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tricity as determined will, pro rata, meet the costs of lost/illegal elec-
tricity that arise as a result of technical and non-technical losses of the
electricity system.
Jurisdiction of Energy Market Regulatory Authority
Under item 1 of Article 4 of Law No. 4628 on the Electricity
Market (“Law”), it states that the Energy Market Regulatory Authority
is established in order to perform the duties authorized under the said
Law and under item 2 of the same Article, in which it states that “The
Authority is responsible for the issuance of Authorized Licenses that
set forth the permitted activities of the corporate persons, and the rights
and obligations arising out of the said activities, existing contracts
within the sphere of transfer of those operational rights to be regulated
in accordance with the provisions of the Law, monitoring of the mar-
ket performance, composing of performance standards, as well as the
amendment, and enforcement of regulations on distribution, consumer
services, establishment of principles of pricing covered by this Law,
structure of pricing codes to be applied in the sale of electricity to
dependent consumers in line with market requirements, and the appli-
cation and control of the formulas in relation to adjustments that are
needed to be made to the said prices as a result of inflation, and to
ensure that the market complies with the provisions of this law …’
Although the Court of Appeal stated that the Authority has the duty
to determine the principal elements for the pricing to be applied to
electricity sales made to consumers, it also pointed out that the limit of
this authority is the cost and profit share for 1KW electricity energy
until it reaches the consumers, and that the Authority is not delegated
with the power or duty to determine an unlimited pricing element.
The Authority has sought recompense of lost/illegal costs from
consumers to date under the “Communiqué on Retail Sales Service
Revenues and Setting up of Sales Price of Retail Electricity Sales”
(“Communiqué”), published in Official Gazette 24843 of 11.08.2002.
However, the Authorities can only issue regulatory procedures for the
purpose of determining the principles and procedures of the rules
imposed by the Law. As to this case, the Authority assumed the right
to demand payment for lost/illegal electricity from consumers under a
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