Energy policy of  Georgia

Based on the resolution of the parliament of Georgia , the Ministry of energy has developed the main directions of the state policy of the energy sector of Georgia.

The main goal of Georgia’s energy policy is to fully satisfy the energy needs of the industrial and household-utility sectors. As a result of the sustainable use of existing energy resources in the country, diversification of energy imports, ensuring economic independence and energy security. In this document, great attention is paid to the use of resources and hydro resources of the designed areas. Georgia’s energy sector has overcome many obstacles over the years .  this was caused by political and economic instability. Nowadays , almost all of Georgia’s residents have access to electricity.  Georgia has made great progress in the regard.  Considering that developing and developed countries consider renewable energy as a main energy priority, Georgia may be considered one of the successful countries. In 1996, while the population was only supplied with electricity for a few hours, the lowest energy consumption for one resident was at only 1.120KW/h, in the last 20 years. This was a reasonable consequence of Georgia’s declaration of independence , in the early years.

According to 2011 data, electricity consumption for each resident was 2.079 KW/h. this is 2 times higher than 1990s amount. Between 2006 and 2010 , investment in fixed generation and distribution lines  amounted to 7.8% of the country’s own product. Electricity supply increased by 44%. Georgia became a net explorer of electricity in 2007.

The great potential for renewable energy. According on the estimated result, Georgia, based on its hydro power resources, can produce 32 TW/h which is 4 times more than the current generation. By 2020, it will be possible to export 6.3 TW/h. the country will also have the ability to supply its entire population with electricity. It will not be dependent on imports. ( even when electricity demand reaches its peak).

Georgia is the cheapest producer of electricity in the region. The tariff for hydro power produced in Georgia is the lowest in the region. And amount to 0.02 USD dollars per KW/h.

This is a very important factor. In our neighboring Azerbaijan , the tariff for thermal power plants is 0.03 USD per KW/h. perhaps such price is due to the fact that Azerbaijanis pay more attention to oil production. For them , promoting and subsidizing gas, one of the country’s source of income, is more profitable. In other bordering countries , such as turkey and Armenia , tariff is much higher in Georgia. Great export possibility.  Given Georgia’s potential for receiving electric energy, can its export volume up 1.7 times by 2015 and 6.7 times by 2020.  High tariff in turkey and the possibility of cheap production in Georgia, may become the basis for the growth of electricity exports in the future.  Turkey’s energy consumption is growing by 7% annually , and according to our research , the country will have a deficit of 118 TW/h by 2020. This is a very favorable situation for Georgia’s energy sector. It is a great incentive for us to generate more and more energy and supply it to our neighbors. In 2011 , the  average wholesale price of electricity in Turkey was 0.08 USD per KW/h , which is higher than the price of 1 KW/h produced by newly built hydro power plants in Georgia (0.06 USD).  These is potential for growth in electricity export to neighboring regions of Georgia, and the issue of entering the EU market via Turkey is being discussed.

Newly built hydro power plants  will be completely under to control of investors. “build  , operate, own”  on principle.  in addition  , hydro electro power plants with a total installed capacity of no more than 13 MW will be able to export their generated energy without licenses.

Owners will have the right to choose their own customers and determine the price of electricity . Nowadays the majority of power plants in Georgia are privately owned.  Only the Enguri and Vardnili  HPP are state-owned. Because Abkhazia is an occupied territory of Georgia and it is impossible to privatize it. 8 reasons why you should invest in Georgia

• Georgia offers competitive  factors: (work, utilities, real estate and taxes. )
• Georgia’s workplace consists  of 1.9 million people. From here 30.8% have a higher education diploma.
• The average monthly salary is much than in Europe -385 $, with the result of 2013.
• The age of unemployed -50.4 % (169 000people) ranges from 20 to 34 years.
• Since 2000, Georgia has been a member of the world Trade Organization and has no quantitative restriction oh trade.
• In Georgia is a good infrastructure . large investments have developed and built international standards, both from the state and private sectors. Railways , ports and airports.
• foreign trade has increased significantly since 2003. Agrarian reforms were implemented, which made it easier and cheaper to trade outside the country’s borders.
• Georgia offers visitors good living conditions, a clean environment focused on green and natural products.