Can solar and wind investors recover revenue lost because of renewable energy curtailment in Turkey? A 2026 guide for foreign investors covering TEIAS instructions, grid congestion, system security, compensation claims, evidence, administrative remedies and project acquisition risks.

Renewable energy curtailment is becoming an increasingly important risk for investors in Turkish solar, wind and hybrid power projects.

A renewable energy plant may be technically capable of generating electricity, have sufficient wind or solar resources and possess a valid generation license, yet still be unable to deliver all available electricity to the grid because generation is restricted for system security, transmission congestion, balancing requirements, maintenance or other network-related reasons.

For a large renewable project, even relatively short periods of repeated curtailment can translate into substantial lost revenue.

This creates an important question for foreign investors:

If a Turkish solar or wind farm is ordered to reduce generation, can the project company recover the revenue it would otherwise have earned?

There is no universal rule that every curtailed MWh automatically creates a compensation claim. The answer depends heavily on why generation was restricted, who issued the instruction, the regulatory basis for the restriction, the project’s contractual position, whether the curtailment was lawful and how the financial loss can be proven.

In 2026, this issue deserves particular attention because Turkey’s transmission system continues to accommodate substantial new renewable capacity, while TEIAS remains responsible for real-time generation-consumption balancing and system-security operations through its national and regional load dispatch structure. (TEİAŞ)

What Is Renewable Energy Curtailment?

Curtailment occurs when a power plant that could technically produce electricity is required or compelled to reduce the electricity delivered to the system.

For example, a 100 MW wind farm may have sufficient wind to operate near full capacity but receive an instruction requiring production to be reduced to 60 MW.

The missing 40 MW represents potential generation that cannot be delivered during the relevant period.

For solar plants, the same situation can arise during periods of high irradiation.

The financial question is therefore:

Available Generation – Permitted Generation = Curtailed Generation

However, calculating compensation is considerably more complicated than applying this simple formula.

Why Are Renewable Power Plants Curtailed?

Curtailment can arise for several reasons.

The electricity system must maintain a continuous balance between production and consumption. TEIAS states that its National Load Dispatch Center and regional centers operate the transmission system, manage real-time supply-demand balancing, conduct operational planning and perform N-1 analyses to preserve system security. (TEİAŞ)

Consequently, restrictions can potentially arise from transmission congestion, system-security requirements, excessive regional generation, maintenance, equipment failures, voltage issues or other operational conditions.

The legal consequences depend on the reason behind the restriction.

A temporary emergency instruction required to preserve system stability is legally different from repeated curtailment allegedly caused by an unresolved network deficiency.

Is Curtailment Automatically Unlawful in Turkey?

No.

The fact that a renewable power plant could technically produce more electricity does not necessarily give the investor an unconditional right to inject that entire amount into the grid at every moment.

Electricity networks must operate within technical and security limitations.

TEIAS performs real-time balancing and system-security functions precisely because unrestricted generation by every plant could compromise safe system operation. (TEİAŞ)

Accordingly, the correct legal question is usually not:

“Was our generation reduced?”

It is:

“Was the reduction authorized, technically justified, proportionate and implemented in accordance with the applicable regulatory and contractual framework?”

That distinction is fundamental to a curtailment dispute.

Can Renewable Energy Investors Claim Lost Revenue?

Potentially, but not merely because curtailment occurred.

A successful compensation strategy generally requires establishing a legal basis for liability.

Depending on the circumstances, the investor may need to demonstrate that the restriction resulted from an unlawful administrative measure, breach of a connection or system-use arrangement, improper network operation, discriminatory treatment, failure to comply with applicable market rules or another legally actionable event.

The project must then establish causation and financial loss.

Therefore:

Curtailment ≠ Automatic Compensation

but

Unlawful or Contractually Actionable Curtailment + Proven Loss = Potential Compensation Claim.

The Cause of Curtailment Must Be Identified First

This is the most important first step.

Foreign investors should not immediately calculate millions of euros in lost electricity revenue before identifying why the project was curtailed.

The legal team should establish:

Who issued the instruction?

When was it issued?

What technical reason was given?

How long did it continue?

Which other generators were curtailed?

What regulatory provision was relied upon?

Was the restriction mandatory?

Was compensation or settlement treatment available under the applicable market rules?

Only after answering these questions can the correct remedy be identified.

TEIAS Curtailment Instructions

For transmission-connected projects, TEIAS’s system-operation role becomes particularly important.

TEIAS operates Turkey’s national transmission system and manages real-time production-consumption balancing through its load-dispatch infrastructure. (TEİAŞ)

A foreign investor challenging a curtailment-related loss should therefore preserve every instruction received from the relevant load-dispatch center.

This can include electronic dispatch records, operational communications, SCADA records and internal plant logs.

A telephone instruction should also be documented internally immediately after receipt.

Distribution-Level Curtailment

Not every renewable project is directly connected to the transmission system.

Projects connected through distribution infrastructure may face different network constraints and different counterparties.

The investor should therefore first identify:

Transmission Connection → TEIAS

or

Distribution Connection → Relevant Distribution Network Operator.

The applicable contractual and regulatory route can differ materially.

Grid Congestion Curtailment

One common commercial concern is curtailment caused by insufficient transmission capacity.

Suppose a region experiences substantial renewable development but the transmission infrastructure cannot continuously accommodate peak renewable production.

Several plants may then face restrictions.

A foreign investor should investigate whether the constraint was temporary and exceptional or recurring and foreseeable.

Repeated curtailment can substantially affect the economic value of a renewable project.

System Security Curtailment

Some restrictions may be necessary to preserve electricity-system security.

For example, operational conditions may require rapid generation changes to maintain frequency, voltage or other technical parameters.

The legal analysis should distinguish legitimate system-security intervention from allegedly excessive or incorrectly implemented restrictions.

An investor cannot simply argue that every reduction required for network stability constitutes compensable damage.

Planned Maintenance

Curtailment can also arise during planned transmission maintenance.

The project should review whether the relevant maintenance was properly notified and whether the connection or system-use framework allocates the associated risk.

The investor should preserve:

Maintenance Notice → Planned Duration → Actual Duration → Curtailment Instructions → Generation Data → Communications.

If an outage substantially exceeds the announced period, the difference may require separate legal analysis.

Emergency Curtailment

Unexpected failures can require immediate restrictions.

A transmission-line fault, transformer failure or another serious event can force generation to be reduced rapidly.

In such circumstances, emergency system protection can carry significant legal weight.

However, an emergency does not eliminate the need to investigate what happened.

If the alleged emergency resulted from prolonged failure to repair a known problem, the investor may need to examine the underlying facts more closely.

Repeated Curtailment Is Particularly Important

An isolated curtailment event may have relatively limited financial consequences.

Repeated curtailment is different.

Suppose a 200 MW solar project loses substantial generation every afternoon during high-production months because of recurring regional transmission constraints.

The cumulative financial effect can become material.

The investor should create a Curtailment Register containing:

Date → Start Time → End Time → Available Capacity → Permitted Capacity → Lost MWh → Reason Given → Instruction Source → Market Price → Estimated Revenue Loss.

This evidence can become central to a future claim.

Can the Investor Challenge the Curtailment Decision?

Potentially, depending on the legal nature of the disputed act.

The first question is whether the investor is challenging an administrative/regulatory decision, implementation of electricity-market rules or performance under a contractual relationship.

Different disputes may therefore require different forums and remedies.

A foreign investor should avoid filing proceedings before determining precisely what legal act caused the loss.

Administrative Remedies

Where curtailment results from a challengeable administrative act, administrative-law remedies may become relevant.

Judicial review can potentially examine whether the contested measure was lawful.

Possible issues may include:

Authority

Procedure

Legal Basis

Factual Basis

Proportionality

Purpose

Equal Treatment

The precise arguments depend entirely on the circumstances.

Compensation for an Unlawful Administrative Measure

If a restriction is ultimately established to be unlawful and causes financial loss, the project company may also investigate whether compensation can be pursued under administrative-law principles.

This requires more than establishing that the investor would have preferred a different system-operation decision.

The project generally needs a legally actionable measure, causation and quantifiable damage.

This makes contemporaneous evidence extremely important.

Contractual Compensation Claims

Some curtailment disputes may instead—or additionally—arise from contractual relationships.

Relevant documents can include:

Connection Agreement

System-Use Agreement

PPA

EPC Agreement

O&M Agreement

Financing Agreements

Government or Investment Agreements, if any

The allocation of grid interruption and curtailment risk should be examined in each contract.

A PPA, for example, may contain specific provisions concerning deemed generation or compensation when electricity cannot be delivered for defined reasons.

Deemed Generation Clauses

Foreign investors financing renewable projects frequently focus on whether a PPA contains a deemed generation mechanism.

Such a clause can potentially determine revenue consequences when the plant is available to generate but electricity cannot be delivered because of specified events.

However, the wording is critical.

The clause should define:

Qualifying Curtailment Event → Available Generation → Measurement Method → Applicable Electricity Price → Exclusions → Payment Mechanism.

A poorly drafted deemed-generation clause can produce substantial disputes after curtailment begins.

How Is Lost Generation Calculated?

This can become one of the most difficult parts of a compensation claim.

A solar plant cannot simply state that it would have operated at maximum capacity throughout the curtailment period.

The claimant must establish what the plant would realistically have generated.

For solar projects, relevant evidence can include:

Irradiance Data → Historical Performance → Inverter Data → Comparable Uncurtailed Periods → Plant Availability → Module Performance.

For wind projects:

Wind-Speed Data → Turbine Power Curves → Turbine Availability → SCADA Data → Wake Effects → Historical Production.

Technical expert evidence may therefore be essential.

Calculating Lost Revenue

After lost generation is established, the next question is price.

The calculation might conceptually involve:

Lost MWh × Applicable Electricity Value = Gross Lost Revenue

But the applicable electricity value depends on the project’s commercial structure.

Relevant considerations may include market prices, bilateral contract prices, renewable support arrangements and other project-specific revenue components.

Costs avoided because electricity was not generated may also need to be considered when determining recoverable net loss.

YEKDEM and Curtailment Losses

For projects benefiting from renewable-energy support arrangements, lost revenue analysis can become more complicated.

The investor should establish whether the curtailed electricity would have qualified for the relevant support mechanism and what price would have applied.

The project should not automatically calculate its claim using the highest theoretically available tariff.

The counterfactual revenue must correspond to the project’s actual regulatory and commercial position.

Battery Storage and Curtailment

Battery storage can change the commercial impact of curtailment.

A renewable project equipped with BESS may be capable of storing electricity that would otherwise have been curtailed and delivering it later, depending on its technical and regulatory configuration.

This can potentially reduce lost revenue.

However, storage does not necessarily eliminate curtailment risk.

Battery power capacity, energy capacity, state of charge and grid restrictions can all limit how much curtailed generation can actually be recovered.

Hybrid Projects and Curtailment

Hybrid power plants can also face unique curtailment issues.

For example, a wind-plus-solar facility may have combined mechanical generation potential exceeding the electrical capacity available at the connection point.

Some reduction may therefore be inherent in the project’s commercial design rather than externally imposed curtailment.

Foreign investors should distinguish:

Designed Internal Limitation

from

External Grid Curtailment.

Only the second category necessarily raises a network-related dispute.

Equal Treatment Between Generators

A particularly sensitive dispute can arise where one investor believes its plant was curtailed while comparable neighboring facilities continued operating.

Different treatment is not automatically unlawful.

There may be legitimate technical reasons.

However, the project should investigate whether curtailment criteria were applied objectively and consistently.

Relevant evidence can include regional generation records, connection configurations, dispatch instructions and technical constraints.

Can Foreign Investors Claim Discrimination?

Potentially, if there is evidence of legally unjustified differential treatment.

But nationality alone should not be inferred as the reason merely because the affected project is foreign-owned.

A credible discrimination claim requires evidence showing that comparable projects were treated differently without sufficient legal or technical justification.

Investment Treaty Claims

For major foreign investments, severe and persistent state-related curtailment may also prompt analysis under an applicable bilateral investment treaty.

This is a much higher threshold than an ordinary revenue dispute.

Routine and legitimate electricity-system regulation does not automatically constitute a treaty violation.

Nevertheless, where state conduct toward a qualifying foreign investment is allegedly arbitrary, discriminatory or otherwise inconsistent with treaty protections, international investment-law analysis may be appropriate.

The investor should examine:

Nationality → Investment Structure → Applicable Treaty → Protected Investment → Government Conduct → Domestic Remedies → Treaty Standards.

Curtailment During a Power Plant Acquisition

Foreign investors acquiring an operating solar or wind farm should investigate historical curtailment before closing.

This is often overlooked.

A project may report excellent technical availability while nevertheless suffering significant grid-related production restrictions.

The buyer should therefore request at least:

Historical Curtailment Data

TEIAS or Distribution Instructions

SCADA Data

Monthly Lost Generation

Connection Correspondence

Network Outages

Compensation Claims

Pending Disputes

Grid Reinforcement Plans

Historical generation alone may not reveal the problem.

Seller Representations and Warranties

The SPA should address material curtailment history.

Depending on the transaction, the seller can be required to disclose all material curtailment instructions, grid restrictions and disputes.

The buyer should be particularly cautious if the financial model assumes unrestricted future generation despite substantial historical curtailment.

Purchase Price Adjustment

Persistent curtailment can directly affect valuation.

Suppose a wind farm has theoretical annual production of 600 GWh but historically loses approximately 8% of available generation because of network restrictions.

A valuation assuming 600 GWh without adjusting for curtailment may materially overstate project value.

The buyer should model:

Gross Potential Generation – Expected Curtailment = Realistic Saleable Generation.

This adjusted figure should feed directly into the acquisition model.

Can the Seller Claim Future Grid Reinforcement Will Solve the Problem?

Possibly, but the buyer should verify the claim.

Planned transmission investment should not automatically be treated as completed infrastructure.

The buyer should investigate the status, budget, construction timetable and expected commissioning date of the relevant network reinforcement.

Until the reinforcement is sufficiently certain, the financial model should incorporate curtailment risk.

Evidence Foreign Investors Should Preserve

A project expecting a potential curtailment dispute should preserve evidence from the first event.

Important evidence includes SCADA records, dispatch instructions, meteorological data, plant availability data, meter data, market prices, correspondence, outage notices, connection agreements, system-use agreements, PPA documentation, technical reports and contemporaneous calculations of lost generation.

This evidence is far more persuasive than attempting to reconstruct lost production several years later.

2026 Regulatory Context

Turkey’s electricity-market rules continue to evolve as renewable generation and network requirements increase. In 2026, EPDK has continued updating and consulting on electricity-market regulations, including proposed amendments affecting balancing and settlement arrangements. (EPDK)

TEIAS has also continued publishing renewable connection-capacity information and implementing new decisions affecting generation-system interactions. For example, a November 2025 regulatory decision introduced a mechanism under which licensed generators can apply regarding electricity delivered above their contractual injection capacity, subject to specified timing and conditions. (TEİAŞ)

For investors, this reinforces an important point: curtailment analysis must use the rules applicable at the exact date of the disputed event rather than relying solely on the regulatory framework that existed when the project was originally financed.

Example: Solar Plant Repeatedly Curtailed

A foreign investor owns a 150 MW solar project.

During summer, the project repeatedly receives instructions reducing output during peak irradiation.

The investor calculates substantial annual lost revenue.

Before bringing a claim, it should determine the technical reason for each instruction, identify the legal basis, obtain historical network data, quantify the electricity that would actually have been generated and determine whether the applicable regulatory or contractual framework provides a basis for compensation.

Example: Wind Farm Curtailed During Transmission Maintenance

A wind farm receives notice that transmission maintenance will require reduced generation for three days.

The restriction ultimately continues for two weeks.

The investor should distinguish losses arising during the originally anticipated maintenance period from additional losses associated with the prolonged restriction and investigate the reasons for the extension.

Example: One Plant Curtailed but Neighboring Plants Continue Generating

A foreign-owned wind project is repeatedly restricted while nearby facilities appear to continue operating.

The investor should obtain technical evidence before alleging unequal treatment.

Different connection points, voltage levels, transmission constraints or operational requirements may justify different dispatch treatment.

If those explanations do not account for the difference, further regulatory and legal investigation may be appropriate.

Example: Foreign Buyer Discovers Historical Curtailment

A foreign infrastructure fund agrees to acquire a solar project.

The seller’s financial model assumes 1,800 equivalent full-load hours.

Due diligence reveals that the project historically loses approximately 7% of potential annual production because of network constraints.

The buyer should incorporate realistic curtailment into the base-case model and determine whether the seller’s forecasts require adjustment.

This may materially reduce the purchase price.

Major Curtailment Red Flags

Foreign investors should pay particular attention to repeated dispatch-down instructions, unexplained production gaps, major differences between resource availability and electricity delivered, recurring regional transmission constraints, prolonged maintenance outages, unequal treatment allegations, missing curtailment records, unresolved TEIAS correspondence, compensation disputes and financial models that assume zero future curtailment despite significant historical restrictions.

These issues can materially affect both operating revenue and asset value.

Renewable Energy Curtailment Dispute Strategy

When substantial curtailment occurs, the project should follow a structured approach:

Record Instruction → Preserve SCADA Data → Identify Technical Reason → Determine Legal Basis → Calculate Lost Generation → Review Connection and System-Use Documents → Review PPA → Compare Treatment of Other Plants → Determine Responsible Party → Assess Administrative or Contractual Remedies → Quantify Recoverable Loss.

The investor should avoid waiting until year-end to reconstruct events.

Curtailment disputes are strongest when every restriction has been documented contemporaneously.

Frequently Asked Questions

1. What is renewable energy curtailment?

Curtailment occurs when available electricity generation is reduced or prevented from being delivered because of system, grid, operational or other restrictions.

2. Can TEIAS require a renewable power plant to reduce generation?

Turkey’s transmission-system operator performs real-time balancing and system-security functions, which can require operational interventions in generation under the applicable electricity-market framework. (TEİAŞ)

3. Does every curtailment event create a compensation right?

No. Compensation depends on the legal basis for the restriction, applicable regulatory and contractual rules, responsibility for the event and proof of loss.

4. Can a foreign investor sue for lost electricity revenue?

Potentially, where there is a legally actionable basis for liability and the investor can establish causation and recoverable financial damage.

5. How is lost solar generation calculated?

Typical evidence includes irradiance measurements, SCADA data, historical plant performance, equipment availability and technical modelling.

6. How is lost wind generation calculated?

Wind data, turbine power curves, SCADA records, turbine availability and historical performance can be used to estimate counterfactual generation.

7. Can repeated grid congestion support a compensation claim?

Possibly, but recurring congestion alone does not automatically establish liability. The legal basis of the restrictions and allocation of network risk must be examined.

8. Can a PPA provide compensation for curtailment?

Yes, depending on its wording. Some agreements allocate curtailment risk through deemed-generation or similar compensation mechanisms.

9. Should curtailment be investigated before buying a Turkish renewable project?

Absolutely. Historical curtailment can materially reduce expected generation, EBITDA and therefore the purchase price of a power plant.

10. What is the most important evidence in a curtailment dispute?

Contemporaneous dispatch instructions, SCADA records, meteorological data, plant-availability information and the documents establishing the legal reason for the restriction are among the most important evidence.

Legal Support for Renewable Energy Curtailment Disputes in Turkey

Curtailment can transform a technically successful renewable project into a financially underperforming investment. The existence of lost generation, however, should be separated from the legal question of whether that loss is compensable.

Firat Fesih Kaya Law Office assists foreign investors, renewable-energy developers and international energy companies with power plant and electricity-market disputes in Turkey. Firat Fesih Kaya can assist with renewable-energy curtailment claims, lost-generation analysis, TEIAS and regulatory disputes, connection and system-use issues, administrative proceedings, compensation claims and due diligence for acquisitions involving historically curtailed projects.

The essential strategy is to establish four elements as early as possible: what caused the curtailment, who was legally responsible, whether the restriction was lawful and how much revenue the plant would actually have earned without it.

Phone: +90 312 434 22 22
Mobile Phone: +90 532 769 22 22
Email: info@firatfesihkaya.av.tr
Address: Mevlana Boulevard No: 221, Yildirim Tower, Balgat, Cankaya / Ankara, Turkey