The government continues negotiations with Transelectrica to Terminate Khudoni HPP agreement. According to a statement published on the public procurement system, the Ministry of Economy will continue the contract with Hogan Lovells, a law firm hired this summer for these negotiations.
The ministry expects, that the negotiations will be completed by July 1, 2021. However, the law firm will pay 118 thousand EUR to conduct a settlement process with the investor.
The agreement on construction, operation and ownership of Khudoni Hydropower Plant was signed on April 28, 2011 between the Government of Georgia, Trans Electrica Limited (BVI), Trans Electrica Georgia Ltd, Energotrans Ltd and Commercial Power System Commercial Operator Ltd.
The current situation makes it clear that the above company is not able to implement the project and it is important to consider alternative ways.
Khudoni HPP is one of the largest energy projects in the country, with an investment of $ 1 billion. The guarantor of the project is the Government of Georgia, which undertakes to purchase electricity at a pre-determined tariff in the case of construction HPP. In particular, the PPA agreement provides to purchase electricity generated by Khudoni at 10.5 US cents per kWh for for the first 8 years.
