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ISET Economist Blog

Georgia Going with the Wind?
Saturday, 27 April, 2013

The obsession with hydropower may have obscured other green energy options for Georgia. For one thing, investment in hydro is not happening as fast as could have been expected a few years ago. But, much more importantly, the bulk of hydropower would be in any case generated in the summer, when Georgia does not need as much of it. The surplus electricity is supposed to be exported to Turkey. But why destroy pristine landscapes and interfere with fragile ecosystems for the sake of exporting electricity to Turkey? Has anybody ever tried to answer the question of how much will Georgia earn in energy security, tax revenues, transmission fees, and jobs for the price of massive and possibly irreversible damage to the environment?

Regardless of how much we care for Svaneti and Racha’s ecosystems, it is clear that the massive investment in hydropower will not make Georgia energy-independent and green in the “dry” winter months. Even at the peak of hydropower generation, in 2010, thermal power generation and electricity imports stood at 683GWh and 222GWh, respectively. The gap was much larger in 2011 and 2012, and with consumption growing from year to year, it is likely to continue to increase.

WHY NOT CONSIDER ALTERNATIVES SUCH AS WIND ENERGY?

According to the Wind Atlas data produced by Karenergo (presented on the website of the Ministry of Energy and Natural Resources), Georgia has considerable wind energy generation capacity. The strongest argument in favor of wind energy, however, is that the seasonal patterns of wind and hydropower generation are exact mirror images of each other. Peaking in winter – the lowest point in hydropower generation – wind can fill the gap in green energy production, contributing to the government’s long-term objective to substitute green energy for imports and thermal generation. In other words, if optimally located, wind farms would produce electricity when it is most needed, counteracting the seasonal decline in hydro generation, and reducing Georgia’s dependence on the imports of electricity and gas.

The wind option has another important benefit given that Georgia is already endowed with considerable hydropower generation capacity and water reservoirs. Wind farms can be particularly effective if located next to existing reservoirs that feed hydropower plants (HPPs). Whenever demand is low, such as at night, excess wind energy can be stored by pumping water back into reservoirs. When demand is high, water can be released from the reservoirs to power turbines and produce electricity.

So far, the "pump-storage" technology has not been utilized in Georgia since excess electricity that is produced by small HPPs in summer months could not be stored for lack of spare storage capacity (mind it that water reservoirs are quite full in summer). This technology could be easily employed to store excess wind electricity (e.g. at night) when reservoirs are half-empty during the winter. The result would be higher day-time production by both HPPs and wind farms.

Clearly, wind energy development faces many technical bottlenecks such as variability, dispatch-ability, and storability. However, the global trends in wind energy generation provide evidence that these challenges can be successfully addressed even in countries where wind accounts for a relatively large share of total electricity production. For instance, in Denmark, Portugal, Spain, and Ireland wind energy is used to produce 21%, 18%, 16%, and 14% of total electricity consumption, respectively. What is then preventing wind energy from taking off in Georgia?

For the moment the main obstacle is cost. Yet, considering global trends in wind energy technology, it may be high time to prepare for tomorrow by investing in relevant education, experimental wind farms, and pump storage facilities. The costs of wind energy have dramatically declined over the past twenty years. The most recent (2012) Renewables Global Status Report prepared by Renewable Energy Policy Network for the 21st Century reported that production costs for onshore wind farms stand around 5.2-16.5 US Dollar Cents/kWh, almost in level with typical costs of hydropower (5-10 Cents/kWh).

In fact, tomorrow maybe already here.

The views and analysis in this article belong solely to the author(s) and do not necessarily reflect the views of the international School of Economics at TSU (ISET) or ISET Policty Institute.
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