Conditions of Electricity Generation
A solar project begins with Article 32 of the Georgian Law on Energy and Water Supply: the construction, maintenance, operation of electricity generation objects and associated devices, and their connection to the transmission and/or distribution network, must comply with the technical standards, norms and other mandatory conditions established by Georgian legislation, including the rules of the transmission and distribution networks, together with requirements related to the environment, public safety and the protection of property. Electricity generation, save for the exceptions envisaged by the law, is subject to mandatory licensing under the Law on Licenses and Permits, this law and the licensing rules approved by the Commission. This means that a large array of solar panels working for sale to the network must first satisfy technical compliance and then pass through the licensing regime. Environmental, public safety and property protection requirements are separately emphasized in this list, because a solar project occupies a large territory and its siting also affects the rights of neighbors.
The Rights of the Electricity Producer
Article 33 of the law defines the powers of the producer: to generate electricity by means of the object accepted into operation and the energy source indicated in the license conditions, in compliance with the relevant license, the technical characteristics established by legislative acts and the requirements related to environmental protection; to conclude contracts on the purchase and sale of electricity in compliance with the conditions established by this law and the electricity market rules; to conclude contracts on balancing and the provision of ancillary services under the conditions established by this law and the relevant subordinate normative acts adopted on its basis; to have access to the transmission and/or distribution system in accordance with this law, the network rules and other legislation; and to enjoy other rights provided by Georgian legislation. For the owner of a solar project this catalogue means that the sales format, balancing contracts and network access are all resolved within one and the same legal frame. It is noteworthy that the right to generate is tied to the object accepted into operation and to the energy source indicated in the license conditions — the enterprise must generate energy precisely with the source fixed in its license. Purchase and sale contracts are shaped by the market rules, while balancing and ancillary service contracts rest on the law and subordinate acts adopted on its basis, so the freedom of negotiation remains within that frame.