Georgian National Energy and Water Supply Regulatory CommissionGeorgian National Energy and Water Supply Regulatory Commission (GNERC)

Transmission system of Georgia and its regulationand its regulation

Irma Kavtaradze

1

Commissioner, GNERC

The Transmission Grid of Georgiag

The transmission grid of Georgia includes all transmission facilities operating above 110kV, including substations and transmission lines, also electricity circuits operating at 35 and 110kV, and relevant substations that are specifically identified in the Transmission License p yand are used for the system and inter-system transit of electricity. Other lines at 35 and 110 kV networks shall be part of distribution facilities.

Ministry of Energy of Georgia approves the list of transmission lines used for system and inter-system transit of electricity;used for system and inter system transit of electricity;

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Transmission LicenseesTransmission Licensees

Transmission of Electricity is performed by two transmission y p ylicensees:

- “Sakrusenergo”, JSC“Sakartvelos Sakhelmcipo Electrosistema” LTD (Georgian State- Sakartvelos Sakhelmcipo Electrosistema , LTD (Georgian State Electricity System)

In the nearest future, one more transmission licensee will be established, as a construction of a new 500/400 kV Black Sea transmission line has begun.

Electricity Transmission Licensee“S k ” JSC“Sakrusenergo” JSC

Established in 1996

50% - state property, 50% - “Russian Electricity System”50% state property, 50% Russian Electricity System

Assets:500kV t i i li 871 k- 500kV transmission lines – 871 km

- 330kV transmission lines – 21 km

- 220kV transmission lines – 12 km

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Total transmission lines – 904 km

Electricity Transmission Licensee“Sakartvelos Sakhelmcipo Electrosistema” LTDS ve os S e c po ec os s e

(Georgian State Electricity System)

Established in 2002100% state propertyAssets:

- 500kV substations -3 - 330kV substations -1- 220kV substations -17

110kV b t ti 24- 110kV substations -24 - 35 kV substations -44

220kV transmission lines 1 609 km- 220kV transmission lines – 1,609 km- 110kV transmission lines - 863.4 km- 35kV transmission lines – 537.4 km

Total transmission lines– 3,009.8 kmTotal substations - 89

Dispatch Licensee“Sakartvelos Sakhelmcipo Electrosistema” LTD

GSE DispatchDispatch of

E ESCOS k

p(Georgian State Electricity System)

neighboring countriesE ESCOSakrusenergo

e.p.j. sadispetCeroEnergo pro Dispatch Telavi Dispatch Generation companies

Telasi DispatchCommercial/industrial companies

International Energy Company Dispatch

Georgian Railways dispatch

Black Sea 500/400 kv Transmission Grid

The owner of the 500/400kV transmission grid is “Energotransi” LTD

100%-shareholder of the “Energotransi” LTD is State Electricity System of Georgia (GSE) LTD

“Energotransi” LTD is responsible for fulfillment of the project of the 500/400kV transmission grid g

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Black Sea 500/400 Kv Transmission i jLine Project

Black Sea 500/400 kV Transmission Grid Assets/

400 kV transmission line “Meskheti” (34 km)

500 kV transmission line “Vardzia” (188km)

500 kV transmission line “Zekari” (59km)

500/400/220 kV substation Akhaltsikhe

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Project ActivitiesProject Activities

Construction of 400 kV transmission line “Meskheti” from Akhaltsikhe to the border of TurkeyCompleting the construction of 500 kV transmission line “Vardzia”Completing the construction of 500 kV transmission line Vardzia from substation “Gardabani-500”Completing the construction of 500 kV transmission line “Zekari” f b i “Z h i 500”from substation “Zestaphoni-500”Construction of 400 kV DC line and the back-to-back converter station

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Project Objectivej j

Strengthening of Georgia’s 500 kV transmission system

Ensuring proper export infrastructure for extra electricity produced in Georgia

Ensuring necessary infrastructure for energy trading in the Caucasus Regioneg o

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Expected results of 500/400 kv Transmission Grid

Progress in stabilization of Georgia’s Transmission GridSupport of Georgia’s energy security Stimulating local production of clean energyExport Georgia’s excess hydro power to the high value

kmarkets Ability of neighboring countries to transit electricity through Georgiathrough Georgia

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Existing Conditions in Cross-Border Trade of El t i itElectricity

The basic direction of export –Turkey (spring-summer period of hydro power overflow). Recently, exports to Russia and Armenia h l b t bli h dhave also been establishedThe basic direction of import – Russia, Azerbaijan (fall-winter peak periods)pe ods)Transit of electricity has not been realized yet.

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Export-Import Is Fulfilled through the Inter-system of Transmission LinesInter system of Transmission Lines

Inter-system transmission lines:y- 500kV transmission line ”Kavkasioni”- 330kV transmission line ”Gardabani”- 220kV transmission line ”Alaverdi”- 220kV transmission line ”Adjaria”

220kV transmission line ”Salkhino” (Russian occupied)- 220kV transmission line Salkhino (Russian-occupied)- 110kV transmission line ”Dariali”- 110kV transmission line ”Djava” (Russian-occupied)j ( p )- 110kV transmission line ”Lalvari”- 110kV transmission line ”Ninotsminda”

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Georgian Energy System 220-500 kV net map-scheme

soxumhesi

soxumi

kavkasioni

pirobiTi aRniSvnebi:

500kv qvesadgurebi

220kv qvesadgurebi

lajanurhesi

vardnilhesi

IV III II I

I II

tyvarCelsresi

engurhesi

zugdidi 110kv -

dariali

k q g

110kv qvesadgurebi

Tbosadgurebi

hidrosadgurebi

500kv egx-ebi

500kv egx-ebi perspeqtiva

330kv egx

220kv egx-ebi

110k bi

varcixehesebi

gumaThesi

rionhesi

Saorhesi

Zevrulhesi

wyaltubo

varcixehesi

IV III II I

menji

d. quTaisi Jinvalhesi

gorixaSuri

d. zestafoni

zahesi

java

yazbegi

110kv egx-ebi

awhesi

qsani

baTumi

gurjaani

d. navTluRi

didube

lisi 220

rusTavi 220

gldani

orTaWalhesi

azenergo

xofa

alazanhesi

awhesi

Tbilsresimarneuli

xramhesi I

xramhesi II sadaxlo weva 110

Nninowmimda 110

borCxa

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Existing Abilities For Capacity Flow From G i T N i hb i E S tGeorgia To Neighboring Energy Systems

Neighbor Energy system

Inter-system connections Maximum capacity, MW

Name of transmission lines

Nominal circuit, kv export import

Russia

kavkasioni 500 600 600

salkhino 220 50 110

nakaduli 110 30 30

dariali 110 40 25

java 110 10 10

Azerbaijan gardabani 330 320 320

l erdi 220 150 170

Armenia

alaverdi 220 150 170

lalvari 110 25 20

ninotsminda 110 20 20

Turkey adjaria 220 150 120

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Turkey adjaria 220 150 120

Total existing capacity: export – 1395 MW import – 1425 MW

Export-Import Dynamics, 2005 – 2010Export Import Dynamics, 2005 2010

Electricity import in 2005‐2010  (thousand kwh)

1400000

16000001398638

1000000

1200000

1400000

777568649048

400000

600000

800000 433264

254802 277800

0

200000

2005 2006 2007 2008 2009 2010

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Electricity export, 2005‐2010. (thousand kwh)

1 158 7001200000000

629470 679559 749 429800000000

1000000000

400000000

600000000

2006

82 642

2007 2008 2009 20100

200000000

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2010

Regulation of the transmission activityRegulation of the transmission activity

Ministry of Energy Regulator (GNERC)Ministry of EnergyIssues Electricity (capacity) Market Rules, which regulate functioning of the electricity

Regulator (GNERC)Issues licenses (transmission, dispatch, etc.)Monitors licenseesfunctioning of the electricity

market…, Technical, commercial and legal issues with regard to electricity transmission,

Monitors licenseesApproves tariff methodology and sets tariffs (transmission, dispatch etc )y ,

dispatch…., import, export, parallel operation of energy systems, etc.

dispatch, etc.)Solves disputes between the licensees, and licensees and consumersconsumers

Regulation of transmission activitiesRegulation of transmission activities

Licenses TariffsLicensesTransmission and dispatch licenses shall be issued for

TariffsTransmission and dispatch tariffs shall be set per kWh

indefinite termElectricity import activity can be carried over by any

as a fixed rateImport tariffs shall be calculated according to thecan be carried over by any

person without licenseElectricity export activity

calculated according to the formula, set by the regulator

can be carried over by any person without license

Export tariffs are deregulated

Third party accessThird party access

Transmission licensee is obliged to transport electricity of entities g p ythat are authorized to sell electricity to customersFor this activity, transmission licensee shall charge the tariff, set by th l tthe regulatorCurrently, existing transmission lines in Georgia are underutilizedand only a theoretical probability exists that congestion will occur in a d o y a t eo et ca p obab ty e sts t at co gest o w occuthe near future. Consequently, there are no congestion management rules yet, but it i f h h l ill b i d d i hi h lis foreseen that such rules will be introduced within the next couple of years

Connection to the GridConnection to the Grid

Fee for the connection to the transmission grid shall be setFee for the connection to the transmission grid shall be set by the regulator

Such fee shall be paid to the transmission licensee

Fee shall be set individually for each connection

Transmission Tariffs (1)Transmission Tariffs (1)

Current tariff methodology in the electricity sector wasCurrent tariff methodology in the electricity sector was approved in 1998;

This methodology is based on the cost plus principle;

Incentive-based tariff methodology is in the process of development;development;

Transmission Tariffs (2)Transmission Tariffs (2)

Transmission Tariffs are set for the following voltageTransmission Tariffs are set for the following voltage groups: 500-330 kV, 220-110-35 kV and 10-6 kV;Transmission Tariffs shall be determined according to gpeak energy volumes to pass through the network;Value of normative losses are included in Transmission TariffsAmount of normative losses shall be set by the regulator

Transmission Tariffs (3)Transmission Tariffs (3)

Annual company revenue requirements are determinedAnnual company revenue requirements are determined during tariff setting;All reasonable expenses, related to the licensed activity, shall be included in the revenue requirement and, thus, in the tariffRequested Revenue includes the following components:EExpenses; Taxes; Profit;Profit;

TransitTransit

The Law on Electricity and Natural Gas does not extend toThe Law on Electricity and Natural Gas does not extend to interstate transitGNERC is not charged to regulate interstate transit g gRevenues from transit shall be taken into account when setting transmission tariffsg

Thank You For Your Attention

Irma KavtaradzeCommissionerCommissioner

Georgian National Energy and Water Supply Regulatory Commission26 Chechelashvili streetKutaisi 4600, Georgia

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Irma.kavtaradze@gnerc.org