To ensure a reliable supply of electricity to
Georgia's capital, Tbilisi, and its surrounding region, the European Bank
for Reconstruction and Development (EBRD) and the International Finance
Corporation (IFC) have agreed to provide two loans of US$30 million (€28.7
million) each to JSC AES Telasi, a newly privatised electricity
distribution company in the country.
"This project demonstrates the support of the EBRD and IFC for the
first privatisation to be undertaken in the Georgian power sector,"
said Ananda Covindassamy, the EBRD's Power and Energy Team Director. Vivek
Talvadkar, Director of IFC's Power Department said: "The financing
will help to improve the efficiency and reliability of electricity supply
to Tbilisi. It will also improve the collection of electricity payments,
and encourage substantial private financing in the power sector."
The loans totalling US$60 million (€57.4 million) will allow Telasi to
strengthen its electricity distribution network, and to install new meters
to improve collection. Investments are expected to significantly enhance
energy efficiency by cutting power transmission losses and will also improve
health and safety standards within Telasi. Furthermore, by increasing the
collection of electricity payments, this project will promote additional
private sector financing for other parts of the Georgian power sector.
Telasi provides electricity at the retail level to approximately 370,000
customers, about 80 percent of which are residential consumers. The company
is 75 percent owned by a subsidiary of the AES Corporation (USA), the largest
independent power producer in the world.
The EBRD was set up in 1991 following the collapse of communism, to aid
the transition from centrally planned to market economies in central and
eastern Europe and the Commonwealth of Independent States (CIS). The EBRD
is owned by 60 shareholders: 58 countries, the European Investment Bank
and the European Community, and operates with €20 billion in capital.
The mission of IFC, part of the World Bank Group, is to promote private
sector investment in developing countries, which will reduce poverty and
improve people's lives. IFC finances private sector investments in the
developing world, mobilizes capital in the international financial markets,
and provides technical assistance and advice to governments and businesses.