Bjorn Brandtzaeg has been associated with the planning and implementation of some of the largest energy projects in Georgia. He is the founder and CEO of Norway’s Clean Energy Group and the CEO of Clean Energy Group Georgia, which is developing the 433 MW Namakhvani Hydropower Plant (HPP). He has twenty years of experience advising financial markets in the field of renewable energy.
His company is constructing the Namakhvani HPP together with ENKA, a Turkish firm with extensive experience in international construction projects. Construction of the Namakhvani HPP is scheduled to start in 2018 and, with an installed capacity of 433 MW, will be the second largest hydropower plant in Georgia.
After winning the tender, Clean Energy Group Georgia has started planning the construction of the Namakhvani HPP. How far along in this process are you at this point?
Our technical team has spent 6 months undertaking a design review of the project to confirm its feasibility. Having concluded the design review we are now working with Enka EPC to prepared the documents for the EPC contract and the start of construction. The lenders to the project have started their appraisal. The target is to start the construction of the Namakhvani project in 2018.
Energy independence is crucially important for Georgia. How can the Namakhvani HPP contribute to Georgia’s pursuit of this goal?
The Georgian electricity system needs more flexibility and storage capacity to ensure that the lights remain on in the country despite the rapid demand growth experienced in recent years. The Namakhvani project is one of the few hydro projects in Georgia that can be developed with a large reservoir providing flexibility to the system and storage of energy resources. The project will deliver its electricity to the Georgian system in the winter months when demand is high and supply limited in the Georgian market contributing to energy security for the country.
What companies or organizations are partnering with Clean Energy Group Georgia and ENKA on this project?
Our philosophy is to use best available expertise when developing complex hydro projects. We have signed mandate letters for financing of the project with IFC and EBRD. We use Stucky from Switzerland as our owners engineer for the project, SLR from France our environmental adviser and leading UK, US and Georgian based law firms for legal advice.
What social and economic benefits will the Namakhvani HPP project bring to the Tskaltubo and Tsageri communities municipalities?
During the project, up to 3000 people will be employed. A majority of the workers will be Georgian nationals. In addition, the infrastructure in the region will be updated with a new 30 km road along the reservoirs improving access to Kutaisi for villages in the area. The company will also pay more than 20 m lari annually in property tax. Clean Energy Group Georgia will also have a social investment programme for the people affected by the project construction.
Some in the NGO and civil society sectors are critical of the environmental impact of large hydropower projects in Georgia. What sort of environmental investigations has your company conducted, and how are you planning to mitigate these risks throughout the construction process?
Most countries that have hydropower resources develop these for electricity production due to the unique nature of hydropower which in most cases is cheap, flexible and renewable. Georgia has in comparison with most other European countries developed a small share of its available resources. Hydropower has certain negative impacts including land take and reduced flow of water in the river. It is important to mitigate against these negative impacts. Clean Energy Group Georgia implements the project according to IFCs Performance Standard which is recognized as the leading standard worldwide for dealing with social and environmental issues associated with large infrastructure developments. We have hired leading international expertise to ensure that the implementation of the project follows Georgian as well as international standards. Our environmental and social approach will be independently audited to ensure that it complies.
What sorts of social responsibility projects are you planning to carry out in the Namakhvani HPP project area?
Clean Energy Group Georgia plans to have a social investment programme in the area where the project is implemented. The programme will focus on improvements to the public health situation in the area, traffic safety and sustainable business development. In addition to this, the project will create a lot of jobs in the area.
How do you measure the success of a large energy project such as this one?
For us a success is to implement a project where people affected by the project development feel that they are better off with the project than without it. The project shall be delivered on time and cost and provide a benefit for the population in Georgia.