Georgian energy sector reports of achievements and plans
13 January, 2011
Georgian energy sector reports of achievements and plans

Georgia exported unprecedented volume of electricity in 2010 and plans to attract more than USD 1.7 billion through hydro power plant development alone during coming 4 years.
Georgia generated and exported unprecedented volumes of electricity in 2010 during the 15 years of independence of the country. According to Aleko Khetaguri, Minister of Energy of Georgia, 10 billion kilowatt/hour (kwt/h) was generated totally and 1. 3 billion kwt/h out of the figure was exported to all the four neighboring countries including

Russia, Azerbaijan, Armenia and Turkey.
To make clearer the achievement of past year Khetaguri compared the past year’s results with 2005 when due to rehabilitation works on Enguri Hydro Power Plant (HPP) [making almost half of the country’s electricity generation] Georgia had to import 1. 3 billion kwt/h of electricity.
“Today we export the similar amount of electricity we used to import in 2005, I mean 1.3 billion kwt/h,” Khetaguri stressed on December 29, 2010 during presentation event of 2010 key achievements of Georgian energy sector. 
To enhance the export potential of Georgia government undertook a large-scale HPP infrastructure development project and   signed memorandums on construction seven HPPs with total installed capacity of 600 megawatt in frames of this project in 2010. The signed projects include construction of Nenskra HPP supposed to be built in Svaneti, Caucasian highlands of Georgia, by Georgian Railway LLC, the state owned enterprise. Khetaguri accentuates that thanks to its special location Nenskra can generate electricity in winter when Georgian hydro electricity generation faces deficit and country mainly depends on expensive thermal stations-generated electricity [that is based on imported gas] and import. With approximately 200 megawatt installed capacity Nenskra HPP can replace one block of Gardabani thermal power plant completely thus reducing dependence on imported gas in winter.
Construction of two HPPs Mtkvari [of 43 megawatt (MW) capacity] and Paravani HPPs [78MW], already started in 2010. By 2011 government set out an ambitious plan  targeted on  construction launch of Nenskra HPP, Khrami cascade, Alpana HPP and Namakhvani cascade with installed capacity of 1000 megawatt and requiring  more than USD 1.7 billion of direct investments for construction fianancing. Construction works are scheduled to start this year and be completed in 4 years.
Moreover, by end-year government plans to divest certain part of its 24% shares at Telasi, Tbilisi electricity distribution network owned by Russian-based Rao AES, at international stock exchanges.
“This will be the first ever Georgian energy company enlisted at international stock exchanges,” Khtaguri underlined.  At the moment government is near to finish negotiations with Rao AES owning 75% of Telasi shares. 
On the other hand government negotiated the Czech-based Energo-Pro, the electricity distribution company providing almost all regions of the country, to implement the individual metering process of regions in three years [instead of 10 year-period envisaged by the contract] and get through with the overall metering by end of  2013.
“It never means only installation of meters however,” Khetgauri stressed. “The entire electricity transmission infrastructure built some 50 years ago will be rehabilitated and rebuilt across the entire country so as this infrastructure will be valid for another 50 years.”
In 2010 was launched construction of 500 kilowatt Black Sea Transmission line connecting Georgia to Turkey that will transit 700 megawatt on the first phase and increase capacity to 1000 on the second phase. A new 500 kilowatt transmission line was built around Tbilisi to insure uninterrupted electricity supply of the capital that suffered by frequent blackouts in summer of 2010 [caused by accidents on high voltage lines] as depended only on one line.
One of the key achievements in energy sector in 2010 is that government managed to negotiate SOCAR, Azeri national gas and oil company providing Georgia with bulk gas supply, to strike a new agreement on uninterrupted gas supply to Georgia till 2020. The key thing is that the new contract terms detain currently active prices thanks to which consumer price on natural gas will not change, Khetaguri underlined.
Feasibility studies for construction oil refinery and underground gas storage launched in 2010 are scheduled to be through by end of 2011 and construction works will follow afterward. Feasibility for Liquefied Natural Gas terminal [to be constructed in frames of the Azerbaijan-Georgia-Romania Interconnector (AGRI) gas transportation project] is also planned to start and be through in 2011.
This year plans include construction of a new 500 kilowatt transmission line with Azerbaijan scheduled to be put into exploitation by end-year.  Moreover Energo-Pro is bound to construct another new 220 kilowatt capacity line connecting Ajara with Turkey [Sarpi-Miuratli] this year.
As to gasification of Georgian regions, important woks were done to this end. Poti, Georgian key Black Sea outlet that was out of gas supply up to date, is supposed to enjoy natural gas supply starting this January. A new segment of trunk gas pipeline was constructed from Senaki to Poti to this end.  Totally 130 thousand household were  gasified in frames of the presidential initiated project Gas to Every Village past year and more are supposed to enjoy gas supply this year.
“This gasification program aims at development of the trunk gas-pipeline infrastructure in regions, and then it’s up to each household’s discretion whether or not to join the main trunk pipeline,” Khetaguri elaborated. 
As to international gas and oil pipeline projects crossing Georgia, Baku-Tbilisi-Ceyhan transported 38 million tons of crude oil, Baku-Supsa-4 million tons, Shah-Deniz gas pipeline transported 5 billion cubic meters of gas, and 1.5 billion cubic meter of gas was transported to Armenia from Russia via Georgia.

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