGY PERFORMANCE OF BUILDINGSWithin the same context, regulations that are of great interest to thebustling construction industry were brought into effect. The Regula-tion on Increasing of Efficiency in Energy Use and the Regulation onthe Energy Performance of Buildings introduce significant innovati-ons for Turkey. Here are some of these innovations:

1. Buildings that do not comply with the Regulation on the EnergyPerformance of Buildings will not be accorded a permit.2. Each building will have an “Energy Identification Document”.3. “Energy Managers” will be employed for production facilitiesand buildings,4. The sale of inefficient products that consume too much energywill not be authorized,5. Projects seeking efficiency increase in industry will be supported,6. Use of in-house renewable energy sources will be promoted.7. “Energy Efficiency Consultancy” firms, a new business area,will provide engineering and consultancy services to the in-dustry. These accredited firms will provide services of measure-ment for purposes of certification and recommendations for re-novation in existing buildings and industrial facilities. This stan-dard establishes important opportunities for job creation especi-ally in engineering and R&D.Even limiting ourselves to the regulations I have just mentioned, it isclear that many new business areas will emerge in sub-sectors thatserve the construction sector. Let me cite a few simple examples:The first has to do with insulation: in order to see the potential ofthis industry, currently wielding a turnover of $3 billion, it is suffici-ent to remember that, in our country, buildings that have adequateinsulation amount to a mere 10% of the existing building stock. Atpresent, a vast amount of investment is needed for the insulation ofsmall dwellings and the largest commercial buildings alike.

The second example relates to lighting equipment. Through a direc-tive that has come into force recently, the European Union is movingtowards eliminating the sale of traditional light bulbs and encoura-ging the use of compact fluorescents, halogens and LED lighting. Alt-hough there will be no legal enforcement in Turkey until this area of-ficially comes within the harmonization process, this shift will affecthundreds of thousands of homes and workplaces as consumers’awareness increases in our country as well.

As I have tried to explain in these few pages, there is a huge spacefor cooperation between Turkish and American businesses in invest-ment in renewable energy, know-how transfer in this area, researchand development, trading of green products, etc.

Finally, I would like to congratulate TURKOFAMERICA for having devo-ted a special issue to energy, the most important item on the worldagenda today. I do hope that this new and important sphere will crea-te lasting occasions of cooperation between our countries.�



Turkey led the Black Sea Economic Cooperationinitiative following the disintegration of the Eas-

tern Bloc following the end of the Cold War at the be-ginning of the 1990s. This initiative was stimulatedby the vision of the development of political and eco-nomic relations with Russia. Turkey started occup-ying a significant place in the global energy equationwith the implementation of the Blue Stream in 2005,envisaging the gas procurement from Russia, andthe Baku-Tbilisi-Ceyhan (BTC) pipeline project in2006. Although the cost of the Blue Stream and thedragging on of the BTC project were questioned fromtime to time, both projects were completed. As apartner of the NABUCCO Project, Turkey has now be-come an indispensable part of the global energyequation.

Because with the NABUCCO Project, Turkey is to be-come an international energy corridor for the secondtime after the BTC. Ass. Prof. Dr. Osman Nuri Aras,expert from the Turkasia Strategic Research Centre(TASAM), claims that with the NABUCCO Project, Tur-key will become Europe's fourth largest energy ar-tery.

Taking into consideration the regional energy pro-jects together with BTC and NABUCCO, it could be

seen that Turkey has become a significant energy ac-tor in the region as well as in the world.

TURKEY: THE FOURTH ENERGY ARTERYAss. Prof. Osman Nuri Aras, a TASAM expert, empha-sises that for the second time Turkey has become aninternational “energy corridor” after the Baku-Tbili-si-Ceyhan project, since a big part of the NABUCCOpipeline is going to go through Turkey and becauseit will meet five percent of EU's natural gas demand.Aras, pointing out that with the completion of theproject Turkey is to generate 400-450 million Eurosin tax revenues, elaborates further: “By mediating EU’s access to energy resources withthe NABUCCO pipeline, Turkey has strengthened itspolitical position. One of the important aspects ofTurkey’s energy strategy is the contribution to Euro-pe's energy safety and becoming the fourth main gasartery of Europe. In line with this target, with the firstconcrete step of the implementation of the Turkey-Greece Natural Gas Interconnector in 2007, NABUC-CO will present Turkey with the means to strengthenthis target as well as to make significant contributi-ons to the increase of Europe's energy safety by di-versifying energy sources and transportation lines.Turkey will also get significant economic gains du-ring the investment process as well as the 25-year

Becoming Europe’s

fourth largest gas

artery with the

NABUCCO Project,

Turkey has gained

the status of an

important regional as

well as global energy

actor with the imple-

mentation of regional

energy projects.

GLOBAL ENERGY ACTOR

By Tamer Çerçi *

TURKEY: An Ind›spensable Country

›n the Global Energy Equat›on

Dr. Steven Chu, US Secretary of Energy(behind), and Mr. Taner Yildiz, Minister of Energy and NaturalResources, Turkey, during the 2009 EBCMeeting in Paris on Wednesday, 14th October 2009; Photo: AlastairMiller / © OECD/IEA (2009)


drawing attention, Turkey has been entering into energy deals withneighboring countries since the 1990’s. According to BOTAfi data,Turkey has accomplished significant energy transportation projectswith a number of countries including Greece, Italy, Turkmenistan,Egypt, Iraq and Russia. Some of these projects are: Turkey-Greece-Italy Natural Gas Pipeline, Transcaspian Turkmenistan-Turkey-Euro-pe Natural Gas Pipeline, Egypt-Turkey Natural Gas Pipeline and Iraq-Turkey Natural Gas Pipeline.

TURKEY-GREECE-ITALY NATURAL GAS PIPELINEIn the scope of the EU Commission's INOGATE Program (InterstateOil and Gas Transport to Europe), a project named the South EuropeGas Ring Project was developed for the transportation via Turkey andGreece of the gas supplied by the Caspian Basin, Middle East, SouthMediterranean countries and other international sources. According to the project, the section of the Turkey-Greece NaturalGas Pipeline within the Turkish territory starts from the existing Ka-racabey Pig Station and ends in Ipsala/Kipi. . The line includes a 17km-long off-shore section beneath the Marmara Sea and will be ap-proximately 300 km long, of which 209 km is within the territory ofTurkey. The authorities of Italy and Greece signed an agreement inAthens regarding the Adriatic crossing on January 31, 2007. The In-tergovernmental Agreement of the Turkey-Greece-Italy Natural GasPipeline (ITGI) was signed on July 26, 2006, in Rome. Within the sco-pe of the project, 3.6 Bcma and 8 Bcma of gas will be transported vi-a Turkey to Greece and Italy, respectively. The pipeline is planned tobecome operational in 2012.

operation period of NABUCCO. It is expected that at least 5,000 pe-ople will be employed during the construction of the pipeline with in-vestments of 4.5-5 billion Euros. The country’s economy will also berevived. According to the agreement, the criteria for the distributionof tax revenues will be based on the length of the pipeline passingthrough the respective countries. That means that approximately 60percent of the tax revenues, i.e., the biggest part, to be obtained af-ter the completion of the pipeline will remain in Turkey. In this case,the annual tax income Turkey is going to generate from the pipelinewould be 400-450 million Euros.”

TURKEY MAY BECOME ONE OF THE TOP 5 COUNTRIESDr. Fatih Birol, the Chief Economist of the International AtomicAgency, says that developments in energy that would shape the fu-ture 40-50 years of Turkey are underway and according to Birol, thatis why Turkey needs to make the most of the next five years. Dr. Bi-rol, pointing out that in the near future energy consumption in Chinaand India will increase, Iran will become an important country inenergy, and that the EU is trending towards renewable energy, addsthe following: “NABUCCO and the Blue Stream with Russia are both very importantprojects. The buyer of both projects is Europe. Thanks to this, Turkeymay become a bridge in energy and control the valve. This is as im-portant for Turkey as becoming an EU member. Turkey may therefo-re become one of the top five countries in the world in energy trans-portation.”

WOULD THERE BE ENOUGH GAS?The most discussed topic regarding the NABUCCO project is whetherthere is enough gas to be transported to Europe. It has been mentio-ned that Azerbaijan, Turkmenistan, Uzbekistan, Iran and Iraq couldbe included in the project as gas suppliers. Recently Qatar has alsoannounced that it looks favorably on becoming a supplier in the pro-ject. The US objection to Iran becoming a gas supplier, due to politi-cal tensions, has prompted the alternative of transporting Iraqi gasto Europe. Another point worth mentioning here is that Turkey is reducing itsenergy dependency on Russia. Experts are pointing out that Turkeymay reduce its dependency on Russia by getting an additional 8 bil-lion cubic metres of Azeri gas. At this point, it is being mentionedthat Europe wants Turkey to be part of the project not as a gas buyerbut as a transporter only.

INTERNATIONAL ENERGY PROJECTSTaner Y›ld›z, the Minister for Energy and Natural Resources, pointingout that Turkey has strengthened its geopolitical position with ro-bust and sustainable policies carried out in the scope of NABUCCOas well as Blue Stream, and saying that “Energy related items are atthe same time the guarantee for peace”, adds the following: “Whilethe USA was listening to the negative comments of Austria three ye-ars ago, now Austria and Turkey have become two of the most impor-tant partners of NABUCCO. The world is globalizing. But the energysector is globalizing faster. Terms and concepts such as petrol andgas that could be assembled under a common denominator are brin-ging together in the international arena countries that have differentopinions. There are countries that fit this definition. There might bea war but the energy trade continues. That is why energy relateditems are at the same time the guarantee of peace.”Although actually international agreements concluded recently are

Dr. Fatih Birol, the Chief Economist of the

International Atomic Agency.

TRANSCASPIAN TURKMENISTAN-TURKEY-EUROPE NATURAL GAS PIPELINEThe aim of the Transcaspian Turkmenistan-Turkey-Europe NaturalGas Pipeline Project is to transport natural gas produced in Southernparts of Turkmenistan via the Caspian Sea to Turkey and then to Eu-rope. A Framework Agreement was signed by the Presidents of theRepublic of Turkey and Turkmenistan on October 29, 1998, for theimplementation of the Transcaspian Turkmenistan-Turkey-EuropeNatural Gas Pipeline Project. A Natural Gas Sale and Purchase Agree-ment valid for 30 years was signed on May 21, 1999, between BOTAfiand Turkmenistan for the use of hydrocarbon resources of Turkme-nistan, in which 16 billion Bcma of Turkmen gas would be supplied toTurkey.

EGYPT-TURKEY NATURAL GAS PIPELINEThe Egypt-Turkey Natural Gas Pipeline Project was developed for thepurpose of diversifying the supply sources and to meet some of thegas demand by importing natural gas from Egypt. Within the scopeof the project, a Framework Agreement was signed in Cairo on March17, 2004, for the import of natural gas from Egypt and the transpor-tation of gas to Europe through Turkey. According to the agreement,Egypt will export 2-4 billion m? of natural gas to Turkey and 2-6 bil-lion m? of gas to European markets via Turkey. A Memorandum ofUnderstanding was signed on 16 February 2006 for the continuationof the cooperation and collaboration between the two countries in

natural gas supply. Under this MoU, working groups were formedwith the participation of Syria and studies were initiated for the fe-asibility of the project.

IRAQ-TURKEY NATURAL GAS PIPELINEThe Iraq-Turkey Natural Gas Pipeline Project was developed for thepurpose of transporting gas produced in Iraq to Turkey. The projectwas initiated with the agreements that were signed by the Ministryof Energy and Natural Resources of Turkey and the Iraqi PetroleumMinister. A new study for the revival of the project, taking into acco-unt the developments in Iraq and the needs of the European market,was initiated by TPAO, TEKFEN and BOTAfi. If the conditions permit,the target of the project is to transport Iraqi gas to Turkey and sub-sequently to Europe via Turkey.

NATURAL GAS UNDERGROUND STORAGE PROJECTSBOTAfi is carrying out various storage projects to ensure the regula-tion and distribution of the natural gas system. One of these pro-jects, the Northern Marmara Region and De¤irmenköy Natural GasUnderground Storage Project, was inaugurated on July 20th, 2007.The second project is the Salt Lake Natural Gas Storage Project. WithWorld Bank credit support received, the tendering offers for theconstruction of the facilities are underway. �

* Press counsellor of Istanbul Chamber of Commerce.

GLOBAL ENERGY ACTOR


DISTRIBUTION AND CONNECTION LINES UNDER CONSTRUCTION

Eskipazar-Karabük and Zonguldak- Çaycuma-Bart›n Natural Gas Pipeline - In the scope of the project, signed on April 13, 2007, nat-

ural gas is planned to be supplied to Karabük, Zonguldak and Bart›n provinces, Eskipazar district of Karabük province, Gökçebey,

Devrek and Çaycuma districts of Zonguldak province and Filyos town in 2009.

Diyarbak›r-Batman-Siirt NNatural Gas Pipeline- The provisional acceptance of the contract covering the Land Survey and

Expropriation/Engineering Works of the project was completed on June 06, 2007. The preparations for the tendering of the project

are still ongoing and the project is planned to be completed in 2010.

Hatay Natural Gas Pipeline- The tender for the construction is planned to be launched following the completion of the project's Land

Survey and Expropriation/Engineering works.

Mu¤la Natural Gas Pipeline- The project’s land survey and Expropriation/Engineering works have been completed. The tendering is

expected to take place this year.

I¤d›r Natural Gas Pipeline- The project’s land survey and expropriation and engineering works have been completed. The tendering

is expected to take place this year. Related to this project, the works for the completion of Hanak and Sivas Compressor Stations

and Türkgözü Metering Station are ongoing.

The NABUCCO Project and Its Advantages

The Turkey-Bulgaria-Romania-Hungary-Austria Natural Gas Pipeline NABUCCO Line), which is envisaged to transport Caspian and

Middle Eastern gas to European markets, will supply natural gas to the countries on its route in the first phase. The target for the

following years is to reach the Western European market to meet their demands through Austria, which is a gas hub of the European

natural gas transportation system. The total capacity of the nearly 3,300 km pipeline will be 25.5-31 Bcma and the line is scheduled

to become operational in 2013. The total length of the line will be: Total NABUCCO Line (excluding feeding lines): 2,841 km. Total

NABUCCO Line (including feeding lines): 3,282 km.

The gas to be produced in Azerbaijan, Turkmenistan and other Transcaspian sources as well as Iran will be transported with the line.

The natural gas from Iraq and Egypt through Syria and from other neighboring sources is planned to be transported in the long term.

The Legal Working Group, established for the development of the legal framework of the project such as the Joint Venture

Agreement, Intergovernmental Agreement, Operational Agreement and Host Government Agreement, is continuing its work. The

project’s Intergovernmental Agreement was signed in Ankara on July 13, 2009.

Natural gas and LNG transportations by year (Mcum)

YEAR NATURAL GAS LNG TOTAL

2000 10,080.00 4,742.00 14,822.00

2001 11,046.00 5,322.00 16,368.00

2002 12,272.00 5,352.00 17,624.00

2003 16,195.00 4,993.00 21,188.00

2004 17,903.00 4,271.00 22,174.00

2005 22,147.00 4,881.00 27,028.00

2006 25,339.00 5,402.00 30,741.00

2007 30,583.00 5,867.00 36,450.00

2008 32,200.00 5,593.00 37,793.00

2009 (*) 15,831.00 3,343.00 19,174.00

Source: Botafl

* As of July



As one of the most ancient energy sources, wind ishelping the world to overcome its energy and fi-

nancial crises. Turkey is one of the many countriesturning to this source. With the progress in wind tech-nology, wind power generation costs have fallen inhalf in a decade. Wind energy is considered low-riskfor investors with no fuel costs and stable costs ofelectricity generation. Most governments encouragewind investments with incentives such as feed-in ta-riffs. As a result, the global wind energy sector hasexpanded fast at 29% last year. The world today ge-nerates a total of 120 gigawatts of energy from wind,almost 1.5% of yearly global energy consumption. Atthe end of the next decade, this amount can rise up to12% of the energy market with supportive govern-ment policies and innovative energy companies.

Developed countries have long put wind in their ener-gy agenda and set goals to expand their wind con-sumption. The USA is the leader of the race, and thisyear has 25 gigawatts of wind power capacity. The topfive countries, the USA, China, India, Germany andSpain, cumulatively generate three-fourths of theworld’s wind energy. One of pioneer countries, Den-mark, has already exploited its capacity in buildingnew wind parks, and generates one-fifth of its energyconsumption from wind. Turkey ranks 25th with aro-und 600 megawatts among 76 countries that genera-te wind energy on a commercial basis, according toWorld Wind Energy Association (WWEA) reports andproduces 1% of its total energy from wind.

THE BEST WIND SUPPLIESTurkey has one of the best wind supplies in Europeafter Ireland and England according to European Par-liament’s wind index. “The same turbine can producetwice as much electricity when built in ‹zmir, Turkeythen anywhere in Germany” says Prof. Dr. Tanay S›d-k› Uyar, VP of WWEA and Associate Professor of Re-newable Energy at Marmara University, who firstmapped Turkey’s wind atlas in the late 90’s. “Wind isthe cheapest energy source for Turkey. It is four timescheaper than conventional energy sources when ex-ternal costs are added,” he says.

Wind turbines are rising fast on the western and so-uthern coasts, in the cities of Canakkale, ‹zmir, Mug-la, Bal›kesir, and Hatay. Currently, there are 17 opera-ting and 77 licensed wind parks. It took only a few ye-ars for Turkey to become one of the world’s mostdynamic world wind markets. Turkey’s wind power

Among the 76

countries that

generate wind energy

on a commercial

basis, Turkey ranks

25th, with around

600 megawatts,

according to World

Wind Energy

Association (WWEA)

reports, and produces

1% of its total energy

from wind.

WIND ENERGY

By Muge Mengu Hale

WIND ENERGY IS COMING ON

STRONG IN TURKEY


ENERGY DEMAND HAS BEEN GROWINGWith the amendments to the renewable energy law in 2005, the go-vernment started to offer feed-in tariffs for renewable energy sources:ten-year purchase guarantee of 5.5 Euro ct/kWh for electricity gene-rated from wind energy. Although this price is lower than those of Tur-key’s European counterparts and there are no other incentives, whichhas been criticized by experts such as Professor Uyar, Bilgin thinksthis price is not bad for the wind power market. “This guarantee con-vinces the financers” says Bilgin. “After a wind power plant is built,there are no fuel costs involved, and the operation becomes low-cost.Energy companies can sell the electricity on the open market for 7.5Euro cents/ kWh.” Since Turkey’s energy demand has been growingby around 8%, despite the effects of the global recession, Bilgin is op-timistic that the markets will demand more energy in the near futureand believes in the future of the wind park projects for investors.“Wind parks with the capacity factor of 40% would pay off in 5-6 ye-ars and start turning a profit,” says Bilgin. Bilgin also initiated the first carbon emission trade in the Europeanvolunteer markets and got credit for his eco-friendly energy wind parkinvestment. “Each wind park project saves 70,000 to 100,000 tons ofCO2 and we got certificates for not polluting the atmosphere” saysBilgin. Bilgin explains a number of Turkish energy companies got cre-dits to finance their wind park projects with this method.

500MW POWER PROJECTS The progress in wind power market has also attracted global invest-ment. “Since the world is focusing on wind power, and Turkey’s poten-tial is high, foreign investors are showing interest,” he says. One cur-rent example is the US renewable energy developer Renewable EnergySystems (RES), which entered the Turkish wind power market with the

capacity jumped from 20 megawatts in 2005 to around 600 mega-watts in 2009. Upon the completion of the ongoing projects, “the ca-pacity will soon add up to 700 megawatts,” says Tolga Bilgin, Presi-dent of Turkish Wind and Solar Energy Investors Association (RESSI-AD) and VP of Bilgin Energy Holdings.

“Until 2001, all energy investments were done with Build-Operate-Transfer model, and the state bought all the energy plants in 20 ye-ars. We planned the first wind parks in this system,” says Bilgin. Butin the first half of the 2000’s, there was an economic crisis in Turkey,and when Electricity Market Law in 2001 liberalized energy markets,it took a while for the system to settle. The state also stopped purc-hase guarantees. The law was a blow to the progress of the wind po-wer market, according to Bilgin. “Wind’s initial investment is expensi-ve. Building 1 megawatt of wind energy costs 1,300,000 Euros. In or-der to find investors or financers, the government’s purchase guaran-tee is influential” he explains. Without the incentive, the wind invest-ment stayed limited in the first half of the 2000’s.

Despite the lack of government incentives, Bilgin’s company built Tur-key’s first private sector 30 megawatt wind park with GE turbines in2006. “Band›rma wind power plant increased the total capacity inTurkey by 150% from 20 megawatts to 50 megawatts. The success ofBand›rma showed other energy companies that wind parks couldoperate successfully without the purchase guarantees. It paved theway for many other projects. During this period, 3356 megawatts ofwind energy got licensed, out of which 567 megawatts are currentlyin working capacity”. Currently, Bilgin Energy is constructing four mo-re wind parks, Maz›-3, Alia¤a, Zeytineli and Soma, which will togethergenerate 320 megawatts of wind energy when completed.

Tolga Bilgin, President ofTurkish Wind and Solar EnergyInvestors Association (RESSIAD) and VP of BilginEnergy Holdings.

acquisition of a 500MW portfolio of power projects worth ?750m.

After 2010, the wind power capacity will gain another strong momen-tum. Currently, the market is expecting the independent regulatorybody, EPDK, to evaluate the wind power plant applications of Novem-ber 2007. After a few years of not accepting any projects, there was arecord 756 applications totaling to 78, 000 megawatts of energy.These projects are still being evaluated and the licensing process isestimated to be finalizede by 2010.

“78, 000 megawatts of energy is twice the total energy supply of Tur-key today. The eligible applications are around 32, 000 megawatts”says Bilgin. The grid infrastructure will allow only some extent of ener-gy into electricity systems. Moreover, some projects which are plannedfor the same areas will be eliminated. “After all projects are licensed,Turkey can generate 12, 000 megawatts of wind energy by 2013. It isstill a big investment for Turkey” says Bilgin. He also warns that someof these projects were completed in a rush, “The wind measurementsare the most important and time consuming part of wind power plantplanning” he says. Wind should be observed for at least 2 years. “So-metimes even two hills on the same land have different wind measure-ments.” he says. Wind parks are built in a relatively short time, one ortwo years; however they need meticulous planning. “It took us almostten years to plan Band›rma Wind Park. Because of the high number ofapplications in 2007, the system got blocked. The market authority,EPDK, should be very careful and impartial with the evaluations, other-wise it can cost Turkey 4 to 5 years of progress in wind,” he says.

TURKEY SHOULD CHOOSE WIND OVER NUCLEAR OR THERMAL A nuclear power engineer, Dr. Tanay S›dk› Uyar, VP of WWEA and As-sociate Professor of Renewable Energy at Marmara University, is apublic critiic of any nuclear and thermal energy investments. He voi-ces Turkey’s renewable energy potential in national and internationalplatforms. “Turkey can produce twice as much of its energy demandfrom the sun and wind,” says Uyar. Compared to conventional energy sources such as fossil fuels, coal ornatural gas, wind is clean, green and renewable; wind energy doesnot pollute the air; it doesn’t produce atmospheric emissions thatcause global warming. Wind is also renewable, which means it is end-

less and cannot be used up.

Another advantage of wind as a renewable energy resource is that it isdomestic. Turkey has long term agreements to buy natural gas fromIran and Russia. Turning to renewable energy to ease Turkey’s depen-dency on natural gas is one of the goals according to the Medium-TermProgram (2010-2012) prepared by the State Planning Organization.The government target is 20, 000 megawatts of wind energy for 2023.

NUCLEAR ENERGY PLANTSUyar agrees that Turkey has the potential to increase its wind capa-city. He also warns against government plans for new nuclear energyplants. Ironically, the Medium-Term Plan also targets giving a start tobuilding nuclear plants until 2012. “Developed countries have longabandoned nuclear plants. These outdated technologies should notbe imported to Turkey” says Uyar.

“The USA ranks in the first place in wind today. The USA has not allo-wed any new nuclear plants since 1976, and now is in the process ofdismantling some of the older ones. Recently, it also regulated the li-censing of thermal plants and disapproved of 100 projects. Turkeyshould not import these technologies because they generate moresocial and external costs. Sun and wind are the answers,’’ he says.Uyar is also the coordinator of the nationwide green NGO called TÜR-ÇEP, where regional organizations share information on health ha-zards and environmental effects of conventional energy resources.

Support for thermal energy policies alarms Greenpeace as well. HilalAtici from GreenpeaceAkdeniz is concerned about the government’splans to build new thermal power plants. Turkey’s carbon emissions in-creased by 136% between 1996 and 2007 but since there is no require-ment for Turkey in Kyoto Protocol, the government has no clear visionto lower its carbon prints. “The government should encourage greenenergy over thermal and nuclear. Greenpeace is demanding the yearlycarbon emission growth to decrease by 25 percent” says Atici. Green-peace also has an internet petition against government plans of to bu-ild 47 new coal-based thermal plants. Greenpeace recently declared analternative energy scenario for Turkey called the Energy ®evolution,showing how Turkey can develop with renewable energy. �

WIND ENERGY



irket Mevkii Üretime GeçiTarihi

Kurulu Güç(MW)

Türbin imalatçısı Türbin adet ve kapasitesi

Company Location Comm. Date InstalledCap. (MW)

Turbinemanufacturer Turbine capacity

Alize A. . zmir-Çe me 1998 1,50 Enercon 3 adet 500 kW

Güçbirli i A. . zmir-Çe me 1998 7,20 Vestas 12 adet 600 kW

Bores A. . Çanakkale-Bozcaada 2000 10,20 Enercon 17 adet 600 kW

Sunjüt A. . stanbul-Hadımköy 2003 1,20 Enercon 2 adet 600 kW

Yapısan A. . Balıkesir-Bandırma I/2006 30,00 GE 20 adet 1.500 kW

Ertürk A. . stanbul-Silivri II/2006 0,85 Vestas 1 adet 850 kW

Mare A. . zmir-Çe me I/2007 39,20 Enercon 49 adet 800 kW

Deniz A. . Manisa-Akhisar I/2007 10,80 Vestas 6 adet 1.800 kW

Anemon A. . Çanakkale- ntepe I/2007 30,40 Enercon 38 adet 800 kW

Do al A. . Çanakkale-Gelibolu II/2007 14,90 Enercon 13 adet 800 kW + 5 adet 900 kW

Deniz A. . Hatay-Samanda I/2008 30,00 Vestas 15 adet 2.000 kW

Manisa-Sayalar I/2008 30,60 Enercon 38 adet 800 kW

nnores A. . zmir-Alia a I/2008 42,50 Nordex 17 adet 2.500 kW

Lodos A. . stanbul-Gaziosmanpa a I/2008 24,00 Enercon 12 adet 2.000 kW

Ertürk A. . stanbul-Çatalca I/2008 60,00 Vestas 20 adet 3.000 kW

Baki A. . Balıkesir- amlı II/2008 90,00 Vestas 38 adet 3.000 kW

Dares A. . Mu la-Datça II/2008 10,00 Enercon 27 adet 800 kW + 8 adet 900 kW

LETMEDEK KAPAS TE TOPLAMI

CAPACITY UNDER OPERATION

Türkiye’deki Rüzgar Santralları

Wind Projects in Türkiye

433,35

Ayen A. . Aydın-Didim I/2009 31,50 Suzlon 2.100 kW

Ezse Ltd. ti. Hatay-Samanda II/2009 35,10 Nordex 900 kW

Ezse Ltd. ti. Hatay-Samanda II/2009 22,50 Nordex 2.500 kW

Rotor A. . Osmaniye-Bahçe II/2009 135,00 GE 54 adet 2.500 kW

Mazı-3 Res Elk. Ür. A. . zmir - Çe me II/2009 22,50 Nordex 9 adet 2500 kW

Kores A. . zmir-Çe me II/2009 15,00 Nordex 2.500 kW

Soma A. . Manisa-Soma II/2009 140,80 Enercon 176 adet 800 kW

Alize A. . Balıkesir-Susurluk 19,00 Enercon 17 adet 800 kW ve 6 adet 900 kW

Borasco A. . Balıkesir-Bandırma 45,00 Vestas 15 adet 3000 kW

Alize A. . Tekirda - arköy 28,80 Enercon 14 adet 2000 kW ve 1 adet 800 kW

Alize A. . Balıkesir-Havran 16,00 Enercon 8 adet 2000 kW

Alize A. . Çanakkale-Ezine 20,80 Enercon 10 adet 2000 kW ve 1 adet 800 kW

Belen A. . Hatay-Belen 30,00 Vestas 10 adet 3000 kW

Alize A. . Manisa-Kırka aç 25,60 Enercon 32 adet 800 kW

Boreas A. . Edirne-Enez 15,00 Nordex 6 adet 2.500 kW

Doruk A. . zmir-Alia a 30,00 Enercon 15 adet 2.000 kW

Yapısan n . Elk. San.Tic. A. . zmir-Alia a 90,00 Nordex 36 adet 2500 kW

Do al A. . zmir-Alia a 30,00 Enercon 15 adet 2000 kW

Do al A. . zmir-Foça 30,00 Enercon 15 adet 2000 kW

Poyraz A. . Balıkesir-Kepsut 54,90 Enercon 61 adet 900 kW

Bilgin Elektrik Üretim A. . Manisa-Soma-Kırka aç 90,00 Nordex 36 adet 2500 kW

Bares Elektrik Üretim A. . Balıkesir-Kepsut 142,50 Nordex 57 adet 2500 kW

1.503,35 MWGENEL TOPLAM

N A HAL NDEK KAPAS TE TOPLAMI

CAPACITY UNDER CONSTRUCTION

TÜRB N TEDAR K SÖZLE MES MZALI PROJE TOPLAMI

PROJECTS WITH A TURBINE SUPPLY CONTRACT667,60

402,40


President Obama administration and Congress arekeen on spending large sums of money on rene-

wables, smart grid and energy efficiency. There are fe-deral loan guarantees, production tax credits, invest-ment tax credits, and some state incentives to supportthese technologies. Dr. Gurcan Gullen, Senior EnergyEconomist at the Center for Energy Economics, Univer-sity of Texas at Austin, says that it is not clear that allof this support will help establish some of these tech-nologies, but when there is “free” money from the go-vernment, companies are lining up to get their share.Gullen emphazies that the biggest challenge to energysector reform is the political apparatus. Dr. Gullen tal-ked to TURKOFAMERICA about energy policy, energyinvestment opportunities and the challenges andchanges in energy sector reforms.

Could you tell us about yourself?I am an energy economist with degrees in economics

from Bosphorus University (B.S., 1990) and BostonCollege (Ph.D., 1996). I studied oil markets for my dis-sertation and moved to Houston after graduation. I ha-ve worked as an energy economist since 1996, first atthe University of Houston and now at the University ofTexas at Austin (although I am based in Houston). TheCenter for Energy Economics is part of the Bureau ofEconomic Geology, the largest research unit within UT-Austin. We focus on energy value chain economics,policy and regulation. We undertake research relevantto industry participants and provide training. As part ofour work, I travelled to Nigeria, Angola, Ghana, India,Bangladesh and Mexico among others; and trainedhundreds of energy sector professionals from about 40countries.

What areas are you studying and focusing on?Our workload depends on our project pipeline. Cur-rently, I am working on renewables portfolio standardsin Texas and elsewhere in the U.S. (and the federal RPSproposal). But over the last few years, I worked onmany other projects. Here are some examples: econo-mics of CO2-EOR value chain in Texas, impact of cap-and-trade legislation on the Texas economy, perfor-mance of national oil companies, implementation chal-lenges associated with Gas Master Plan in Nigeria,economics of developing a secondary gas market inGhana, institutional challenges of newly establishedenergy sector regulators around the world, and globalcoal industry trends and their impacts on South Asianeconomies.

Can you littlle bit tell us about the electricity market de-sign in the US and how will impact on community’s liffe?I studied electricity markets in many jurisdictions but Iknow the Texas electricity market the best. The res-tructuring law in Texas passed in 1999 (Guide to Elec-tric Power in Texas we produced was used as a resour-ce during legislative deliberations); and the competiti-ve retail market started in 2002. We have produced re-ports on its progress. Texas has one of the most suc-cessful competitive electricity markets in the world.There are many reasons for this success but one is cen-tral: the legislation that restructured the market wasdeveloped with input from all key stakeholders. As aresult, it was much less of a political bill than those se-en in other places. For example, in California, theywanted to have benefits of competition but did notwant to make it easier to build generation or transmis-sion and they continued to protect retail customerswith price caps much lower than wholesale market pri-ces. This kind of political trickery does not pay: doesanyone remember the governor of California at the ti-me of energy crisis? He used to have presidential am-bitions. Today, the California government is bankrupt.Texas is a business friendly state with constrained go-

Dr. Gurcan Gullen:

“It is unfortunate that

the developed world

is trying to dictate

developing countries

what kind of energy

they can use due to

climate change

concerns. Some call

this eco imperialism;

sounds pretty fitting

A BRIEF OUTLOOK TO AMERICAN ENERGY INDUSTRY

By Ali Ç›nar

W›ll Eco Imper›al›sm Save the World?

vernment: our legislature meets only every other year and only for abo-ut five months. Given that electricity is a political commodity, it helpsto keep politicians away while the competitive market gets on its feet.

In many countries, restructured markets fail or do not live up to their po-tential because tendency of politicians to interfere is high especially du-ring election times; they often hold on to state utilities with their inhe-rent inefficiencies; regulatory agencies that are supposed to be inde-pendent are not (often, governments control their budget); investmentdecisions are often too lucrative to be left to the market. The Turkishelectricity market suffers from similar shortcomings.

What are the energy investment opportunities in the U.S.? Which ener-gy areas could be interestting for Turkish investors? Clearly, the current administration and Congress are keen on spendinglarge sums of money on renewables, smart grid (e.g., installing smartmeters) and energy efficiency. There are federal loan guarantees, pro-duction tax credits, investment tax credits, and some state incentives tosupport these technologies. It is not clear that all of this support willhelp establish some of these technologies, but when there is “free” mo-ney from the government, companies are lining up to get their share.There is excitement about smart grid but most politicians will not sup-port charging customers real time prices (e.g., $1 per kWh at peak sum-mer afternoon hours and 8 cents per kWh at night when demand is verylow); without this kind of pricing, we will not get the benefits of so cal-led smart grids. There is also some support (or at least promise of sup-port) for carbon capture and sequestration. Unfortunately, nuclearenergy that could provide some of the cheapest electricity in the long-run with almost no emissions does not get any attention. The industryhas high capital costs upfront and needs to improve its fuel recyclingpractices; it could have benefited from some of the loan guarantees.

What are the challenges and changes in energy sector reforms?The biggest challenge to energy sector reform is the political apparatus.I already discussed elsewhere some of the missing links between policydecisions and realities of the energy industry. Technologies get sup-ported because some politicians believe they will get investment in the-ir jurisdiction so that their constituencies can get jobs and raise the taxbase. In such an environment, fundamental economics of energy pro-jects and markets are often ignored. Worse, with the policies they pass,politicians create a large number of unintended consequences: take thecase of corn ethanol. It uses too much land, water and fertilizers; as aresult of support given to the industry in 2005 and 2007, depletion ofwater reservoirs in the Midwest has been alarming; fertilizer run-off tothe Mississippi River created the largest dead zone in the Gulf of Mexi-co; and allocation of land to corn raised prices of corn, soy and othercommodities, which raised feed costs for animal farmers, which all con-tributed to food cost inflation. But, most importantly, corn ethanol isnot more efficient than gasoline and it does not necessarily reduceemissions. The only reason to support corn ethanol is to support far-ming interests, and at that, not necessarily small farmers but large com-panies such as ADM; helping the country become energy independentis just empty rhetoric. It is the same perverted system around theworld. Energy sectors around the world are always distorted by irratio-nal, politically (interest group) driven policies that, on average, end upincreasing the cost of energy to consumers. There is large amount ofrent associated with this very large industry; it is just too tempting forpoliticians to allow markets to decide who gets what portion of the rent.

How doo you see Turkey’s energy policy and how Turkey is strong in theTurkic world?Like any other country with limited natural resources, Turkey needs todiversify its energy sources to increase reliability, reduce costs and mi-



nimize environmental impact. In addition to importing oil and naturalgas, exploration and development of local resources should be enco-uraged. From that perspective, a modern petroleum law that recogni-zes Turkey’s current resource potential (limited) and includes fiscalterms that encourage risk taking investors to explore for oil and gas se-ems desirable. As for imports, diversification of import sources (as lar-ge a number of producing countries as commercially feasible) is a ge-neral principle to follow. From this perspective, I am not sure if Nabuc-co is a pipeline that makes commercial sense; the risk-reward equationhas to make sense. Could Nabucco be a bargaining chip between Euro-pe and Russia? Renewable resources such as wind and solar, and ge-othermal should of course be pursued; but everyone needs to be rea-listic: at current technology and cost structure, these alternatives can-not provide the energy an industrialized, growing economy needs in areliable manner. Nuclear and coal should not be forgotten. The chal-lenge is to create a stable and transparent framework, mostly based onmarket signals, that can allow the development of energy projects whe-re and when they make the most sense (balancing economics, environ-ment and security dimensions). Ad hoc decisions do not make policy.

What is the future for the specialty of economic geology especially pro-jects that you work with Bureau of Economic Geology? Carbon capture and sequestration is an important area; but also un-conventional oil and gas resources. The world has plenty of coal andis not going to stop using it just because Al Gore wants it to. Look athow the cap and trade provisions in the Waxman Markey bill have be-en watered down to garner the support of representatives from coalstates. China, India, South Africa and Australia will continue to use co-al; Kevin Rudd, who, like Obama, promised carbon regulation duringhis election campaign has postponed any such bill, having realizedhow much Australia depends on coal-fired generation and coal ex-ports. So, making carbon capture and storage in geologic formationsfor long periods of time technologically feasible and economically vi-able is a key challenge.

The world is not running out of oil and gas. In fact, we are finding mo-re all the time. We just need to make sure that resources are economi-

cally and technologically recoverable. Few years back, natural gas pri-ces soared and everyone thought that the U.S. would need LNG importsto meet the rising demand in the face of declining production; new im-port facilities were built but then producers in the U.S. started produ-cing unconventional natural gas resources such as shale gas from theBarnett Shale (an area heavily researched by BEG scientists). Estima-tes for shale gas, tight gas, coal bed methane in the U.S. are huge; si-milarly for shale oil. But, environmental regulations at the state and fe-deral levels block most development. There is plenty of conventionalresources offshore but again environmental opposition is blocking de-velopment.

There is also gas hydrates. The resource base is immense: one estima-te is 200,000 trillion cubic feet. Just recently, there were major discove-ries offshore Texas in the Gulf of Mexico (again BEG researchers are in-volved). Japanese have successfully produced natural gas from hydra-tes in Canada but in small quantities. The technology needs to be sca-led up; but the potential is there.

After climate and energy, what do you think is the most importaant envi-ronmental issue facing the nation? Climate change is not ranked high in my list of issues; in fact it is pret-ty far down. Millions of people dying today in developing countries is amuch more significant problem than the uncertain cost moving peopleinland in distant future if sea level rises enough. Depending on whosestatistics one looks at, there are anywhere from a billion to billion anda half people without access to electricity in the world. Many more ha-ve limited, unreliable service. Not to mention the lack of access to mo-dern fuels such as propane (or LPG). Millions die in developing countri-es (especially in Africa and South Asia) due to maladies that could beprevented with development based on reliable energy. Switching topropane cookers from charcoal could save many who die from lung di-seases. Electric pumps could help clean water and prevent deaths dueto water borne illnesses. It is unfortunate that the developed world istrying to dictate developing countries what kind of energy they can usedue to climate change concerns. Some call this eco imperialism; so-unds pretty fitting to me. �

A BRIEF OUTLOOK TO AMERICAN ENERGY INDUSTRY


She said that she was fortunate to stay for two mo-re years after that as a research assistant on ma-

rine law and policy for Professor Nilufer Oral at Istan-bul Bilgi University. “I absolutely loved the three ye-ars that I lived in Turkey, and consider Istanbul to bemy second home,” she said.

In 2005, she left for New York to pursue a master’sdegree in international energy management and po-licy at Columbia University. During that time, shewas honored to serve as President of Turkish Initiati-ve, a graduate student organization at Columbia de-dicated to promoting informed discussion on Turkishhistory, culture, and politics.

Most recently, she worked as a researcher at the Co-lumbia University Center for Energy, Marine Trans-portation and Public Policy (CEMTPP) on urban ener-gy and marine transportation issues, as well as ener-gy governance in the Black Sea and Caspian regions,under the guidance of Professor Stephen Hammerand CEMTPP Director Albert Bressand. She talked toTURKOFAMERICA about Urban Energy developments

in the US and urban energy issues that could be in-teresting for Turkish investors.

Could you tell us about yourself?I am a 29-year old PhD student with a passion forTurkish culture, language, history, and contempo-rary politics… not to mention baklava! I am originallyfrom Tacoma, Washington, but have spent the pasteleven years living in Washington DC, Istanbul, andNew York City.

What areas are you currently studying and focusingon?I am just starting my PhD in Near and Middle EasternStudies, with a focus on Turkish Studies, at the Uni-versity of Washington. My research interests includeTurkey’s relationship with the EU and other Turkiccountries, and Turkey’s role in helping to establishenergy governance and sustainability principles wit-hin the Black Sea and Caspian regions. I am alsovery interested in Turkey-Azerbaijan relations, afterhaving the chance to spend a month in Baku thispast summer.

One area of potential

interest to Turkish

investors is that of

distributed

generation

technologies,

which are

increasingly being

deployed in cities.

JEANENE MITCHELL

By Ali Ç›narUpon graduating from

GeorgetownUniversity, Jeanene

Mitchell moved toIstanbul as a Fulbright

fellow to conductresearch on legal

issues relating to thesea and

navigation in theStraits.

POTENTIAL INTEREST TO TURKISH INVESTORS:

DISTRIBUTED GENERATION

TECHNOLOGIES


gation and adaptation strategies, and thinking about energy effici-ency and security of supply.

Which areas of opportunity related to urban energy issues could beinteresting for Turkish investoors? One area of potential interest to Turkish investors is that of distributedgeneration technologies, which are increasingly being deployed in ci-ties. This includes renewables like solar photovoltaic, solar thermaland small wind, but a technology to watch is combined heat and po-wer (CHP). CHP systems usually operate at the building scale, and areideal for dense urban environments. They simultaneously generateheat and electricity at or near the point where the energy will be con-sumed, and are dramatically more efficient than conventional, large-scale central station power plants. As a result, they can save moneyon fuel costs and reduces greenhouse gas emissions. The Mayor ofNew York City has even set a target of 800 MW of CHP deployment bythe year 2030. While the regulatory and market situation is differentin each city, and can in some cases complicate deployment, demandfor CHP should nonetheless be on investors’ radar, as demand forgreater energy efficiency in urban environments will continue to growcommensurate with rising electricity prices and climate change con-cerns. For more information, a 2007 study published by CEMTPP onthe viability of CHP in New York City is available at www.cemtpp.org.

How was your experience in working with the “Marine Transportati-on 2030” Scenarios group att CEMTPP? How do you see the future ofmarine transportation in the Black Sea?Working with the “Marine Transportation 2030” scenarios group toenvision the future of the marine transportation industry was a sin-gular experience, because it reconciled a group of prominent thin-kers and professionals in the maritime industry and asked them tothink plausibly about how the industry will evolve to the year 2030.After two years of research, we are in the process of completing a bo-ok with the conclusions and policy implications of our findings. I amcurrently co-authoring a chapter on the Black Sea with Professor Ni-lufer Oral of Istanbul Bilgi University. The future of marine transportation in the Black Sea will be shaped bythe balance struck between the tripartite forces of economic volatility,environmental sustainability, and the quest for safety and security.

After climate and eenergy, what do you think is the most important is-sue facing the world? The continued existence of extreme poverty in the world, and the factthat there is a continually-growing global gap between the rich and thepoor, is one of the most important issues facing the world. Not surpri-singly, there is actually a significant energy and climate dimension tothis issue as well. The poor are disproportionately affected by the we-ather incidents brought about by climate change, from floods to dro-ughts, both because they tend to live in areas with inferior or limitedinfrastructure, and because they often have more agrarian lifestyles.In developing countries, the poor are also the people for whom accessto electricity for simple things like refrigerating medicines, pumpingwater or lighting even a single light bulb would allow for needed vac-cinations, eliminate the need for a two-hour walk to a well and enablea child to study in the evening, respectively. We are privileged to livethe lives that we do, and I think that bestows us with a responsibilityto give some of our time, resources, and/or intellectual capacity to sol-ving the problems of those who do not enjoy the same luxuries, oppor-tunities, or fulfillment of basic needs as we do.�

Can you tell us about tthe Columbia University Center for Energy, Ma-rine Transportation and Public Policy’s (CEMTPP) Globaal Energy Go-vernance Program? What is the relevance of this program for Tur-key’s energy policy?The Global Energy Governance Program at CEMTPP aims to bring to-gether the different perspectives of energy producer, consumer, andtransit countries on the issue of energy governance. Since there isnot yet a common understanding of the concept, we define an effec-tive energy governance regime as a combination of common rules,market structures, formal and informal institutions, and political re-lationships which facilitate mutually-beneficial, multilateral energyand investment relations over the long term.

We are beginning our program with a focus on Eurasia, the CaspianSea, and the Black Sea regions because they collectively comprisesuch a strategically important area for energy production and trans-port. Yet geopolitical and market changes in this part of the worldhave led to a fragmented approach to energy governance. As I dis-cuss in my forthcoming article in Azerbaijan Focus, everyone losesfrom the incongruent rules and norms, the lack of consensus on mar-ket structures, unconstructive competition, and tense political relati-onships which currently characterize energy relations in these regi-ons. We saw this all too clearly earlier this year, when the gas pricingdisputes between Russia and Ukraine resulted in gas flows beingshut off to significant parts of Europe.

How do you see Turkey’s role in the region? Turkey is clearly a critical player in this milieu, as one of the most im-portant energy transit countries for oil and gas pipelines supplyingEurope and international markets further afield. Especially as Euro-pe seeks greater security of energy supply in the aftermath of theRussia-Ukraine disputes, Turkey is seen by Europe as a trustworthyand dependable partner. The signing of the Nabucco pipeline agree-ment further solidifies Turkey’s pivotal role in the region. Yet Tur-key’s aspirations to be an energy hub rather than just a transit co-untry bring additional levels of complexity from a technical, political,and governance perspective. The establishment of trustful, coopera-tive political and economic relations among regional players, as wellas common notions of energy market rules and pricing, could greatlyfacilitate Turkey’s progression towards becoming an energy hub. Itcould also avert tensions such as those that recently arose over gasprices between Turkey and Azerbaijan, in spite of a long history ofclose relations between the two countries. For this reason, Turkeyhas much to gain from improved energy governance in the region.The insights emerging from CEMTPP’s Global Energy Governanceprogram and our scenarios work in the region will therefore be of in-terest to Turkish policymakers and other Turkish stakeholders in theenergy industry.

What are the Urban Energy developments in the US?? Since most of the energy in the world is consumed in cities, it makesa lot of sense to understand developments in energy policy, markets,and technologies at the city scale. CEMTPP has developed a cutting-edge Urban Energy Program, led by Dr. Stephen Hammer, to do justthat. While the decentralized nature of energy markets and policywithin the U.S. makes it somewhat difficult to generalize about ur-ban energy issues in the U.S., I can say that city governments are ge-nerally becoming much more interested in playing an active role inshaping their energy futures, seeking to pursue climate change miti-


ASyracuse-based business incubator funded bythe New York State Energy Research and Deve-

lopment Authority (NYSERDA) today released thefirst comprehensive directory created to connectemerging clean technology companies with resour-ces in Central New York that can help develop,grow, and retain businesses in this growing sector.

The Clean Tech Asset Guide was published by theClean Tech Center, a program of the Greater Syra-cuse Chamber of Commerce located at the TechGarden in downtown Syracuse. The Center was es-tablished with $1.5 million from NYSERDA to createa facility for the support, incubation and accelerati-on of new clean energy technology companies.

“While Upstate New York has been emerging as avibrant hub of clean energy businesses, until nowthere has been no full accounting of all the resour-

ces available in this growing field,” said Francis J.Murray Jr., President and CEO of NYSERDA. “Thisguide will serve as an essential tool to help connectthe extraordinary wealth of talent in Central NewYork with investors and support systems to helpthem build the clean energy economy envisionedby Governor David Paterson.”

“Entrepreneurs in Central Upstate New York are for-tunate to be able to work shoulder-to-shoulderwith some of the world’s top experts in renewableand clean energy sectors, right here in this region,”said Linda Hartsock, Executive Director of The Cle-an Tech Center. “The resource guide demonstratesthat this region has built a well-connected infras-tructure and working partnership to support greeninnovation. NYSERDA is the catalyst for building aninnovation ecosystem across New York State, con-necting clusters of entrepreneurial activity throughits new clean energy incubator program. NYSERDAis truly the model for strategic green business de-velopment.”

Created with support from NYSERDA, the 61-pageClean Tech Asset Guide is a ‘one-stop’ directorywith listings of assets including university and aca-demic research programs, specialized facilities,support organizations, and funding programs. Inaddition, the guide lists research and developmentresources, business development resources, fun-ding programs, and market leaders, including asso-ciations and organizations.

In addition to the Tech Garden in Syracuse, NYSER-DA has funded incubators at the University at Buf-falo, Rochester Institute of Technology, and thePolytechnic Institute of New York University in Bro-oklyn.

NYSERDA funds are used to assist companies thro-ughout the incubation process and to develop a fi-nancially self-sustaining program that will streng-then the clean tech economy in Central New York.Collaborators with the Clean Tech Center includeleading New York State colleges and universities,investors, utilities, technology and industry associ-ations, and government agencies that are includedin the resource guide.

To download the resource guide, visithttp://www.thecleantechcenter.com/Cleantech/CleanTechManual_12_09.pdf�

Created with support

from NYSERDA, the

61-page Clean Tech

Asset Guide is a ‘one-

stop’ directory with

listings of assets

including university

and academic

research programs,

specialized facilities,

support organiza-

tions, and funding

programs.

HOW TO EXPAND YOUR COMPANY

The Clean Tech Asset Gu›de for Compan›es ›n the

Expand›ng Clean Tech Sector


SiemensSiemens AG (NYSE: SI) is a global powerhouse inelectronics and electrical engineering, and operatesin the industry, energy and healthcare sectors.http://www.usa.siemens.com/entry/en/

King & KingKing & King, Architects LLP has a rich history in theupstate New York area. Founded in 1868, it is theoldest architectural firm in New York State and thefifth oldest in the country. In the Syracuse area, somenotable buildings include Crouse College, BirdLibrary, and Manley Field House, all on the SyracuseUniversity campus; Onondaga County Courthouse.http://www.kingarch.com/

Greater Syracuse Chamber of Commerce and Convention and Visitors BureauThe Greater Syracuse Chamber of Commerce is the lar-gest business organization in Central New York. TheChamber is an icon in the Syracuse business commu-nity, leading the way in everything from government re-lations and lobbying to creating economic growth in theregion. http://www.syracusechamber.com/

USS Department of Energy (DOE)The Department of Energy’s overarching mission is toadvance the national, economic, and energy securityof the United States; to promote scientific and tech-nological innovation in support of that mission; andto ensure the environmental cleanup of the nationalnuclear weapons complex. http://www.energy.gov/

Environmental Protection AgencyThe EPA leads the nation’s environmental science, re-search, education and assessment efforts. The missionof the Environmental Protection Agency is to protecthuman health and the environment. Since 1970, theEPA has been working for a cleaner, healthier environ-ment for the American people. http://www.epa.gov/

Metropolitan Development AssociationnThe MDA is a private, not-for-profit corporation, rep-resenting the business leadership of Syracuse andCentral New York. Membership of the MDA is compri-sed of the chief executive officers of the largest cor-porations and institutions in the region with acknow-ledged leadership in manufacturing, finance, distri-bution, bio-technology, real estate, construction, me-dical technology, education and law.http://www.mda-cny.com/

Tate Access Floors, Inc.Tate is the largest raised access floor manufacturer inNorth America, allowing Tate to service large andsmall projects simultaneously. As the leading autho-rity on underfloor service distribution, Tate leveragesits 45 years of experience in the industry to providetechnical support and education to the design andconstruction community.http://www.tateaccessfloors.com/

MARKET LEADERS OF CLEAN TECH IN NEW YORK STATEOrganizationsNYSERDANew York State Energy Research and DevelopmentAuthority (NYSERDA) is a public benefit corporationcreated in 1975 under Article 8, Title 9 of the StatePublic Authorities Law through the reconstitution ofthe New York State Atomic and Space DevelopmentAuthority. NYSERDA’s earliest efforts focused solelyon research and development with the goal of redu-cing the state’s petroleum consumption. Subsequentresearch and development projects focused on to-pics including environmental effects of energy con-sumption, development of renewable resources, andadvancement of innovative technologies.http://www.nyserda.org/

National GridIs a wholly owned subsidiary of National Grid, an inter-national, London-based company whose core businessis the delivery of electricity and natural gas. NationalGrid has a strong commitment to clean tech and is asmart grid leader. http://www.nationalgridus.com/

Carrier CorporationFrom the time its founder invented the basics of mo-dern air conditioning in 1902, Carrier has been theworld leader in air conditioning, heating and refrige-ration systems. A wholly-owned subsidiary of UnitedTechnologies Corporation, Carrier is built upon a le-gacy of innovation and commitment. Through mar-ket-leading products and solutions, it is constantlystriving to help people live more comfortable, he-althy and productive lives.http://www.corp.carrier.com/www/v/index.jsp?vgnextoid=9d087afdef677010VgnVCM100000cb890b80RCRD

CorningSince its earliest days, Corning Incorporated, theworld leader in specialty glass and ceramics, hasworked closely with customers to understand theirproblems, explore possible solutions, and then bringthose solutions to life through world-class scientificand manufacturing capabilities.http://www.corning.com/index.aspx

NYSTARNYSTAR supports technology development, innovati-on and commercialization leading to economicgrowth in New York State.http://www.nystar.state.ny.us/

IBMIBM helped pioneer information technology over theyears, and it stands today at the forefront of a worl-dwide industry that is revolutionizing the way inwhich enterprises, organizations and people operateand thrive, particularly in regard to intelligent buil-ding design and systems integration.http://www.ibm.com/us/en/

HOW TO EXPAND YOUR COMPANY

O’Brien & GereO’Brien & Gere is an employee-owned engineeringand project delivery company with over 850 scien-tists, engineers, construction, and operation person-nel located in 30 offices across the U.S. With a 60-ye-ar history of applying technology and innovation,O’Brien & Gere is a leader in providing total capital &facilities, energy, environmental, and water solutions.http://www.obg.com/

Environmental Finance Center at Syracuse UniversityThe Environmental Finance Center at Syracuse Univer-sity is tasked by the EPA with facilitating the develop-ment of sustainable communities. It connects motiva-ted local government officials and private organizati-ons with technical assistance, assessment tools, andfunding offered by a large network of collaboratorsand resources. It also provides professional trainingand community outreach to engage, educate, andenable the public to make changes toward improvedenvironmental infrastructure and quality of life.http://efc.syracusecoe.org/

Air InnovationsAir Innovations designs and manufactures speciali-zed air conditioning systems and environmental con-trol equipment for a variety of industries that are ins-talled worldwide. The company, established in 1986,is known for its expertise in applications that requireprecise control of temperature, humidity, pressureand filtration. Air Innovations’ capabilities range fromconcept development to prototyping and testing,from made-in-the-USA manufacturing to regulatorysubmissions and international distribution.http://www.airinnovations.com/

C&S CompaniiesFull-service, project delivery specialists—the C&S te-am includes more than 400 professionals and trades-people engaged in making built environments stron-ger, natural environments richer, and all environ-ments more sustainable. Its mission is to advancequality of life in an ever-changing world.http://www.cscos.com/

CDH EnergyProvides energy system and technology analysis,using both field monitoring and energy simulationskills to assess technologies, verify savings, assessmarkets, or determine application feasibility. Appli-cations include: building system design optionsanalysis, energy savings project feasibility studies,product assessment and technology research anddemonstration.http://www.cdhenergy.com/

ArupIs an independent firm of designers, planners, engi-neers, consultants and technical specialists offeringa broad range of professional services.http://www.arup.com/

Northeast Natural HomesThe essence of Northeast is designing, teaching,and building in Nature’s Image. It is a nature-inspi-red ecological design & building firm with originsin the sciences of ecology and biology, and the bu-ilt environment. The company draws inspirationfrom the Haudenosaunee Confederacy and its li-ving decision-making principle-to always delibera-te for the Seventh Generation to follow.http://www.ngbc.us/

SensisFounded in 1985, Sensis Corporation is a globalprovider of air defense, air traffic control, airlineand airport operations management, and data in-tegration and distribution. The company serves aglobal client base and is actively involved in in-dustry organizations and working groups worldwi-de, helping to address critical issues and developinnovative, real-world solutions.http://www.sensis.com/

SRCAs a not-for-profit, research and developmentcompany that develops unique, creative solutionsfor nationally significant challenges in defense,environmental, and intelligence, SRC is committedto redefining possible.™http://www.syrres.com/

Fulton BoilerFulton is a global manufacturer of steam, hot wa-ter and thermal fluid heat transfer systems. Fultonproducts include steam boilers, hot water boilers,thermal fluid heaters, temperature control units,custom engineered systems, boiler rooms and afull range of ancillary equipment.http://www.fulton.com/

Syracuse UniversittyFrom its founding in 1870, Syracuse University hasbeen the embodiment of Scholarship in Action—education that transcends traditional boundariesthrough a combination of innovative thinking, da-ring choices and entrepreneurial attitude.http://www.syr.edu/

National CouncilsU.S. Green Building CouncilThe mission of the U.S. Green Building CouncilNew York Upstate Chapter is to provide an unpa-ralleled opportunity to accelerate change and helpshape the future of green building practices in theChapter Region. http://www.greenupstateny.org/



Over the last decade we have developed a realiza-tion of the global shortage of petroleum and na-

tural gas. Keeping up with the demands of populati-on growth and economic expansion is becoming anextremely important resource game. The competiti-on for a variety of natural resources is increasing. Ontop of that, about 80% of the world’s oil reserves liein politically unstable regions. We are seeing foreignand military policies being shaped over the issues ofaccess and control of energy resources. World go-vernments see acquisition, control, protection, andstable flow of natural resources as a fundamentaland complex national security requirement, overwhich they give strong signals of not being hesitantto fight if needed.

In this major strategic issue, not only the MiddleEast, but Central Asia as well, which stretches fromthe Ural Mountains to China’s western borders, withvast reserves of oil and natural gas resources, has al-so received a level of global strategic thinking, inwhich the major forces of the world would like to se-cure and protect the flow of oil to its allies.Turkey, in this complex strategic board, is locatedclose to more than 70% of the world’s known gasand oil reserves, especially those in the Middle Eastand the Caspian basin. As one would expect, thisputs Turkey in the position of transit country betwe-en producing and consuming countries. In this gro-wingly important role, major pipelines have been bu-ilt, and others are in planning stages.

Blue Stream: The Blue Stream’s gas pipeline fromRussia goes under the Black Sea, resurfacing in theTurkish port of Samsun. Russia eventually has theaim of increasing its capacity to 32 billion cubic me-ters in an effort to halt the Nabucco pipeline, whichis a key project to diversify the European energy sup-ply away from Russia through a route that will carryCentral Asian and eventually Iranian gas. The exten-sion of the Blue Stream gas pipeline to Ceyhan andall the way to Israel is also under consideration.

BTC Pipeline: BTC is a pipeline that extends from theAzeri Chirag-DeepWater Gunashli (ACG) field thro-ugh Azerbaijan and Georgia to a terminal at Ceyhan.It has a capacity of 1 million barrels per day, whichequates to 1.5% of the world’s oil supply. In June of2006, Kazakhstan officially joined the BTC pipelineproject. Eventually more of the crude oil supply isexpected to be tied up in this pipeline. Turkish Straits: The straits are of particular impor-tance as around 4% of the world’s oil consumption isshipped through the Turkish straits.

Trans Anatolian (Samsun-Ceyhan): Due to heavytraffic in the straits, there is a growing importance todevelop alternative routes. Hence, a pipeline hasbeen built from Samsun to Ceyhan.Baku-Tblisi-Erzurum (BTE) Natural Gas Pipeline: Itsmain purpose is to transport gas from the Shah-De-niz field in the Azerbaijan sector of the Caspian Seaacross the Georgia-Turkey border. This pipeline willbe further developed in various stages in the Trans-Caspian Natural Gas Project, which will integrate oneof the world’s largest gas reserves in Turkmenistanand Kazakhstan with the world markets.

NABUCCO Pipeline: An important milestone for Tur-key becoming a global energy hub is the NABUCCOPipeline project. NABUCCO is designed to transportgas via Turkey through Bulgaria, Romania, and Hun-gary to Austria. NABUCCO is vitally important for theEuropean Union’s diversification strategies awayfrom Russian supplies. NABUCCO places Turkey as amain route of energy supplies, along with Norway,Russia, and Algeria.

Southern Europe Gas Project: One of the further di-versification steps of Europe’s energy efforts is thering that interconnects Turkey, Greece and Italy’sgas pipeline networks. The major step of this deve-lopment was the Turkey-Greece Interconnector. Links to Iraq and Iran: Turkey is also interested in thedevelopment of Iraqi and Iranian natural gas reser-ves and the integration of gas from both countries in-to the gas system with a parallel pipeline to the alre-ady existing Kirkuk-Ceyhan oil pipeline. Turkey is on its way to becoming a transit country for10% of global oil exports and up to 15% of global gasdeliveries. With these developments, the countrywill collect transit fees and will be a hub for storage,trading and refinery developments. This role willcause an eventual build-up of business, investmentand human capital stock which will place energy asvital part of economic value creation.

We can conclude by stating the ever increasing roleof Turkey as global energy hub. Turkey sits at thecorner stone of the energy diversification strategyfor the EU, which puts the country in a position of le-verage in further accession talks. Politicians shouldsupport rule of law, transparency, and policies thatare investor friendly. It is vitally important to carryexcellent relationships with producing and consu-ming countries and be seen as a factor for balance,stability and trust in the region.* Altan Ergun President of Arsila Group �

Turkey is on its way

to becoming a transit

country for 10% of

global oil exports and

up to 15% of global

gas deliveries.

ENERGY HUB

Turkey S›ts at the Corner Stone of the EU’s

Energy D›vers›f›cat›on Strategy

By Altan Ergün


The Turkish Coalition USA Political Action Commit-tee (TC-USA PAC) is a bipartisan organization sup-

porting political candidates who endorse a strongUS-Turkish relationship and encouraging TurkishAmericans to participate in the US political process,disclosed a 2009-2010 annual report.

The report says that the Turkish-American commu-nity has only just begun to participate in the Ame-rican political process en masse. Nonetheless, theyare making an impact already. In the first election

cycle in which it participated, (2007-2008) TC-USAPAC was able to contribute over $135,000 tofederal, state and local candidates. For thiselection cycle, as of January 1, 2010, over $92,500has been contributed to federal, state and localcandidates.

Since 2007, the total amount fundraised by the Tur-kish-American community in the United States hasreached the $1,000,000 mark, not including contri-butions to the recent Presidential election campa-igns. Over $1,050,000 has been raised by TurkishAmericans for both the Democratic and RepublicanParties and congressional, state and local candida-tes during this time. Turkish-Americans have financi-ally supported nearly 100 candidates nationwide.These activities have put the Turkish-American com-munity on the map. �

In the first election

cycle in which it

participated,

(2007-2008) TC-USA

PAC was able to con-

tribute over $135,000

to federal, state and

local candidates.

COMMUNITY NEWS

Turk›sh Amer›cans

Have F›nanc›ally

Supported Nearly 100

Cand›dates Nat›onw›de

The Empire State Building launched a campaign last Janu-ary that aims to entice tourists to visit the Big Apple land-

mark, with the tagline: “The Real Magic, The Real NewYork.” The campaign, by New York-based agency Avrett Fre-e Ginsberg, highlights the “emotions, experiences and hu-man connections” of visitors to the Empire State Building'sObservatory, according to the tourist attraction. Ads, run-ning in regional publications like Time Out New York and theNew York Post, show real consumers taking in the view fromthe observatory floor.Yucel Erdogan, Group Creative Director and the photograp-her at Avrett Free Ginsberg, said it is rare to be both the di-rector and the photographer but he did the artwork/photog-raphy as well as come up with the campaign concept for ot-her major campaigns, such as the Tumi Luggage campaign. The campaign launched on January 20th and is running bro-adly in and around New York City: in regional magazinessuch as Time Out and the New York Post, on billboards inNew York City, and outdoor displays in the Midtown Tunnel,Bruckner Expressway and the New Jersey Turnpike as wellas on taxi cabs. Erdogan came to the U.S. on February 5th,1988 on a Turkish Education Scholarship, to get a Mastersin Communication Design at Pratt Institute in Brooklyn,New York. While he was in school, he worked freelance fordesign firms and advertising agencies. In 1999, he got anassignment to design an international ad campaign for themakeup company Max Factor. He was hired as a full timeart director in advertising at LMPM. During his eight years

there he shot TV advertising and print campaigns in Japan,Greece and South Africa.At LMPM his work won the agency numerous major campa-igns: St. Regis, Tumi, Dewars 12, Bacardi Flavors, Fortune-off, NY Design Show, Carrera vs Carrera, Sally Hansen, Em-pire State Building and two real estate campaigns, PeterMarino, and 110 Warren Street.Erdogan have just started a new chapter in his career. Heleft AFG right before the new year, and he is heading hisown creative shop, Reason-Y. �

The campaign

launched on

January 20th and

is running broadly

in and around

New York City:

in regional

magazines such as

Time Out and the

New York Post,

on billboards in

New York City.

The Emp›re State Bu›ld›ng’s Campa›gn

Ad Des›gned by Turk›sh Art›st


The U.S. Department of Energy’s (DOE) ArgonneNational Laboratory will play a key role in a Clean

Energy Partnership recently announced betweenTurkey’s Ministry of Energy and Natural Resources(MENR) and the U.S. Trade and Development Agency(USTDA).

“We have enjoyed a longstanding partnership withArgonne National Laboratory and we look forward toworking with them again as we address critical issu-es related to future energy use and developing cleanenergy technologies,” said Budak Dilli, General Di-rector for Energy Affairs at MENR. “Their expertisewill be instrumental in helping us understand our fu-ture energy supply and demand situation while reali-zing the environmental and economic implications ofour energy policy decisions.”

A memorandum of agreement between Turkey andthe USTDA outlines a clean energy partnership thatwill advance key objectives of the Obama adminis-tration by reducing carbon emissions and develo-ping advanced renewable energy technologies. “Our Clean Energy Partnership with MENR highlightshow USTDA’s program provides access to U.S. tech-nology and global best practices in meeting overse-as development challenges,” said USTDA Acting Di-rector Leocadia I. Zak. “We are pleased that the ex-perts at Argonne National Laboratory will play an im-

portant role as Turkey prepares to make key decisi-ons about the development of its energy sectors.”

The project includes training for Turkish officials inArgonne’s energy planning and modeling tools tosupport long-range energy supply and demand pro-jections while improving and diversifying energyuse, developing renewable energy and reducing car-bon emissions. Argonne has worked with Turkeyover the last 18 years on a series of complex energyand power modeling issues funded by the WorldBank and the United Nations Development Program.

“Turkey has significant energy potential that has yetto be realized,” said Argonne’s Guenter Conzelmann.“Our training and models will help the Turkish go-vernment make decisions that will address their fu-ture energy supply needs, develop sustainable ener-gy strategies and mitigate potential power shortageswhile reducing vulnerabilities and promoting econo-mic growth.”

Conzelmann heads Argonne’s Center for Energy, En-vironmental and Economic Systems Analysis (CEEE-SA), which develops models to analyze energy, envi-ronmental and economic issues. The models crea-ted by CEEESA are used to inform decision makersabout large-scale energy deployments and addresstoday's energy and environmental problems.

CEEESA has trained more than 1,300 experts frommore than 90 countries. CEEESA works with powercompanies, consulting agencies and governmentsaround the world, including the U.S. Department ofEnergy, the U.S. State Department, the U.S. Agencyfor International Development (USAID), the WorldBank, the International Atomic Energy Agency (IAE-A), the USTDA and various state agencies.

Argonne National Laboratory seeks solutions topressing national problems in science and techno-logy. The nation's first national laboratory, Argonneconducts leading-edge basic and applied scientificresearch in virtually every scientific discipline. Ar-gonne researchers work closely with researchersfrom hundreds of companies, universities, and fede-ral, state and municipal agencies to help them solvetheir specific problems, advance America 's scientificleadership and prepare the nation for a better future.With employees from more than 60 nations, Argonneis managed by UChicago Argonne, LLC for the U.S.Department of Energy's Office of Science.�

A memorandum of

agreement between

Turkey and the

USTDA outlines a

clean energy

partnership that will

advance key

objectives of the

Obama

administration by

reducing carbon

emissions and

developing advanced

renewable energy

technologies.

PARTNERSHIP

Clean Energy Partnersh›p

between Turkey and the U.S.


Reuters - Fatih Birol predicts that the world will se-e a gas glut in the next four to five years, which

he says would have huge implications for gas expor-ters such as Gazprom.

Birol says that oil use in rich industrialized countrieswill never return to 2006 and 2007 levels because ofmore fuel efficiency and the use of alternatives, TheOrganization for Economic Cooperation and Deve-lopment (OECD) countries will account for 53 percentof world demand in 2010, according to the IEA. In its

January 15 monthly Oil Market Report, the IEA fore-cast OECD demand would average 45.48 million bar-rels per day (bpd) in 2010, unchanged from 2009.World demand is forecast at 86.33 million bpd, upfrom 84.89 million in 2009.Birol said the economic crisis had played a role incurbing OECD demand but the main reasons weremore efficient cars and the increasing use of electri-city and gas instead of oil in areas outside transport.Birol examines the world energy outlook with grap-hics and charts as follows. According to Fatih

Birol, Chief Economist

of the International

Energy Agency,

some global strategic

challenges are the

security of energy

supplies, the threat of

environmental

damage caused by

energy use, uneven

access of the world’s

population to modern

energy, and

investment in

energy-supply

infrastructure.

WORLD ENERGY OUTLOOK

World Energy Outlook w›th Numbers

World Primary Energy Demand Gas grows fastest in absolute terms & non-hydro renewables fastest in terms of percentage, but oil remainsthe dominant fuel.

▼

Share of International Trade (%)Energy trade between regions more than doubles between now and 2030, most of it inthe form of oil

▼

Developing Asia Oil andGas ImportsDeveloping Asia will become more dependenton oil & gas imports, fromfewer countries –mainlythe Middle East and Russia.OK, by CO, you mean carbon monoxide, right,not just carbon?

▼


Energy-Related CO Emissions CO2

World emissions increase by 1.8 % per year to 38 billion tons in 2030–70% above 2000 levels.

▼

Map of Global Energy PovertyMap Poverty 1.6 billion people have no access to electricity, 80% of them in SouthAsia and sub-Saharan Africa.

▼

World Primary Energy Demand and CO and CO2 Emissions Emissions increase faster than demand over the next 30 years,because the share of fossil fuels in the energy mix grows

Per Capita COPer CO22 Emissions Per Capita CO2 Emissions (Is this what he’s trying to say?)Per capita emissions rise quickly in developing countries, but remainmuch higher in the OECD & transition economies.

▼

Energy Investment by Region 2001 2030 Almost half of the global energy investment will be needed in deve-loping countries.

▼

▼

World Energy Investment 2001-2030Total investment: 16 trillion dollars

▼

FROM EUROPE

By Prof. Dr. Faruk SenPresident, TAVAK

(Turkish-German Educational andScientific Research Foundation)

Having received EU membership in the year 1982with the help of then President of France Valery

Giscard d’Esteing, Greece lived through a seriousgolden age between the years 1981 and 2005.Along with the regional and social developmentfunds, the EU also gave agricultural funds in theamount of 104 billion euro to Greece during theseyears. While Turkey was borrowing from the IMFand other international institutions, Greece stoodfirmly on its feet with these grants. With the help ofthe EU, living standards in Greece were in muchbetter condition in comparison to those in Ger-many, France, and England.

On Mondays, stores open in the afternoon in Gree-ce. They used to close again in the afternoon onWednesdays and they used to take off Friday after-noons off. Government employees used to havethe same hours. Especially given the framework ofthe EU’s efforts to accept Spain and Portugal as fullmembers, ‘father Papandreu’ had requested a Me-diterrenean fund in serious amounts and he bene-fitted from this fund the most. In the EU, which hasconsisted of 27 countries since 2008, we see thatthe source is diminishing gradually. First, Hungaryand Romania began to present economic problemsfor the EU and they ended up having to agree withthe IMF. Not being able to transfer much money toBulgaria, one of the new members, Germany inves-ted greatly in Turkish transporation companies andtransporters in order to provide more opportunitiesto the Bulgarian transporter fleet, and, because ofthis, many owners of transporter fleets had to starta business in Bulgaria. At the end of the year 2009,we see that Greece’s foreign debt exceeded the li-mit of 295 billion euro. According to experts on thesubject, this debt reached nearly 350 billion euro.Greece needs 53 billion euro for the year 2010.

The Difficult Task of the EUIf Greece were a business, it would have been serio-usly considered to be bankrupt. However, as it ishard for countries to go bankrupt, especially sincethe European Central Bank (ECB) does not allowsuch a thing, the President of the ECB, Jean ClaudeTrichet, sought, through a new summit, for oppor-tunities to help the euro country Greece. Accor-dingly, by following a plan for the next 10 years, the27 EU countries will try to eliminate the concerns ofthe investers, which are due to the weak countriesin the euro zone. After Greece, Spain, Portugal, and

According to experts

on the subject, this

debt reached nearly

350 billion euro.

Greece needs

53 billion euro

for the year 2010.

Ireland rank among the countries that are proble-matic. According to recent developments, Italy’scondition is also becoming difficult, day by day.

Greece implemented certain discretions. Underthese, it increased the retirement age from 61 to 63.Beginning in 2011, for every five government emp-loyees who leave, one new person will be hired.Short term benefits of stocks will be taxed. The sa-laries of the Greek prime minister and other minis-ters will be frozen. The same sanctions are beingapplied to the salaries of other workers. Greek so-ciety, who had been used to conveniences, respon-ded to these regulations by holding a 24-hour stri-ke. The task of saving Greece from this situationhas been left to the EU, and especially to countrieslike Germany and France. Greece owes Germanbanks nearly 30 billion euro. Greece’s inability to ri-se out of this crisis is bringing serious problems in-to the euro zone and demonstrating that the euro’svalue is compromised relative to dollar and is dec-reasing day by day. In spite of this, Greece continu-es its spendings on war planes and defense nons-top. In order to ensure France’s support under the-se circumstances, it was announced that the Greekarmy would buy 6 war ships from France in the fol-lowing years. EU funds have not bee marked by anyserious increase over the past few years. However,the number of countries that request a share fromthese funds has increased to 27. While 6 countriesstill pay more to the fund than they receive from it,the other 21 countries are trying to get as much aspossible from the EU. Despite all of its problems,Greece is in a condition to be saved by the EU in theyear 2010. In addition, the major countries of theEU will provide Greece with certain assurances.

We can take into account that in 2011 Spain and Por-tugal will also knock on the door of the Union withthe same problems. The EU, in which Turkey has be-en trying to become a full member for the past 50 ye-ars, has entered into a phase of economic decline.Although Greece, with its population of ten million,has been the country that has benefitted the mostfrom the EU funds, it has not able to prevent the dec-line. If there were a chance for an EU member to beremoved from the Union, the country that would ha-ve left first would have probably been Greece. As acountry that does not have an economic policy regar-ding production, Greece will most likely knock onEU’s door to be ‘saved’ in 2020.�


EU’S GREATEST PROBLEM:

GREECE


The Buffalo Green Belt development, in the city ofBuffalo, New York, is a renewable energy and tech-

nology corridor. The growing green economy, in thewestern New York area, takes advantage of its positionas a Great Lakes transportation hub, as well as its in-dustrial infrastructure and educated work force.

The city of Buffalo, New York is excited to announce itsnew initiative, the Buffalo Green Belt. "With a highly-skilled workforce, excellent location advantages, im-proved permits and licensing processes, strong incenti-ves, and business assistance experts ready to help yo-u move your project forward, the city of Buffalo is set tobe your business development partner. Talk to uswhether you are looking to expand your business, starta new one, or relocate your business to Buffalo, and wewill work with you to meet your business goals," saysByron W. Brown, Mayor of Buffalo.

The Buffalo Green Belt boasts a strong work force,along the Lake Erie shoreline, the largest number ofwind turbines on the Great Lakes, shovel ready landand progressive companies and industries.

WHAT’S HAPPENING NOW IN THE BUFFALO GREEN BELT RiverWrightAt 110 million gallons per year, RiverWright, LLC will beone of the largest capacity ethanol plants in the co-untry. The project will restore the existing historic gra-in elevators on the Buffalo River with state-of-the- artgrain handling equipment to store 10.1 million bushelsof biomass. Strategically located near marine, rail andmajor highway infrastructure, RiverWright has the abi-lity to move massive amounts of biomass fuels by ship,rail or truck to the highest population centers in theeastern United States.

Niagara River GreenwayRunning directly through the Buffalo Green Belt is the Ni-agara River Greenway, with its over 40 miles of parks,shoreline, and beautiful landscapes from Lake Erie to La-ke Ontario. The Niagara River Greenway is a world classdestination, with beautiful scenery, parks, trails and high-ways; the Greenway protects, regenerates and promotessignificant natural, cultural, recreational, scenic and heri-tage resources. Cities of the Greenway spark revitalizati-on, reinvestment and renewal, including reuse of brown-fields and support of downtown development.

HoneywwellInventor of the world’s first biodegradable soap pro-duct, Honeywell’s Buffalo lab is working to create anew, green, alternative for automotive air conditionerfluid. Geared for reduced fuel consumption, energy ef-ficiency, and lower operating cost, this next generationof automotive air-conditioning coolant will provide anon-greenhouse gas contributing solution that is com-patible with existing automotive components.

SteelwindsComprised of 8 state-of-the-art 2.5 megawatt ClipperLiberty wind turbines, Steel Winds has transformed theLake Erie shoreline from forgotten steel plant land intoa progressive energy landscape. Steel Winds generatesover 50 million kilowatt hours of clean, renewableenergy each year, as well as bringing economic bene-fits to western New York�

The Buffalo Green

Belt boasts a strong

work force, along the

Lake Erie shoreline,

the largest number of

wind turbines on the

Great Lakes, shovel

ready land and pro-

gressive companies

and industries.

GREEN INVESTMENT IN BUFFALO

Buffalo Green Belt


Wind has been the fastest growing source of elec-tricity generation in the world through the

1990s. However, the majority of this growth has be-

en in Europe, where conventional energy costs arehigher than those in the United States. With largeuntapped wind energy resources throughout the co-untry and declining wind energy costs, the UnitedStates is now moving forward into the 21st centurywith an aggressive initiative to accelerate the prog-ress of wind technology and further reduce its costs,to create new jobs, and to improve environmentalquality. Wind Powering America will expedite themovement of wind technology into the mainstreamof the U.S. electric sector.

The United States has experienced 4 years of stronggrowth. In 2008, the United States led the world inwind capacity additions and in cumulative capacity.The United States lags behind other countries interms of the percentage of electricity produced bywind. Wind represents just 1.9% of the United Sta-tes' electricity supply, while that percentage is ashigh as 20% in Denmark, 12% in Spain, 11% in Portu-gal, 9% in Ireland, and 7% in Germany.

U.S. wind power installed capacity now exceeds35,159 MW, which is enough to serve 9.7 million ave-rage households. Texas is firmly established as theleader in wind power development, followed by Iowaand California. The DOE has said wind power couldgenerate 20% of US electricity by 2030.

According to Lester R. Brown, an American environ-mentalist and founder of the Worldwatch Institute,wind-generated electricity cost 38¢ per kilowatt-ho-ur when the wind industry began in California in theearly 1980s. Since then it has dropped to 4¢ or belowat the best wind sites and some U.S. long-term sup-ply contracts have been signed for 3¢ per kilowatt-hour. By 2010, wind farms at prime sites may be ge-nerating electricity at 2¢ per kilowatt-hour, making itone of the world’s most economical sources of elec-tricity. �

The United States

has experienced 4

years of strong

growth. In 2008,

the United States

led the world in

wind capacity

additions and in

cumulative

capacity.

WIND ENERGY

The Fastest Grow›ng

Source of Electr›c›ty

Here are some of the largest wind farms in the United States, as of October 2009:Wind farm Installedd capacity (MW) StateAltamont Pass Wind Farm 576 CaliforniaCapricorn Ridge Wind Farm 662 TexasFowler Ridge Wind Farm 750 IndianaHorse Hollow Wind Energy Center 736 TexasRoscoe Wind Farm 781 TexasSan Gorgonia Pass Wind Farm 619 CaliforniaSweetwater Wind Farm 585 TexasTehachapi Pass Wind Farm 690 California


The Town Hall functions as the center of governmentfor the town of Greenburgh, population approxima-

tely 86,000, the largest town in Westchester County (thefirst county north of New York City). Greenburgh has be-en an Energy $mart Community since February 2003and actively conducts outreach to educate its residentsand businesses about energy conservation/efficiencyand renewable energy.Town officials sought to install this 5.6 kW photovoltaicsystem primarily as a demonstration system to increasepublic awareness of the need for and benefits of rene-wable energy. The Town Hall’s central location, high vi-sibility and large number of visitors made it an ideal set-ting for this purpose. A monitor in the lobby displays re-al-time data about the system’s performance. The Townalso benefits from the electricity produced by the sys-tem and the fact that it helps reduce the Town Hall’s pe-ak demand. In order to first reduce the building’s energyconsumption, in early 2006 the Town Hall completed anenergy-efficiency retrofit, installing new high-efficiencylighting and occupancy sensors.

“We hope that our solar demonstration project at Green-burgh Town Hall will encourage residents and busines-ses throughout the town to explore solar power and ot-her energy alternatives, as well as to save energy,” saidTown Supervisor Paul Feiner. “We must reduce our useof fossil fuels and end our reliance on foreign oil. Thetown hopes to lead the way.”

THE BACKGROUNDSolar-electric power is generated from the conversion ofsunlight into electricity through a photovoltaic (PV) orsolar cell. Photovoltaics provide power naturally and re-liably. While the initial system cost can be considerable,

NYSERDA has introduced an innovative program to ma-ke PV systems and to encourage new PV installationsthrough qualified system installers.

THE SYSTEM The 5.6kW PV system, comprised of 34 PV modules, wasinstalled on a south-facing, sloped, standingseam roofof the Town Hall, occupying approximately 479 squarefeet on the roof. Through a data acquisition system, alobby display monitor provides real-time data on perfor-mance of the PV system.

THE SAVINGSThe Town of Greenburgh’s PV system will generate ap-proximately 6,840 kWh of electricity annually (roughlythe equivalent of the use of an average to large house).Emissions of CO2, the primary greenhouse gas, will bereduced by an estimated 7,460 pounds a year.

Photovoltaics provide power naturally and reliably. Whi-le the initial system cost can be considerable, NYSERDAhas introduced an innovative program to make PV sys-tems and to encourage new PV installations through qu-alified system installers.

THE STORYFor Michael Siegel and Barbara Caldwell, harvesting solarenergy just makes sense. At Farm & Granary, their 14 acrefarm nestled between the Shawangunk Ridge and theCatskill Mountains in the Rondout Valley, they take thebest of what is old and marry it to the best of what is new.Their certified organic heirloom vegetables and eggs rep-resent a new direction in agriculture. Crops on their farmare intensively grown in raised beds and in high tunnelswhich extend the season in which Michael and Barbarabring great tasting sweet potatoes, yellow Brandywine to-matoes, and varieties of beets to market. Knowing that as-sistance was needed to accomplish their goals, Michaeland Barbara contacted NYSERDA, which provided the nee-ded assistance to make the photovoltaic dream a reality.

THE SYSTEMThe system is comprised of 30 photovoltaic modules,140 watts each. The DC (direct current) power producedby the solarmodules is converted into AC (alternatingcurrent) for use by Farm & Granary. The total AC ratedpower of the system is 3.5kW. The total installed systemcosts are approximately $34,200 and the NYSERDA in-centive is $16,800.

THE SAVINGSThe estimated annual output of the Farm & Granary sys-tem is 4,900 kWh. This system should reduce the amo-unt of energy purchased by about 85%. Emissions ofCO2 will be reduced by 5,350 pounds annually. Source: www.powernaturally.org �

The town of

Greenburgh’s PV

system will generate

approximately 6,840

kWh of electricity

annually.

The estimated annual

output of the

Farm & Granary

system is

4,900 kWh.

SUCCESS STORIES OF CLEAN TECH

Clean Technology Pract›ces Make A D›fference Clean Technology Pract›ces Make A D›fference


BDG Financial Advisory Services Company, whichconcentrates on providing in-house services to

domestic and international companies, has recentlyadvised on and completed an acquisition deal in theenergy sector in Turkey. The deal involved the acqu-isition of Ka-Metal, located in Bursa by Istanbul-ba-sed Bozlu Holding.

Ka-Metal, established in 1998, has been involved inthe manufacturing of metal parts for the automotivesector. Since 2000, it has developed a business in so-lar energy, particularly related to solar tracking sys-tems in production facilities located in Bursa. Thecompany, with experience and technical know-how inproject design and implementation, is a major produ-cer of mechanical and electrical elements of solar trac-king systems in Turkey. Moreover, it holds patents for

manufacturing 6 types of solar tracking systems.

As part of its business development strategy, BozluHolding has acquired the company to enter into thesolar energy field. The new company operations willcontinue in existing production facilities under thename of Solar Energy Technology and Metal IndustryCorp. (SOLENTEK) with the objective of becoming amajor player in the solar energy sector in the co-untry and region.

BDG Financial Advisory Services Ltd., was foundedby Bayram Tuncer, Durmus Cavdar and Ahmet Gözi-tök in 2000, in Istanbul, Turkey. The managing part-ners and members of the company have been activeprofessionally in the management of major privateand public sector institutions.�

BDG Financial

Advisory Services

Compay has

recently advised

on and completed

an acquisition deal

in the energy

sector in

Turkey. NYSERDA

will provide nearly

$300 million for

renewable energy

projects under the

Renewable

Portfolio Standard

Program (RPS).

NEWS FROM THE ENERGY WORLD

BDG Adv›ses On An Energy Acqu›s›t›on Deal ›n Turkey

Governor David A. Paterson announced that theNew York State Energy Research and Develop-

ment Authority (NYSERDA), in conjunction with thePublic Service Commission (PSC), will provide nearly$300 million for renewable energy projects underthe Renewable Portfolio Standard Program (RPS),which will help accelerate the development of NewYork’s clean energy economy. With these awards,New York continues to invest in clean energy to ac-hieve Governor Paterson’s goal of meeting 45 per-cent of the state’s energy needs through energy effi-ciency and renewable energy by 2015.

The projects supported by today’s $96 million awardwill add more than 142 megawatts of renewable ca-pacity and produce nearly 578,656 megawatt hoursper year of clean renewable energy, enough cleanenergy to supply approximately 85,000 homes. Pro-

ject developers estimate that these projects will alsoprovide more than $91 million in in-state benefitsover the next three years through new jobs, increa-sed property tax revenues, royalty payments to lan-downers, and other economic activity.

New York is nationally recognized for its investmentsin clean renewable energy technologies. Includingprojects from this latest solicitation, 33 renewableprojects have been selected under the RPS program,representing more than 1,300 megawatts of rene-wable capacity. Of the 33 projects selected to date,27 have successfully entered operation, one facilityis under construction, and the five are under deve-lopment. These include 13 wind farms, 17 hydroelec-tric plant upgrades, two power plants displacing co-al with biomass, and one power plant that will use100 percent clean renewable biomass.�

$300 M›ll›on for Renewable Energy Projects

The U.S. Renewable Energy Group, A-Power EnergyGeneration Systems, and American Nevada Group

announced the development and construction of anew production and assembly plant in Nevada thatwill supply wind energy turbines for renewable ener-gy projects throughout North and South America.The facility will be about 320,000 square feet with anannual production capacity of 1,100 MW of windenergy turbines annually, enough to power 330,000homes.The facility is expected to employ about 1,000 Neva-da workers and create even more jobs during theconstruction process. ANC will identify potential si-tes for the facility and will develop the facility for thegroup. The United States Renewable Energy Group is

a U.S.-based private equity firm that mobilizes andfacilitates the participation of international financingand investment in large-scale renewable energy pro-jects within the United States.

SPG is a renewable energy industry alliance based inShenyang, China. SPG's member companies rangefrom power equipment makers to engineering servi-ce providers, including A-Power.

A-Power. through its China-based operating subsidi-aries, is the largest provider of distributed power ge-neration systems in China, focusing on energy-effici-ent and environmentally friendly projects of 25 MWto 400 MW. �

W›nd Turb›ne Product›on Assembly Plant Com›ng to Nevada


The multi-dimensional strategies of Turkey, firmlyavoiding to confront with both Western and Eastern

countries, especially reveals itself in the energy policies.Assessing all the different aspects one may suggest thatTurkey takes steps among the USA, Russia and EU wit-hin a balanced policy looking after her own interests asthe energy policies builds up in parallel to the politicalapproaches in the short and long run determining thepower balance thus the signed agreements are of inter-national importance politically. On the other hand it isnot likely to comprehend just through the opinions pub-lished in the press what the reactions from the USA wo-uld be in the future for her own plans in the region aga-inst the policies of Turkey, which Turkey considers theyare the balanced ones. Turkey rejoins against the nega-tive attitudes on her EU membership by her energy poli-cies while the USA and Russia take steps to protect the-ir interests over the countries they influence. The estab-lishment of the EU was technically dependent on theunion of coal and steel. The course in the coming dayswill prove whether the energy basin and transit routebetween the East and West would create petrol-naturalgas cooperation as much as their interests overlap. He-re it is the important that how much of this cash flow wo-uld be controlled by Turkey not how much of the petroland natural gas flowing through this pipe line would beconsumed by her. The USA does not need the MiddleEastern petrol directly. Even though America providesmost of her petrol need from the Southern American co-untries the main reason behind her interest for the pet-rol drilled in this region is that she holds the reins ofcash flow using petrol as a tool. It would be reasonableto evaluate that Turkey might be a power to control the

cash flow that would be resulted from natural gas.

One may suggest that Turkey aims to recover somemissed chances during the course of history in the co-ming years reaching in the Middle East and later to theaxis of Afghanistan and Pakistan over Iran and Cauca-sia, energy and commerce arenas of the Central Asiaand heading towards the new Silk Road destination.Several experts claims, considering the Mediterrane-an-Middle East-Europe, Turkey and the USA and Tur-key-Russia relations in the light of Braudel’s opinions,that Turkey in 2010 must adopt a policy to recover mis-sed chances, attempt for new acquisitions, protect herown interests and build up a stronger negotiation ba-se. Ed Crooks in his article published in Financial Timessays “we can accuse of none of the country in the Rus-sia’s influence sphere as they demand that their opti-ons remain open” and points out that Turkey uses herstrong leverage against Europe. “Only partnership notfriendship prevails when vital interests matter”. In thisarticle it is stressed that Turkey, before which was laidobstacles not to be a member of the EU, takes stepsimplementing different initiatives in order to gainstrength. On the other hand in an article, written by Ta-r›k Ramazan of the Islamic Research Institute of OxfordUniversity, difficulties Turkey faces during the mem-bership procedure is assessed. It reads out “Turkey ispart of Europe. The thing holds her at bay from Europeis fear”. It will be seen whether the idea ‘cowards diemany times before their deaths’ is true or not and whatenergy bids and a Turkey with stronger position willchange. The Turkey’s plan for future is based on beinga transit country in the energy network as it importsthe 92 per cent of petrol and 97 of natural gas.

WHAT TURKEY PERSUES?Another remarkable comment published in the maga-zine “The Middle East” in England in August-Septem-ber 2009 cover. In the article by Mustafa Karkouti he-adlined “What Turkey Pursues?” he claims that Tur-key is about noticing her potential to be a newly dis-covered regional power not only in the Middle Eastbut also both in Caucasia and the Balkans for the firsttime. He emphasizes that Turkey gets an open sup-port from the USA for her new foreign policy, whichmakes the issue more interesting. Another commentthat stressed the power of Turkey in the past camefrom Yevgeni Satanovski, the President of RussiaMiddle Eastern Institute. His article published in Iz-vestia was headlined “Return of Bab›ali”. (Moscow,21.1.2010). The author points to positive and impartialapproach of Turkey, taking her own interests into con-

“Cooperation with

East and West: The

attempts of Turkey to

establish a balance in

numerous fronts

instead of a

dependent allegiance

result from both her

geography and

geopolitics”

ENERGY DIPLOMACY

By Assistant Prof.Goknur Akcadag*

Energy D›plomacy of Turkey:

Cooperat›on w›th East and West


hern Corridor” and foreseeing to transport the Caspian natural gas toEurope have been significant factor. The energy maneuvers on an enor-mous geography from Trans-Caucasia to Central Asia are hereby in qu-estion. The time is approaching to take serious steps to determine thecourse of the events in the Caspian Region in coming years. (S. Tarasov,Regnum,10.1.2010). As of the end of 2009 the trade volume betweenRussia and Turkey increased 49 per cent reaching a record amount of33,8 billion USD. Ankara allowed the Southern Stream natural gas pi-peline to flow through her territorial waters. The capacity of new natu-ral gas pipeline project increased from 31 million cubic meters to 63 mil-lion cubic meters per year. Apart from that the parties have been goingon to discuss about the Southern Stream II Project.

Energy has a pivotal role in shaping Turkey’s regional role as the co-untry, a major consumer of energy in its own, is also key to linking oiland gas producers in Russia, Caspian, Central Asia and the MiddleEast with energy-hungry markets in Europe. Yet, Turks are not con-tent for being a simple “bridge” over which energy flows only; theyaspire to become a regional hub extracting greater value for thecriss-crossing oil, gas pipelines and power interconnections. This isan exceptional and unique role Turkey could play as a regional ener-gy hub, rather than a bridge. This is what Washington and Brusselsshould be supporting wholeheartedly. Unlike the West, Russia se-ems to have adjusted much earlier to this new geopolitical game.�* SUNY- Binghamton University- Fernand Braudel Center former scholar, Y›ld›z Technical

Uni., Department of Humanities and Social Sciences-‹stanbul / ‹nonu Uni. Department of

History, Turkey.

sideration in a pragmatic way, for the Russia’s regional including conf-licts in Chechnya, Abkhazia and Southern Ossetia.

PIPELINES WILL BRING LONG-TERM MUTUAL DEPENDENCE Expert Ian Lesser of German Marshall Fund says about the issue: “Tur-key has transformed her ideas dates back to the Ottoman era about Rus-sia into a remarkably interesting relations that have considerable tradeand energy features. Besides this causes long-termed questions to beasked for the tough choices and pressures Turkey may face in case therelations of West to Russia may transform into more competitive struc-ture” (Risks and Advantages of Proposal Turkey Offered Russia, 12/01,Reuters). Wolfango Piccoli of Eurasia says about the issue: “Until one ye-ar ago the close relations between Turkey and Russia had been worriso-me for the West. But in the end Europe could find out that Turkey im-ports the 65 per cent of gas she needs from Russia”. Russia is for nowkeeping silent towards Armenia-Turkey rapprochement as she has someeconomic interests (for example common petroleum and natural gasprojects with Turkey and Azerbaijan and partnerships in military andtechnical fields) because Russia has proved her own talent to break theagreements scores of times at a critical step. She is able to keep the par-ties dependent on her instigating the conflict whenever she likes thuscreating a favorable situation for herself. It is difficult to find out howenergy policies and regional conflicts are accommodated.

It is seen in the background that Ashkhabad and Baku extends theirenergy relations with other neighboring countries. The Devletabad-Se-rahs-Hangeran natural gas pipeline was opened during the visit of Ira-nian President Mahmoud Ahmedinejad to Turkmenistan. Iran will buy8-20 billion cubic meter natural gas per year from Turkmenistan. TheTurkmenistan-Uzbekistan-Kazakhstan-China natural gas pipeline, who-se projected capacity is 60 billion cubic meter, started to operate on De-cember, 2008. The Russian President Vladimir Putin explained that the-re was no any disapproval against flowing of the Turkmen natural gasinto China in addition to Russia since a new energy network had beenestablished in the Caspian Region. The details of such system have be-en cleared more after Azerbaijan wended towards Iran.

Pipeline does not only mean natural gas. Pipeline creates long-runmutual dependency between countries. Therefore it manifests itselfdefinitely in cooperation as well as in the geopolitical positions ofthe countries. So Alexandros Petersen, the Director of the EurasiaEnergy Centre of Atlantic Council, maintains that some events havingsymbolic importance exist. “West is losing its initiative to set up al-ternative destinations for the Caspian Sea natural gas reserves”. Es-tablishment a multi-axial policy is accompanied by a backstage dip-lomacy having the intrigue character. As concluded by John Robert-son, an American expert on energy security, Turkey assured the tran-sition of Turkmen natural gas profitless over Azerbaijan by fixing herown price as it was foreseen in the Nabucco Project.

Moreover Turkey, which attempted to bypass it, tries to acquire theTurkmen natural gas passing through Iran and ship it to Europe. Conse-quently implementing the “Zurich Scenario” foreseeing to postponethe agreement on the transition of Azeri natural gas through Turkey andsetting up diplomatic relations between Ankara and Yerevan has in-creased the appeal of alternative natural gas shipment destinations,both towards Iran that is to east, to Russia that is to west over Russiaand to north that is to Russia, for Azerbaijan. Some events occurred, butnot noticed by everybody, around the pipelines included in the “Sout-


Cappadocia is the ancient name of a large region inthe center of Anatolia, although when we speak of

Cappadocia today we refer specifically to the valleys ofGöreme and Urgup, with their natural pinnacles androck churches. A long, long time ago a series of erupti-ons from the cones of Mt. Erciyes and Mt Hasan cove-red the area in a thick layer of volcanic ash which soli-dified to form the soft tufa that characterises the surfa-ce strata. Both these volcanic mountains are still ex-tant and dominate the landscape. The signature of theregion, the 'fairy chimney' is formed when a cap of re-silient stone protects the column of softer material be-neath it while the surrounding tufa is removed. Thearea is now a warren of caves, underground cities, rockchurches and chambers and it's almost certain thatthere are more such sites waiting to be rediscovered.All that said, Cappadocia has gone under an enormo-us transformation during the last 40 years. As a well-known historical site, it combines the rare beauties ofnature, culture and human creativity. However, with

the influx of thousands of tourists all over the world tothe region, the texture of life has changed at times be-yond recognition. Today, it is very hard to find a tradi-tional, true cave-dwelling in any of the major towns ofCappadocia, which is not already transformed into apension house or a modernized summer residence.Most of these new built houses hardly respect to theold characteristics of the local, vernacular architectu-re. Building forms of former times, which had beendifferent as one travels from one Cappadocian villageto the next, are increasingly replaced with standardconstruction and decor elements without paying at-tention authentic ways of doing things, using localmaterials, and of course the centuries long traditionsof masonry so unique to the region as a whole. The re-sult is a rapid loss of the particular historical characterof different Cappadocian towns and villages.

I first arrived in Akkoy, Cappadocia as an internationallaw professor from Canada with my young family in thelate summer of 2008. The village is located 11 kmsnorth-east of Urgup, and the winding roads that lead tothe Cave House we were going to stay at were intrigu-ingly obscure and yet welcoming. At the time, I alreadyknew that many of the local cave dwellers of traditionalCappadocian rock-villages have been either moved tonew, subsidized houses provided and planned for thelocal population, or, villagers themselves desertedtheir ancient dwellings and ways of life and moved tonearby towns for a better life and jobs. There were in-deed three ‘emptied’ stone and rock villages on ourway to Akkoy, each more eerie than the other withhardly a handful of people still remaining in these sur-really beautiful clusters of ancient houses, graveyardsand arches. Since the 1970s, rapid urbanization, mo-dernization and the extensive growth of the tourismmarket as well as the allure of new building materialscaused dramatic changes in these villages, and for themost part, led to their decay and total deterioration.Yet, Akkoy was strikingly different. The immediatelyobservable decay of traditional, vernacular culturalwealth and the disappearance of unique Cappadocianbuilding styles were not applicable to this village. Itwas, truly, like an open air museum. What is more, ithad real people living and farming in it. Unbeknownstto me at the time, this was the beginning of a long jo-urney for me, and my dealings in Akkoy.

Fast forwarding a year, I am now a property owner inthe village, and a business partner for Mehmet Gulec,the owner and founder of the Akkoy Evleri we origi-nally stayed at as a family. I have an incredibly talen-ted team of masons turning my own cave home, Uver-cinka, into a Museum House and a Children’s Libraryto be opened in summer 2010 as a philanthropic en-terprise. I named it Uvercinka, suitable for a region

BIOTOURISM

By Nergis Canefe

BIOTUOURISM – NEW FACE OF TREND

One area of potential

interest to Turkish

investors is that of

distributed

generation

technologies,

which are

increasingly being

deployed in cities.


traditionally decorated and the cotton covers, carpets, kilims, woodenfurniture, etc. are locally produced. However, each room also includesprivate stone shower and w/c, some rooms even a jacuzzi, constanthot water, comforting wooden floors, and a must for an internationalacademic, internet service.What is more, in Akköy, this summer myself and my young boys enjo-yed natural life and tasted the fresh organic food from our own gardenand the fields and wineyards laced around the village. In the kitchen,the food is prepared fresh every day, entirely from locally grown ingre-dients and depending on what is available in each season. The cooksare villagers themselves who prepare standard regional favorites aswell as special treats for holidays. The village and its immediate envi-rons allows for direct participation in organic farming, as well as se-asonal activities as the villagers harvest the produce from the fieldsand orchards. The villagers are also expert collectors of mountain pro-duce, such as select mushrooms, herbs and berries and the visitors inour hotel are most welcome to join in these communal activities. Theharvest is then processed for the year, as grapes are squeezed into ex-tract and dried to paste, wheat and other grains and processed thro-ugh traditional means to make pesah (dry/yeastless bread) for thewinter months, jams and preserves are boiled, and fruit and vegetab-les are lined up to be dried under the sun. There are also activities forthose who suffer from specific ailments such as romatism and arthiri-tis that the villagers themselves are accustomed to for many centuri-es. The best cure for any chronical pain caused by rheumatism, arthri-tis, fybromyalgia, skin disorders, digestion problems, respiratory di-sorders and more is the natural waters and hot-water pools availablein the area. The village itself imposes nothing on the visitor or guests as there areNO shops to sell anything, or no merchants at your doorsteps. The ide-a is for one to rest, enjoy the air, the sun, the quiet, and the history andlife style that comes with the village itself. However, on the weeklymarket in the nearby town of Urgup, we also saw many different kindsof merchants, farmers from the mountains who come to sell their freshfruit and vegetables, herbs, as well as unique samples of ironware andtextile. Since its restoration and opening in 2003, Akkoy Evleri AkkoyEvleri hosted many unique guests from all corners of the world inclu-ding archeologists, nature lovers, architects, diplomats, engineers,doctors, students, teachers, photographers, professional mountaine-ers, artists, and more. They arrive from many different and unrelatedlocations, including Japan, Korea, many states in Africa, all over Euro-pe, Canada and the United States of America, as well as Australia. In

known for its love of pigeons (guvercin in Turkish). My house is parti-cularly designed as a family residence, fully furnished for long-termstay. It will offer a perfect escape for artists, writers, musicians whowish to hold workshops, master-classes or run writing and creativearts sessions. I also began making freskos on the cave walls of AkkoyEvleri , the Cave Hotel, and we are starting a winery business togetherwith Mehmet.

But why would I take the risk and invest time, energy, love, compassi-on, and cash, to this esoteric, ancient mountain village removed fromall else except the timeless routines of communal village life, cropcycles, silent and mostly empty cave houses, and quiet roads leadingto sleeping wine yards up on distant valleys? As I made several new vi-sits to the village between August 2008 and now, I learnt that akkoy isa very ancient settlement that hosted Hittites, Asurians, Seljuks andOttomans in its long history. The village's unique vernacular architec-tural style is readily observable in the stone houses carved into thevolcanic rock formations. The village as it stands was given its finalshape during the 1920s and 1930s by local craftsmen who created aspectacular vista of terraced streets and cubic stone houses fully equ-ipped with cave storage rooms, sun roofs, open kitchens and multiplechambers.

Once populated by hundreds of people and beaming with activitiesand trade, today Akköy has become one of the three adjacent ancientmountains villages in the vicinity inhabited mostly by the elderly. Thefirst wave of labour migrations from the village was to Germany duringthe 1960s, followed by the second and third waves to Turkish citiesand again abroad. Today, the remaining population of 80 to 100 peop-le are proud of their ancient settlement and protects and look aftertheir village for future generations. The civil architecture of the villageis preserved untouched. The unmatched beauty of the rows of sand-stone houses carved by local masons is a sight to be enjoyed on itsown. The villagers also continue to till the land and engage in animalhusbandry and horticulture keeping to seasonal routines, which allowvisitors to engage in biotourism activities first hand. The village has aunique graveyard that keeps to the Hittite tradition of collecting andpreserving the bones in a pile in order to open space for new burrials.The guests to the village are truly welcome to spend time with the vil-lagers, visit their households, the communal coffeehouse, and jointhem in their yearly activities.

That is why; part of our yearly routine of moving from Canada to Tur-key now includes a family stay at Akkoy. Both Uvercinka and Akkoy Ev-leri Cave Hotel's commanding location give the visitor the full view ofthe ancient village of Akköy as well as the surrounding valleys and mo-untains with three other rock and stone villages in sight, fertile fields,and the unique landscape of Cappadocia. The whole place is markedby its serenity, comforting hospitality, the unique and the magical fe-atures of the village. The area around the village offers superb oppor-tunities for historical site-seeing, photography and nature hikes, andof course, biotourism. In terms of accommodation, the quality of thecave rooms make you feel cool in the summer and warm in the winter.Volcanic rock called "tuffa" is perfect insulation material. It keeps thetemperature between 17 - 20 degrees Celsius throughout the year. Allrooms at Uvercinka as well as at the Akkoy Evleri are different fromeach other in their size, shape and qualities, but they each have thesignature curves, texture, cupboards, fireplaces, arches and decorati-ons characteristic of the village’s local civil architecture. All rooms are

that, I take comfort and justify my rather unusual decision to spendpart of my life in a distant mountain village in Cappadocia, where I amthe only urban person and a non-local, while feeling truly at home inour new home, Uvercinka.

BIOTOURISM CALENDAR OF AKKOYDECEMBER/ JANUARY / FEBRUARY /MARCHThese long months of the winter come with plenty of sunshine andwhite snow to the valleys and hills surrounding the village. For thosewho may be tempted, there is plenty of small game for hunting in theenvirons of the village, as well as the possibility of nature walks withspecial winter shoes used by the villagers. In the evenings, it is a de-light to gather around the wood stoves and fireplaces in your room andthe hotel’s central areas and restaurant, to eat barbecued potatoesand local vegetables. The local village café is a welcoming spot for longevening chats, drinking tea and coffee and sharpening your back-gam-mon and other Middle Eastern game skills with the villagers. Thenights are crisp and quiet, with an early morning sunrise always wel-coming you to the new day.

APRIL With the arrival of spring, the outlook of the village changes entirely.The stone houses and pavestone pathways are now laced with thespring bloom of apricot, plum and almond trees. The fields are filledwith the buds of narcissus, anomone and other rare mountain bulbo-us flowers. The villagers engage in communal clearing of the fields andpruning of the fruit orchards as well as tending of the wineries. Our gu-ests are welcome to work along the villagers, as well as enjoy guidedtours of the spring brooks, rare plants in the valleys and mountains, as

well as bird watching and other calm activities to enjoy the spring we-ather and sunshine in full.

MAY The best gift of the month of May is the early crop of fruits that naturegives us. Plum, apricot and almond trees have special green fruits thatthe villagers, especially the children, really enjoy. This is also the timefor communal mushroom picking activities in the mountains. This an-cient habit equips the villagers with a much appreciated delicacy fortheir local cooking practices. Our guests are welcome to join us in le-arning the different kinds of edible mushrooms growing in our moun-tain village as well as the myriad recipes used to enjoy their rare tasteto the fullest.

JUNEWhile the work in the agricultural fields had slowed down in April andMay, june is the month when the bulk of the work for organic farmingtakes place in the village. The fields need regular tending, wateringand upkeep until the harvest time. June is also a special month of fes-tivities. At the third week of the month, there is the annual Rice Festi-val of the village, whereby the whole community goes upto the moun-tain tops, eats, dances and plays traditional instruments to celebratethe summer and the upcoming harvest. Our guests are most welcometo take part in these ancient festivities and enjoy first hand the beautyof communal traditions of Asia Minor.

JULYIn this month, fruits and vegetables ripen and are ready for harvesting.Our guests are welcome to join us in collecting the gifts of nature in themany fields we have in the environs of our village, down in the valley,up on the mountains tops and along the brooks running through thevillage itself.

AUGUST /SEPTEMBERThis is the Harvest Time, when all the hard work of the year comes tofruition. The villagers are now in the fields, collecting the goods andgifts of nature, working hard in teams, when entire families and seve-ral generations work side by side. All the harvest then gets carried in-to cave storages. Big wood fires are built to boil the fruits and grapesto produce the precious extracts and to make yearly preserves andjams. Nuts such as walnuts are harvested for yearly consumption, bro-ken and stored in cotton bags. The local delicacies of sun-dried apri-cots are bagged for winter months and fruit and vegetable compostsare prepared. This is practically the best season to join the villagers intheir agricultural activities as the autumn season slowly sets in.

OCTOBER/NOVEMBERPreparations for the long winter season starts. In the households, vil-lagers make yeastless bread and special baked goods for storage. Wo-od is collected from the valleys for the long months ahead. Seeds arebrought to the fields and the villagers make the preparations for nextyear’s crop by tilling and turning the soil before putting the seeds in.This is a wonderous time when the light turns orange, and long naturetours and walks in the area allows the enjoyment of the crisp mounta-in air and the changing colors of the local trees for our visitors. Our vi-sitors are also most welcome to join the villagers in their winter prepa-ration activities.�

For contact: www.akkoyevleri.com or email: [email protected].

BIOTOURISM


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I N C O M E T A X I N C O M E T A X P r e p a r a t i o n P r e p a r a t i o n


Kyrgyzstan is the only country in Central Asia, thewater resources of which are located in its own ter-

ritory almost entirely, and this is its hydrological pecu-liarity and advantages, as well as one of its main as-sets. The water reserves are estimated at approxima-tely 2,458 km3, 1,745 km3 of which are lake watersand 650 km3 in glaciers. The total surface river flow is50 km3 and groundwater resources make up 13km3.

The Kyrgyz Republic is a country, the greatest part ofwhich is surrounded by mountains, with a populationof 5.3 million people, and an area of 200,000 km2. It islocated in the eastern part of Central Asia and sharesborders with China, Kazakhstan, Tajikistan and Uzbe-kistan. Mountains occupy 94% of the territory ofKyrgyzstan.

Energy is the basic sector of Kyrgyz economy, provi-ding the domestic needs of the national economy andpopulation with electricity and heat energy. The well-being of the Kyrgyz people and successful economicdevelopment of the country largely depends on a stab-le and reliable operation of the energy sector. Expected reserves of 70 main coal deposits in theKyrgyz Republic are estimated at more than 2.2 billiontons while in-place reserves are 1,317 million tons.

According to forecasts, undiscovered reserves of oiland gas resources make up about 289 million tons offuel oil equivalent. Fifteen oil and gas fields are beingexploited in the south of the country with recoverable

reserves of industrial oil totaling 11.6 million tons and4.9 billion cubic meters of natural gas. The main source of energy in the country is water reso-urces, the energy potential of which is estimated at142.5 billion kW-hrs of possible generation of powerper year, only 10% of which is currently used. The water and power potential of our republic is rankedthird among the CIS countries after Russia and Tajikis-tan. Development of Kyrgyzstan's water and power po-tential is the main target strategy for the energy deve-lopment program of the republic. On the whole, the po-wer system operates 18 power stations with a total ins-talled capacity of 3,666 MW, of which the power instal-led in hydraulic power plants (HPPs) is 2,950 MW andthere are two thermal power plants (TPPs) with an ins-talled capacity of 716 MW. The cascade of the Toktogulhydropower plants, with a powerful water basin that isthe Toktogul reservoir with the capacity of 19.5 billioncubic meters of water, makes up the basis of power ge-neration in hydro-power plants and providesKyrgyzstan and the neighboring states of the CentralAsian region, not only with electricity but also with irri-gation water for irrigation of the most important crops.

A UNIFIED ENERGY SYSTEMWhen designing and creating a unified energy systemfor Central Asia, the cascade of Toktogul HPPs was plan-ned to work in the irrigation regime. And this means ma-ximum discharges of water from the cascade of ToktogulHPPs in vegetation seasons, in spring and summer, inexchange for fuel resources for TPPs in the winter. Bynow, this technological scheme has been violated dueto lack of power in Kyrgyzstan, which resulted in a chan-ge in the mode of operation of the cascade from an irri-gational one into a power mode. Consequently, the wa-ter discharge is intensified not only in spring and sum-mer, but in winter too, in order to meet Kyrgyzstan’s do-mestic needs in electricity. This affects noticeably thevolumetric capacity of the water reservoir.

AN ENERGY INVESTMENT OPPORTUNITY IN CENTRAL ASIA

By Burçak Akduman *

Expected reserves of

70 main coal deposits

in the Kyrgyz

Republic are estimat-

ed at more than 2.2

billion tons while in-

place reserves are

1,317 million tons.

A Potent›al Dest›nat›on for

Turk›sh-Amer›can Energy

Contractors


In this context, water resources cannot be considered separate from is-sues of energy, since the main hydro-systems of interstate importancein the basins of the Naryn-Syr Darya and Amu Darya rivers not only re-gulate the flow of water in these rivers, but also generate the lion's sha-re of electric power in the joint power system in Central Asia.Due to the fact that the volume of the existing hydro-systems of inters-tate importance allow the regulation of the flow of transboundary ri-vers, there is no need to build basins for irrigation purposes only.

For these purposes, there are a sufficient number of existing hydro-sys-tems of interstate importance. Only new generating stations are neces-sary, operating in parallel with the united energy system of Central Asi-a, through which discharges of water could be regulated effectively forthe benefit of the entire region, respecting the environment. In Kyrgyzstan, only on the Naryn River and on its tributaries, 22 hydro-power stations can be built with an annual power output of about 30billion kilowatt-hours.

KAMBARATA HPP-2In 2007, Kyrgyz President Kurmanbek Bakiyev made a strategic decisionto resume construction of Kambarata HPP-2 with the capacity of 360 MWand to allocate funds from the budget for this purpose. The start of put-ting into operation of the first aggregate of this power plant is expectedin the first six months of 2010, while a unique large-scale explosion on theconstruction of the dam is going to be implemented in December 2009.However, the greatest efficiency of Kambarata HPP-2 is going to be achie-ved in the presence of a reservoir at Kambarata HPP-1. For this reason, atpresent, the Government of the Kyrgyz Republic is working on practicalimplementation of the project of construction of Kambarata-1 with the ca-pacity of 1,900 MW. Construction of Kambarata HPPs will make it possib-le to use the Toktogul hydropower site, both in energy and in irrigationmode in the interests of all Central Asian republics with the possibility toexport electricity up to 9 billion kWh annually. For the purpose of ensuring connection of Kambarata HPPs to the po-wer system and serving out power, construction of 500/220 kV “Datka”power substation and 220 kV networks in the south of the republic isplanned.

To improve reliability of the main electrical power networks of the re-public and to increase the capacity of transmission lines to the north ofthe republic, it is planned to build a 500 kV transmission line entitled“Datka-Kemin”, that is going to be 410 km long, and 500 kV “Kemin”substations.In order to solve the problem of improvement of reliability and susta-inable power supply to consumers in the south of Kyrgyzstan, to use itsown power network, and to improve interaction between the energysystems of neighboring countries in 2010-2011, it is planned to buildtransmission lines of 110 kV entitled “Aygultash-Samat”, which are go-ing to be 140 km long.

EXPORTING ELECTRICITYAn issue for electricity export to South Asia in the international project CA-SA-1000 is being worked on too. In order to develop the Central Asian andthe South Asian Regional Electricity Market ("CASAREM"), a Memoran-dum of Understanding between Kyrgyzstan, Tajikistan, Pakistan and Afg-hanistan was signed on 16 November 2007 in Kabul. In accordance withthe project, upon completion of the transmission line 500 kV "Datka-Khudjand (Tajikistan)", it will be possible to export electricity fromKyrgyzstan in the amount of up to 2 billion kWh starting from 2013.

Development of the power industry should be the top priority in the for-mation of the fuel-energy complex in the country, taking into conside-ration great importance of meeting the demand for power at the ener-gy market in Central Asia.

The share of the power industry accounts for about 5% of the GDP, 16%of industrial production volume, and 10% of state budget revenues.Production of the electric power industry plays an important role in en-suring the development of the republic's economy, covering the repub-lic industries and population’s needs in energy, and generating hardcurrency from its export.

Development and efficient operation of the fuel-energy complex of therepublic depends, to a great extent, on solving problems, providing anagreed mutually beneficial cooperation of Central Asian countries withrespect to formation of a balanced, rationally functioning energy mar-ket in the region. This will allow the optimization of the routine work ofhydroelectric and thermal power plants, oil refineries and coal mines, toensure the efficient use of generating capacities of plants, both in a da-ily and annual mode.

Activities are conducted to strengthen the country’s energy indepen-dence through development of generating sources.

The development priorities in the short-term period are to increaseelectricity output through rehabilitation of the existing power genera-ting facilities. First of all, that means reconstruction of Bishkek TPP-1 bybringing its electrical capacity to 400 MW, reconstruction of Uch-Kur-gan HPP and At-Bashy HPP, by attracting investments. Further develop-ment of the hydropower capacity of the Naryn River is going to take pla-ce as well. Currently, a study is being undertaken to assess options fordevelopment of hydro potential in the upper reaches of the Naryn Riveras well as technical and economic characteristics of first-priority HPPs.

KARA-KECHE THERMAL POWER PLANTStrengthening of the basic capacities of the power system is also ex-pected through construction of Kara-Keche thermal power plant of over600 MW, in the coal fields of Kara-Keche. Work on the formation and development of the electric energy and po-wer market is underway. A significant amount of work on developmentof commercial electric power accounting systems has been completed,ensuring the formation of a power and electricity wholesale market. In-dustrial structures of the energy sector have been reformed on the func-

tional basis for the purpose of adapting them to market methods of ma-nagement. In addition, incorporation and partial privatization of enter-prises have been conducted.

In order to develop the energy sector, the state paid sufficient attentionto building and improving the legal framework in the fuel-energy comp-lex. Research on new mechanisms that combine primarily state and le-gislative regulation with market methods of economic stimulation wereconducted constantly. Over the past few years, the management struc-ture and the fuel-energy complex facility regulation in the Kyrgyz Re-public have been significantly modified, and principal laws regulatingthe energy industry have been adopted.

In turn, analysis of legal and regulatory framework allows us to concludethat Kyrgyzstan has one of the most liberal legislations in the field of ener-gy among the countries of Central Asia, and it has the necessary legal fra-mework to attract direct foreign investments into the energy industry.

The Ministry of Energy attaches great importance to the issue of energyconservation and use of renewable energy sources. Some steps have be-en taken already to increase the production of energy-saving lamps andlight-emitting diode (LED) bulbs, to master production of electronic elec-tricity supply meters, as well as natural gas, water and heating meters."Short-term strategies and priorities for the development of the energyindustry for 2009-2012" have been instituted, as well as the Program of"Energy conservation in the Kyrgyz Republic for 2009-2015" and theProgram of Small Waterpower Engineering Development in the KyrgyzRepublic. These documents, as well as the adopted National EnergyProgram of the Kyrgyz Republic for 2008-2010, the Development Stra-tegy of Fuel-Energy Sector until 2025, the Law of the Kyrgyz Republic "OnRenewable Energy”, and Regulations on procedure of construction, ac-ceptance and technological connection of small hydro power plants to theelectrical networks, make up a strong legal and regulatory basis of deve-lopment of energy conservation and renewable energy sources.

WATER-ENERGY RESOURCES An important issue is protecting Kyrgyzstan`s interests in the frame-work of rational use of the water-energy resources of Central Asia. Atthe meeting of presidents of Central Asian States that took place on 28April 2009, President Kurmanbek Bakiyev raised issues of working outmutually acceptable solutions in the fields of securing water-energy re-sources in Central Asia, conservation of the area of formation of the lar-gest rivers, which are the Syr Darya and the Amu Darya, reduction ofglaciers, reforming of the International Fund for Saving the Aral Sea,compensation for services on water accumulation, and creation of mul-tilateral commissions on integrated water resources management.

In these issues, the main efforts of the Ministry are targeted at the de-velopment of a new long-term draft agreement on using water-energyresources in the Central Asian region with reflection of issues of balan-ced use of water-energy resources, creation of a financial mechanism toregulate using of water-energy resources, development of coordinatedpricing rules, and distribution of costs and revenues with an equal be-nefit for all participants.

Hydropower engineering development in Central Asia representing a sing-le water-energy system can have a positive impact on the environment,maintaining a healthy natural environment for future generations. �* Burcak Akduman is advisory board member of TurkofAmerica.

AN ENERGY INVESTMENT OPPORTUNITY IN CENTRAL ASIA


ESBAS

The three major universities in Izmir (Ege Univer-sity, 9 Eylül University and Izmir Institute of Tech-

nology) are acknowledged as the national and inter-national authorities in Biomedical Technologies,subjects including but not limited to Bioengineering,Bio-mechanics, and Materials Sciences.

Human resources, physical infrastructure, and rese-arch results in this field have more than sufficient ca-pacity to lead the Biomedical Technologies Industryand Production Sector, which is now beginning todevelop in Izmir.

For this reason and with these resources, the creati-on of clusters and excellence centers will assure theleadership of Izmir in this area.The project consists of three stages that depend onindustrial and academic partnership:

& INOVERSITYEducation Network

& INOVACITYR&D Region

& INOVATECHScience and Technology Park

An international Graduate Program will be activatedin the Biomedical Technologies field with the sup-port of The Scientific and Technology Research Co-uncil of Turkey-TUBITAK, the Turkish American Sci-entists and Scholars Association-TASSA, qualifiedEU universities and three national universities withinthe scope of INOVERSITY.

This program is going to award post graduate (M.Sc.), doctorate (Ph. D) and post doctorate (Post Doc)degrees in an exchange program model. This educa-tion will be carried out with the support of three uni-versities, Turkish academicians who are the mem-bers of TASSA and currently living in USA, highly pla-ced officials of TUBITAK, and a supervising coordina-tion committee. Our goal is to train qualified emplo-yees and encourage R&D operations to make the re-gion a leader in the biomedical technologies field.

Save the date:

1st Izmir Global

Health Conference

May 24-25, 2010

Aegean Free Zone

Gaziemir, Izmir,

TURKEY

Education activities in INOVERSITY, which is a virtu-al creation, will be performed with the support of thethree universities’ physical and human resources ba-ses and also within the framework of the “memoran-dum of understanding‘’ that has been signed by thethree universities.

In an R&D Center to be created at Aegean Free ZoneDevelopment and Operating Co-ESBAS and other lo-cal / foreign sector stakeholders, within the scope of‹NOVACITY, the devices that universities cannot sup-ply because of the financial difficulties will be provi-ded. Both researchers from Izmir and other parts ofTurkey as well as American scientists coming fromTASSA will be free to use them.

INOVATECH will pave the way for commercializing re-search results. Izmir and its surrounding area is be-coming a more appealing location for BiomedicalTechnologies. In this concept, the basis for creatingnational and international new technologies and uni-que products will be completed.

Ege University Science and Technology Centre-EBIL-TEM is the coordinator of the EU CIP Program. Inter-national cooperation will be coordinated with Enter-prise Europe Network. R&D and promotion supportfor reaching international markets and attracting fo-reign investment will be developed. The enterprisewill be made stronger by the coordination and co-operation of ESBAS and American medical productfirms.

With this unique approach, individuals who gain ne-cessary skills will become creative, innovative, solu-tion oriented, positive people with a global vision.

• Izmir is an ideal environment to work at forR&D scientists from both Turkish and foreign co-untries,

• The great wealth of Izmir’s infrastructure andhuman resources will be attractive for local andforeign investments,

• A cluster in Biomedical Sector will be initiated.


A NEW IDENTITY FOR IZMIR – INOVIZ

BUILDING BRIDGES FOR SUSTAINABLE

SCIENCE AND TECHNOLOGY

Theme: Izm›r for Health


IMS Health, the world’s leading provider of marketintelligence to the pharmaceutical and healthcare

industries, reported annual U.S. prescription salesgrowth of 1.3 percent in 2008, to $291 billion. Dis-pensed prescription volume in the U.S. grew at a 0.9percent pace.IMS Health also reported that the value of the globalpharmaceutical market in 2010 is expected to grow 4- 6 percent on a constant-dollar basis, exceeding$825 billion, driven by stronger near-term growth inthe U.S. market. The forecast, the leading annual in-dustry indicator of market dynamics, predicts globalpharmaceutical market sales to grow at a 4 - 7 per-cent compound annual growth rate through 2013,and takes into account the impact of the global mac-roeconomy, the changing mix of innovative and ma-ture products, and the rising influence of healthcareaccess and funding on market demand. Global phar-maceutical market value is expected to expand to$975+ billion by 2013.In its latest forecast, the company raised its expecta-tions for five-year pharmaceutical market growth by

one percentage point, partly due to the stronger de-mand being experienced in 2009. “Overall, market growth is expected to remain at his-torically low levels, but stronger-than-expected de-mand in the U.S. is lifting both our short- and longer-term forecasts,” said Murray Aitken, senior vice pre-sident, Healthcare Insight, IMS. “The economic cli-mate will continue to be a dampening influence inmost mature markets, particularly in those countrieswith rising budget deficits and publicly funded healt-hcare systems. In the U.S., pricing flexibility and in-ventory management actions are contributing tomuch higher growth than anticipated earlier this ye-ar, and are the main reasons for the upward adjust-ment to our five-year forecast.”In its latest analysis, IMS identifies the following keymarket dynamics:

• Growth prospects in the U.S. market improve. Ne-ar-term growth prospects in the U.S. have strengthe-ned in recent months, reflecting both sustained le-vels of price increases and changing inventory stoc-king patterns. Pharmacy chains are more tightly ma-naging their inventory levels based on expectationsof patient demand, which has led to greater purcha-sing volatility than in previous years. This also hasplayed a role in unusually high sales growth in thefirst quarter of 2009 relative to forecast expectati-ons. U.S. market growth in 2009 is now expected tobe 4.5 - 5.5 percent, and 3 - 5 percent in 2010.

• Economic downturn affects markets to varying deg-rees. Growth has slowed in countries where there ishigh out-of-pocket spending on pharmaceuticalsand steep declines in macroeconomic activity, espe-cially in Russia, Mexico and South Korea. At the sa-me time, growth has been less affected to date in co-untries where drugs are largely funded publicly,such as in Germany, Japan and Spain. However, newcost-containment measures expected to be introdu-ced during the forecast period likely will impact thepace of growth in these markets. In the U.S., phar-maceutical manufacturers’ efforts to expand accessto and awareness of patient assistance programs, aswell as co-pay subsidies for patients in need, are li-miting the impact of the economic downturn to someextent.

• Impact of the innovation/patent loss imbalancedampens growth prospects. Consistent with thetrend over the past several years, the next five areexpected to reflect a significant imbalance betweennew product introductions and patent losses. This isthe primary factor limiting global pharmaceuticalmarket growth to the mid-single digits through 2013.

U.S. market growth in

2009 is now expected

to be 4.5 - 5.5 percent,

and 3 - 5 percent in

2010. Despite economic

conditions significantly

affecting some markets

– notably Russia,

Turkey, South Korea

and Mexico – the seven

pharmerging countries

are expected in aggre-

gate to grow by 12 - 14

percent in 2010

PHARMACEUTICAL & HEALTCARE INDUSTRIES IN THE USA

The Global Pharmaceut›cal Market

Exceeds $825 B›ll›on


two markets.

• Healthcare access and funding under intensifying pressure. Theeconomic climate has heightened concerns by payers about healt-hcare funding, and intensified their efforts to limit access to non-ge-neric drugs. During the next five years, markets will be impacted bynumerous payer actions, including the imposition of price cuts onexisting drugs, the raising of standards required to achieve reimbur-sement for innovative therapies, and the use of economic incentivesfor prescribers and pharmacists to drive a shift to generic alternati-ves. Evidence of the value that medicines bring to healthcare sys-tems will be required to achieve access and funding in both develo-ped and emerging markets.�

During the next five years, products that currently generate an un-precedented $137 billion in sales are expected to face generic com-petition, including Lipitor®, Plavix®, and Seretide®.

• Pharmerging markets in aggregate sustain strong growth. Despiteeconomic conditions significantly affecting some markets – notablyRussia, Turkey, South Korea and Mexico – the seven pharmerging co-untries are expected in aggregate to grow by 12 - 14 percent in 2010,and 13 - 16 percent over the next five years. China’s pharmaceuticalmarket is expected to continue to grow at a 20+ percent pace annu-ally, and contribute 21 percent of overall global growth through2013. Russia and Turkey may be impacted significantly by new me-asures intended to reduce the level of healthcare spending in those

GROWTH IN GLOBAL BIOTECHOLOGY, 2007-08 (US$m)Public company data 2008 2007 ChangeRevenues 89,648 80,344 12%R&D expense 31,745 26,881 18%Net income (loss) (1,443) (3,055) -53%Number of employees 200,760 201,690 -0.5%Number of companiesPublic companies 776 815 -5%Public and private companies 4,717 4,799 -2

Source: Ernst & Young

TOP CORPORATIONS BY U.S. SALES US$ IN BILLIONS RANK 2008 2007 2006 2005 2004 1 PFIZER 20.5 23.6 26.8 27.3 31.1 2 GLAXOSMITHKLINE 18.4 20.7 22.2 20.2 19.1 3 ASTRAZENECA CORP 16.3 15.5 14.7 12.7 11.5 4 JOHNSON & JOHNSON 16.0 16.3 16.1 16.0 16.7 5 MERCK & CO 15.5 17.6 16.7 15.4 15.3 6 AMGEN CORPORATION 13.4 14.3 14.5 11.9 9.6 7 HOFFMAN-LAROCHE 13.1 12.4 10.4 8.2 6.2 8 NOVARTIS 12.4 13.9 13.9 12.9 11.5 9 LILLY 11.4 10.3 9.2 8.7 8.2 10 SANOFI AVENTIS 11.0 10.9 11.0 11.2 10.2 11 ABBOTT 10.0 9.7 9.5 8.7 8.0 12 TEVA PHARM USA 9.2 7.9 7.4 5.7 4.7 13 BRISTOL-MYERS 8.0 6.9 6.4 8.3 9.1 14 TAKEDA 8.0 7.7 7.2 6.6 6.2 15 WYETH CORP 7.6 8.6 8.2 8.1 8.1 Total US Prescription-bound market 291.5 287.6 276.5 253.9 239.9

Source: IMS National Sales Perspectives™

GLOBAL BIOTECHNOLOGY AT A GLANCE IN 2008 (US$m)Global US Europe Canada Asia-Pacific

Public Company Data Revenues 89,648 66,127 16,515 2,041 4,965R&D expense 31,745 25,270 5,171 703 601Net income (loss) (1,443) 417 (702) (1,143) (14)Number of employees 200,760 128,200 49,060 7,970 15,530Number of companiesPublic companies 776 371 178 72 155Public and private companies 4,717 1,754 1,836 358 769

Source: Ernst & Young


Biotechnology is a $89 billion a year industry inthe U.S. that has produced some 160 drugs and

vaccines. According to Erns & Young report, in 2008the revenues of the publicly traded global biotech-nology industry increased by 12%, from US $80.3billion in 2007 to US$89.7 billion.

According to the same report, in Europe, the reve-nues of publicly traded companies increased by26%. This growth rate was boosted by the impact offluctuations in the exchange rate — when stated ineuros, revenues grew by 17%.

In Canada, revenues of publicly traded biotechcompanies decreased 9%, from US $2.2 billion in2007 to US $2 billion in 2008, mainly due to the ac-quisitions of four significant Canadian firms — Ari-us, Aspreva, Axcan and Draxis — by foreign compa-nies. If 2007 revenues were adjusted to excludethose four companies, the industry’s revenues wo-uld have increased by 26% instead of falling.

In the Asia-Pacific region, revenues grew by an im-pressive 25%, led by strong growth in Australia,where the sector benefited from strong sales ofCSL’s Gardasil. Indeed, in each region, a few matu-re companies had a disproportionate impact ontop-line growth, highlighting that biotech remainsan industry of haves and have-nots.

DEAL ACTIVITYDeal activity remained strong in 2008, driven bothby long-term trends such as big pharma’s need toreinvent itself because of looming patent expirati-ons and by the immediate challenges created bythe current funding environment. M&A activity was

robust in both the US and Europe. The total value ofM&A transactions involving US biotechs was morethan US$28.5 billion — a record high not countingmegadeals in prior years, such as the 2007 acquisi-tion of MedImmune by AstraZeneca. Though absentany megadeals in 2008, the US totals were boostedby three large transactions valued at more thanUS$5 billion each: Millennium Pharmaceuticals’ ac-quisition by Takeda Pharmaceuticals, ImCloneSystems’ purchase by Eli Lilly, and the acquisitionof Applied Biosystems by Invitrogen (since rena-med Life Technologies). In Europe, M&A transacti-ons totaled US$5.0 billion (€3.4 billion).

The potential value of strategic alliances involvingUS biotech companies reached an all-time high ofalmost US$30 billion, while the potential value ofalliances involving European companies was US$13billion (€8.8 billion).

INDUSTRY FACTS Biotechnology is responsible for hundreds of medi-cal diagnostic tests that keep the blood supply sa-fe from the AIDS virus and detect other conditionsearly enough to be successfully treated. Homepregnancy tests are also biotechnology diagnosticproducts.

Consumers already are enjoying food items grownwith the help of biotechnology, such as papayas,soybeans and corn. Hundreds of biopesticides andother agricultural products also are being used toimprove our food supply and to reduce our depen-dence on conventional chemical pesticides.

Environmental biotechnology products make it pos-sible to clean up hazardous waste more efficientlyby harnessing pollution-eating microbes withoutthe use of caustic chemicals.

Industrial biotechnology applications have led tocleaner processes that produce less waste and useless energy and water in such industrial sectors aschemicals, pulp and paper, textiles, food, energy,and metals and minerals. For example, most la-undry detergents produced in the United Statescontain biotechnology-based enzymes.

DNA fingerprinting, a biotech process, has dramati-cally improved criminal investigation and forensicmedicine, as well as afforded significant advancesin anthropology and wildlife management.

Source: Biotechnology Industry Organization�

BIOTECHNOLOGY INDUSTRY

B›otech Industry Facts

There are 1,473

biotechnology compa-

nies in the United

States, of which 371

are publicly held. In

2008 the revenues of

the publicly traded

global biotechnology

industry increased by

12%, from US $80.3

billion in 2007 to

US$89.7 billion.


US BIOTECHNOLOGY AT A GLANCE (US$b)

Public Companies Industry Total

2008 2007 Change 2008 2007 Change

Financial

Product sales $54.1 $49.9 8.4% $57.0 $52.7 8.0%

Revenues 66.1 61.0 8.4% 70.1 64.9 8.0%

R&D expense 25.3 21.0 20.5% 30.4 26.1 16.8%

Net income (loss) 0.4 (0.1) -430.7% (3.7) (4.2) -11.2%

Industry

Market capitalization $343.8 $369.2 -6.9% — — —

Total financings 8.6 15.9 -46.3% 13.0 21.4 -39.2%

Number of IPOs 1 22 -95.5% 1 22 -95.5%

Number of companies 371 395 -6.1% 1,754 1,758 -0.2%

Number of employees 128,200 131,300 -2.4% 190,400 192,600 -1.1%

Source: Ernst& Young

BIOTECHNOLOGY LEADERS IN TOTAL REVENUE IN THE US MARKET (Trailing Twelve Months)

Amgen Inc. $14.6 B

Gilead Sciences, Inc. $7.0 B

Genzyme Corporation $4.5 B

Biogen Idec Inc. $4.4 B

Life Technologies Corporation $3.3 B

Celgene Corporation $2.7 B

Talecris Biotherapeutics Holding $1.5 B

Charles River Laboratories Inte $1.2 B

Qiagen N.V. $1.0 B

Amylin Pharmaceuticals, Inc. $758.4 M

Source: Yahoo Finance, Marc 2010

SELECTED 2008 US BIOTECH M&As

Company Location Acquired company Location Value (US$m)

Takeda Japan Millennium New England 8,800

Life Technologies San Diego Applied Biosystems SF Bay Area 6,700

Eli Lilly Other (Indiana) ImClone New York State 6,500

Kinetic Concepts Texas LifeCell New Jersey 1,700

GlaxoSmithKline UK Sirtris New England 720

ViroPharma PA/Delaware Valley Lev New York State 618

Hologic New England Third Wave Tech. Midwest 580

J&J New Jersey Omrix New York State 438

Galderma Pharma Switzerland CollaGenex PA/Delaware Valley 420

Ipsen France Tercica SF Bay Area 404

Novartis Switzerland Protez PA/Delaware Valley 400

Teva Israel CoGenesys Mid-Atlantic 400

Valeant LA/Orange County Dow Pharmaceutical Sci. SF Bay Area 277

The Future of the

B›omed›cal Industr›es

›s ›n New York State

The Future of the

B›omed›cal Industr›es

›s ›n New York State


Despite the deep recession, pharmaceuticalresearch and biotechnology companies remain a

potent economic force throughout New York and theindustry has strong potential for continued long-term growth.

According to a survey in the July 2006 issue ofBusiness Facilities Magazine, New York State isranked first in the nation for biotech growth. This sci-

ence represents a formidable force in the 21st centu-ry and New York State is at the forefront of cutting-edge research and developments.

As a one of the world leaders in the biomedicalindustries, New York State remains the destinationof choice for many high profile biotech, pharmaceu-tical and medical manufacturing companies, such asPfizer, Bristol-Myers Squibb, Sanofi, Johnson &

The Cyberstates

2009 report shows

that New York State

remained the third

largest cyberstate,

employing 304,200

with a total payroll of

$25.9 billion.

THE FUTURE OF BIOMEDICAL


OTHER REGIONAL RESOURCES Capital RegionSUNY Albany - Biotechnology Incubator New York State Health Department's Wadsworth Center Albany Medical Center

Central New York/Mohawk ValleySUNY Upstate Medical University Finger Lakes University of RochesterRochester Institute of Technology (RIT)

Long IslandCold Spring Harbor Laboratory Brookhaven National Laboratory Millennium Technology CenterLI High Technology Incubator - Stony Brook Broad Hollow Bioscience Park at SUNY Farmingdale North Shore-Long Island Jewish Health System (North Shore-LIJ)Biotechnology Incubator

Mid-HudsonThe Landview at Eastmark - Tarrytown Ardsley Park - Tarrytown New York Medical CollegeIBM Thomas J. Watson Research Center

New York CityAudubon Biomedical Science and Technology Park Columbia University Medical Center Memorial Sloan-Kettering Cancer Center Rockefeller University SUNY Downstate Medical University Structural Biology Center - City College of New York Weill Medical College of Cornell University

North CountryClarkson University

Southern TierBoyce Thompson Institute for Plant Research Cornell's Nanobiotechnology Center Cornell Genomics InitiativeNew York State Agricultural Experiment Station

Western New York Roswell Park Cancer Institute SUNY Buffalo Gov's Center of Excellence in Bioinformatics in Buffalo

CONTACTNew York State Industry SpecialistJeff Janiszewski , Industry DirectorTelephone: (518) 292-5247 E-mail: [email protected]�

Johnson, Bausch & Lomb, Bayer, Welch Allyn, J&J's Ortho-ClinicalDiagnostics, Celltech, Wyeth, Genecor, and Albany MolecularResearch.

In addition, the Cyberstates 2009 report - which details national andstate trends in high-tech employment, wages, and other key eco-nomic factors for all 50 states, the District of Columbia, and PuertoRico - shows that New York State remained the third largest cyber-state, employing 304,200 with a total payroll of $25.9 billion. NewYork's high-tech industry experienced a net gain of 2,700 jobs in2007, the most current year for which state data are available.

New York State ranks the second in the nation for academic researchand development expenditures at nearly $3.5 billion, and in 2005ranked second in the number of science and engineering doctoratesawarded, with 2419.

In 2005, New York State was ranked third nationwide for the numberof grant awards provided to its research institutions, a total of 4898with a value of $2.72 billion, according to the National Institute ofHealth.

New York State is a preeminent center for health care and medicalresearch and plays a key role in the international medical technolo-gy industry. With a high concentration of hospitals, medical researchinstitutions, and leading surgeons and physicians who pioneer newpractices and procedures, New York State serves as a major base forclinical trials of medical technology products.

New York State is home to many of the world's preeminent surgeons,physicians, scientists and a skilled, high-tech workforce. Accordingto a study commissioned by the Biotechnology IndustryOrganization in 2004, New York State had more than 33,000 biolog-ical scientists in the workforce, the second highest in the US.

BIOMEDICAL RESOURCESNew York State has an abundance of science and technologyresources available to serve its burgeoning Biomedical community. Alist of statewide and regional resources, including trade associa-tions, research and development centers, academic and researchinstitutions follows.

ASSOCIATIONSNew York Biotechnology Association (NYBA) Biotechnology Industry Association (BIO) Health Care Industries AssociationAMDeC Foundation, Inc.

SUPPORTING RESEARCH NYSTARList of Biomedical-related Centers for Advanced Technology (CATs):Center for Biotechnology - SUNY Stony Brook Center for Biotechnology - Cornell UniversityThe Center for Automation Technologies at Rensselaer PolytechnicInstitute The Center for Electronic Imaging Systems at the University ofRochesterThe Center for Ultrafast Photonic Materials and Applications at CUNY


Pharmaceutical research and biotechnology compa-nies remain an economic force throughout New

York, and a new study shows the industry has strongpotential for continued long-term growth.

An analysis of the impact of the biopharmaceuticalsector on the economy of New York, using data prima-rily from 2006, indicates that the biopharmaceuticalindustry generated $29.1 billion in total output, ofwhich $16.0 billion was generated from direct employ-ment. New York State is responsible for 6.8% of all di-rect biopharmaceutical output nationally. The biop-harmaceutical industry paid $3.8 billion in wages todirect employees in 2006. In 2008, New York was second in the nation with5,053 clinical trial sites in the state. Additionally, NewYork shows its broad medical strength with high num-bers of trials being performed for all 9 conditions stu-died. The top regions in the state for total employment areNew York City, Long Island and Westchester. The regi-ons that have the best “clustering” effect are Long Is-land, Rochester and Westchester.

Between 1996 and 2006, nationally, employment inthe biopharmaceutical sector grew twice as fast as allother sectors combined, 3.1% versus 1.4% compoundannual growth rates. Additionally, each direct biop-

harmaceutical job supported 3.7 other jobs in the eco-nomy in 2006, as compared to 2.2 jobs in 1996.

During that same time period, the industry was res-ponsible for numerous breakthroughs, including theFDA approval of more than 400 new medicines.

From 1999 to 2007, items in the development pipelinein the U.S. grew from 1,756 to 2,742 for a compoundannual growth rate of 5.7%. However, the number ofnew entity approvals granted annually fell over that ti-me period, from 47 in 1997 to 27 in 2006.

In 1996, New York ranked third nationally in direct bi-opharmaceutical employment, behind California andNew Jersey, and had risen to second place by 2006.However, New York State ranked 4th in 2006 in totalbiopharmaceutical employment, with New Jersey andPennsylvania passing ahead of New York. This indica-tes that those two states have a greater clustering ef-fect from direct employment than New York. However,the biopharmaceutical sector in New York should beseen as a growth area, with untapped potential giventhe balance of research resources and growth oppor-tunities.

The biopharmaceutical sector in NY is responsible for55,446 direct jobs, 38,590 indirect jobs, and 36,428induced jobs, of which 16,885 of the total are unionjobs. In comparison to other states in the U.S., NewYork ranks second in direct biopharmaceutical jobs,behind California, and fourth in total employment du-e to the biopharmaceutical industry, behind Californi-a, New Jersey, and Pennsylvania.

The analysis indicates that direct employment in thebiopharmaceutical industry is responsible for $16.0billion in economic output, indirect employment for$8.1 billion, and induced employment for $5.0 billion,for a total output of $29.1 billion.

New York ranks fourth in total output, behind Califor-nia, New Jersey and Pennsylvania. The average directoutput per direct biopharmaceutical employee in NewYork is $288,182, compared to $155,443 for all othersectors. In total, New York State is responsible for6.8% of the nation’s direct biopharmaceutical output.

Regions in New York with the highest amount of “clus-tering” are Long Island, Rochester, and Westchester.The three regions with the lowest amount of cluste-ring are New York City, Ithaca and Binghamton.

* Report Prepared by Archstone Consulting LLC, Feb-ruary 2009 �

An analysis of the

impact of the

biopharmaceutical

sector on the

economy of New

York, using data

primarily from 2006,

indicates that the

biopharmaceutical

industry generated

$29.1 billion in total

output.

ECONOMIC IMPACT

Econom›c Impact of the B›opharmaceut›cal

Sector on New York State*

Volume 8 Issue 35 - Energy Special Issue

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