The Turkish Green Taxonomy is the classification system, in force since 24 September 2026, that decides which activities in Turkey qualify as green for finance.
For a foreign investor with a solar, wind or storage project in Turkey, the regulation arrives looking like a reporting rule for banks. Read closely, it is something broader: a shared vocabulary that every lender, insurer and fund in the Turkish market will use to describe your project, and that vocabulary will be written into documents long before anyone is legally obliged to file a single report.
The regulation (Türkiye Yeşil Taksonomisi Yönetmeliği) was published in the Official Gazette (Resmî Gazete) No. 33380 of 24 September 2026 by the Ministry of Environment, Urbanisation and Climate Change (Çevre, Şehircilik ve İklim Değişikliği Bakanlığı). It rests on Article 8(1)(c) of Climate Law No. 7552 (İklim Kanunu) and took effect on the day of publication. The Ministry has described its reach as 16 sectors, 137 economic activities, six environmental objectives and three core conditions.
Investors meeting the framework for the first time usually ask what the Turkish Green Taxonomy actually decides. It decides one thing: whether an economic activity may be presented as environmentally sustainable. It grants no licence, no subsidy and no tax benefit. It supplies the test that financiers, reporting institutions and, because reports are published, the wider public will apply to your activity.
The next question is sharper: who is actually required to report under it? Banks, investment firms, insurers and pension companies must report. For everyone else, taxonomy reporting is a voluntary requirement. The text says companies “may” report (Article 13(1)), yet the same article allows obligated financial institutions to ask their clients to report (Article 13(4)), and a borrower rarely treats its lender’s request as optional.
Timing follows naturally: when does the taxonomy start to matter for a company? Financial institutions are relieved of mandatory reporting until 1 January 2029 (Provisional Article 1). The deadline that will shape a company’s next three years is one that does not apply to the company at all. Banks will need taxonomy data on their loan books by 2029, and that data will come from borrowers, through loan documents signed today.
One more question deserves an early answer: which projects can never qualify as green? Production activities that use solid fossil fuels are excluded outright by Article 11(2); a coal-fired plant cannot become taxonomy-aligned through any technical criterion. Gas and other transitional technologies sit in a different category, and the answer for them depends on criteria that the regulation itself does not contain.
⚖️ Is Reporting Under the Turkish Green Taxonomy Mandatory for My Company?
No, not for an ordinary company. A company that carries out at least one activity listed in Annex 1 “may” report using templates published by the Directorate of Climate Change (İklim Değişikliği Başkanlığı), under Article 13(1). Nothing in the regulation compels it to.
The mandatory circle is narrow and precisely drawn. Article 13(2) names three groups of financial institutions: intermediary institutions, investment companies and portfolio management companies; banks operating under Banking Law No. 5411; and insurance, reinsurance and pension companies operating under Insurance Law No. 5684 and Law No. 4632 on the Private Pension Savings and Investment System. Their reporting procedures will be set separately by the Capital Markets Board (Sermaye Piyasası Kurulu, SPK), the Banking Regulation and Supervision Agency (Bankacılık Düzenleme ve Denetleme Kurumu, BDDK) and the Insurance and Private Pension Regulation and Supervision Agency (Sigortacılık ve Özel Emeklilik Düzenleme ve Denetleme Kurumu, SEDDK), each for its own sector (Article 13(5)).
That is the text. The practice will look different, and the difference sits in a single paragraph. Article 13(4) allows those same financial institutions to ask the companies behind their transactions to report under the regulation, and Article 12(3) tells them to calculate their own indicators using those companies’ current data. A bank that must show the share of its loan book financing aligned activities cannot produce that number without its borrowers’ figures.
So the honest answer to a client is layered. Legally, your company decides whether to report. Commercially, the decision will often be made in a term sheet (usually as an information covenant, sometimes as a condition of a “green” pricing margin), and it will be made by the party lending you money. What looks optional from the regulation’s text is, from the lender’s side of the table, a data requirement with a 2029 deadline.
For investors structuring debt in Turkey, this is where the taxonomy meets ordinary banking and finance work: the obligation is created by contract, not by the regulation, which means its scope is negotiable in a way a statutory duty never is.
⚖️ What Changes for a Renewable Energy Project Financed in Turkey?
The loan documents change first. Before any regulator asks a project company for a taxonomy report, its lenders will start asking for taxonomy data, and the request will arrive as drafting: a representation that the project is aligned, an undertaking to deliver revenue, capital expenditure and operating expenditure ratios each year, and sometimes a margin step-down that depends on staying aligned.
Each of those clauses carries a different risk. A representation of alignment is made at signing but tested against technical screening criteria that the Directorate may revise every year; updated criteria are published by 15 December and apply from the following year (Article 11(5) and (6)). A project that was aligned when the facility was signed can fall out of alignment without changing a single panel, simply because the yardstick moved. A well-drafted representation speaks as of a date and refers to the criteria in force on that date; a loosely drafted one becomes a recurring default trigger.
Information undertakings raise a second question, which is where the data goes. Reports filed on the Online Taxonomy Management System (Çevrimiçi Taksonomi Yönetim Sistemi) are, as a rule, open to the public (Article 20(3)). Supporting information outside the report may be shared with third parties only with the company’s permission (Article 22(1)). A sponsor that agrees to “provide all information required for the lender’s taxonomy reporting” without limits may find commercially sensitive figures travelling further than intended.
Then there is the social side, which energy sponsors tend to underestimate. Alignment requires compliance with minimum social safeguards, defined by reference to the principles in the ten core ILO conventions, the rights in the Universal Declaration of Human Rights, the OECD Guidelines for Multinational Enterprises, the UN Guiding Principles on Business and Human Rights, and Turkish labour and social security law (Article 10). For a construction-heavy project with layers of subcontractors, that condition is rarely failed on the turbine or the panel; it is failed quietly, at the subcontractor’s payroll.
None of this makes taxonomy clauses something to resist. It makes them something to draft. Our energy law practice sees the same pattern across project types: the clauses that cause disputes later are the ones accepted as boilerplate now, and a careful review of these provisions belongs in the same pass as the rest of the financing contracts.
Has your lender already asked for taxonomy data on your Turkish project?
Taxonomy covenants are easiest to shape before signing. Send us the draft facility terms and we will tell you which clauses deserve a second look.
⚖️ The Three Conditions a Project Must Meet to Be Called Green
An activity is taxonomy-aligned only if it meets three conditions at the same time (Article 6): it makes a substantial contribution to at least one environmental objective, it does no significant harm to any other objective, and it complies with minimum social safeguards. Meeting two out of three produces no partial credit.
The distinction that matters most in practice is between “eligible” and “aligned”. An eligible activity is simply one listed in Annex 1 (Article 4(1)(ü)). An aligned activity is an eligible one that also satisfies the three conditions (Article 4(1)(v)). A solar plant is eligible the moment it appears in the Annex; it becomes aligned only when its numbers, its environmental footprint and its labour practices are tested and pass.
Both technical tests are binding in the same way. To be classified as making a substantial contribution, the activity must meet the substantial contribution criteria for the relevant objective (Article 8); to be classified as doing no significant harm, it must meet the corresponding criteria for the other objectives (Article 9). The regulation calls these two sets together the technical screening criteria, and it leaves their content to the Directorate (Article 11(1)).
That last point is easy to miss. The regulation published in the Official Gazette contains the architecture, not the thresholds. The thresholds, such as emission intensity levels or lifecycle requirements, live on the Directorate’s website (Article 11(4)) and move on an annual cycle. Anyone assessing a project against the Turkish Green Taxonomy is therefore assessing it against two documents: a regulation that rarely changes and a set of criteria that may change every December.
⚖️ The Six Environmental Objectives and Four Activity Types
The Turkish Green Taxonomy recognises six environmental objectives, listed in Article 7: reduction of greenhouse gas emissions; adaptation to climate change; sustainable use and protection of water and marine resources; transition to a circular economy; pollution prevention and control; and protection and restoration of biodiversity and ecosystems.
A renewable energy project in Turkey will normally seek alignment through the first objective, reduction of greenhouse gas emissions. The regulation defines that objective to include not only cutting emissions but also protecting, increasing and improving carbon sinks such as forests (Article 4(1)(p)). The remaining five objectives then act mainly as do-no-significant-harm tests for the same project.
The Turkish Green Taxonomy uses four activity categories. An eligible activity is any activity listed in Annex 1. An aligned activity is an eligible activity that meets the three conditions in Article 6. A transition activity supports the move to a climate-neutral economy in sectors where low-carbon alternatives do not yet exist, has the lowest emission levels in its sector and does not block low-carbon alternatives (Article 4(1)(ı)). An enabling activity makes a substantial contribution by others possible and does not lock in carbon-intensive assets (Article 4(1)(k)).
For energy investors, the enabling category deserves attention. Grid connection equipment, storage and component manufacturing may contribute to emission reduction indirectly rather than by generating clean electricity themselves. Whether a particular activity of this type is listed, and under which criteria, is answered by Annex 1 and the published technical screening criteria, not by the definitions alone.
The regulation also defines lifecycle as every connected stage of a product from raw material to disposal (Article 4(1)(y)), and the Directorate must consider lifecycle environmental impact when setting criteria (Article 11(1)(e)). A wind or solar project is therefore assessed on more than its operating emissions; manufacturing inputs and end-of-life treatment can enter the assessment through the criteria.
⚖️ Can a Coal or Gas Project Be Green Under the Turkish Taxonomy?
A coal project cannot be green under the Turkish Green Taxonomy. Article 11(2) provides that, under the technical screening criteria set by the Directorate, production activities in which solid fossil fuels are used are not assessed as environmentally sustainable economic activities.
The wording of Article 11(2) matters, and some English summaries in circulation render it as excluding the “production of solid fossil fuels”. The Turkish text (katı fosil yakıtlar kullanılan üretim faaliyetleri) refers to production activities that use solid fossil fuels. Read that way, the exclusion reaches beyond coal mining to production processes, including power generation, that run on coal or other solid fossil fuels.
A project that co-fires solid fossil fuel with biomass, or uses coal as a backup fuel, should be assessed carefully against Article 11(2) before any alignment representation is given. The provision contains no percentage threshold, and the regulation does not say whether partial use of solid fossil fuel disqualifies the whole activity or only part of it. That question will be answered by the technical criteria and by practice, and it has not been answered yet.
Gas is treated differently from coal in the Turkish Green Taxonomy because gas is not a solid fossil fuel. If gas-fired activities qualify at all, the natural route is the transition activity category defined in Article 4(1)(ı), which requires the lowest emission levels in the sector and no obstruction of low-carbon alternatives. This page does not take a position on whether any specific gas-fired activity appears in Annex 1; that answer sits in the Annex and in the Directorate’s published criteria.
⚖️ Who Must Report Under the Turkish Green Taxonomy, and From When
Mandatory taxonomy reporting in Turkey applies only to three groups of financial institutions, and none of them must report before 1 January 2029 (Provisional Article 1). Companies outside those groups may report voluntarily from now on.
| Party | Reporting status | Procedures set by | Mandatory from |
|---|---|---|---|
| Companies carrying out an Annex 1 activity | Voluntary (Art. 13(1)) | Directorate of Climate Change templates | Not mandatory |
| Intermediary institutions, investment companies, portfolio management companies | Mandatory (Art. 13(2)(a)) | Capital Markets Board (SPK) | 1 January 2029 |
| Banks under Banking Law No. 5411 | Mandatory (Art. 13(2)(b)) | BDDK | 1 January 2029 |
| Insurance, reinsurance and pension companies (Laws No. 5684 and 4632) | Mandatory (Art. 13(2)(c)) | SEDDK | 1 January 2029 |
Taxonomy reports are uploaded to the Online Taxonomy Management System by the end of the sixth month after the end of the financial statement period (Article 13(3)). Companies using a special accounting period count the six months from the end of that special period. Each report covers the reporting period of the year before the year in which it is filed (Article 13(7)).
For a calendar-year bank, the reporting cycle in the Turkish Green Taxonomy produces a filing date of 30 June, covering the previous financial year. Read together with Provisional Article 1, the earliest mandatory filings by financial institutions would fall in 2029. Whether the first mandatory report covers financial year 2028 in full will be settled by the implementing rules that SPK, BDDK and SEDDK issue under Article 13(5).
Voluntary reporting by companies follows the same calendar and the same templates. A company that chooses to report for 2026 would file by the end of June 2027, using the technical screening criteria in force for the reporting period (Article 13(6)). Starting early gives a company two or three reporting cycles of practice before its lenders’ own reports become mandatory.
⚖️ What Lenders Will Measure: Key Performance Indicators
The Turkish Green Taxonomy measures alignment through key performance indicators, and for companies those indicators are three ratios: the share of revenue, capital expenditure and operating expenditure that comes from taxonomy-eligible or taxonomy-aligned products and services (Article 12(2)(a)).
Financial institutions report different indicators under Article 12(2). Banks report ratios showing how far their activities take environmental sustainability into account and contribute to the environmental objectives. Intermediary institutions, investment companies and portfolio management companies report equivalent ratios for their activities, and insurance, reinsurance and pension companies report ratios for theirs.
Article 12(3) of the Turkish Green Taxonomy links those two levels of reporting. Financial institutions obliged to report must calculate their own indicators on the basis of the current data and key performance indicators of the companies that report under Article 13(1). A bank’s green ratio is, in practical terms, an aggregation of its borrowers’ revenue, CapEx and OpEx figures.
The regulation contains a materiality threshold of 10 percent in Article 13(8). If revenue, capital expenditure or operating expenditure from Annex 1 activities is below 10 percent of the company’s total for that measure, the company may leave the related indicator out of its report. At 10 percent or above, the indicator belongs in the report.
The 10 percent threshold applies separately to each of the three measures. A diversified industrial group whose renewable energy subsidiary generates 6 percent of group revenue but 25 percent of group capital expenditure could omit the revenue indicator for that activity but would still need to report its CapEx indicator.
⚖️ Greenwashing Under the Turkish Green Taxonomy: Defined, Not Fined
The Turkish Green Taxonomy defines greenwashing but does not attach a specific penalty to it. Article 4(1)(z) defines greenwashing (yeşile boyama) as the deceptive use of public relations, financing, advertising or marketing methods to create the perception that a company’s products or services make a substantial contribution to an environmental objective, do no significant harm and meet minimum social safeguards.
The only sanction in the regulation is in Article 23. Parties reporting under Article 13 that fail to meet the notification, information and document obligations required for reporting face an administrative fine under Article 14(6), (9) and (11) of Climate Law No. 7552. The fine is tied to reporting failures, not to misleading green claims as such.
The wording of Article 23 refers to “those reporting under Article 13” without limiting the group to mandatory reporters. On its face, a company that chooses to report voluntarily under Article 13(1) and then fails to provide the information and documents its report requires may fall within the scope of the Article 23 fine. A company considering voluntary reporting should treat that choice as entering a regulated process, not as publishing a brochure.
Greenwashing outside the regulation is not unregulated. Misleading environmental claims in advertising and consumer communications can be examined under Turkish consumer protection and commercial advertising rules, including Consumer Protection Law No. 6502, which operate independently of the taxonomy. The taxonomy definition is likely to become a reference point in those assessments because it describes, in statutory language, what a green claim implies.
⚖️ Turkish Green Taxonomy vs EU Taxonomy
The Turkish Green Taxonomy follows the architecture of the EU Taxonomy (Regulation (EU) 2020/852): the same three conditions for alignment, the same six environmental objectives and the same revenue, CapEx and OpEx indicators. The differences lie in who must report, where the criteria are published and how they are updated.
| Feature | Turkish Green Taxonomy | EU Taxonomy |
|---|---|---|
| Legal basis | Climate Law No. 7552, Art. 8(1)(c); regulation of 24 September 2026 | Regulation (EU) 2020/852 and delegated acts |
| Conditions for alignment | Substantial contribution, no significant harm, minimum social safeguards | Same three conditions, plus compliance with technical screening criteria |
| Environmental objectives | Six (Art. 7) | Six |
| Social safeguards reference | Ten core ILO conventions, Universal Declaration of Human Rights, OECD Guidelines, UN Guiding Principles, Turkish labour and social security law (Art. 10) | OECD Guidelines, UN Guiding Principles, ILO core conventions |
| Who must report | Specified financial institutions from 1 January 2029; companies voluntarily | Determined by EU sustainability reporting legislation |
| Technical criteria | Published on the Directorate of Climate Change website; updates announced by 15 December, effective the next year | Set out in delegated acts of the European Commission |
| Where reports go | Online Taxonomy Management System, public as a rule (Art. 20) | Within the reporting entity’s sustainability disclosures |
Alignment under one taxonomy does not establish alignment under the other. A Turkish project financed by an EU lender may need to be assessed twice: once under the Turkish Green Taxonomy for the lender’s Turkish reporting or local subsidiary, and once under the EU Taxonomy for the lender’s group reporting. The thresholds in the two sets of technical criteria will not necessarily match.
The Ministry has stated that agriculture and tourism, sectors of particular weight in Turkey’s economy, were incorporated into the Turkish Green Taxonomy alongside the activities taken from the EU framework. For investors in those sectors, the Turkish list may be the more relevant of the two, and European investors in Turkey should not assume the EU activity list tells the whole story.
⚖️ Public Reports, Data Sharing and Confidentiality
Taxonomy reports filed on the Online Taxonomy Management System are open to the public as a rule (Article 20(3)). The Turkish Green Taxonomy treats publication as the default, not the exception, so any figure a company places in its report should be one it is prepared to see quoted by competitors, journalists and counterparties.
Information and documents uploaded to the Online Taxonomy Management System that are not part of the taxonomy report itself may be shared with third parties only with the permission of the company concerned (Article 22(1)). The distinction between the public report and the non-public supporting material is therefore a practical tool for protecting commercially sensitive data.
Information security on the Online Taxonomy Management System is governed by Cyber Security Law No. 7545 of 12 March 2025, Climate Law No. 7552 and the secondary legislation issued under them (Article 22(2)). The Directorate of Climate Change manages the system and announces its operating procedures on its official website (Articles 17 and 20(2)).
Loan agreements often require the borrower to consent in advance to the lender sharing information with regulators and group companies. Where taxonomy data is involved, a consent clause in a facility agreement may operate as the “permission” contemplated by Article 22(1), so the scope of that clause should be read with the regulation in mind.
⚖️ Practical Steps for Foreign Investors Before 2029
Foreign investors with energy or industrial assets in Turkey have roughly two reporting cycles before mandatory reporting by financial institutions begins on 1 January 2029. The following steps use that window efficiently.
- Map activities against Annex 1. Identify which of the company’s activities are eligible under the Turkish Green Taxonomy; eligibility is the starting point for every later step.
- Test alignment against the current technical criteria. Check substantial contribution and do-no-significant-harm criteria on the Directorate’s website, and diarise 15 December each year for updates.
- Build the three ratios. Prepare revenue, CapEx and OpEx figures for eligible and aligned activities, and check the 10 percent threshold in Article 13(8) separately for each.
- Audit social safeguards. Review subcontractor labour and social security compliance against Article 10, since alignment fails if safeguards fail.
- Review financing documents. Identify taxonomy representations, information undertakings, margin ratchets and data-sharing consents in existing and draft facility agreements.
- Decide on voluntary reporting deliberately. Weigh the benefit of an early public report against public visibility under Article 20(3) and the possible reach of the Article 23 fine.
- Align with group reporting. Where the group also reports under the EU Taxonomy, reconcile the two assessments so that the same asset is not described differently in two jurisdictions.
Where a taxonomy review forms part of an acquisition, the same checklist fits naturally inside legal due diligence in Turkey: a target described as “green” in its marketing should be able to show the ratios, the criteria and the safeguards behind that description.
⚖️ What the Turkish Green Taxonomy Does Not Cover
The Turkish Green Taxonomy is a classification and reporting framework. It does not grant licences, approve projects, create incentives or set prices on carbon, and alignment under it does not satisfy any other legal requirement a project must meet.
Taxonomy alignment does not replace the environmental impact assessment (Çevresel Etki Değerlendirmesi, ÇED) process or the licences required under Turkish energy market legislation. A taxonomy-aligned solar plant still needs its generation licence or licence-exempt status, its grid connection approvals and its environmental clearances on their own terms.
The Turkish Green Taxonomy is not an investment incentive scheme. Investment incentive certificates and the support available to qualifying projects are governed by separate legislation; our page on manufacturing incentives in Turkey covers that framework. Emissions trading under Climate Law No. 7552 is also a separate regime from the taxonomy, even though both rest on the same law.
Trade defence measures sit outside the taxonomy as well. Turkey imposed a definitive anti-dumping measure in September 2026 on certain solar panel junction boxes originating in China; duties of that kind affect a renewable project’s cost base but have no bearing on whether the project is taxonomy-aligned. Anti-dumping proceedings follow their own rules.
Schedule a Legal Consultation
Whether you are financing a solar or wind project in Turkey, negotiating taxonomy covenants with a lender, or deciding on voluntary reporting before 2029, our Istanbul energy and finance lawyers can review your position.
The Turkish Green Taxonomy will be read in 2029 as a reporting rule for banks. By then, most of what it decides about individual projects will already have been decided, clause by clause, in financing documents signed between now and then. The companies that come out of that period well will not be the ones that reported first, but the ones that knew, before signing, what they were agreeing to describe as green.