Tbilisi, Georgia, March 19, 2015—IFC,
a member of the World Bank Group, the Asian Development Bank (ADB), and
the European Bank for Reconstruction and Development (EBRD) are helping
Georgia tap its hydropower potential and achieve energy self-sufficiency
by investing in the construction and operation of the Shuakhevi hydropower
The $250 million debt financing arranged by IFC represents the largest-ever
private hydropower investment in Georgia, consisting of two $90 million
long-term senior loans, one each from ADB and EBRD, and $70 million from
IFC. IFC’s total investment in this project is $104 million, which includes
a $34 million equity investment in the project company, Adjaristsqali
Georgia, a joint venture between India’s Tata Power and Norway's Clean
Energy Invest (40 percent each), and IFC (20 percent).
The Shuakhevi plant will satisfy Georgia’s electricity demand during winter,
reducing dependence on imported fuel and increasing renewable energy output.
It will also foster cross-border electricity trading at other times of
the year by exporting electricity to Turkey through a transmission line
financed by EBRD. The project will benefit local communities by helping
create jobs, boosting municipal incomes, and upgrading area roads.
“Through the strong partnerships fostered with the Georgian government,
our equity partners, Tata Power, IFC, and the other lending institutions,
we are realizing the renewable energy potential of Georgia,” said Baard
Mikkelsen, Chairman of Clean Energy. “This project demonstrates that non-recourse
cross border financing is available for greenfield hydro projects in Georgia,
and will be important for the development of the sector and Georgia.”
Anil Sardana, Managing Director, Tata Power, said: “I would like to thank
the Government of Georgia for their support in exploring Georgia’s huge
hydropower potential. We are also grateful to our strategic partners, Clean
Energy and IFC Infra Ventures, for putting us on a strong footing. We are
confident that the potential will be realized with exemplary clean governance
and speed of action.”
Michael Barrow, ADB Deputy Director General for Private Sector Operations
Department, said: “The project will promote regional cooperation and generate
additional revenues for Georgia through energy trade. This groundbreaking
renewable energy investment highlights the important role ADB plays in
leveraging support for energy security and environmentally sustainable
growth in the region.”
Some $15 million of ADB’s $90 million in financing will be provided by
the Canadian Climate Fund for the Private Sector in Asia, funded by Canada’s
government and administered by ADB.
Nandita Parshad, EBRD Director for Power and Energy, said: “It is particularly
fulfilling to see private investment in energy generation projects stimulated
by EBRD’s initial investment in the Georgia-Turkey cross-border transmission
line. It is a prime example of how the bank facilitates private sector
investment as part of its mandate to help countries transition to open
Wiebke Schloemer, IFC Regional Industry Head of Infrastructure in Europe,
Middle East and North Africa region, said: “We continue to support the
Georgian government’s efforts to tap the country’s full hydropower potential
by jointly developing world-class projects with private companies and bringing
in important international players, like Tata Power. The Shuakhevi project
is expected to strengthen investor confidence in Georgia and stimulate
more private sector investment in the sector."
The project is the first hydropower project in Georgia certified by the
United Nations Framework Convention on Climate Change for carbon emission
reductions. It is expected to produce about 450 gigawatt hours of power
annually and reduce greenhouse gas emissions by more than 200,000 tons
per year. The project will develop the 187-megawatt Shuakhevi hydropower
scheme, consisting of the Shuakhevi and Skhalta hydropower plants located
in the Adjara region, in southwest Georgia. Work on the plant began in
September 2013 with a target to start producing electricity in 2016.
IFC has supported the project since its early development, in 2011, through
IFC InfraVentures, together with Clean Energy Invest. India’s largest
integrated power company and a pioneer in hydropower generation in India,
Tata Power, came on board in 2013. IFC’s investment will be complemented
by World Bank financing of the power transmission line, which will connect
the plant to Georgia’s national grid and improve power supply to the Adjara
IFC, a member of the World Bank Group, is the largest global development
institution focused exclusively on the private sector. Working with private
enterprises in about 100 countries, we use our capital, expertise, and
influence to help eliminate extreme poverty and boost shared prosperity.
In FY14, we provided more than $22 billion in financing to improve lives
in developing countries and tackle the most urgent challenges of development.
For more information, visit www.ifc.org.
ADB, based in Manila, is dedicated to reducing poverty in Asia and the
Pacific through inclusive economic growth, environmentally sustainable
growth, and regional integration. Established in 1966, it is owned by 67
members—48 from the region. In 2013, ADB assistance totaled $21.0 billion,
including cofinancing of $6.6 billion. For more information, visit www.adb.org.
The EBRD is investing in changing people’s lives and environments in more
than 35 countries from central and Eastern Europe to Central Asia, the
Western Balkans and the southern and eastern Mediterranean. Working together
with the private sector, the bank invests in projects, engages in policy
dialogue and provides technical advice to foster innovation and build sustainable
and open-market economies. For more information, visit www.ebrd.org.
About Tata Power
Tata Power is India’s largest integrated power company with a growing
international presence. The Company together with its subsidiaries and
jointly controlled entities has an installed gross generation capacity
of 8,747 megawatts in India and a presence in all the segments of the power
sector. With its track record of technology leadership, project execution
excellence, world class safety processes, customer care and driving green
initiatives, Tata Power is poised for a multi-fold growth and committed
to 'lighting up lives' for generations to come. Visit us at: www.tatapower.com.
About Clean Energy
Clean Energy Group is the brand name for the sister companies Clean Energy
Invest AS and Clean Energy Group AS. Clean Energy Invest AS was set up
in February 2010 as a single purpose company to develop the Adjaristsqali
hydro projects in Georgia. Clean Energy Group AS has been set up to develop
greenfield hydropower projects in countries with a sustainable energy framework
and untapped hydro potential. Clean Energy Invest has its head office in
Oslo, Norway. Visit us at: www.cleanenergygroup.no.