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Programs Energy and Environment
Energy and Environment
Objective
Current Situation
Successes
Program Activities
Assessments and Other Publications
Objective
A viable, commercial energy sector able to meet demand
USAID activities assist Georgia's long neglected energy sector in the areas of production, supply, and distribution. Support to the government of Georgia in developing and implementing both market-friendly policies and a regulatory framework helps move state-owned utilities toward becoming private entities. Our program is also designed to integrate energy and environment activities at the community level.
Current Situation
Georgia's energy sector lags well behind that of its neighbors and other countries in Central and Eastern Europe for many reasons, including years of neglect and widespread corruption. Despite the potential for ample electricity generation and the government's recognition that reform is vital for long-term economic growth, Georgia's power sector remains incapable of reliably meeting its current and future energy demands.
USAID has invested more than $71 million in the sector since 1999. Initially, efforts centered on legal/regulatory reform and winter heating assistance to vulnerable segments of the population. Today, efforts are focused on energy sector operations by improving energy distribution efficiency, rural access to energy, regional water monitoring, and watershed management. USAID also provides advisory support to the Ministry of Energy. Notably, consumer bill collection rates nationwide rose from 20% to 44% in the last half of 2004 and from 44% to 70% during 2005 through USAID management of a government-owned electricity distribution company. Nationwide, consumer non-payment for power was reduced from 57% to 24% during 2005 due to greater government support for companies to operate commercially. Positive gains have occurred since the Rose Revolution of 2003 yet much remains to be done to supply the population with steady, reliable energy, both in urban and rural areas of the country.
Our activities in the environmental sector center on increased coordination of regional watershed management, sanitation, and supply among the three Caucasus countries. USAID continues to be an active supporter in reforming Georgia's prized national parks, providing assistance through the U.S. Department of Interior.
Successes
- USAID management of the government-owned distribution company streamlined human resources, automated processes - including elimination of cash bill collectors – and installed meters, resulting in an increase in consumer bill collection from 17% to 70% between 2003 and the end of 2005
- Attracted 35 million Euro loan from the German development bank KfW to install additional individual meters along Georgia's electricity network and for upgrading the distribution system
- Supplied heating assistance for seven winters through the Georgia Winter Heating Assistance program, benefiting 230,115 households, 685 institutions, and 20,554 internally displaced persons
- Advised Ministry of Energy to clarify and document plans for meeting winter energy needs, to develop an initial electricity master plan and to develop and implement a community outreach plan
- Provided national parks expertise from the U.S. Department of Interior to develop visitor services and law enforcement to protect Georgia's wildlife from poaching
Program Activities
Improving electricity distribution
Since 2003, USAID partner PA Consulting (www.paconsulting.com) has overseen the management of the Georgian government-owned United Electricity Distribution Company. Activities center on organizational management and development, payment collection improvement efforts, public awareness, and accountability. Aggressive management and technical operations reform already has produced tangible results in increased distribution efficiency and consumer payment. USAID management of the government-owned distribution company streamlined human resources, automated processes - including elimination of cash collectors for payments – and installed wholesale, communal and individual meters, resulting in an increase in consumer bill collection (compared to the value of electricity purchased) from 44% to 70% during 2005. USAID is also collaborating with the World Bank to install and implement a metering system along the network and with the German development bank KfW to fund individual meters that will enable precise billing and further increases in collection rates.
The major accomplishments to date are:
- For the first time in 15 years, paying customers in the regions receive 24 hour power supply
- Within the United Energy Distribution Company service area, power supply limitation schedules have been eliminated under normal operating conditions
- In 2005, collections reached $38 million, which is 130% higher than collections in 2003 and 54% higher than in 2004
- Payments to the state budget increased from $2.7 million in 2003 to $14 million in 2005
- A new billing system serving 651,107 customers in 35 service centers (89% of UEDC’s total customer base) was installed
Advisory assistance to the Ministry of Energy
USAID provides advisory assistance to the Ministry of Energy through its partner organization Core International. (www.coreintl.com) USAID's principal goal is to help the Ministry effectively and competently manage the resources and institutions in the sector through policy development and monitoring. USAID's assistance focuses on developing energy strategy, policy, and legislation; providing institutional reform advisory services; installing a management information system; and creating a public relations strategy and outreach program. In 2005, this assistance enabled the Ministry to finalize a short-term electricity action plan and begin development of a comprehensive gas and electricity strategy. USAID also helped the Ministry draft a new energy law and revise its energy policy to provide clear guidance to the rest of the government and energy sector stakeholders.
Improving access to energy in rural areas
Increasing the supply of independently-produced, clean energy to power rural communities is the goal of the Rural Energy program, implemented by our partner Winrock International (www.winrock.org). The Rural Energy program will increase supply of grid and off-grid energy to 40 participating communities, promote energy efficiency and use of alternative energy resources, and improve sustainable natural resource management.
A network of independent power producers, enterprises designed to refurbish or install new small hydropower systems will generate much-needed electric power. Some of these producers will develop natural gas supply systems. About 200 energy efficiency projects, using locally available renewable resources, will explore greater use of biomass (crop and processing wastes), biogas (generated by livestock production), solar power and other energy sources. These projects will power community health facilities, schools, small businesses and value-added production centers.
Increasing the ability of local people to work together, set priorities, and develop community-level projects is an investment in long-term progress. Community representatives will learn how to develop integrated natural resource management plans and will be given access to credit and small grants in order to ensure sustainability.
Improve transparency and public accountability
USAID's local partner Caucasus Environmental NGO Network (www.cenn.org) aims to encourage more responsible consumer behavior, establish an energy consumers association, and encourage responsive and accountable energy entities. Activities are intended to increase the transparency and efficiency of consumption through public awareness geared at promoting greater citizen responsibility over resource use and participation in decision-making. The consumer group serves as a model to increase dialogue among interested parties in energy sector governance.
Managing the region’s water resources
The South Caucasus Water Program is being implemented by our partner PA Consulting Group (www.paconsulting.com). The program seeks to increase regional cooperation among Georgia, Armenia, and Azerbaijan in the management of shared water resources. Activities will concentrate two trans-boundary river basins: the Alazani River sub-basin between Georgia and Azerbaijan and the Khrami-Debed River sub-basin between Georgia and Armenia. The project will assist the countries to strengthen trans-boundary river basin management, develop the scientific and analytical capacity needed to turn data into information and promote its use for management, and involve civil society in monitoring and achieving lasting results.
Protected Areas Development Project
Our partner the U.S. Department of the Interior has established a long-term working relationship with Georgia to foster a national system of protected areas. The Department of the Interior is helping establish a national training center and a national training program focused on issues of park system management, administration, and personnel management. The Department is also providing field-level expert advice and training.
Assessments and Other Publications
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