Turkish power producers Akenerji and Zorlu gained before a meeting tomorrow at which cabinet members are expected to discuss raising power prices for the first time in five years.
Akenerji, the third-biggest non-state power company, gained 20 kurus, or 2.5 percent, toYTL 8.30, and Zorlu climbed 10 kurus, or 2.2 percent, to YTL 4.56 at 11:45 a.m. in Istanbul.
Energy Minister Hilmi Güler, Economy Minister Mehmet Şimşek, Finance Minister Kemal Unakıtan and Deputy Prime Minister Nazım Ekren will meet today in Ankara to discuss the sale of state energy companies and the problems Turkey faces in meeting rising demand for power, said Erkan Durdur, Erken's spokesman.
The ministers will also discuss raising electricity prices for the first time in five years, the newspaper Vatan reported yesterday. Durdur declined to confirm a price increase would be discussed.
Non-state power producers argue that a cap on prices is making their business unprofitable, because imported fuel costs have risen as much as 40 percent. The cap has helped the government lower inflation to single digits since 2002.
It has also discouraged companies from investing to increase capacity, company executives say. The lack of capacity has caused blackouts in parts of Turkey as demand surged during the country's hottest summer in eight decades.
Prime Minister Recep Tayyip Erdoğan's government promised the International Monetary Fund under a $10 billion loan accord it would sell regional power grids this year.
The sales were postponed until after a general election in July because the government expected investor concern about political stability to lower bids. The government now wants to complete the sales before the end of 2007. Erdogan won't attend the meeting tomorrow, according to his spokesman, Hacı Unal.
(Bloomberg)