Assuring access to modern energy services for the whole population is a crucial step to improve human well-being and stimulate economic and social development. The International Energy Agency (IEA) has identified the lack of access to modern energy services as one of the main obstacles to overcome in order to achieve the UN Millennium Development Goals. In its 2011 World Energy Outlook, the IEA argued forcefully about the need to find and mobilize the resources required to extend access to modern energy services to the poor around the world.

Transition countries are not typically considered particularly problematic as far as access to energy services is concerned. However, in such countries coverage is sometimes far from complete and substantial efforts are still required to ensure full coverage.

One such clear case is that of Georgia. Most of the infrastructure used for the transmission of electricity and the transportation of gas was seriously damaged (and/or substantially deteriorated) in the years immediately following the separation of the country from the Soviet Union in 1991. Despite the impressive improvements taking place after the Rose Revolution of 2003, some challenges still lie ahead.

ACCESS TO ELECTRICITY

According to 2012 data from the Statistical Office of Georgia (Geostat), 100% of Georgian households had access to electricity.

However, the Ministry of Energy of Georgia has recently published a list of 36 villages for which this data is not true. In this list one can find high mountain villages from the regions of Adjara, Racha-Lechkhumi & Kvemo Svaneti, and Mtkheta Mtianeti; alongside other villages from the regions of Kakheti, Shida Kartli, Kvemo Kartli, Samtskhe Javakteti and Imereti.

The Ministry of Energy of Georgia has estimated the total cost of bringing electricity to these villages to be about 5.5 million USD. This is the cost of an “on-the-grid” solution, according to which these villages will be connected to the grid (i.e. new transmission/distribution lines will be built). The estimated cost of access per household shows a large variation (see table): from about 900 USD per household in the village Janjghari (in Adjara) to about 86,000 USD per household in the village Tkemlovana (in Sida Kartli).

The cost of granting households access to the grid can, therefore, be quite high.

A way to reduce these costs could be moving (in some cases) from an “on-the-grid” to an “off-the-grid” solution. Renewable sources of energy can provide interesting “off-the-grid” opportunities. For example, solar energy generation seems to be especially promising in the Georgian case. The annual yield of solar energy in Georgia is estimated to be good (at between 1,250-1,800 kWh/m²), particularly in isolated mountain locations. An investigation into the cost of installing sufficient solar generation capacity to cover the needs of an average household (500-watt generating capacity, plus accumulators) has quantified the necessary initial investment to be approximately 6,000 USD (this estimate is based on the experience of a Georgian firm specialized in the installation of stand-alone solar generation systems in remote areas of the country: www.sun.org.ge).  While almost four times higher than the lowest cost of connection to the grid, this amount is 14 times lower than the highest one. Considering the energy savings, the expected long life of the investment (20-30 years for the panels and 3-8 years for the accumulators), and the flexibility of this solution – thanks to which fixed costs do not increase significantly, even for isolated households – this definitely looks like an interesting alternative that could save the Georgian government a substantial amount of resources.

While the obstacles that Georgia has to overcome to assure full access to modern energy services for all its citizens are still substantial, the impressive results achieved in the last decade and the initiatives presently being undertaken seem to suggest that the final goal could be achieved in the not too future. The costs of achieving such a goal (and the time required in the process) will obviously depend on the capacity of Georgian institutions (and especially of the Georgian Ministry of Energy of Georgia) to keep a flexible approach, making full use of all available options, ranging from direct public intervention to the use of market forces.