The Legal Base of a Wind Project
A wind energy project is subject to the conditions defined by Article 32 of the Georgian Law on Energy and Water Supply: the construction, maintenance and operation of electricity generation objects and associated devices, and their connection to the network, must comply with the technical standards and other mandatory conditions established by legislation and by the network rules, including the requirements of environmental protection, public safety and the protection of property. Generation, apart from the cases envisaged by the law, is subject to mandatory licensing. For a wind park this matters acutely: territory scale, turbine siting and connection parameters must all be designed to these requirements. Licensing rests on the Law on Licenses and Permits, the energy law and the Commission's licensing rules, applied together.
Acceptance into Operation
Under Article 36, an enterprise that has built a wind power plant or reconstructed it, increased its capacity and connected the object to the network must apply for acceptance into operation to the operator of the system to whose network it is connected; representatives of the transmission system operator participate in the trial run and complex testing. Unless the network rules provide otherwise, the operator declares consent or refusal within no more than 90 calendar days from the trial run. During the acceptance period no license is required, the purchase and sale of the electricity produced is regulated by the market rules, and once the object has been accepted, generation is allowed on the basis of a license or a confirming document.
Transmission Network Development Planning
Article 53 regulates network development through ten-year planning: the transmission system operator annually develops or updates the ten-year development plan for the next 10 calendar years. The plan covers supply and demand indicators, the infrastructure to be built or improved over the next 10 years, the investments of the following 3 years, project deadlines, and information on the integration of new generation objects, including renewable energy sources, into the network. The draft plan, after consultations, is submitted no later than 1 October of the relevant year to the Ministry and the Commission; the Commission justifies its remarks within 2 months of receiving the draft, and the Ministry approves the plan with the Government's consent by the end of the year. For an investor the plan shows where network development is planned and where connection preconditions may arise; where an investment is not implemented the Commission may hold an open tender, in which a generation, supply or trading company cannot act as investor. Projects tied to state policy targets cannot be removed from the plan, though their deadlines may change and their costs may be financed from the budget or reflected in the tariff. The operator must facilitate investment projects and provide investors with all necessary information, including on connection of new devices; financial arrangements require the Commission's prior consent.
Favorable Terms for New Interconnectors
Article 99 of the law provides that, upon the request of an electricity enterprise, the full capacity of a new direct current interconnector or part of it may be temporarily exempted from certain obligations, provided all conditions are met: the investment promotes competition in electricity supply; given the risks, it is impossible without the exemptions; the owner is separated, at least in legal form, from the transmission system operator and from the operator of the connected system; users bear the obligation to pay the fee; no component of the fee for the connected system has covered the interconnector's capital or operating costs; and the exemptions do not harm competition or the efficient functioning of the internal and regional markets or of the regulated system. By way of exception the regime also applies to alternating current interconnectors where the costs and risk significantly exceed those ordinarily arising from connecting two neighboring transmission systems, and to cases of a significant increase of an existing interconnector's capacity. The decision is taken for each individual case by the Commission and the neighboring country's competent regulatory organ; it must be adopted within 6 months of the submission of the request, failing which the Energy Community Regulatory Council may itself examine the matter. The decision must be justified and published, and before adoption the Commission defines capacity management and allocation rules, including offering unused capacity on the market and secondary trading of contracted capacity. The Secretariat may demand amendment of the decision within 2 months, extendable by a further 2 months; such a request must be satisfied within 1 month. The consent loses force if construction does not begin within 2 years or the interconnector is not accepted into operation within 5 years, except where the delay is caused by reasons independent of the requesting person. These requirements apply where the neighboring country is a member of the Energy Community or consents to their application.
Frequently Asked Questions
Within what period is consent on a wind plant declared?
Within no more than 90 calendar days from the trial run, unless the network rules provide otherwise; during the acceptance period no generation license is required.
Where can I see planned network development?
In the ten-year transmission network development plan, updated annually by the operator, which also reflects the integration of new generation objects, including renewable sources.
Who decides exemptions for a new interconnector?
The Commission together with the neighboring country’s regulatory organ, case by case, within 6 months of the request; the decision must be justified and published.
How We Help on Legal.ge
The lawyers of Legal.ge support wind energy projects from licensing through acceptance into operation: we analyse the network development plan, prepare connection and testing documentation, and defend the project’s interests before the Commission. Contact us — and your project schedule will be built with regulatory risk accounted for.