The 12.35-Cent Curse: Why Turkey Will Pay Double the Global Market Price for Electricity to Rosatom for 15 Years and Call It Energy Independence

Expert Comment — Eurasia Programme

2026-02-05

TWhen the first reactor at the Akkuyu Nuclear Power Plant begins commercial operation in 2026, every Turkish household and business will start paying a hidden tax that will persist for 15 years. The plant’s electricity will be purchased at a guaranteed price of 12.35 US cents per kilowatt-hour. The average wholesale electricity price in Turkey in 2025 was approximately 8 cents per kilowatt-hour. The difference of 4.35 cents per kilowatt-hour will be passed through to consumers through a surcharge on their electricity bills. Over the 15-year guarantee period, the above-market premium paid by Turkish consumers is projected to total between $5 billion and $7 billion. This is the price Turkey pays for a deal that was supposed to deliver energy independence.

The Akkuyu project is structured under a build-own-operate model that is exceptionally favourable to the contractor. Rosatom, Russia’s state nuclear corporation, owns 99.2 per cent of the project company. Rosatom financed the construction through a combination of Russian state loans and project financing. Turkey guarantees the purchase of electricity at the fixed price for 15 years, regardless of whether it needs the electricity or not. After 15 years, the price will be reduced, but Rosatom will retain majority ownership for the remaining 45 years of the plant’s operating life. The arrangement ensures that Rosatom will capture the economic benefits of the plant for its entire 60-year lifecycle, while Turkey bears the market risk.

The comparison with other nuclear projects is instructive. The United Arab Emirates’ Barakah nuclear plant, built by a Korean consortium, is owned and operated by the Emirates Nuclear Energy Corporation, with Korean companies providing construction and training. The UAE retains full ownership and control of its nuclear assets. Turkey’s deal with Rosatom, by contrast, cedes ownership and control to Russia. The UAE model reflects a commercial transaction in which the buyer retains strategic control. The Turkey model reflects a relationship in which the seller retains strategic control. The difference has implications for Turkey’s energy sovereignty that extend well beyond the price of electricity.

The $20 billion invested in Akkuyu represents an enormous opportunity cost for a country with Turkey’s infrastructure needs. The same investment could have financed approximately 20 gigawatts of solar and wind capacity, supported by grid-scale battery storage. Turkey has some of the best solar resources in Europe, with solar irradiation levels 50 per cent higher than Germany’s. The levelised cost of solar energy in Turkey has fallen to under 4 cents per kilowatt-hour, less than one-third of the guaranteed Akkuyu price. The renewable alternative would have created more jobs per dollar invested, provided electricity at lower cost, enhanced Turkey’s energy security by reducing import dependence, and supported Turkey’s climate commitments. The decision to pursue nuclear rather than focusing exclusively on renewables reflects not economic logic but geopolitics and the influence of the nuclear industrial lobby.

Akkuyu represents a new form of energy dependency that is less visible but no less constraining than dependence on Russian gas. The plant will be producing Russian-controlled electricity in Turkey for the next sixty years.

Akkuyu’s location on Turkey’s Mediterranean coast, less than 30 kilometres from the East Anatolian Fault, has been a source of concern since the project was first proposed. The February 2023 earthquakes, which killed over 50,000 people in southern Turkey and destroyed hundreds of thousands of buildings, intensified these concerns. Rosatom has stated that the plant is designed to withstand a magnitude 9.0 earthquake, and the site has been subject to extensive seismic studies. However, independent geologists have noted that the seismic hazard assessment for the site is based on limited data and that the fault system in the region is not fully understood. The tension between Turkey’s energy needs and the seismic risks of nuclear power in a seismically active region has not been adequately resolved.

Integrating the Akkuyu plant’s 4,800 megawatts into Turkey’s electricity grid presents significant technical challenges. The plant’s output represents approximately 6 per cent of Turkey’s total installed capacity, making it one of the largest single power plants in the country’s grid. The sudden loss of the plant due to a technical fault or safety incident would require immediate backup generation to prevent a grid collapse. The grid infrastructure in the Mediterranean region, where the plant is located, is not designed to handle the plant’s output or to manage the risks associated with a large nuclear plant. The integration challenge has received less attention than the construction and financing challenges but is equally important for the project’s operational success.

Turkey has no permanent nuclear waste storage facility and no comprehensive plan for managing the spent fuel and radioactive waste that will be generated by the Akkuyu plant over its 60-year operating life. The plant will produce approximately 30 tonnes of spent nuclear fuel annually, which will be stored on site in cooling pools and dry cask storage until a permanent disposal solution is developed. The search for a permanent storage site in Turkey has not begun. The experience of other countries, including the United States and Germany, demonstrates that developing a permanent nuclear waste repository takes decades and faces significant political and technical challenges. Turkey’s nuclear waste management plans are inadequate for the scale and duration of the Akkuyu project.

Turkey’s nuclear programme has regional implications that extend beyond its borders. The plant’s location on the Mediterranean coast, less than 100 kilometres from Cyprus, has raised concerns in Greece and Cyprus about the safety and environmental risks of the project. The plant’s cooling water discharge could affect marine ecosystems in the eastern Mediterranean. The potential for an accident at the plant, however unlikely, would have transboundary consequences that could affect multiple countries. Turkey has not engaged in systematic consultations with its neighbours about the risks of the Akkuyu plant. The regional dimension of Turkey’s nuclear programme has been neglected in the public debate about the project.

The cost of decommissioning the Akkuyu plant at the end of its 60-year operating life is not included in the project’s financial structure. Decommissioning a large nuclear power plant is a complex and expensive process that can take decades and cost billions of dollars. The funds required for decommissioning are supposed to be accumulated over the plant’s operating life through a decommissioning fund. The adequacy of the funding arrangements for Akkuyu has not been publicly disclosed or independently verified. The risk that the decommissioning costs will ultimately fall on Turkish taxpayers, rather than on the project company, is a significant contingent liability that has not been adequately recognised in the public debate about the project.

The contrast between Turkey’s Akkuyu deal and other recent nuclear projects in the region is instructive. The United Arab Emirates’ Barakah plant, built by a Korean consortium, is owned and operated by the Emirates Nuclear Energy Corporation. The UAE retains full ownership and control. The financing was structured as a commercial transaction with the Korean Export-Import Bank providing export credits. The UAE’s model reflects a buyer-supplier relationship in which the buyer retains strategic control. Turkey’s Akkuyu model, by contrast, cedes ownership and control to the supplier. The difference reflects not only the relative negotiating power of the two countries but also their different approaches to energy sovereignty. The UAE has maintained strategic control over its nuclear assets. Turkey has outsourced strategic control to Russia.

The financing of Akkuyu is as controversial as its ownership structure. The project is financed through a combination of Russian state loans, Turkish bank financing, and equity from Rosatom. The Turkish government has provided sovereign guarantees for the project, meaning that Turkish taxpayers bear the risk of cost overruns, delays, or operational problems. The total project cost has already increased from an initial estimate of $20 billion to over $25 billion as a result of construction delays, inflation, and currency depreciation. The cost overruns have been absorbed by the project company, but the sovereign guarantees mean that the ultimate risk falls on Turkish taxpayers. The financing structure of the project has not been subject to the same level of public scrutiny as the technical aspects, but it is equally important for assessing the project’s economic impact on Turkey.

The decision to proceed with Akkuyu reflects not only energy policy but also the political economy of nuclear energy in Turkey. The nuclear industry in Turkey has strong support from the military-industrial complex, which views nuclear technology as essential for national prestige and technological development. The construction of the plant has provided employment and contracts for Turkish construction companies. The plant’s location in the Mersin region, a stronghold of the ruling AK Party, is not coincidental. The political economy of nuclear energy in Turkey creates powerful constituencies that support the project regardless of its economic or strategic merits. Understanding these dynamics is essential for assessing the project’s resilience and its long-term implications for Turkey’s energy policy.