This is a best prospect industry sector for this country. Includes a market overview and trade data.
Last Published: 7/19/2017

Overview

Georgia is an exporter of electricity with significant additional export potential, especially to markets in Turkey and Europe.  Georgia also serves as a transit country for electricity flowing between Azerbaijan, Russia, and Armenia.  With assistance from USAID, European Bank for Reconstruction and Development (EBRD), Kreditanstalt für Wiederaufbau (KfW), and the European Investment Bank (EIB), Georgia completed construction of an electricity interconnector project that will allow for the export of electricity to more lucrative markets with high demand such as Turkey and Western Europe.  With assistance from KfW, a new high voltage transmission line is under devlopment that will connect Georgia and Armenia and will allow for greater power flow between those countries.  The government of Georgia has aggressively undertaken efforts to attract investments in the hydro power sector.  During 2011-2012, the U.S. government financed the rehabilitation of transmission lines that are an important part of the infrastructure for facilitating exports and assisted Georgia in the establishment of the Georgia Electricity Market Model of 2015 that will facilitate an electricity trading mechanism with Turkey and others.  The related legal and regulatory framework developments are underway, along with regional electricity transmission planning and regional regulatory assistance for the cross-border trading of electricity.  The U.S. government also supported the development of the Energy Strategy for Georgia which was partly based upon the Market Allocation Model (MARKAL).  In June 2015, the U.S.-based Schulze Global Investments private equity firm launched $100 million investment fund in Georgia that will mainly focus on hydropower projects and clean energy.

ELP Best Prospects/Services

The best opportunities for U.S. companies in this sector are in electricity power generation – specifically hydroelectric power, transmission, and distribution projects.  There are also export opportunities for U.S. manufactured equipment and services during construction and rehabilitation of facilities, and management and upgrades of existing power infrastructure.  Opportunities for U.S. suppliers are also available in projects financed by multilateral financial organizations and bilateral assistance: the World Bank, EBRD, the Asian Development Bank, the Japan Bank for International Cooperation (JBIC), and KfW.
 
Other opportunities exist in demand side energy management for the electricity distribution companies that serve electricity market end-users. ​ These opportunities are for smart grid, metering and intelligent energy management systems for the distribution grid operators, industrial, commercial users and lesser extend for the residential users, as the country develops better incentives for energy efficiency.

  

ELP Opportunities

Georgia currently does not produce power generation and transmission equipment, with the exception of some small capacity hydroelectric turbines and electricity meters.  Most current equipment was produced in the Soviet era, primarily in present-day Russia.  Current efforts of the Georgian government to develop hydropower generation infrastructure and construct new power transmission infrastructure should create demand for equipment and opportunities for U.S. investors and exporters.  All medium and large hydroelectric generation facilities except Enguri and Vardnili hydropower plants have been privatized.  Between 2009 and 2014, USAID’s Hydroelectric Investment Promotion Project (HIPP) and Hydro Power and Energy Planning (HPEP) project worked with the Georgian Ministry of Energy to address gaps in Georgia’s regulatory framework in an effort to encourage private sector investment and create the market rules to enable electricity exports, primarily to Turkey.  A follow-on project, the energy component of the Governing for Growth (G4G) project, supports market-based initiatives to promote and secure international investment into Georgia’s small- and medium-sized run-of-river type hydroelectric power market.  The program aims to facilitate power transit among the Caucasian countries and the rest of Europe through the harmonization of Georgian trading rules and regulations with EU standards.  

ELP Resources

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Georgia Energy Trade Development and Promotion