UES Mtkvari Plant

active

In January 2000, AES singed agreement to acquire control of three electric generating facilities from Republic of Georgia with a combined capacity of 823 MW. AES Gardabani Holdings BV purchased the 600 MW Gardabani thermal power plant which consists of two 300 MW supercritical gas and oil-fired units and AES Georgia Holdings BV acquired 25-year management contract for Khrami I and II hydroelectric power stations, which have a combined capacity of 223 MW. The total acquisition price for the three facilities is $11 million. Units 9 & 10 of the thermal power plant Tbilsresi are located in Gardabani. The plant has been renamed AES Mtkvari. Its two mazut/gas-fired units have a combined capacity of 600 MW. Tbilsresi is a major thermal power plant in Georgia generating a significant share of base energy, thus representing a crucial facility for the entire power grid of Georgia. AES took units 9 & 10 over the management in April 2000 pursuant to the completion of privatization agreement. Over the next three years, AES plans to invest $50 million to improve operational processes and an overall condition of the plant. As stipulated in the 20-year power purchase agreement, AES Mtkvari will be selling electricity to the Wholesale Electricity Market of Georgia (WEM). One-third of AES Mtkvari electricity will be supplied to Tbilisi electric distribution company, AES Telasi. On December 22, 2001, the Unit 10 at the Tbilisi Power Plant exploded, causing severe damage that will take at least a year to restore. AES-Mtkvari, a subsidiary of AES-Telasi that operates the 300-MW generating unit, said that the explosion occurred because the computer control system and the mechanical portion were incompatible. However, in January 2002, Georgia's national energy regulatory commission suspended AES-Mtkvari's license to operate the unit, prompting an AES Vice President to announce that the company will evaluate in the summer of 2002 whether it will remain in Georgia. In September 2003, Inter UES, a subsidiary of Russia's Unified Energy Systems (UES), purchased the AES Mtkvari power facilities from AES for US$23 million. As of December 2011, InterRAO was still the sole owner of Mtkvari.