GEORGIAN NATIONAL ENERGY AND WATER SUPPLY

REGULATORY COMMISSION

Security of supply and solidarity in Georgia–

status quo, challenges and future developments

Georgi Shengelia Budapest, 2018

• Legal Framework

• Emergency and solidarity mechanisms

• Diversifying supplier countries and routes

• Increasing energy efficiency

Content

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• The Main Directions of the State Energy Policy of Georgia, 2015

• Law of Georgia on Electricity and Natural Gas

• A Ten-Year Network Development Plan – Electricity

• A Ten-Year Development Plan for Georgian Gas Transmission Network

• Draft Law on Energy

• Regulation on Security of Electricity Supply - Draft

• NEEAP & NREAP

• Monitoring Rules - Draft

Legal Framework

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Directive 2004/67/EC concerning measures to safeguard security of natural gas supply

By 31 December 2020

Directive 2005/89/EC concerning measures to safeguard security of electricity supply and infrastructure investment

By 31 December 2019

BSTP-BSRI Black Sea Balancing Market Integration Study

Emergency and solidarity mechanisms – Electricity (1/3)

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BSTP-BSRI Black Sea Balancing Market Integration Study

Regulators should work with TSOs:

• To develop/amend grid code: • To define ancillary services other than balancing • To define Balancing Responsible Parties (BRP)

• To develop a methodology for pricing balancing services separately

• To develop a methodology for allocation of transmission use costs.

• To harmonize grid codes at the sub-regional level

• Collect cost data of BRPs and calculate true-costs of balancing reserves

• A regulator should approve and publish: • Grid code • Methodology for choosing BRP • Methodology to calculate NTC • Methodology to allocate NTCs among interested market players • NTC allocation results

Emergency and solidarity mechanisms – Electricity (2/3)

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BSTP-BSRI Black Sea Balancing Market Integration Study

A regulator should develop:

• A methodology and KPIs for monitoring performance of TSO in terms of network security and reliability.

• Define KPIs and necessary input data for monitoring investments in generation capacities in relation to security of supply.

Regulators should monitor:

• TSO's prequalification/certification/monitoring process for ancillary services • Level and effectiveness of market opening and competition based on KPIs. • Investments in generation and transmission capacities in relation to security

of supply. • Merit-order of the balancing suppliers

Emergency and solidarity mechanisms – Electricity (3/3)

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Diversifying supplier countries and routes- Electricity

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Cross-Border Capacity of Georgia for 2016 and 2020 (MW)

Draft of National Energy Efficiency Action Plan of Georgia is prepared and the following measures are envisaged regarding the electricity sector:

• Investments in renovating hydropower stations;

• Optimization of capacity reserves and seasonal modes;

• Expansion of transmission network and integration of new capacities into the network;

• Requirements by Rule of Calculation of the Electricity Normative Losses (ensuring investments).

Increasing energy efficiency – Electricity

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JSC Georgian Oil and Gas Corporation (JSC GOGC) is planning to construct an underground gas storage facility (UGS).

• Increase of security of supply; • Increase operational flexibility; • Satisfy seasonal needs; • Contribution in competitive market development

Natural Gas Network Rules shall regulate emergency management:

• Obligation of the TSO to maintain adequate technical and human

resources to ensure safe and uninterrupted operation of the

system

• Description of the TSO’s responsibilities

Emergency and solidarity mechanisms – Natural Gas

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Diversifying supplier countries and routes- Natural Gas

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Draft of National Energy Efficiency Action Plan of Georgia is prepared and the following measures are envisaged regarding the natural gas sector:

• Natural gas savings through replacement of old Thermal Power

Plants with efficient Combined Cycle Gas Turbine technology;

• Requirements by Rule of Calculation of Normative Losses in Natural Gas Distribution Network (ensuring investments).

Increasing energy efficiency – Electricity

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#whenbalanceisachieved

Georgi Shengelia Deputy Director of International

Relation Department, GNERC g.shengelia@gnerc.org