Donor Conference

Ministry of Energy of Georgia

Current situation

• Technical problems– Power sector of Georgia – not build to operate

independently

• Economic problems• Collection rate

– Not metered– High Indebt ness– Not rehabilitated properly for 10 years

• Financial aid needed for transition period and basic rehabilitation

Objectives• Self-Sustainability – profitability

– Independently operational – Without additional subsidies from donors and / or

government– Attractive for private investment

• Energy Security– Utilization of transit opportunities– Multiple sources for import – Differentiated markets for export

• Otherwise politically and economically dependent• No prospect for economic development• Social tension

Policy• Collection rate

– Main problem– 40% collection rate– Investment in metering– Legislation against theft of electricity– Public awareness campaign

• Rehabilitation and construction of new grid and high voltage lines– Turkey, Azerbaijan, Russia, Armenia

• Rehabilitation of Existing Hydropower Plants– 40-45 % of installed capacity– Spend less on imports

500KW

Energy System of GeorgiaEnergy System of Georgia

Ministry of Energy

Enguri HPP 1300MW – 700MW

Vardnili HPP 210MW – 60MW

Hydro Power Plants of GeorgiaHydro Power Plants of Georgia

Khrami I HPP 112MW – 60MW

Khrami II HPP 110MW – 0MW

Jinvali HPP 130MW – 90MW

Shaori HPP 38MW – 18MW

Dzevrula HPP 80MW – 54MW

Vartsikhe Cascade HPP 184MW – 132MW

Ministry of Energy

Gumati I,II HPP 66MW – 39MWRioni HPP 48MW – 45MW

Lajanuri HPP 111MW – 30MW

Planned: Hudon HPP 600MW

Current achievementsWithout additional investments

• Decreasing of electricity looses in high voltage grid – 17% in Winter of 2003 – 9.6% in Winter of 2004

• Relatively improved supply of electricity – up by 16% • Installation of meters at borders with neighbor countries• State budget investment - 2,5 mln USD per month

– Enguri HPP rehabilitation project co-financing– Wholesale & commercial metering– Urgent maintenance

• Rehabilitation of the 1st unit of Vardnili HPP (70 MW)• Detailed business plan for 2004-2005• Improved legislation for financial rehabilitation

Projects• Metering

– Improved collections– Decreased consumption– Rustavi example

• Rehabilitation of HPP – 40 - 50% of installed capacity– “Quick Hit” program

• Rehabilitation of Gardabani TPP – Electricity for base load– Problem – Funds for natural gas supply

• Rehabilitation of the network – Increased system stability

• Winter Heat Program– Improved supply and help vulnerable