The Announcement of signing Financing Agreement between Dariali Energy JSC and European Bank for Reconstruction and Development (EN)
On November 6, 2014 the Announcement Ceremony of signing Financing Ageement between Dariali Energy JSC and European Bank for Reconstruction and Development was held in Radisson Blu Iveria Hotel Tbilisi.
On August 2014, Dariali Energy JSC and European Bank for Reconstruction and Development signed Loan Agreement fo up to US 80 million for the financing of the development, construction and operation of Dariali HPP, which comprises the first project financing and first successful public private partnership project in energy sector of Georgia.
This is the first energy projects in Georgia to be financed under an A/B long-term loan, syndication structure, where the EBRD will provide an "A" loan of US 40 million, while the "B" loan will be split into a US 30 million tranche provided by the Dutch development bank FMO and a US 10 million tranche by the Green for Growth Fund, Southeast Europe (GGF).
Dariali HPP Project provides a demonstration of new financing methods to other project developers in the market and has the potential to be the first energy project to deliver carbon neutral construction in Georgia.
The Project includes a reforestation component which would target the full compensation of all greenhouse gas emissions associated with the project over its lifecycle, through the capture of carbon in vegetation. A program of reforestation in the area of relevent authorities has the potential to result in the first carbon neutral construction project in Georgia and for the EBRD in all regions.
Construction of Dariali Hydroelectirc Project aimed at developing the hydroelectic potential of the Tergi River. Dariali HPP will be built as a one-step, run-of-the-river power plant. Such structure negates the need of flooding the upper part of the river and reduces associated construction magnitude, thus drastically decreasing the environmental impact of the project both in short and long term perspectives. The implementation of the project will significantly contribute to socio-economic development of Kazbegi Municipality and Mtckheta-Mtianeti.
The favorable impact of local population employment is noteworthy. Following the HPP has been launched, the power system will get extra energy, which is extremely important for the country's indepedence with the respect to power resources. Income growth of Kazbegi Municipality and the whole region is also expected, which will be an important positive impact in terms of social and economic development. At the construction stage (for about 4 years) 300 people will be given jobs, while on operation stage 50 people will be employed.
The Project is in full compliance with EC European Energy Policy adopted in 2007 and the UN framework convention on Climate Change, which appeals to all states to concentrate efforts towards increasing of energy consumption efficiency through increased utilization of renewable energy sources and decrease of environmental degradation.
The completion of Dariali HPP marks a milestone for Georgia as it will significantly improve the country's energy supply and energy independence.