Making the business case for renewables: how USAID is transforming Georgia’s energy landscape

USAID is partnering with Georgia’s private sector to harness renewable energy sources, showing how solar, wind, and hydro can strengthen energy security, bolster economic growth, and protect the climate.

Georgia, which has historically depended on imported electricity, is primed for increased domestic energy production. Specifically, renewables. With plenty of sunshine, wind-swept plains, and flowing rivers, Georgia has the homegrown resources to generate more power for homes, hospitals, schools, and businesses. Recognizing this potential, USAID supports Georgia to pave the way for a more secure and sustainable energy system that benefits people all over the country.

Agro Impex Ltd, an agriculture producer located in the scenic village of Lemshveniera in Gardabani municipality, recently partnered with USAID to install the country’s first-ever floating solar power station. The station will slash carbon emissions while generating about 300,000 kWh of electricity each year to irrigate nearby fruit orchards.

The new floating solar station is good for the climate, good for business, and good for the local economy. Because it floats on water, the plant saves valuable agricultural land, reduces water evaporation, and improves solar panel efficiency through natural cooling.

Managing partner Lasha Jincharadze explained that Agro Impex will be able to cut its electricity grid consumption by 38%, allowing it to save about $32,400 annually. With a more efficient business model, Agro Impex hopes to increase production and expand its workforce, which currently includes 150 people from the surrounding area.

The initiative received a vital boost from USAID, which co-financed $85,000 of the total project cost of $177,000. Agro Impex received the remaining funds through a loan from TBC Bank, facilitated by the Rural Development Agency.

Lasha explained the initiative in more detail: “We purchased 60 hectares of land in Gardabani municipality, where we arranged central irrigation pilot systems. Opting for space efficiency and recognizing the enhanced performance of energy generation with cooling water, we chose to install a floating solar power plant on our lake. We applied for USAID’s grant for green energy production and secured co-financing.”

USAID views Agro Impex as one of many companies across Georgia who can make an impact by integrating renewables into their respective business models. This is a key part of USAID’s development strategy, which reflects the U.S. government’s global commitment to more fully integrate climate change mitigation into foreign assistance programs.

As USAID/Georgia Mission Director John A. Pennell explained: “This pilot project is part of a larger USAID initiative to strengthen Georgia’s energy security and economic growth. We have allocated $4.5 million to support 30 similar projects in economic sectors including agriculture, manufacturing, healthcare, hospitality, and tourism. Through initiatives like this, we are helping Georgia’s private sector make the business case for transitioning to renewable energy sources.”

One project among many

Three-hundred and sixty kilometers away lies Ureki, on the shores of the Black Sea. The resort town is home to another of the 30 renewable energy pilot projects supported by USAID. There, USAID partnered with hotelier Khatuna Lagazidze to install solar panels at her resort, the Hotel Kolkhida. The panels, installed in December, now fully meet the resort’s electricity needs, powering the hotel as well as the spa and rehabilitation center.

This is a major positive change for Khatuna’s business; previously, high energy costs during winter meant that the spa and rehabilitation center could operate only during the summer months. Now, powered by the sun, Khatuna can offer the full range of services throughout the year, earning revenue outside of the summer months.

“Not only has it succeeded, but it has also surpassed our expectations,” said Khatuna. “This opportunity will allow us to extend the tourist season and enhance the hotel’s sustainability efforts.”

Toward climate-friendly industries

These renewable power stations are a crucial step towards integrating renewable energy into traditional sectors like agriculture and hospitality.

While Lasha and Khatuna make clear that this new approach to energy is good for the bottom line, the significance extends beyond the business case. Projects like these make a significant environmental impact.

As Lasha explained, “The plant [at Agro Impex] will reduce carbon dioxide emissions by 3,500 tons over a 30-year period. This is equal to planting 50,000 trees or cultivating a forest spanning 50 hectares.”

What’s more, investment in renewable energy sources bolsters Georgia’s energy security. By generating more electricity at home, Georgia can reduce its dependence on imports from neighboring countries.

As USAID/Georgia Mission Director John A. Pennell explains, this exemplifies USAID’s partnership with Georgia: “USAID, as part of the U.S. government, partners with Georgia on development initiatives that strengthen the country’s security, prosperity, and democracy. A more secure and diversified energy system, which meets the needs of Georgian citizens and reduces dependence on imports, directly benefits the Georgian people today and far into the future.”