EBRD and Georgia sign initial agreement to work on first wind park
Thursday, July 23The European Bank for Reconstruction and Development (EBRD) and the Government of Georgia have signed a mandate letter setting out their readiness to cooperate on the first wind farm project in the country.
The letter was signed during the 2015 EBRD Annual Meeting in Tbilisi in the presence of Deputy Prime Minister and Minister of Energy, Kakha Kaladze; EBRD Managing Director for Energy and Natural Resources, Riccardo Puliti; Giorgi Bezhuashvili, Director of the Georgian Energy Development Fund; and Aida Sitdikova, EBRD Director for Energy and Natural Resources, Russia and Central Asia.
A mandate letter is an initial agreement which will be followed by work on the project by all parties. The EBRD’s Board of Directors is expected to vote on the project later this year.
The EBRD is considering providing up to a US$ 25 million senior loan to a special purpose vehicle established in Georgia for the sole purpose of constructing and operating a wind power plant (WPP) in Gori. Part of the loan is expected to be syndicated under an A/B loan structure.
The total installed capacity of the power plant will be 20 MW and expected annual generation 85 GWh. The total estimated cost of the project is US$ 35 million.
EBRD Managing Director for Energy and Natural Resources, Riccardo Puliti, said: “Georgia is having success in developing domestic renewable energy sources, thus reducing imports of power generated by fossil fuels.? This is important in terms of energy security as well as climate change. After investing ˆ312 million in hydro power generation, we are hoping to make another renewable source – wind – attractive for investors.”
Kakha Kaladze, Georgia’s Deputy Prime Minister and Minister of Energy, said: “We welcome the EBRD’s support for the first wind park project in Georgia which will also be the Bank’s first engagement in wind power generation in the Caucasus region. The Gori WPP will support the government’s strategy to foster low carbon generation and cover the country’s seasonal demand in the winter period. The Georgian Energy Development Fund, the government agency in charge of boosting renewable energy investments, is now actively working with the EBRD on the project.”
In total, the EBRD has invested over ˆ2.6 billion in Georgia’s economy, of which over 20 per cent has been in energy. In addition to ˆ312 million invested in renewable energy generation, the Bank has also invested over ˆ210 million in transmission and distribution projects, which opened export markets for Georgia’s renewable energy and attracted private investors to the sector. (Ministry of Energy)