Energy Grid Connection — the Legal Framework
Connection to the energy grid — whether the transmission or the distribution network — is regulated in Georgia by the Law on Electricity and Water Supply, which builds a complete system of third party access, device connection and network codes. This page explains how that system works: who provides access, how the fee is set, what the network codes cover, and which principles — non discrimination and transparency — ensure that connection does not become a barrier to market entry.
The legal regime of connection is built on two levels: the law establishes the basic rules and at the same time empowers the commission to approve detailed network codes in which the concrete connection procedures are implemented. When planning a connection, you therefore need to know documents of both levels simultaneously — the law and the network codes in force.
Third Party Access to the Transmission System
The transmission system operator ensures, in compliance with the requirements of the electricity transmission network codes, non discriminatory and unrestricted access of users to the transmission system. The fee for access to the transmission system is accounted and set by the commission according to the respective methodology. The offer of the same service to different users must be made on equal contractual terms, using the harmonized transmission services contract or in accordance with the transmission network codes.
The law does not prevent the conclusion of long term contracts, provided they comply with the competition rules established by the legislation of Georgia and of the Energy Community. The transmission system operator publishes on its website the procedure, rules and conditions of access, including the requirements set by the transmission network codes and the fees determined by the commission, as well as the technical and quantitative data necessary for access to and use of the transmission system, which must be regularly updated. In the cases provided for by a legal act of the commission, access related services may be provided to a user only after the submission of an appropriate financial guarantee — such a guarantee must be non discriminatory, transparent and proportionate and must not create an unjustified barrier to market entry.
Device Connection to the Transmission Network and Access to the Distribution System
The technical side of connection is governed by a separate norm: the transmission system operator ensures, in accordance with the transmission network codes, the connection of electricity devices to the transmission network. The fee for connecting devices is set by the commission on the basis of a calculation carried out under its own adopted methodology — the fee is therefore not a matter for the operator's discretion but the result of a regulated calculation.
The same principle operates at the distribution level: the distribution system operator ensures, in compliance with the requirements of the rules, non discriminatory and unrestricted access to the distribution system, and the fee for this access is based on the tariff calculated and set by the commission under the respective methodology. This means that the conditions of connection fall within the same independent pricing and technical framework for large and small consumers alike, and any basis for differential treatment disappears. For a project developer, this converts connection from a negotiation risk into a planning parameter.
Distribution Network Codes — the Detailed Regulation of Connection
The operation and management of the distribution network are carried out under the distribution network codes. In one sector only one set of distribution network codes may be approved — separately for electricity and for natural gas. The codes establish: the operational requirements necessary for the security of the network; the procedures for its operation in normal and emergency regimes, in failure conditions, in force majeure situations and during other disturbances; the procedure, rules and conditions for third party access to the distribution system, including the services provided by the distribution system operator; the procedure and conditions for connection to the distribution network, including the preconditions for connection, the method of metering electricity or natural gas, the functional requirements and accuracy class of metering devices, ownership of the metering device at the connection point, and the rights and obligations of the operator and the user; the rules and conditions of dispatching; the criteria for the procurement of ancillary services; the planning of the operation and development of the network; the accounting of capacity and of the volumes delivered and distributed; the procedures related to interruptions of supply; the rules for the consideration and resolution of disputes; the rules for publishing and exchanging information; and measures related to energy efficiency and security of supply.
The distribution network codes are developed and approved by the commission in close cooperation with distribution system operators and after consultation with all interested parties. The codes must be consistent with the transmission network codes and with the technical rules provided for by law, and are published in the Legislative Herald and on the websites of the operators. Contractual relationships connected with connection are regulated in the codes through the standard conditions of the connection contract — which reduces the risk of individualized negotiations and gives the connected party a predictable framework.
The Cross Border Dimension and the Priority of Renewable Energy
The connection system also crosses borders: under bilateral or multilateral agreements, the transmission system operator may have access to the networks of the transmission system operators of neighbouring countries, where this is necessary for the performance of its functions, including cross border transmission of electricity. This creates the technical and legal basis of regional integration and matters for projects oriented towards export or import.
Special attention is devoted to renewable energy: in the dispatching of generation objects, the operator is entitled, under the procedure established by legislation, to give priority to objects generating energy from renewable sources, or to other promoted generation objects. For green projects, connection is thus not only possible but protected by priority at the dispatching level — a factor that materially improves the bankability of renewable generation investments.
What an Applicant for Connection Should Know
In practical terms, an applicant for connection should bear in mind: first, connection at both levels is carried out under approved network codes and not by individual arrangement, so studying the codes is the first step; second, the fee is set independently by the commission on the basis of a methodology, which means that disputes about tariffs are justiciable rather than a subject of bargaining; third, the technical and quantitative data are published and regularly updated, which facilitates project planning.
Fourth, in certain cases a financial guarantee may be required, the conditions of which must be provided for in the standard terms of the contract and which must be non discriminatory, transparent and proportionate. Taking these elements into account in advance makes the connection process predictable and reduces the risk both for the applicant and for the network operator.