Georgia to Achieve Energy Self-sufficiency via Hydropower Funding

IFC, a member of the World Bank Group, the Asian Development Bank (ADB), and the European Bank for Reconstruction and Development (EBRD) are helping Georgia tap its hydropower potential.

By investing in the construction and operation of the Shuakhevi hydropower plant will also see the country achieve energy self-sufficiency.

The $250 million debt financing arranged by IFC represents the largest-ever private hydropower investment in Georgia, consisting of two $90 million long-term senior loans, one each from ADB and EBRD, and $70 million from IFC. IFC’s total investment in this project is $104 million, which includes  a $34 million equity investment in the project company, Adjaristsqali Georgia, a joint venture between India’s Tata Power and Norway's Clean Energy Invest (40 percent each), and IFC (20 percent).

The Shuakhevi plant will satisfy Georgia’s electricity demand during winter, reducing dependence on imported fuel and increasing renewable energy output. It will also foster cross-border electricity trading at other times of the year by exporting electricity to Turkey through a transmission line financed by EBRD. The project will benefit local communities by helping create jobs, boosting municipal incomes, and upgrading area roads.

Some $15 million of ADB’s $90 million in financing will be provided by the Canadian Climate Fund for the Private Sector in Asia, funded by Canada’s government and administered by ADB.

The project is the first hydropower project in Georgia certified by the United Nations Framework Convention on Climate Change for carbon emission reductions. It is expected to produce about 450 gigawatt hours of power annually and reduce greenhouse gas emissions by more than 200,000 tons per year. The project will develop the 187-megawatt Shuakhevi hydropower scheme, consisting of the Shuakhevi and Skhalta hydropower plants located in the Adjara region, in southwest Georgia. Work on the plant began in September 2013 with a target to start producing electricity in 2016.

IFC has supported the project since its early development, in 2011, through IFC InfraVentures, together with Clean Energy Invest. India’s largest integrated power company and a pioneer in hydropower generation in India, Tata Power, came on board in 2013. IFC’s investment will be complemented by World Bank financing of the power transmission line, which will connect the plant to Georgia’s national grid and improve power supply to the Adjara region. 

Picture of Shuakhevi dam in Georgia, reproduced under CCL.

Friday 20th March 2015

Add New Comment:


To Comment you must be a member of The ESA, please login or register to join

There are currently no comments, be the first to comment above.