National Policy of Georgia on Developing Renewable Energy Sources - საერთაშორისო გამჭვირვალობა - საქართველო

National Policy of Georgia on Developing Renewable Energy Sources

11 January, 2010

Georgia has a significant potential for the development of many sources of renewable energy. The rough calculations prepared by the Georgian Energy Academy in fall 2007 upon the request of the United States Agency for International Development put the energy potential from wind, the sun, geothermal, and biomasses at 15-17 billion kilowatt/hr annually. Specifically, the annual wind energy potential is 3-4 billion kilowatt/hr, solar energy – 3-5 billion kilowatt/hr, biomass energy – 2 billion, hydroelectric energy from small hydroelectric power stations – 5 billion. Geothermal energy has the lowest potential at 2 billion kilowatt/hr. Currently, Georgia consumes approximately 8 billion kilowatt/hr of electricity, 1.8 billion cubic meters of natural gas, and 750,000 tons of oil products annually. Georgia imports 71% of these resources from neighboring countries with only electricity as an exception. A significant portion of electricity (71%) comes from large, medium, and small hydroelectric stations. The remaining 29% is produced by means of imported natural gas. Georgia’s energy consumption reached its highest level in the early 90s just before Georgia declared independence from the Soviet Union. During this period, electricity consumption reached 18 billion kilowatt/hr, gas consumption – 6.5 billion cubic meters, and oil consumption – approximately 2 million tons. Current consumption lags considerably behind per capita rates of consumption during the Soviet era and of developed countries currently (5,000-7,000 kilowatt/hr annually). Presumably, demand for energy resources will rise in the future in correspondence with Georgia’s economic development and the improved purchasing power of the population. Consequently, the government of Georgia has to start thinking about how the increased demand will be satisfied – by increasing imports from neighboring countries or by maximally utilizing Georgia’s existing renewable resources and enhancing energy efficiency. Naturally, as a net importer of energy resources and like the developed importing countries of the EU, it is desirable that Georgia choose a path of enhanced energy efficiency and maximal utilization of local renewable sources. Georgia has already assumed this responsibility by joining the European and international organizations working in energy and environmental areas and the officially announced aspiration towards the EU. The European Neighbourhood Policy directly obligates the countries participating in this process to coordinate their legislative acts regulating the sphere of energy politics and energetics with the corresponding legislative acts and main regulations on energy politics of the EU member states. The Energy Security Policy of the EU consists of four main directions. These are: 1. the reduction of dependence on imported resources, 2. the enhancement of energy efficiency, 3. maximal utilization of the local renewable sources, and 4. the reduction of greenhouse gas emissions (which is generated through the use of hydrocarbons). The utilization of renewable sources supports the reduction of the dependence on imported resources, as well as of the reduction of greenhouse gas emissions to the atmosphere. According to the decision of the European Commission, the share of the renewable sources (wind, solar, biomass, and geothermal) in the energy balance of EU member states should reach 10% for 2010, 15% for 2015, and 20% for 2020. Achieving this is not easy, given that the prime costs of renewable energy sources (wind, solar, biomass and geothermal) exceed the prime cost of hydrocarbons and, accordingly, cannot yet compete with it. However, the current price structure on hydrocarbons on the international energy market creates favorable conditions for the development of renewable energy sources. Georgia has no obligatory quotas for reducing greenhouse gases under the Kyoto Protocol. In fact, after the dissolution of the Soviet Union (and the resulting collapse of the regions’ energy intensive industries), Georgia’s greenhouse gas emissions into the atmosphere were reduced substantially (if in 1990 Georgia emitted 46 million tons of CO2 into the atmosphere annually, in 1997 Georgia emitted only 14 million tons of CO2). However, along with economic growth it is very likely that this rate will rise again. Besides, Georgia can profit from implementing projects under the clean development mechanism of the Kyoto protocol and receive significant benefit from the development of renewable energy sources. If Georgia truly aspires towards EU membership, the country must undertake the following initiatives in order to reduce dependence on imported energy resources and the harmful environmental impact:

  • Pursue a policy of strict energy saving and energy efficiency;
  • Support maximal utilization of country specific renewable sources as much as possible;
  • Not allow the augmentation of greenhouse gas emissions into the atmosphere.

For this purpose, Georgia should take into consideration the experience of the EU member states. In order to support the development of renewable energy sources, it should create a legislative basis and action plan that will serve as a road map for the development and market penetration of Georgia-specific renewable energy sources.