VARDNILI & ENGURI HYDRO REHABILITATION

The Project consists of two related components: (a) the rehabilitation of two residual generator units (No. 1 and 5) of the altogether five generators of the Enguri Hydro Power Plan (HPP) (units No. 2, 3 and 4 have already been rehabilitated recently) and (b) investments at the Vardnili HPP cascade – located downstream of the Enguri HPP – required to guarantee safe water evacuation towards the Black Sea (e.g. rehabilitation of the Vardnili I dam and spillways including the provision of safety equipment, dredging of the existing artificial Vardnili canal, access roads improvements and any technical assistance required to establish and operate an appropriate Project Implementation Unit for these investments).

The Project concerns the rehabilitation of the Enguri and Vardnili HPP cascade to restore generation capacity and instate safe operating conditions, in line with international requirements. The project will promote the supply of renewable energy and improve the operational safety of energy infrastructures.

The project, if located in the EU, would be categorised as an Annex II type investment under the EIA Directive, requiring the competent authority to determine the need for environmental assessment. Under Georgian legislation, the project is screened out. The Bank has reviewed the environmental impact study submitted to the Georgian authorities and finds it acceptable. The implementation of appropriate mitigation measures will be covenanted in the finance contract.

Procurement of the Enguri rehabilitation components under the project, which would be financed by EBRD, will be undertaken in line with EBRD procurement rules. For works related to the Vardnili cascade to be financed by EIB, the EIB’s legal documentation will oblige the promoter to ensure that any procurement procedures are done in accordance with EIB Guidelines and the relevant applicable EU rules.