Adjaristsqali Georgia LLC

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The proposed investment is a 184 MW hydropower scheme comprised of two dams (39 m and 22 m in height, respectively) with reservoirs on the Adjaristsqali and Skhalta Rivers; a 5 m weir on the Chirukhistskali River; a 6.4 km tunnel from the Chirukhistskali River through to a 6 MW Hydro Power Plant (HPP) on the Skhalta river; a 9.4 km tunnel from the Skhalta and Chirukhistskali rivers to the Didachara reservoir on the Adjaristsqali River; and a 18 km tunnel from the Didachara reservoir to the 178 MW Shuakhevi HPP. The scheme is located in the Adjaristsqali region of the Autonomous Republic of Adjara in southwest Georgia. The Shuakhevi scheme will also involve construction of 5.9 km of new roads and four new bridges. Construction camps for this scheme will be developed adjacent to the Chirukhistskali weir (up to 50 persons), the Skhalta and Didachara dam walls (100-150 persons), the Shuakhevi HPP (up to 400 persons) and one of the tunnel adit portals (up to 50 persons). Each construction camp will include office, accommodation facilities, workshops, storage and sanitation facilities.The total project cost is estimated to be US$427 million ($367 million excluding financing costs). It will be developed by Adjaristsqali Georgia LLC (AGL), a special purpose vehicle (SPV) owned by Clean Energy Invest of Norway, Tata Power of India and IFC Infraventures. The SPV was established for the purpose of constructing and operating a cascade of hydroelectric power plants on the Adjaristsqali River. The cascade was originally proposed to include three phases, namely the 185 MW Shuakhevi scheme, the 150 MW Koromkheti scheme and the 65 MW Khertvisi scheme. However, detailed assessments of each of the phases identified significant economic and environmental risks in the Khertvisi scheme, including potential impacts within the boundaries of the planned Machakhela National Park. As a result, AGL has confirmed that, although it retains the concession for the Khertvisi scheme, this scheme will not be pursued. AGL intends to construct the Shuakhevi and Koromkheti schemes in sequence, with financing being sought initially for Shuakhevi (this investment). If developed, the downstream (Koromkheti) scheme will comprise a 19 m dam and reservoir on the Adjaristsqali River; two weirs (an 8 m weir on the Chvanistskali River and a 5 m weir on the Akavreta River); a 0.67 km tunnel from the Chvanistskali River; a 9.5 km tunnel from the Akavreta River to the Koromkheti reservoir; and a 15 km tunnel from the reservoir to an underground powerhouse near Koromkheti village, then back into the Adjaristsqali River.Five construction contractors have been selected through tender for the Shuakhevi construction phase, covering preparatory works (road and bridge construction and rehabilitation, site preparation at construction and accommodation sites, establishment of water supply and waste water treatment systems, etc.), electrical works, mechanical works and civil works. Tunnelling will be achieved using conventional drill and blast. The Shuakhevi scheme, construction of which is expected to take three years, will generate 464 GWh power annually, to be exported to Turkey through a cross border transmission line for 9 months of the year, and sold domestically during the 3 winter months when Georgia is energy deficient. The ground breaking ceremony was held at the project’s construction site on September 16, 2013. This phase 1 investment does not include the development of transmission lines to export power generated to the national grid. Electricity from the powerhouses will be conveyed to the national grid via a new 120 km 220kV transmission line between existing substations in Batumi and Akhaltsikhe. This line is part of an overall transmission line expansion for Georgia and will be the subject of a separate ESIA to be developed by the Government of Georgia on behalf of the Georgian State Electro System LLC (GSE) in accordance with Georgian and World Bank Group requirements. Based on an agreement with GSE, AGL is conducting an ESIA for the transmission line development.