A big financial nod from the Asian Development Bank could reshape how Georgia stores and secures electricity, as the country takes a huge step toward future-proofing its energy.
ADB has greenlit a $104 million loan to help Georgia build its very first energy storage facility — a strategic move that’s expected to strengthen grid reliability, cut foreign dependence, and unlock more renewable energy down the line.
A Strategic Boost to Georgia’s Energy Backbone
The new project centers on a high-tech Battery Energy Storage System (BESS) with a capacity of 200 megawatts (MW) and 200 megawatt-hours (MWh). It’ll be plugged into Georgia’s main transmission network at the Ksani Substation, just outside Tbilisi.
In simple terms? It means Georgia can store more energy during periods of surplus and deploy it when the grid needs a lift.
And that’s big — because Georgia currently leans heavily on hydropower, which can be fickle with changing rain patterns and seasonal water flow.
One line sums it up best, straight from ADB’s Georgia Country Director Lesley Bearman Lahm:
“This new project marks another significant step toward enhancing the country’s energy independence.”
Why Now? Climate, Demand, and a Shifting Grid
Georgia’s energy consumption has been creeping up steadily. At the same time, climate change has thrown a wrench in its hydropower-dependent system. Less snow, irregular rainfall, and warmer winters mean dams aren’t generating as much as they used to.
And while solar and wind have potential, integrating them without storage is like trying to run a store without inventory space.
Battery storage — like the 200MW BESS being built — solves that. It fills the gaps, balances the grid, and takes the edge off peak-hour consumption.
One official with knowledge of the project called it a “bridge to a more flexible and renewables-ready grid.”
Here’s what the BESS will change in real terms:
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Reduce the need for emergency imports from neighboring countries.
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Give Georgia better leverage to stabilize voltage and frequency during demand spikes.
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Create the framework for future private-sector projects tied to solar, wind, and hydrogen.
Green Hydrogen: Georgia’s Next Frontier
On top of the battery facility, ADB is tossing in another $400,000 — this time in the form of grant-based technical assistance to help Georgia size up its green hydrogen potential.
Now, this is forward-looking stuff.
Adnan Tareen, ADB’s Principal Energy Specialist, said surplus electricity from hydropower — especially during spring and summer — could be turned into green hydrogen and sold to EU energy markets.
One-liner from Tareen that stood out:
“Surplus energy generated during peak seasons can be converted to green hydrogen and traded… creating new economic opportunities.”
Laws, Rules, and Incentives: Building the Foundation
New tech demands new rules. And Georgia’s regulatory system isn’t fully prepped yet for energy storage or green hydrogen.
That’s why part of ADB’s plan includes helping the country rewrite parts of its legal and technical framework to allow these systems into the national grid — and eventually into a competitive energy market.
This includes:
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Creating market rules for BESS to participate in grid balancing and capacity reserves.
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Setting up permits and standards for hydrogen production, storage, and trade.
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Providing clarity for private players who want to invest but don’t know the rules of the game yet.
That last point is key. Because Georgia wants to attract private capital, not just rely on international banks.
What It Means for Georgia’s Long Game
The BESS and hydrogen project is closely aligned with Georgia’s 2024–2028 Country Partnership Strategy with ADB. That roadmap spells out goals for a greener, more efficient, and regionally integrated energy system.
Take a look at where the government sees things heading:
| Key Energy Goals | What ADB Project Supports |
|---|---|
| Increase energy security | 200MW/200MWh BESS to reduce import reliance |
| Diversify clean energy sources | Prepping for green hydrogen trade |
| Attract private sector | Legal frameworks for new tech |
| Improve grid reliability | BESS at Ksani Substation |
| Become regional hub | Hydrogen exports to EU |
This isn’t just about Georgia keeping the lights on. It’s about positioning the country as a net energy exporter in a future powered by clean energy.
Who’s in Charge and What’s Next?
The Georgian Ministry of Economy and Sustainable Development will lead the charge on project execution. That includes driving the policy reforms that make the storage and hydrogen sectors viable.
The technical work will be managed by the Georgian State Electrosystem — the country’s grid operator. They’ll oversee everything from procurement to system integration and making sure the BESS plays nicely with the rest of the power network.
As for the timeline, full construction is expected to roll out in the next 12–18 months, with a detailed hydrogen roadmap being developed in parallel under the technical assistance grant.
It’s early days — but energy insiders say Georgia is finally putting the right pieces in place.
