On 29 December, GNERC issued new tariffs on electricity. The new tariffs are effective from 1 January 2021 to 31 December 2025.
As expected, they have increased both for individuals and for businesses. Depending on usage, the new rates for individuals have risen by almost GEL 0.035 a month, while the average increase for businesses is between GEL 0.11 and 0.13/month.
While the government plans to subsidise the difference in consumer rates, the almost 70% increase in commercials rates will put a considerable strain on businesses that might result in higher prices for final consumer goods. Now more than ever, businesses have to start considering alternative sources of energy.
According to Bloomberg New Energy Outlook, wind and PV will grow to generate 56% of electricity by 2050. With innovation and scale driving the cost of renewable energy down and increasing the quality of technology, renewables are now the cheapest new electricity, and in five years, they will even be cheaper than coal and gas.
Solar energy is slowly gaining popularity in Georgia, with new suppliers coming to the market. More and more businesses are adopting this resource: statistics show that 40% of the solar stations in Georgia were set up in 2020. Given the increased tariffs described above, the number of stations is expected to grow from 2021 on.
The financial benefits of a solar power plant are very attractive: an investment of US$ 55,000 could offer annual electricity savings of up to US$ 7,000. Considering the recent changes in rates, utility bills can add up to US$ 11,000 annually. It is up to businesses now: the difference of US$ 4,000 can be either paid in electricity bills or put to better use by investing in a solar energy-generating plant.
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Image: GSE