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Last Updated: September 2013

Overview


Map of Georgia
Map of Georgia
  • Although it is not a significant energy producer, Georgia is an important transit country owing to its strategic position between Western Europe and Central Asia.
  • The biggest export route to bring oil directly from fields in the Caspian Sea region to European markets passes through Georgia. The Baku-Tbilisi-Ceyhan (BTC) pipeline, commissioned in 2006, runs from the Caspian Sea to the Black Sea and carries an average of 1 million barrels per day of crude oil.
  • The South Caucasus Pipeline (SCP) runs parallel to BTC and supplies natural gas to Georgia and Turkey from Caspian fields such as Azerbaijan's Shah Deniz. The pipeline began operating in 2007 and has the capacity to transport about 280 billion cubic feet (Bcf) of natural gas, according to IHS Global Insight. In 2010, SCP's daily throughput averaged 180 Bcf of natural gas, according to BP. Georgia generates revenue from transit fees for using the SCP and BTC pipelines.
  • Georgia imports natural gas and petroleum products as its main energy sources. It also generates domestic hydropower for some electricity generation and uses traditional biomass for residential heating. Because it relies on imports for virtually all oil and natural gas, Georgia's economy is very vulnerable to global energy price movements.
  • Georgia's power grid was previously part of an integrated South Caucasus network. After the collapse of the Soviet Union, Georgia experienced a severe energy crisis. Georgia's Ministry of Energy has announced plans to rehabilitate older hydropower generators and build new ones in an effort to increase electricity generation. These projects are funded in part by foreign investors, such as the European Bank for Reconstruction and Development (EBRD).