Namakhvani HPP

Namakhvani Cascade on Rioni River - A preliminary assessment

The proposed Namakhvani cascade is a 3-stage 450MW site along the Rioni River, which is Georgia's most affluent river. A 5-year development and construction period is envisioned for the entire cascade, with the first unit coming online after 3.5 years. It is estimated that the site will produce some 1674 GWh at full production. The site appears to be economically and financially viable at a tariff of 5.7 USc until debt is repaid, at which point it is expected that the tariff will fluctuate somewhat. In the analysis, expected revenues from sales of carbon credits play a key role in bridging the requirements of international investors and those of the regulator. The Ministry of Energy, Georgia has commissioned a feasibility study for the site. Subject to further geological tests, the site appears to be technically and economically feasible with no known major environmental/social risks.

Table A         Key results for the Namakhvani Cascade (Costs in USD)

* Includes three reservoirs of sizes; 13Mm³, 156Mm³ and 12.6Mm³.

** This is the estimated average tariff for the first 12 years of operation, before planned liberalization in 2023. According to the analysis in the study, this average tariff ensures a RoE of approximately 20% on the project. However, to ensure debt repayment and liquidity in early years, a tariff of 5.7 USc is required - followed by a fall in the tariff once debt is fully repaid. See pre-investment study for more details.

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