{"id":49627,"date":"2022-09-27T15:50:23","date_gmt":"2022-09-27T13:50:23","guid":{"rendered":"https:\/\/libmod.de\/inputpaper-energiesicherheit-georgien-integrierter-europ-markt\/"},"modified":"2022-09-27T16:57:36","modified_gmt":"2022-09-27T14:57:36","slug":"inputpaper-energiesicherheit-georgien-integrierter-europ-markt","status":"publish","type":"post","link":"https:\/\/libmod.de\/en\/inputpaper-energiesicherheit-georgien-integrierter-europ-markt\/","title":{"rendered":"Energy security agenda for Georgia and the path towards an integrated European energy market"},"content":{"rendered":"

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Foto: Imago Images<\/figcaption><\/figure>\n

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The second series of input papers for the project \u201cEastern Partnership Plus\u201d deals with the question of the depen\u00addence of the three associated countries on energy imports and a better integration into the European energy market.<\/h2>\n

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Nana Pirtskhelani, Independent Energy Expert, Georgia<\/em><\/p>\n

 <\/em><\/p>\n

Intro\u00adduction<\/em><\/strong><\/p>\n

Georgia\u2019s desire for full membership of the European Union is clearly manifest in its willingness to enhance its cooper\u00adation with the EU in the energy field. For three decades, Georgia\u2019s active partic\u00adi\u00adpation in energy activ\u00adities involving the use of variety of collab\u00ado\u00adrative tools has demon\u00adstrated the country\u2019s desire to join the unified European energy system and contribute to regional energy-security goals. The recent devel\u00adop\u00adments relating to the prospect of candidate status for Georgia, alongside Ukraine and Moldova, were another confir\u00admation of this aspiration. In the process of dramatic and dynamic changes, Georgia continues to enhance regional energy cooper\u00adation through diver\u00adsi\u00adfying supply sources, suppliers, and supply routes.<\/p>\n

It is worth noting that the ongoing Russian military aggression in Ukraine has had a signif\u00adicant impact not only on the formation of Ukrainian energy security policy but also on that of other European countries as well. The relates partic\u00adu\u00adlarly those countries that consume more energy than they produce, as they are partic\u00adu\u00adlarly vulnerable to the use of energy supply as an instrument of political pressure. Thus, ensuring the security of supply by reducing import depen\u00addence and enhancing sustainable devel\u00adopment has become a signif\u00adicant energy policy challenge for every European country. Relevantly, the need for a coordi\u00adnated energy policy was put on the agenda. In this context, the \u201cAssociated Trio\u201d (Moldova, Ukraine, and Georgia) took on particular impor\u00adtance for the European Union as strategic energy partners, and more emphasis began to be placed on their role in ensuring supply security.<\/p>\n

Georgia on the map of energy-supply security challenges<\/em><\/strong><\/p>\n

The EU Joint Commu\u00adni\u00adcation entitled \u201cEastern Partnership Policy Beyond 2020<\/a>\u2033 sets out proposals aimed at the creation of a broader framework for cooper\u00adation and placing greater priority on energy issues. In line with this, new condi\u00adtions for meeting its oblig\u00ada\u00adtions under the Associ\u00adation Agreement and beyond it were set out for Georgia, as a benefi\u00adciary of the EU financial assis\u00adtance. With regard to energy, strength\u00adening supply security and supporting sustainable devel\u00adopment measures emerged as the most critical topics in this context.<\/p>\n

It is worth noting that Georgia has faced energy crises since the beginning of the 21st<\/sup> century and has identified security of supply as a vital objective of its national energy strategy. When discussing the security challenges being faced and ways to overcome them, it is essential to review the mix of Georgia\u2019s energy production and consumption, identify the extent of depen\u00addence on imported energy, and further review strategic goals with respect to dealing with the overwhelming challenges.<\/p>\n

It should be empha\u00adsised that hydro resources account for the greatest share of the country\u2019s energy potential. However, only 22% of Georgia\u2019s hydropower capacity is currently under exploitation (potential capacity is 15 000 MW). Conse\u00adquently, despite the fact that hydropower accounts for around 73% of electricity production from domestic sources, electricity generated by imported natural gas still dominates in terms of total final energy consumption[1]<\/sup><\/a>.<\/p>\n

The energy mix domestic energy production is as follows: approx\u00adi\u00admately 67.9% of Georgia\u2019s domestic energy production (1.043 Mtoe in 2020) comes from hydro (0.709 Mtoe), 22% from biofuels\/\u200bwaste (0.227 Mtoe), 3.8% from coal (0.040 Mtoe), 3.1% from crude oil (0.031 Mtoe), 2.5% from renew\u00adables (0.026 Mtoe), 0.7% from natural gas (0.007 Mtoe)[2]<\/a>. Due to the low rate of utili\u00adsation of hydro resources and increased domestic demand, the country has been forced to import expensive energy products and is heavily dependent on imported oil and gas.<\/p>\n

According to the latest statis\u00adtical data, energy imports are used to cover about 89.6% of the country\u2019s total energy demand. Natural gas makes up the largest share of these imports (about 57.6%), followed by oil resources (about 33.9%), imported coal and electricity account for the rest. Imports account for 99.4% (2,504 million cubic meters, up 0.9 percentage points from last year) of the natural gas consumed, with local production accounting from only the remaining part 0.6%. The Republic of Azerbaijan is the primary source of imported natural gas (91%), about 9% of it comes from Russia.[3]<\/a> Georgia is also involved in transit activ\u00adities as well as enhancing natural gas transit flows from Azerbaijan to Turkey (via the SCP pipeline) and from Russia to Armenia (via the NSMP pipeline).<\/p>\n

Almost all oil products consumed in Georgia are imported. Unlike the case with natural gas, oil import sources are quite diver\u00adsified. Georgia\u2019s Union of Petroleum Importers reported that oil imports in the first half of 2021 came mainly from Romania (23.4% of total imports), Turkmenistan (23.0%), Russia (20.6%), Azerbaijan (17.7%) and Bulgaria (10.8%), with additional imports from Greece (2.1%), Turkey (1.5%), Kazakhstan (0.5%) and other countries.[4]<\/a> The transit flows through the territory of Georgia via the BTC and WREP pipelines give the country additional oppor\u00adtunity to diversify import sources. As for coal, the primary import market is the Russian Feder\u00adation. Coal accounts for only a 4.3% share of total energy imports, and only a 3.9% of the country\u2019s total energy demand.[5]<\/a><\/p>\n

Georgia is actively involved in electricity export-import activ\u00adities on a regional level. It has energy trading relations with all its neigh\u00adbouring countries (Armenia, Azerbaijan, Russia, and Turkey). With a total installed capacity of 4536.5 MW, the country is capable of exporting electricity in the summer months, a period of surplus production. However, generally, the country is charac\u00adterised by a negative trade balance. In 2021, Georgia imported a total of 2006.2 million kWh of electricity. Russia supplied 1244.9 million kWh of that total. Abkhazia was the desti\u00adnation of 79% of the electricity from Russia (992.7 million kWh), due to a drastic reduction in local electricity production resulting caused by the shutdown of the Enguri HPP for repairs (the Enguri plant normally provided almost 90% of Abkhazia\u2019s supply). Georgia also imported 600.1 million kWh (29.9% of total imports) from Azerbaijan and 161.2 million kWh. (8% of total imports) from Turkey in 2021. No electricity imports from Armenia were reported in 2021.[6]<\/a><\/p>\n

To sum up, identi\u00adfying import depen\u00addence as a signif\u00adicant challenge, the country\u2019s energy strategy focuses on ensuring uninter\u00adrupted supply at an affordable price as a primary task with a view to energy security. Several important activ\u00adities expected to enable the country to signif\u00adi\u00adcantly increase its degree of energy security by 2030 have been identified.<\/p>\n

 <\/em><\/strong><\/p>\n

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Security of energy supply from the perspective of the EU-Georgia cooperation<\/em><\/strong><\/p>\n

In the context of high import depen\u00addence, the low utili\u00adsation rate of local resources, season\u00adality of hydropower potential, lack of critical reserves, and risks related to the relia\u00adbility of energy infra\u00adstructure, security of supply has been identified as the primary energy challenge facing the country. The imple\u00admen\u00adtation of activ\u00adities aimed at ensuring affordable, reliable, and uninter\u00adrupted supply has been the primary objective in the energy strategy, and a variety of measures are underway:<\/p>\n