Turkey's emissions trading system (TR-ETS) runs a pilot covering 2026 and 2027 emissions from Category B and C installations in five sectors: electricity generation, cement, iron and steel, aluminium and fertilisers. Pilot installations submit their first monitoring methodology plan by 27 October 2026 and their verified 2026 emissions and activity level reports by 30 April 2027. Nothing is surrendered for 2026; the 2027 obligation is covered by 100% free allocation and surrendered by 30 November 2028.
For EU readers the logic will look familiar, but the details are Turkish and some key numbers have not been published yet. Each rule below is tied to its article, and where a value has not been announced, it is left blank rather than estimated.
The legal basis
| Instrument | What it covers |
|---|---|
| Climate Law No. 7552 (Official Gazette 09.07.2025/32951) | Establishes the ETS, administrative fines (Art. 14), 80% fine reduction during the pilot (Provisional Art. 1(1)) |
| Turkish ETS Regulation (Official Gazette 27.08.2026/33353) | Categories, permits, monitoring plans, reporting, verification, fine amounts (Art. 35) |
| Carbon Market Board decision KPK/2026/1 | Pilot sectors, duration, 100% free allocation |
| Pilot Period Procedures and Principles (approval 30.09.2026/18626) | Pilot activities, sub-installations, surrender dates, allocation formula |
The Regulation repealed the 2014 regulation on monitoring greenhouse gas emissions (Art. 40) and leaves detailed monitoring, reporting and verification rules to new communiqués from the Climate Change Presidency (Arts. 28, 29, 31, 33). As of early October 2026 none had been published, so the 2014 Monitoring and Reporting Communiqué and the 2017 Verification Communiqué continue to apply.
Who is covered
Two questions, in order: what category is the installation, and what is its main activity.
Category. Article 4 defines categories per installation, using annual emissions estimated conservatively from installed capacity. Biomass CO₂ is excluded; transferred CO₂ is included.
| Category | Annual emissions (tCO₂e) | ETS | Pilot |
|---|---|---|---|
| A | ≤ 50,000 | Outside the ETS, MRV obligations continue (Art. 5) | Out |
| B | 50,000 – 500,000 | In | In, if in a pilot sector |
| C | > 500,000 | In | In, if in a pilot sector |
A common mistake is to read the category off the corporate inventory. A company total that includes Scope 2 and 3 tells you nothing about an installation's category. The relevant figure is the capacity-based emissions of the single installation.
Main activity. Article 2(1) of the Procedures lists eleven Annex 1 activities: electricity generation by fuel combustion in installations of 20 MW and above (electricity sector only), coke production, metal ore roasting, sintering and pelletising, iron and steel production and casting, production or processing of ferrous metals, primary aluminium and alumina, secondary aluminium, non-ferrous metals (steel and aluminium sectors only), clinker, nitric acid and ammonia.
Two exclusions apply. An installation whose main activity is outside these sectors stays out of the pilot even if it generates electricity under Prodcom code 35.11.10.30.00 (Art. 2(2)). Natural gas and crude oil transmission and storage stay outside the ETS until the end of the pilot, though MRV still applies (Art. 2(3)).
Example: a textile mill running a 60 MW cogeneration plant may well be Category B, yet it is not in the pilot. When the first trading period starts with 2028 emissions, all Category B and C installations carrying out Annex 1 activities are in (Art. 18(1)).
Key dates
| Date | Obligation | Legal basis |
|---|---|---|
| 27 Oct 2026 | First monitoring methodology plan (pilot installations); extendable by up to 6 months | Regulation, Provisional Art. 3(1) |
| 30 Apr 2027 | Verified 2026 emissions report; extendable by up to one month | Regulation, Art. 29(1) |
| 30 Apr 2027 | Verified 2026 activity level report | Procedures, Art. 13(9) |
| 30 Jun 2027 | Activity level reports for 2023-2025, electricity sub-installations | Procedures, Art. 13(10) |
| 31 Dec 2027 | First monitoring methodology plan, B and C installations outside the pilot | Regulation, Provisional Art. 3(2) |
| 30 Apr 2028 | 2027 emissions and activity level reports | Art. 29(1); Procedures, Art. 13(9) |
| 9 Jul 2028 | Emissions permit (three years after the Climate Law took effect) | Regulation, Provisional Art. 2 |
| 30 Nov 2028 | Surrender for the 2027 system year | Procedures, Art. 6(2) |
The monitoring methodology plan
Minimum content is in Annex 4 of the Regulation. In practice three items take most of the effort.
Source stream classification comes first. Each fuel and process input is classed as major, minor or de minimis, and the required tier depends on that class and the installation category. Measurement-based sources, such as N₂O from a nitric acid plant, count toward the classification total.
Then sub-installations. Annex 1 of the Procedures lists the types: product benchmark, heat benchmark, fuel benchmark, district heating, process emissions and in-plant heating. At most one of each type is set up, and the installation's total emissions must be fully attributed across them (Art. 10). Allocation is calculated per sub-installation, so getting this split wrong costs money directly.
Then the laboratory. Analyses that determine calculation factors are done in accredited laboratories, or equivalence with TS EN ISO/IEC 17025 is documented (Art. 32).
One requirement that tends to be overlooked: an ETS installation must employ monitoring staff with an engineering or science degree. At least one person with one year of experience for Category B, two people with two years each for Category C (Annex 3, item 9). Changes affecting the plan are notified within 30 days (Arts. 9(1), 34).
Verified emissions report and activity level report
The emissions report covers 1 January to 31 December under the approved plan and must be verified before it goes to the Presidency (Arts. 29, 30). Verifiers are assigned through the MEDAS system and must be accredited by TÜRKAK under ISO/IEC 17029. Entities subject to Public Procurement Law No. 4734 are outside MEDAS.
The activity level report is the basis for allocation. It sets out production, heat and fuel quantities per sub-installation; free allocation is that quantity multiplied by the benchmark. An installation with a correct emissions report but an incomplete activity level report calculates its liability correctly and its allocation too low.
Allocation
During the pilot, free allocation is 100% on a benchmark basis, with a sectoral activity factor of 1 (Procedures, Arts. 7(1), 12(5)-(6)). Outside electricity, the benchmark is the weighted average of all pilot installations; for electricity it is plant-specific, based on the weighted average emission intensity of the last five years.
100% free allocation does not mean zero cost. The rate applies to benchmark-based allocation, not to actual emissions. An installation more carbon-intensive than its sector average buys the difference. Benchmarks will be published in the National Allocation Plan after verified reports are in (Art. 7(2)); no figures exist yet, so a precise 2027 allocation cannot be calculated today. What you can do now is know your own emission intensity.
Further rules: emissions attributed to process emissions, in-plant heating and district heating sub-installations are allocated in full (Art. 12(4)). Allocation to electricity sub-installations is adjusted by a sectoral correction factor (Art. 12(2)). Pilot allowances can only be used for pilot obligations, and any shortfall is carried into 2028 (Art. 8). No banking or borrowing (Art. 17); offsets only by Carbon Market Board decision (Art. 16).
Market participation has a price too: the energy regulator EPDK's 2026 tariff sets an annual participation fee of TRY 100,000 and a spot trading fee of TRY 4.00 per tCO₂e, excluding VAT.
Penalties
Article 35 of the Regulation sets the fine for failing to submit a verified report on time, in 2026 amounts:
| Category | Annual emissions (tCO₂e) | Fine (TRY) |
|---|---|---|
| A | ≤ 50,000 | 627,450 |
| B | 50,000 – 250,000 | 1,254,900 |
| B | 250,000 – 500,000 | 2,509,800 |
| C | 500,000 – 2,000,000 | 4,392,150 |
| C | > 2,000,000 | 6,274,500 |
Amounts double for installations covered by the ETS (Art. 35(1)(b)). During the pilot, Provisional Article 1(1) of the Climate Law reduces fines by 80%. For a pilot cement plant emitting 150,000 tonnes: 2 × 1,254,900 = TRY 2,509,800, reduced to TRY 501,960. Amounts are revalued at the start of each year (Misdemeanours Law, Art. 17(7)); the amount for the year in which the breach occurs applies.
Operating without a permit carries a separate scale, from TRY 1,254,900 to TRY 12,549,000 depending on equivalent capacity (2026 amounts). ETS installations are deemed permitted until 9 July 2028, so this fine applies after that date.
Because the pilot is defined by system years, the text does not settle whether the 80% reduction covers fines imposed after the reporting deadlines for 2026 and 2027, or installations outside the pilot. Budgeting on the unreduced amount and confirming with the Presidency is the safer course.
How Carbolyt handles it
Carbolyt's TR-ETS module works per installation. It takes Annex 1 activities and installed capacity, derives the category from capacity-based emissions, decides pilot coverage under KPK/2026/1 and Article 2 of the Procedures, and declines to decide when the main activity has not been declared. The monitoring methodology plan (Annex 4), annual emissions report (Annex 6) and activity level report (Annex 5) are generated from the same inventory rows, with source stream classification, tier checks, lab analyses and biomass fractions kept per stream.
Fines are shown from Article 35 together with the pilot reduction. Because benchmarks have not been announced, the allocation scenario asks the user for them and does not calculate without them. Deadlines are on the regulation calendar and the module is described on the platform page. If the same plant exports to the EU, its production data also feeds the CBAM calculation; the free CBAM calculator is in Turkish.
Frequently asked questions
Which installations are in the Turkish ETS pilot?
Category B and C installations whose main activity is electricity generation, cement, iron and steel, aluminium or fertilisers. Categories are based on annual emissions estimated conservatively from installed capacity: above 50,000 tCO₂e is B, above 500,000 tCO₂e is C. Installations whose main activity lies outside these sectors but generate electricity on the side, and gas and crude oil pipeline compressor units, are excluded.
When is the first monitoring methodology plan due?
Pilot installations submit their first plan within two months of the Regulation's entry into force on 27 August 2026, i.e. by 27 October 2026. The Climate Change Presidency may extend this by up to six months. Category B and C installations outside the pilot have until 31 December 2027.
Do allowances have to be surrendered for 2026?
No. Under the pilot procedures, 2026 is a reporting-only system year. Allowances for 2027 are surrendered by the last working day of November 2028 (30 November 2028), and free allocation during the pilot is 100%.
What is the fine for a late verified report?
Article 35 of the ETS Regulation sets 2026 amounts between TRY 627,450 and TRY 6,274,500 depending on category, doubled for installations covered by the ETS. Under Provisional Article 1(1) of the Climate Law, fines imposed during the pilot period are reduced by 80%.
Sources
This article is for information and is not legal advice. Dates and rates reflect the official texts at the time of publication; check the current text before acting.