Georgia’s giant hydropower plan raises wave of protest

The $500m Khudoni dam project, recently awarded a $5m in pre-investment funds by the World Bank, has a long and turbulent history behind it. Initiated by the Soviet government in the 1980s when Georgia was still a Soviet republic, it was halted on environmental grounds in 1989/90, then indefinitely as the Soviet Union collapsed and funds evaporated.

Resuscitated in 2005, the project could provide 10% of annual energy used by the South Caucasus country, according to the World Bank. In the winter, much of Georgia still experiences long-lasting blackouts daily.

But Georgian environmentalists and the NGO Bankwatch argue that smaller hydroelectricity projects and other energy sources could meet Georgia’s energy needs without destroying the unique Inguri river valley in Georgia’s mountainous Svaneti region with its isolated medieval-style villages.

Manana Kochladze, Bankwatch regional coordinator for the Caucasus, told edie: “The dam would have an irreversible impact on the Inguri river gorge. The region is very rich biologically and culturally, and very beautiful.”

The Georgian government is pushing for the enormous Khudoni project because of the publicity it will bring, instead of using Georgia’s geothermal resources, renovating existing small and medium-scale hydroelectric power stations, and increasing energy efficiency, she argued.

The project would also raise energy prices by $0.04 pet kW from the current tariff of $0.06-0.07, according to Bankwatch.

“It is very troubling that the new government, which came to power in 2003 after the Rose Revolution [the event that ousted president Schevardnadze on charges of corruption], is going forward with this old destructive plan without any consultation with the Georgian public.”

“It seems that our government and the World Bank have successfully forgotten that energy security results from two things – energy supply and energy accessibility,” said Manana Kochladze, arguing that the new prices would place electricity out of the reach of many Georgians.

The World Bank invested $816 million in 40 operations in Georgia since the country joined in 1993.

“Before 2003 most of this money was stolen by corrupt officials,” said Manana Kochladze. The government that came to power in 2003 has been more effective at fighting corruption, the World Bank and Bankwatch agree.

The Khudoni dam is part of a larger World Bank investment in Georgia’s deteriorating infrastructure, with a focus on energy and transport. The WB claims that some of the initial $5m “pre-investment facility” (IPF) would be spent on investigating environmental impacts.

Roy Southworth, World Bank Country Manager for Georgia, said: “Specifically, the IPF Project will finance technical assistance to assess the feasibility and effectiveness of proposed investments through preparation work, including technical and sectoral studies, engineering design, and analysis of economic, financial and environmental feasibility, as well as financial and legal advisory services, where required.”

By Goska Romanowicz