Energy
Georgia's Energy Fund Says Khudoni, Namakhvani, Nenskra All Viable
September 20, 2026
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Georgia's three largest stalled hydropower projects — Khudoni, Namakhvani and Nenskra — remain technically viable, the state Energy Development Fund says, even as it acknowledges that the social opposition that halted them has not been resolved.
Tamaz Akhvlediani, the Fund's Director of Project Management, told Business Media Georgia that the Fund is actively involved in study and research work on the Khudoni project, with the primary objective of identifying and assessing possible alternatives to the original scheme.
Technically sound, socially unresolved
"All three projects are viable, but everyone knows there were major social problems in relations with the population," Akhvlediani said. "Work is currently underway to raise awareness and provide people with more objective information."
He said the projects matter for Georgia's energy sector and energy security, and that the Fund holds regular meetings and awareness campaigns around hydropower schemes to explain their potential benefits and address concerns about their effect on local communities.
That framing is significant. The Fund is not arguing that the engineering or the economics failed. It is arguing that the consent did — and that consent is what it is now trying to rebuild.
Why these three matter
The trio represents the bulk of Georgia's large-scale undeveloped hydropower potential. Each stalled in the face of sustained local opposition centred on resettlement, valley flooding, seismic risk and the distribution of benefits between developers and affected communities. Namakhvani in particular became the focus of one of the largest protest movements in recent Georgian history before the contract was terminated.
Restarting any of them is therefore a political undertaking as much as a financing one. Akhvlediani's reference to assessing alternatives to the original Khudoni design suggests the Fund is exploring a smaller or reconfigured scheme rather than reviving the project as previously specified — a route that could reduce the resettlement footprint that drove much of the opposition.
The energy-security argument
The case for building rests on Georgia's import position. Renewable sources generated 99.8% of Georgia's domestic electricity in June 2026, but domestic generation does not cover domestic demand across the year, and Georgia remains a net importer in the winter months when hydropower output falls and consumption peaks.
The country is adding capacity: more than 300 megawatts of new generation is due to come online this year, and energy-sector lending has reached 3.18 billion lari. Georgia is also pursuing a Black Sea submarine cable intended to open electricity exports to European markets, a project whose commercial logic depends on having surplus power to sell.
Large storage hydropower is the asset class that addresses both problems at once, because it can shift output into winter and into peak hours in a way that run-of-river and solar cannot.
The obstacle that has not moved
Cost is the other constraint. Industry figures have argued that a tariff of 6.5 US cents per kilowatt-hour is no longer sufficient to make Georgian hydropower projects bankable given rising construction costs — a gap that would have to be closed by tariff, by state participation, or by concessional finance before private capital returns.
Akhvlediani gave no timeline, cost estimate or capacity figure for any of the three projects, and no decision to proceed has been announced. Georgia's Economy Minister has said separately that the government has an ambition matching the country's energy potential, while the Energy Development Fund's own director has said the sector needs more attention.
For now, the Fund's position is narrower than a revival: the projects are buildable, the alternatives are being studied, and the communities have not yet agreed.
