
Khudoni, Georgia’s largest hydropower investment project, is again making the headlines. According to a recent statement by Georgia’s Minister of Energy and Natural Resources Kakha Kaladze, the project will be put on hold at least until March 1, 2014.

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.

“Fast and furious... Soviet-style: Crazy stunt drivers of Georgia try to impress Hollywood by speeding through crowded public streets.” The clip, uploaded by the team of would-be-stunts has reportedly received 2 million YouTube views in a week.

The ability of families to meet their most basic needs is an important measure for the development of a country. Poverty touches on questions of human dignity and fairness in society, but beyond that, poverty causes problems that may impair long-run economic prospects, like crime, social unrest, and underinvestment in human capital.

Can Georgia stimulate investment in electricity-intensive sectors by providing cheap electricity? To answer this question one has to first analyze the behavior of the wholesale electricity market during the past 3 years.