Exploring carbon taxes as catalysts for financing nuclear power projects in Turkey

Abstract

Purpose- Climate change and the urgent need to transition to low-carbon energy systems have led nations worldwide to seek innovative financing mechanisms for sustainable energy sources. This article delves into the feasibility of leveraging carbon taxes as a potent financial instrument to promote nuclear power projects, with a particular focus on Small Modular Reactors (SMRs), in Turkey. Methodology- This study outlines a methodology for designing a tailored carbon tax framework, addresses challenges, and highlights the strategic importance of this approach. Concurrently, an empirical case study has been conducted to introduce a carbon tax in Turkey to show the fundamentals of calculating carbon tax in Turkey. Findings- By aligning carbon taxes with nuclear power initiatives, Turkey can reduce emissions, secure funding, enhance competitiveness, and contribute to global climate goals, paving the way for a sustainable energy future. Conclusion- Implementing carbon pricing mechanisms could improve Turkey's investments in SMR power plants and reinforce its stance towards a more environmentally sustainable energy future. Keywords: Green financing, nuclear power, sustainable investment, carbon taxes, financial JEL Codes: Q30, Q40, H20