Details of Namakhvani Dam Cascade Tender are Confidential

 Article from 2017 via ifact.ge

The criteria for the selection of the best investor to build, operate and own Namakhvani Dams cascade in Georgia is confidential.  The investment letter from the winner, as well as from other tender participants’ offers, also remain confidential.

On January 25, the  Energy Development Fund of Georgia declared on their website that the winner chosen to invest in one of the largest dam project in Georgia was Norwegian “CLEAN ENERGY GROUP GEORGIA“ LLC.

According to the fund, three companies took part in the so-called “expression of interest”:  “General Development LTD”, ”POWER CHINA RESOURCES LTD” and ”CLEAN ENERGY GROUP GEORGIA LLC”.

The Energy Development Fund told “iFact” that the criteria to select the winner, other potential investors’ letters, and the names of the committee members who selected the winner, will all remain confidential.  

The Namakhvani Dam Cascade will be erected on the Rioni River in western Georgia.  According to the fund, the project is supposed to generate 1,514 gigawatts of energy annually.

The winner was selected by a committee which was created under the auspices of the Energy Development Fund of Georgia. Fund director Levan Mosakhlishvili said the committee is not permanent and was created specifically for this Namakhvani project.

Mosakhlishvili would not share with “iFact” the names of the committee members, saying this would be revealing “private information”.  He did say directors of the fund were member of this committee.    

Concerning the legal status of the fund – a Joint Stock Company – Mosakhlishvili said it was not legally obliged to disclose information that otherwise would be considered public.  He said the fund was not a public entity and could choose which information to disclose; he insisted the Georgian Administrative Code for Disclosing the Public Information was not relevant in this case.   

“I understand the high public interest, though” he said.  

On January 27, two days after the winner was declared, “iFact” requested details about the process, including the investment letters of the three companies, the names of the committee members, and the criteria for choosing the winner.

To these questions the fund answered only that the committee was not permanent. Other answers would qualify as ‘confidential,’ the fund wrote in a letter.  

Mosakhlishvili did not clarify the reason of keeping this information confidential.   

The Joint Stock company Energy Development Fund of Georgia was created in December 13, 2010.  It is 100% owned by the government of Georgia.

Clean Energy Group AS

“CLEAN ENERGY GROUP GEORGIA LLC” is the daughter company of the Norwegian Clean Energy Group AS.  For this company Namakhvani HPP is the second and larger in size than a project in Adjara on the Adjaristskali River.   

On January 27, Prime Minister Giorgi Kvirikashvili met  Adjaristskali hydropower plant investors.  In news disseminated by the prime minister’s office, there was no mention of the Namakhvani project.  By that time, Clean Energy Group AS had already won the project.  

Bjorn Brandtzaeg: at left ,close to the flag
Photo: gov.ge

Company representative   Bjorn Brandtzaeg, also attended the meeting with the prime minister. Brandtzaeg used to be the advisor to the Minister of Energy in 2008, hired by Econ Poyry, an international consulting firm..

In 2010, when Clean Energy Group AS won the Adjaristskali Georgia  dam project, Brandtzaeg left the consultancy position and moved to the investor company.

In 2011, Brandtzaeg became the director of the “Adjaristskali Georgia”; in 2014, he became a minor shareholder of the Clean Energy Group AS. According to the  2014 financial report of Clean Energy Group AS,  Brandtzaeg owned 2,1 percent of the shares.

 

 This article has been translated from the original Georgian, written by David Adeishvili and found at https://www.sustainability.ge/namakhvani.

Namakhvani Cascade - a totally unsustainable project

Political economy assessment

Facts and Figures : The total planned capacity of the two Namakhvani Cascade HPPs (at Namokhvani and Tvishi) is 433 MW, with an estimated output of 1.6 billion kWh.

The top surface of the reservoirs is planned to be 100 + 510 = 610 ha, comprising a territory 30 km long and approximately 200 meters wide. For comparison, think of a strip of width of two football fields from Tbilisi to Rustavi. The height of the dams will be 60 and 105 meters.

It is not known exactly, however, how many hectares of land in total will be submerged and become unusable by the damming process - according to some data, it will be more than 1000 hectares. This area will include agricultural lands, forests, 19 cultural heritage sites, and 13 archeological sites. 7 settlements will be affected, of which 3 will be totally submerged. 104 families will be resettled.

Endangered species of sturgeon and the unique Tvishi viticulture microzone - both protected by international conventions - are at risk.

4 seasonal power plants have already been installed on the Rioni, including the 4 stations of the Vartsikhe diversion cascade. Now, in addition to this, the Oni and Namakhvani cascades are planned, which means that a power plant will be located on average every 15 kilometers along the river in the section from Glola to Samtredia, including all dams and diversion pipes. This is expected to create an excess of cumulative negative effects on the environment of the Rioni Valley.

The Namakhvani project was rejected in the 1980s.

In 2019, Georgia consumed a total of 12,767 million kWh, of which 12.7% was imported and 75% of the production was generated by hydropower plants (Source: Esco.ge).

Violations and Transparency: The company Enka Renewables, in agreement with the government, has begun preparatory construction work on the HPP project without a final EIA decision or the necessary information and research. The court did not consider the lawsuit filed by the non-governmental organization "Green Alternative". Hence many questions remain unanswered.

Ignoring and suppressing protests: For more than a month, locals have been carrying out a continuous occupation and protest, day and night, against the construction. They have been disrupted and dispersed by the police; the government refuses to meet them and has no communication with the general public about this project.

Energy Myths:

1. "Georgia has untapped surplus hydro resources." If we evaluate these "resources" in terms of basin management and sustainable development, it turns out that the size of water resources is minimal and mainly suitable for small hydropower plants.

2. "Georgia needs energy independence." If we are talking about self-sufficiency in electricity, then we already today have achieved 90% of this, which can not be said about any other consumer product in Georgia. Achieving this “goal” would be much more inefficient and costly than attempting to address, for example, issues of self-sufficiency in wheat, oil, or meat.

3. "Hydropower is cheap." In fact, this energy is very expensive, if we take into account all the economic consequences and the negative externalities (non-monetized associated costs) which we will need to internalize.

4. "There will be a shortage of electricity." The demand for electricity  in Georgia is growing directly proportionally to GDP growth, but at a much slower pace. The demand for new generation will be less than expected in the future if we take into account the considerable potential for reducing the intensity of electricity consumption in Georgia (increasing energy efficiency) and the opportunities for diversified imports on a seasonal basis. In the coming years, GDP decline and lower growth rates are expected in Georgia. This gives us a chance to reorganize the electricity sector, including the consideration of alternative sources and system modernization.

A priori evaluation of the project: International practice confirms the instability of large hydropower plants - their economic, social, ecological and technical (geological, seismic, and hydrological) dubious nature.

Large hydropower plants are a thing of the past in the world of development. Not only are large hydropower plants no longer being built in Western Europe and North America, they are even being selectively dismantled to restore the damaged environment.

Cost-benefit analysis: The cost-benefit analysis method has not been used to economically evaluate an investment project of this magnitude (more than $700 million), which would shed light on many questions and make decisions easier.

For example, no one is counting on what revenue will be lost from the export potential Tvishi viticulture and winemaking, as well as losses from the tourism perspective. The ecological and socio-cultural damage caused to the country by the implementation of the project has not been assessed.

On the other hand, a maximum of 1600 million kWh of electricity per year is at stake for the state. For comparison, in 2019, about the same amount was imported - 1626 million kWh of electricity, the value of which amounted to 67.3 million USD (0.9% of total imports of Georgia). For comparison, more than this amount - 67.4 million USD was paid to Georgia in 2018 only for the import of poultry meat, the replacement of which with local production would not be a big problem.

Political conclusion: What is happening is the exploitation and destruction of Georgia's common natural "green capital" and socio-cultural environment by foreign financial capital and local private interests, in conjunction with the negligence and support of a corrupt bureaucracy and the bribery and manipulation of a part of the local poor population.

Solution: Stop the project! Develop an energy strategy based on the principles of sustainable development and pursue appropriate policies.

Emphasis should be placed on wind and solar energy sources, energy efficiency, market decentralization, and the regulation, rehabilitation, and modernization of the generating systems. Temporarily (in the medium term) it is possible to start new capacities of thermal power plants.

---

Sources used

Esco.ge. (nd). Georgia Electricity Balance 2019 . Electricity Market Operator. https://esco.ge/files/data/Balance/energobalans_2019_geo.pdf

---

 

Statement of the Georgian Sommelier Association

 

Statement of the Georgian Sommelier Association regarding the possible threat to Tvishi Wine as a result of the construction of Namakhvani HPP

 

The Georgian Sommelier Association (member of the Association de la Sommellerie Internationale, A.S.I.), as an organization interested in the development and promotion of Georgian viticulture and winemaking, confirms the great importance in Georgian winemaking of the appellation of origin "Tvishi".

 

We believe that this important Georgian appellation may be threatened by a possible change in the microclimate caused by the construction of the Namakhvani HPP.

 

We welcome any new business project focused on the economic development of the country, including the increase of security and independence of the energy sector.

 

We cannot address geological and hydrological safety issues beyond our competence. At the same time, we naturally sympathize with and support the locals, who for centuries have been living in the areas which have been designated for the construction of power plant infrastructure. If construction is carried out, they will have to leave their native places forever.

 

The Georgian Sommelier Association demands that the research related to the Tvishi microzone be made public and that the Georgian society, including the representatives of the viticulture and winemaking sector, be fully informed about the possible results on the basis of its findings.

 

Representatives of the field, as well as the Georgian society, have a full and legitimate right to know what changes in the Tvishi microclimate are expected as a result of the construction of a hydropower plant complex, as well as what impact will it have on the Tvishi appellation, one of the most distinctive and unique in the country, and on local viticulture and the quality of the wine made from the grapes grown here.

 

Shalva Khetsuriani

President of the Georgian Sommelier Association

Founder of "Marani Khetsuriani"

 

Hiking the Rioni; Existing Dams on Rioni

 

From my hiking trip along the Rioni Valley in 2019. At that time, I didn't know that all this was set to disappear in a few short years. It's a bit past the weather for good hiking, but I'm contemplating a sea-to-source hike of the Rioni for 2021. Sadly, we may be the last generation to see the wild Rioni rage as it did in the time of Medea and the Argonauts, as it did when Prometheus was chained to Khvamli Mountain and stared down at it day and night. I would like to experience this mighty being before it is assassinated by corporate and political greed. If this idea goes ahead, you will surely hear about it here.

The Rioni currently has three dams built on it: at Gumati (just above Kutaisi), Kutaisi, and Vartsikhe (just below Kutaisi). None of these have impacted the course of the river to all that great of an extent; they don't include large reservoirs or very high walls. The Vartsikhe project diverts a major part of the flow of the Rioni into a long canal, dropping the water down a series of weirs until a point just south of Samtredia. This dam has been blamed for affecting fish populations in the Rioni, but the impact has apparently been of a manageable and mitigable size.

Some people say that dams are simply necessary for energy production and the ecology must simply take its lumps as it may. I certainly don't oppose hydropower in all forms. I believe that it's possible, even on such a mighty river as Rioni, to construct ecologically responsible hydropower plants. To me, it's very clear that the "Namakhvani" and Tvishi Dams, as well as four (!!) dams planned above Oni, are anything but ecologically responsible. Some couple of people are about to make a bucket of money off of the backs of Georgian ecological and cultural heritage, the indigenous inhabitants of the Rioni Valley, and the ecological well-being of future generations.

 

 

Statement by Merab Gongadze, Senior Scientist at the TSU Vakhushti Bagrationi Institute of Geography, Department of Geomorphology

"The pattern [seen in the video] below is very similar to the Rioni gorge with Namakhvani. There is limestone on both sides. The Rioni-Tskhenistskali watershed is only about 20 km wide, and in a straight line 15-17 km from Namakhvani, the limestone-karst massif of Tskaltubo extends across the watershed to the famous caves of Kumistavi (Prometheus), Kvilishori, Satsurblia, Bgheri, and so on. It is possible that leaking water from the reservoir will rapidly create passageways to these karst caves (if these canals do already not exist), in which case it will be almost impossible to keep the required amount of water in the reservoir. It should also be noted that the huge mass of water created by the 100 m dam will immeasurably increase the pressures on the walls of the reservoir and its outflow into the cracks will rapidly increase.

Because of this project, we were interviewed several times in 2010 at the Institute of Geography, in particular in the Department of Geomorphology, where a karsto-speleological laboratory operates. Representatives of the project organization were very interested in our conclusion about the cracking of the limestone walls of the future reservoir. They were obviously demanding a positive conclusion from us that there would be no catastrophic leakage of water from the reservoir. We developed a project that included several months of field research by staff from the Institute of Geomorphologists, karstologists, and the Institute of Geophysics in the Tvishi-Namakhvani section of the Rioni Valley. They asked us several times to conduct this project, but afterwards would vanish without a trace.

Finally, Kukuri Tsikarishvili and I were summoned to the State Oil and Gas Corporation (we still do not understand what they had to do with this project) and we were asked in detail what we thought about the HPP project. Of course, we stated that thorough field research is necessary and a conclusion should only be made after that. However, we also did not hide the fact that after analyzing the available data during the preliminary research work, the conclusion was likely to be negative [showing the project to be geologically infeasible]. After that, no one called us at all.

Later, we found out from other sources that they brought Italian specialists and together with the local specialists created a 600-page report, which provided general geographical information about this section of the valley, an individual hydrological data of this section of the Rioni Valley, biodiversity of the area (flora, ichthyofauna, etc.) How much did this account cost, I just do not want to mention this figure here, since I am not certain about its reality. I do not know exactly, but it is possible that on the basis of this report the authors of the Namakhavani project intend to prove its suitability, although as far as sharing it, they have not shown it to anyone.

Besides the issue to the water leaks, the slopes of the Rioni Valley in this area are covered with deluvial deposits, which are more conducive to landslide movements in the Rioni Valley than the thin layer of clay found later in Italy. The fact is that these deluvial deposits in the upper part of the limestone slopes are to this day active in the processes of depletion and denudation (spatial washing). Exhausted rocks are exposed to gravity and surface water in the middle and lower parts of the slope, gradually thickening and over time becoming covered with soil and vegetation. The eye of a non-specialist can not distinguish them from the limestone slope. The river gradually washes away the base of these deluvial deposits and removes their support. Eventually, the movement of this mass begins towards the river bed, and a landslide develops.

Now imagine a rising water level after the creation of the dam, which begins the process of the washing of the slopes and, consequently, the development of landslides. Our late colleague, Karlo Liponava, worked on the coastal processes of Georgian reservoirs in the 70s and 80s of the last century, and I also conducted field research with him in this direction, as I worked on human impact on topographical relief and particularly on the development of modern exodynamic processes. Thus, I am aware of the mechanism of possible development of these coastal processes.

It should also be noted that the characteristics of the movements and levels of underground water should be taken into account, as their outputs are likely to be covered after the water level rises. This poses another separate hydrogeological problem in the reservoir area, with more or less predictable consequences. Not to mention the active seismicity of the region, the changing microclimate and biodiversity changes in the valley, starting with ichthyofauna, ending with unique vine and fruit varieties.

Finally, I would like to address those who, without any reason, advocate the construction of such large hydropower plants in any populated area. I advise them to go to Pankisi gorge, at the head of the Alazani, to visit the 25-megawatt Khadorhesi, designed by the Chinese and built by the Georgians on the principle of the traditional Georgian mill, without the dam and reservoir. Similar stations can be built there, on the left tributaries of the Alazani, which have the necessary slope, as well as on many rivers on the southern slope of the Caucasus and the northern slope of Adjara-Trialeti. However, in my deepest belief, the purpose of the project authors revolves purely around the goal of making big money and evicting the local population. We need to wake up everyone and take active action against these parasites!"

https://www.youtube.com/watch?v=DtGsHfZ1tS8

OpenDemocracy: Detailed Overview

 This article, published in June, before the establishment of the permanent protest camp, has a lot of useful information about the hazards and questions behind the Namokhvani-Tvishi dam project. Check it out!

https://www.opendemocracy.net/en/odr/unsustainable-transition-hydropower-and-post-covid-recovery-georgia/

'

 Pictured: The Rioni near the village of Derchi and its eternal guardian, the legendary Mount Khvamli.

GYLA: Public Discussions Concerning Namokhvani Dam Were Not Adequately Carried Out

 According to the Georgian Young Lawyers Association, the public discussions for the construction of Namokhvani Dam were carried out illegally and in an inadequate manner. Locals also claim that they were prevented from accessing meeting sites. Read more at the following link (English): 

https://gyla.ge/en/post/print/ganckhadeba-namakhvanis-hesebis-kaskadis-proeqtis-sajaro-gankhilvis-kanondarghvevebit-chatarebis-shesakheb