Türkiye and Saudi Arabia signed an energy agreement that covers an investment of about $2 billion (TL 87.01 billion) to build two solar farms, a senior official announced on Tuesday.
Under the deal, Saudi companies will construct a solar power plant in the eastern province of Sivas and another in the central province of Karaman with a total capacity of 2,000 megawatts (MW) in the first phase.
The total capacity of solar and wind power plants that the Saudi Arabian companies will construct will reach 5,000 MW, Energy and Natural Resources Minister Alparslan Bayraktar said on the social media platform X.
The agreement came on the sidelines of President Recep Tayyip Erdoğan's visit to Riyadh.
"We view these investments as one of the most important examples of direct foreign investment in our energy sector, and they will be financed entirely through external financing. Credit will also be provided by international financial institutions," Bayraktar said.
The $2 billion solar power plants will meet the electricity needs of 2.1 million households in Türkiye, the minister also said.
Türkiye has been heavily investing and providing incentives to expand renewable energy capacity. By 2035, it plans to reach an installed capacity of 120,000 MW in solar and wind power.
The country's total installed electricity generation capacity reached 122,519 MW at the end of 2025.
Renewable sources accounted for 76,281 MW, or 62.3%. Combined, solar and wind installations approached 40,000 MW, equivalent to 32.6% of overall capacity.
Solar power capacity reached 25,109 MW, representing 20.5% of the total, while wind capacity stood at 14,774 MW, or 12.1%.
Treasury and Finance Minister Mehmet Şimşek on Wednesday said the foreign direct investment (FDI) inflow "will accelerate the green transition, enhance energy security and structurally reduce reliance on energy imports."
"The pace of FDI is picking up, underscoring the growing credibility of our economic program," Şimşek wrote on X. He said FDI inflows reached $12.4 billion in the first 11 months of 2025, an increase of 28% from the previous year.
"We are now in the final phase of our (economic) program, anchoring lasting price stability while laying the foundation for sustainable high growth," Şimşek said.
Bayraktar said electricity purchases will be made for 25 years at a rate of 1.99 euros ($2.36) per kilowatt-hour from the plant to be built in Karaman and 2.34 euros per kilowatt-hour from the plant to be built in Sivas.
The minister said they aim for 50% localization within the scope of the project.
"We will hopefully lay the foundation in 2027, and we aim to complete the first phase toward the end of 2027 and the entire project in 2028 and 2029," he added.
Bayraktar also noted that they discussed some projects that will make the cooperation between the two countries in the field of electricity more long-term.
"In particular, regarding the electricity transmission line from Saudi Arabia to Türkiye, and the interconnection, our colleagues will hopefully come back here and start working again. That is also a project of such magnitude and importance that it can affect our entire region," he added.
