Georgia Slashes Funding for 200 MW Energy Storage Project

The Georgian government has reduced funding for its planned 200-megawatt energy storage facility, with the 2026 state budget allocating GEL 35 million, down from the previously planned GEL 120 million.

The final draft shows an GEL 85 million reduction for next year, alongside a downward revision of capital spending for 2027-2029-from GEL 355 million to GEL 270 million, The Caspian Post reports citing foreign media.

Deputy Finance Minister Giorgi Kakauridze explained that updated assessments indicate the project will cost less than initially expected, noting that lower equipment and installation prices influenced the revised estimates. The facility is expected to require around 18 months to complete.

Financed through an Asian Development Bank (ADB) loan and implemented by the Georgian State Electrosystem (GSE), the project involves constructing a 200 MW / 200 MWh lithium-ion battery system in Mtskheta municipality, near the Ksani 500 kW substation. Its primary purpose is to strengthen grid stability and serve as a reserve energy source for Tbilisi during peak demand or emergency situations.

Government documentation shows several strategic goals: improving the integration of renewable energy, reducing reliance on electricity imports and ensuring reliable power supply to critical infrastructure, particularly in scenarios involving transmission failures or disruptions to natural gas supply.

GSE announced a tender for the project on August 4, closing on November 17. The results have not yet been published.