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Hydropower development in Georgia

Svaneti, Georgia. Panorama above Mestia. (More images in our flickr set.)
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Hydropower in Georgia - Quick facts

installed capacity:
3500 MW
(= 25% of available capacity - Source)

annual output:
appr. 8.5 TWh
share of domestic electricity needs:
85 percent (Source)
potential capacity:
estimated with 80 TWh (27 TWh economically viable)

Blessed with staggering mountains, Georgia has a largely unexploited hydropower potential (see quick facts) on which private investors, the Georgian government and international lenders have set their sight.

Experience and ongoing monitoring shows that while some hydropower projects would only bring marginal, if any, benefits for locals, the risks associated with them are largely being underestimated or ignored.

Read the briefing:
Hydropower in Georgia - Impacts on communities, the environment and the economy (pdf)

Large dams versus local communities


By far the most controversial hydropower project in Georgia is the Khudoni dam. It will interfere with a rich cultural heritage and 2000 people will have to be forcefully resettled.

At the same time the opaque ownership of the project company (registered in a tax haven) and its contractual obligations make the purported benefits of the 702 MW project doubtful.

Read more:
Detailed background, images and updates on the Khudoni hydropower plant.

A historical view on the Georgian energy sector, the effects on local communities and the role of international financial institutions.



Not far from the site for Khudoni, another controversial large dam project, the 280 MW Nenskra hydropower plant, is being planned. It is the most advanced of Georgia's massive plans for hydropower installations in the Upper Svaneti region. It will deprive the local community of ethnic Svans of lands and livelihoods, but potential negative impacts have not been properly assessed.

More on Nenskra


A cascade of projects

An interactive map of planned hydro installations in the Upper Svaneti region shows how dense and without strategic planning these investments have appeared.

Explore the map


Geological hazards in mountain areas

Landslides happened at the site of the Dariali hydropower construction. (Original image by Iago Kazalikashvili.)

Also smaller projects like the Dariali (pdf) and the Shuakhevi (pdf) HPPs can pose substantial risks, even when no dams have to be built.

Apart from damaging the rivers' biodiversity, the projects are being constructed without proper assessment of the geological conditions. Two fatal landslides in the Dariali Gorge revealed the irresponsible decision-making by the investors and the Georgian government.

Read more

Second fatal landslide in Georgian Dariali valley
Blog post | August 22, 2014


Below: See an Al Jazeera report on Georgian hydropower constructions in seismically active areas.


Resettlement and lack of legal protection

Involuntary resettlement in Georgia - an overview

Download the study

Georgian communities that face hydropower projects have difficulties protecting their rights as affected stakeholders and landowners.

  • Georgia’s legislation does not address the issue of involuntary resettlement caused by infrastructure projects.
  • The Environmental Impact Assessment (EIA) system is ineffective in Georgia, both in terms of providing the public with information and opportunities for public participation (pdf).
  • An unclear legal rights regime offers no or minimal protection for communities that make customary use of land that traditionally was in their hands. Unregistered land plots can literally be grabbed by investors for infrastructure projects.

In addition to the threat of losing their land or being resettled, farmers may have to face reduced access to water for irrigation or higher risk of flooding due to dam constructions. Both exposes them to an increased food insecurity.


Latest developments


Blog entry | November 6, 2012

The European Bank for Reconstruction and Development boasts of having invested 10 billion euros in sustainable energy since 2006. A closer look reveals that although the bank's efforts deserve recognition, several investments make a mockery of 'sustainability'.

Bankwatch in the media | June 28, 2012

By creating loopholes in environmental legislation, is President Mikheil Saakashvili’s administration making a deal with the devil?

Blog entry | June 25, 2012

A too strong focus on energy security is steering Europe's engagement with neighbouring states in a troublesome direction for the partnering countries.

Blog entry | March 21, 2012

Criticism and protests around the World Water Forum have highlighted the risk of hydropower projects being greenwashed and the dangers these installations can pose to people and nature in many countries.

Blog entry | October 31, 2011

Why is it that when we advocate for something to the international financial institutions (IFIs) they often manage to give it a peculiar twist of their own?


Briefing | November 21, 2011

The proposed Khudoni hydro power plant poses the risk of an ecological disaster in one of the most amazing highland regions of Georgia. Additionally, the economic justification of the project is doubtful because the contract with the completely unknown, offshore Virgin Islands registered Georgian-Indian Company Transelectrica Ltd, is based on the BOO (Build-Own-Operate) principle that does not promise any significant income for the Georgian budget.

Briefing | May 15, 2011

The Turkish company Georgian Urban Energy (GUE) has requested a USD 44 million EBRD loan for the Paravani HPP, an 87 MW plant using a 14 km derivation tunnel in order to divert water from the Paravani river to the Mtkvari river. Bankwatch member group Green Alternative has deep concerns regarding the project's potential negative impacts as well as its overall justification.

Advocacy letter | July 23, 2009

We have received the following responses:

  • On July 29, 2009 from EBRD (pdf here).
  • On August 4, 2009 from EIB (pdf here).
  • On August 27, 2009 from World Bank (pdf here).
Briefing | July 23, 2009

The energy policy of the Georgian government supported by a number of IFIs, aims at utilising the hydroenergy potential in the country in order to overcome the existing energy crisis. But effectively, this policy has the potential to cause significant negative impact on the environment, to drastically change the social and demographic situation in Georgia's mountain areas and to devastate the existing cultural heritage.

Study | June 26, 2009

This report reviews documents provided by the Georgian government and the World Bank, and a number of independent research reports regarding the Georgian power sector and highlights the concerns of the local people towards the Khudoni HPP as expressed during the public hearings organized in Svaneti in summer 2008.