GNERC sets new tariffs for generation, transmission, dispatch and distribution for the regulation period January – December, 2016. Selected generation facilities (some HPPs/all TPPs), the transmission and dispatch licensee (GSE), and all distribution network operators (DNOs) fall under the status of a regulated entity. 9 regulated HPPs, currently owned and operated by Energo-Pro Georgia – one of the three DNOs in the country - got their tariffs revised (See Table 1). New tariffs are set so as to cover the capital and operating expenditures for the year 2016 and deliver a margin pre-determined by GNERC. Guaranteed capacity (GC) fees and per kWh generation tariffs for TPPs were also revised (See Table 2). The transmission tariff for GSE was reduced to GEL 0.00754 (-0.5%) and the dispatch fee was reduced to GEL 0.00098 (-3.9%) per kWh. The cross-border transmission licensee, Energotrans, had its tariffs increased for the 500kV domestic grid to GEL 0.0042/kWh (+55.6%) and reduced for the 400kV export line to GEL 0.0029/kWh (-17.1%). Revised tariffs are in effect through December 31, 2016.
A 433MW installed capacity cascade, Namakhvani HPP, should be granted a construction permit in the beginning of 2016 and is up for open EOI starting December 25, 2015. The Namakhvani cascade will consist of two HPPs with estimated annual generation of 1,514gWh and estimated initial investment cost of US$ 730mn. The project implementation model will be a BOO (Build-Operate-Own). The cascade project is currently owned by GEDF, a state-owned energy investment fund.
The energy sector is the second largest recipient of FDI in Georgia with almost US$ 860mn invested over the past five years. At 15% of total FDI, it is second only to the transport and communication sector (23.4% of total over the past five years). The bulk of the energy FDI falls on the electricity generation sector. Over the past three years, US$ 283mn was invested in HPPs through which an additional 170MW of installed capacity was added to the grid, according to the Ministry of Energy. Commercial banks are actively involved in the development, with over US$ 100mn of financing made available over the past three years.
