EU and EBRD support Georgia’s largest hydro power plant modernisation

€7.05 million EU grant for Enguri plant rehabilitation and €28 million EBRD loan will ensure more reliable and sustainable electricity.

The EU Investment Grant and Technical Assistance of €7.05 million will modernise the Enguri Hydro power plant. This is in line with the Global Gateway Strategy, implemented in the Eastern Neighbourhood through the Economic and Investment Plan, which will boost energy, digital and transport connectivity in the region and especially in Georgia.

In parallel, the European Bank for Reconstruction and Development (EBRD) is providing a €28 million sovereign loan to modernise and rehabilitate the Enguri hydropower plant, Georgia’s largest provider of electricity.

The EU-EBRD project outcomes encompass improved generation safety, stability, grid reliability, flood risk mitigation, dam integrity, and environmental preservation.

This financing package will fund long-term structural stability works of the Enguri dam, repairs to the underground tunnel and penstock to ensure a more reliable power generation and grid system. In addition, the investment will reduce water leakages in the headrace tunnel and enable additional renewable energy production.

Built in the 1970s and situated in the western region of Georgia, the Enguri power plant and Vardnili hydropower plants, part of entire energy complex, meet approximately 30 per cent of the nation’s electricity needs and are key to the country’s energy infrastructure, providing a steady supply of power and stimulating economic growth.

EBRD and EU have co-financed the first four phases of the rehabilitation of Enguri HPP. Enguri HPP Rehabilitation, Phase V aims to help reduce reliance of electricity imports, improve energy security, and contribute to the country’s commitment to a greener and more sustainable future. These funds will then be used to construct vital infrastructure, including roads to monitor the dam, to improve the safety and reliability of the electrical grid and energy generation, as well as to create a fish passage downstream of the Enguri dam to protect biodiversity. Thus, EU Grant inclusion alleviates pressure on the household tariff and carries significant financial additionality.