Data-Based Infrastructure for Smart Cities
Indicative Return:
Investment Timeframe
Market Size
Ticket Size
Investments in Connectivity Technology for Smart Cities: A data-based city infrastructure to use smart performance meters for resource efficiency
Expected ImpactThis IOA will utilize IoT technology and smart meters to enable the real-time monitoring of energy consumption to improve energy and resource efficiency levels.
RegionsCentral Anatolia Region, Eastern Anatolia Region, Marmara Region, Mediterranean Region
Development need: Turkey’s performance on SDG 9 (Industry, Innovation and Infrastructure) exhibits major challenges, and significant challenges still remain for SDG 12 (Responsible Consumption and Production) according to the Sustainable Development Report 2020. (1)
Policy priority: The government has planned the following public investment amounts for urban infrastructure areas for 2020: 198 million TRY (29 million USD) for urbanization, 152 million TRY (22 million USD) for communication infrastructure, 71 million TRY (10 million USD) for environment and 67 million TRY (10 million USD) for municipal services. (2)
Gender inequalities and marginalization issues: Within the infrastructure sector, there is a high rate of informality among solid waste collectors. Workers in this area suffer from poor working conditions and a lack of social security. In terms of the provision of utilities, households with lower income levels face the risk of energy poverty. Fair employment practices and pricing mechanisms need to be implemented to address the issues of marginality within this sector. Investments in this area need to generate job opportunities within the green economy and promote energy-efficiency measures to decrease the household consumption costs.
Investment opportunities: Turkey’s Private Participation in Infrastructure (PPI) figures show that infrastructure in ICT, integrated MSW (municipal solid waste) and treatment and disposal still needs a higher private sector engagement. (3)
Key bottlenecks: Given high investment and operations costs, human capital and technology resources and governance needs, some urban infrastructure services such as wastewater treatment facilities cannot reach the desired efficiency levels. New models are needed to improve efficiency in urban infrastructure
Policy priority: There is a target to facilitate advanced metering infrastructure that measures energy distributed until 2025 and which includes at least 80% of customers by 2035 as part of Turkey’s Smart Grid roadmap. (4)
Gender inequalities and marginalization issues: According to academic reseach in this area, approximately a quarter of the households in Turkey are energy poor. Half of the households with the lowest income levels carry the risk of facing energy poverty. (18)
Investment opportunities: Turkey’s Private Participation in Infrastructure (PPI) figures show that infrastucture in ICT, integrated MSW (municipal solid waste) and treatment and disposal still needs a higher private sector engagement. (3)
Key bottlenecks: While investing in digital infrastructure initiatives such as smart cities, it is imperative to not only invest in digital literacy, but also digital security to minimize risks
Critical IOA Unit
A market sizing value for smart meters does not currently exist for Turkey, but a sectoral report is used to retrieve the current number of smart meters in use.
The household number is retrieved from the database of Turkish Statistical Insititute.
Research by European Commission in similar contexts shows that smart metering investments generate between 11.7-17% IRR. (8)(9)
In order to advance 5G network and infrastructure, installation of 5G stations are expected to be finalized by 2023. (10) Large scale installations take between 5 to 6 years. (11)
Türk Telekom already piloted a project with BUSKİ and Baylan Water Meters to install smart water meters to remotely monitor water consumption.
Ticket SizeThe COVID-19 era showcased the need for remote monitoring for utilities, as countries struggled to monitor energy expenditures in-person.
Smart metering helps optimize energy use, reducing energy waste and increasing disposable income for households.
According to academic reseach in this area, approximately a quarter of the households in Turkey are energy poor. Half of the households with the lowest income levels carry the risk of facing energy poverty. (18)
This IOA can enable real-time monitoring of energy consumption to improve energy and resource efficiency through smart meters using IoT technology.
This IOA can increase resource utilization by installing smarter energy management infrastructure.
This IOA can lower energy use by enabling customers to make informed decisions through data collection.
Investments in this IOA will particularly help households with limited purchasing power to optimize on their energy use.
9.5.1 Research and development expenditure as a proportion of GDP
Current Level0.96% (12)
Target LevelThe long-term objective for this indicator is a value of 3.7. (12)
11.a.1 Number of countries that have national urban policies or regional development plans that (a) respond to population dynamics; (b) ensure balanced territorial development; and (c) increase local fiscal space
Current Level1 (13)
Target Level1 (13)
12.1.1 Number of countries developing, adopting or implementing policy instruments aimed at supporting the shift to sustainable consumption and production
Current Level1 (13)
Target Level1 (13)
Reduced GHG emissions through reduced energy consumption
Impact RisksExternal risk given that the 5G and communications infrastructure sector is heavily affected by multiple factors.
External risk given that the 5G and communications infrastructure sector is heavily affected by multiple factors.
Execution risk given a transition to smart infrastructure might disrupt current services.
Impact Classification
B—Benefit Stakeholders
Increased resource efficiency and energy savings.
Smart meters are likely to increase energy efficiency and measure energy and water consumption rates more accurately for households.
Disruptions in the new 5G infrastructure might create prolems in service delivery for energy and water consumption.
This IOA will utilize IoT technology and smart meters to enable the real-time monitoring of energy consumption to improve energy and resource efficiency levels.
Turkey’s plans to build local 5G capacity can facilitate the spread of smart meter infrastructure through enhanced machine-to-machine communication technology.
Information Technologies and Communications Authority (BTK) will carry out the necessary studies for the use of new generation domestic and national 5G and beyond communication technologies in the country.
(11th Development Plan): The 11th Development Plan states that “R&D and production activities of domestic electronic communication network and infrastructure components including 5G and higher technologies will be encouraged”.
Other incentives: Small and Medium Industry Development Organization (KOSGEB) also support smart digital technologies with up to 300 thousand TRY in grants and 350 thousand TRY in concessional loans. (16)
Financial incentives: Communications Technology Cluster (HTK) and TÜBİTAK jointly run and support the “Uçtan Uça Yerli” and National 5G Communication Network Projects so as to develop the necessary network infrastructure and design for 5G.
Fiscal incentives: The Ministry of Industry and Technology declared it would institute necessary support mechanisms to expand the 5G infrastructure in Turkey.
(Regulation): For smart meters, Turkey’s Energy Market Regulatory Authority is the regulatory body for energy in Turkey (including smart electricity meters).
(Regulation): The main piece of legislation that regulates this area is the Energy Markets Law. Since 2013, this law has been amended to give the ownership of electricity metering systems to electricity distribution companies. (15)
(Regulation): The Regulation on Stabilizing and Mediating Electricity Markets published on 14.04.2009 by the Official Gazette #27200 further defines the legal metering methodology, which should be hourly and defines other methods for circumstances where hourly metering is not possible. (15)
Another law that directly governs this area is the Regulation on the Appropriate Methods and Principles for Determining the Measures of Smart and Automatic Meter Reading Systems published on 10/04/2011 in the Official Gazette #27901 and amended on 1/12/2012 through the Offical Gazette #28484. (15)
(Regulation): Municipalities are heavily involved as partners in the smart-metering area. Information Technologies and Communications Institute regulates 5G infrastructure.
PRIVATE SECTOR
Firms like Baylan Water Meters, Luna Smart Meters, Manas and national telecom companies like Türk Telekom, Turkcell and Vodafone.
GOVERNMENT
Ministry of Industry and Technology, Ministry of Transport and Infrastructure, Municipalities, Water and Sewage Treatment Organizations such as Bursa Directorate of Water and Sewage.
MULTILATERALS
World Bank, EBRD, EU through IPA funding.
SECTOR SOURCES
1) Bertelsmann Stiftung & SDSN, 2020. Sustainable Development Report Dashboards 2020.
2) Presidency of Strategy and Budget, 2020 Investment Program,
3) World Bank. Turkey PPI Snapshot.
4) EPDK. Turkey Smart Grid 2023 Vision and Strategy Roadmap Summary Report.
IOA SOURCES
7) Turkish Statistical Institute.
8) EC, 2015. A Smart Grid for the city of Rome: a Cost Benefit Analysis.
9) EC, 2020. Cooperation between Horizon 2020 Projects in the fields of Smart Grid, Energy Storage, Islands, and Digitalisation.
11) Deloitte. Akilli Sayac Sistemleri.
12) Bertelsmann Stiftung & SDSN, 2020. Sustainable Development Report Dashboards 2020. Turkey.
13) UNStats. SDG Indicators Database.
14) Shura, 2020. Türkiye’de Enerji Dönüşümü.
15) Deloitte. Akıllı Sayaç Sistemleri Avrupa uygulamaları analizi ve Türkiye uygulamaları üzerine düşünceler.
16) KOSGEB, 2019.
18) Işıl Şirin SELÇUK & Ali Gökhan GÖLÇEK & Altuğ Murat KÖKTAŞ, 2019. “Energy Poverty in Turkey,” Sosyoekonomi Journal, Sosyoekonomi Society, issue 27(42).