The government and not a private investor might construct the Khudoni Hydro Power Plant (HPP).
Government may build Khudoni HPP
By Tea Mariamidze
Friday, August 1
“We do not exclude the project to be carried out by the government, as it is one of the most important projects for Georgia,” Energy Minister Kakhi Kaladze said. The statement was negatively taken by Trans Electrica LTD, the company that was planning to invest in the project and which has already drafted 4 volumes regarding the HPP impact on nature and spent millions of laris.
Meanwhile, Svaneti residents are firm on their positions and claim that they will not let the construction of the HPP get underway; as they worry it may cause flooding of their historical homes. Constant rallies organized by locals were the major obstacle for the government and the investor to launching the project. However, despite the rallies, Kaladze stated that the HPP would be built anyway as the project was vitally important for the country’s self-sufficiency in terms of energy. Trans Electrica should have received permission for launching the work by March 1, 2014. However, the LTD has not yet received the green light.
Chairperson of Trans Electrica, ex-Energy Minister Davit Mirtskhulava states that various preparation activities have already been undertaken by the company. He admits that such projects should be carried out by private companies rather than the government.
Economic analyst Levan Kalandadze states that there are two major reasons why the government should not take the project.
“The cost of the project is 1,200, 000 000 USD, and the government does not have such financial resources; and the second, government is always a poor ruler of such projects,” Kalandadze says.
Former official Guram Chalagashvili admits that such steps taken by the government might discourage foreign investors to put investments in Georgia.
The Khudoni HPP project envisages the construction of a dam, a reservoir and a 500 kV power transmission line. The designed capacity of the project is 700 MW, which means 1.4 billion kilowatt hours (kWh) annually. According to preliminary estimates, the construction of the Khudoni HPP would increase the country's electricity generation by 20 percent.
The Khudoni HPP will be the second largest-capacity plant in the Georgian energy system, after the Enguri HPP, and will account for almost 16 percent of the country's hydropower generation.
However, environmentalists stress that the level of seismic activity in Svaneti is high, they are also concerned about the threat of landslides and that the accumulation of huge amounts of water in the territory will create problems for the health and safety of locals. Environmentalists appeal to the government to construct smaller hydro power plants, rehabilitating existing ones, and decrease electricity losses from transmission lines.