Exploring Green Sukuk as a Sustainable Financing Option for Renewable Energy in Turkey
Keywords:
Zero Carbon Emission, Turkiye Energy Self-Sufficiency, Green SukukAbstract
Securing energy resources is paramount for the sustenance and development of societies worldwide, necessitating a collective agreement on their judicious utilization to safeguard both present and future generations. Moreover, the utilization of energy must not exacerbate environmental degradation, as pollution disrupts ecological equilibrium, alters climate patterns, and imperils renewable energy sources. The Paris Agreement underscores the commitment of participating nations to foster environmental health and safeguard natural energy reservoirs through sustainable practices. Each signatory nation is tasked with endeavors aimed at preserving climatic equilibrium and ecological integrity, underscoring the significance of this global pact. A core objective of the Paris Agreement involves transitioning towards renewable energy sources while conserving non-renewable counterparts. This transition necessitates substantial investments, particularly pertinent for energy-importing nations like Turkiye, beset by myriad challenges in sourcing non-renewable energy. Turkiye's energy importation faces hurdles such as pricing dynamics, supply constraints, distribution complexities, and geopolitical intricacies with energy-exporting nations. This paper advocates for the adoption of financial instruments to bolster renewable energy generation, thereby meeting domestic energy demands and achieving national energy self-sufficiency. Specifically, it advocates for the utilization of green sukuk, financial instruments akin to bonds but devoid of interest-based returns, making them impervious to interest rate fluctuations. Employing qualitative methodologies, this study draws insights from secondary data sources and authoritative institutional findings. Focusing on Turkiye's energy investment needs through 2050, this paper explores the potential of green sukuk instruments to raise investment capital. It presents illustrative calculations to elucidate the benefits of deploying green sukuk instruments for securing investment funds and attracting potential investors. Green sukuk products, owing to their independence from interest rate fluctuations, offer both competitiveness and security. Their positive impact on Turkiye lies in their capacity to support energy requirements, preempting potential energy crises. With energy independence and resilience against energy crises, Turkiye's populace can pursue their daily lives and economic activities unhindered.
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