Enka Renewables Secures $383 Million in Georgian Arbitration Victory

Enka Renewables has been awarded $383.2 million in an international arbitration case against the Georgian government, the company announced.

The dispute stemmed from the government’s termination of an $800 million agreement for the construction of the Namakhvani Hydroelectric Power Plant. In October 2021, Enka filed for arbitration, citing gross violations of investment terms by the Georgian state. The case revolved around the government's decision to halt the project, a move deemed contradictory to the signed investment agreement, as determined by the arbitration tribunal.

The controversy surrounding the project began earlier in June 2021, when then-Prime Minister Irakli Gharibashvili announced that the hydroelectric project would not proceed in its current form. This decision conflicted with the terms of the original agreement, allowing Enka to challenge the government’s actions in arbitration.

Enka Renewables is a subsidiary of ENKA, a Turkish engineering and energy conglomerate. The company had been poised to develop the 433 MW Namakhvani Hydroelectric Power Plant, one of the largest infrastructure projects in Georgia’s energy sector.

This arbitration outcome underscores the significant legal and financial implications of investment agreements in large-scale infrastructure projects, further emphasizing the importance of adherence to contractual obligations.