This is a best prospect industry sector for this country. Includes a market overview and trade data.
Last Published: 6/24/2019

Overview

Smart City projects in Turkey are fewer in number than in European countries and in the United States. Therefore, there is room for growth and opportunities for new projects with U.S. exports.  Limited funding and qualified human resources are the main obstacles.  A lack of Global Information Systems (GIS) infrastructure is another challenge; only 3% of municipalities have completed their GIS investments or implemented GIS systems.  The Ministry of Development (MinDev), with the help of the other relevant ministries, prepared the Information Society Strategy and Action Plan for 2015-2018.  According to this study, many cities have already introduced smart applications, particularly in transport and urban services.

Accessing services through electronic channels and e-government is the most popular application among municipalities.  However, smart applications in the fields of energy and water management are much needed and, on their way, with Supervisory Control and Data Acquisition (SCADA) and GIS applications in particular, by electric utilities, water and sewage administrations in major cities.  Smart metering is still in early stages.  To facilitate the development of smart cities in Turkey, MinDev assigned the Ministry of Environment and Urbanization (MinEnv) as the responsible institution and MinEnv recently established a new Smart Cities and Geospatial Technologies Department under the Directorate General of Geospatial Informatics, Planning and Coordination, Application and Development.  This new department is developing a National Smart City Strategy and Action Plan 2019-2022 and is leading all country-wide smart city applications, such as city information system software and 3D data modeling development software, both of which will be used by all municipalities and central government organizations.  As of May 2019, the Strategy is awaiting final approval, after which it will be published.  Once published, it can be accessed here.

Leading Sub-Sectors

Smart Energy
Smart grid systems deployment has already started in Turkey.  Stages of implementation vary from one electric distribution company (DisCo) to another.  Most have deployed SCADA and GIS systems.  DisCos give importance to smart grid deployment to decrease losses, increase reliability and quality.  The Turkey Smart Grid 2023 (TSG’2023) Vision and Strategy Roadmap sets some targets for full smart grid system implementation in Turkey.  TSG’2023 will be implemented during and after the 3rd Tariff Implementation Period (2016-2020) and is aimed at providing a road map to DisCos on the 2035 smart grid vision in the short and medium term (3rd and 4th Tariff Implementation Periods) by highlighting priorities.  Several DisCos have approval to implement different types of energy storage pilot projects to understand the benefits of energy storage in electric distribution.  DisCos are also planning for electric vehicle charging stations.  The Turkish Government intends to replace 30% of street lighting (there are currently 7.5 million street lights) with smart LED lighting systems by 2023.  This change is estimated to bring a savings of $40 million, with an increase to $130 million with further LED conversion between 2023-2033.

Smart Mobility
Intelligent Transportation Systems (ITS) are being installed in many Turkish cities.  However, other than major cities such as Istanbul, Izmir, and Ankara, the majority are in the early stages.  The Ministry of Transportation & Infrastructure stated in its 2013-2023 Action Plan that all cities will implement smart traffic light systems according to traffic density; green wave systems where cars, after encountering one red light, pass through subsequent green lights when maintaining a specific speed; digital traffic signs; and solar powered bus stops with digital arrival time boards.

Currently, all smart transportation projects are planned and realized by local municipalities; however, while some use their own resources, others use local or foreign funding resources.  Since there is no central ITS institution, it is not possible to obtain the total amount of spending or planned spending for all projects in Turkey. 

Some implementations are as follows:  Ankara has smart bus stops, an online traffic density map, and an online tracking system for fire department vehicles.  Izmir implemented in 2018 the most advanced ITS system in the country - the Fully Adaptive Traffic Management System – and continues to upgrade it.  This system includes: fully adaptive intersections; online traffic density maps for passengers/drivers; special traffic lights, such as talking lights, for the disabled; and an enforcement system to track speed/parking/lights, etc.  A World Bank-funded project continues to be implemented and e-payment cards will be used on all modes of transportation, including ferries, busses, trains, and metros.  Istanbul has an intelligent signalization system, electronic enforcement system, traffic congestion and emergency management center, talking roads & talking vehicles (connected vehicles), an automated parking system with unmanned payment points, e-payment cards, smart bus stops, special info points at bus stops for the disabled via cards.  Other cities have shared bicycle systems (Antalya, Izmir, Erzincan, Kocaeli, Yalova).  E-cards are used in both highly populated (e.g., Istanbul) and smaller (e.g., Mardin) cities.  ITS systems are utilized partially in Eskisehir, Konya, Mardin, Kahramanmaras, Gaziantep, Sakarya, Yalova, Kars, Edirne and Manisa.  Following recent local elections, some new mayors could focus on traffic problems and look into ITS implementation.  However, this will depend largely on available budgets.

Smart Infrastructure
Turkey's accession process to the European Union, though currently stalled, has been a major impetus for large-scale environmental remediation and implementation of new environmental standards.  Local municipalities play an important role in recycling, water purification, waste-sewage treatment, environmental remediation and solid waste management.  The U.S. Department of Commerce’s International Trade Administration has identified Turkey as a top 10 market for U.S. environmental technology exports.

Preventing water loss is a priority for Turkish municipalities.  The water authorities of some large and industrialized cities have implemented SCADA systems to identify water losses and network failures.  However, this system needs to be expanded to less developed regions of Turkey as well.  Restoration of the sewage network and treatment of sewage sludge are also important.  Moreover, the textile, cement, iron/steel, chemical, food processing and automotive sectors will need to make investments in wastewater treatment.

With respect to waste management and recycling, Turkey is mostly in line with European legislation; however, it lacks source separation recycling.  Although not an EU member, Turkey’s candidacy requires harmonization of environmental regulations with EU standards.  Alignment with EU standards creates an environmental infrastructure and technologies market that will ultimately be worth $96 billion.  Such alignment should be complete by 2024.  Although there are recycling facilities, more development of regional solid waste processing and recycling facilities and sanitary landfills is needed.  The government also plans to remediate and upgrade existing unsanitary landfills.  With President Erdogan’s wife Mrs. Emine Erdogan’s initiative, government buildings, including the public schools and hospitals, are expected to switch to source separation recycling, which is expected to advance the whole system when fully implemented.  In some major cities, waste to energy systems are being implemented.  Private sector companies and organized industrial zones are also among potential buyers.

Regarding the air pollution controls subsector, Turkey has made great strides in improving the monitoring of air quality and has instituted a national air pollution monitoring program. The main sources of ambient air pollution in Turkey are thermal energy generation through coal-fired power plants, home heating units, motor vehicles and industrial sources.  The government is requiring the installation of flue gas desulfurization (FGD) units on all new and existing power plants, opening up high-value projects in the air pollution control market.

Opportunities

As of April 2018, the World Bank approved a $91.54 million loan for the Sustainable Cities II Project in Turkey.  This is the second project in a series under the Program for Sustainable Cities, which aims to improve the economic, financial, environmental and social sustainability of Turkish cities by enabling interested municipalities to access financing for their investments and to deliver improved services to their citizens.  The first Sustainable Cities Project, valued at $132.7 million, was approved on December 20, 2016.  The project is being implemented by IlBank of Turkey, which was established in 1933 to fund reconstruction activities of Turkish municipalities.  The grant will assist the cities of Antalya, Mugla, Denizli, Kayseri, Balikesir, Ordu, Kahramanmaras, Malatya, Mardin, and Van through financing investments in infrastructure needed to meet service delivery requirements in the water and wastewater systems, public transport, waste management, and energy services.  Denizli, Mugla, and Antalya will also receive support in preparing urban and financial investment plans through the first Sustainable Cities Project’s Institutional Strengthening component, which is co-financed by the European Commission.  U.S. companies can participate in these projects as vendors to the municipalities.

The semi-government owned Turkish telecom company, Turk Telekom, and one of its affiliated companies, Innova, have a smart city management platform where all smart applications operating in the city are managed by a single operations center.  Together, they have completed two smart city pilot projects with the municipalities of Karaman and Kars.  They have also moved on to the second phase of the municipality of Antalya’s smart city infrastructure project and have similar projects in the pipeline with the municipalities of Kirsehir and Mersin.  U.S. companies can integrate their technology to this platform.  As Turk Telecom has broadband fiber infrastructure in every city in Turkey, it could act as an integrator for U.S. companies while reaching out to Turkish municipalities.

Web Resources

For further information on this section or for more on potential opportunities, contact:

Yaprak Cakilcioglu
Commercial Specialist
Smart Technologies Team Leader
U.S. Commercial Service Turkey
Yaprak.Cakilcioglu@trade.gov
www.export.gov/turkey

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