Energy Efficiency and Cleaner Production. Status Report

Transcription

1 Energy Efficiency and Cleaner Production Capacity Building Programme in Georgia Status Report December 2005 energoefeqturobis centri saqartvelo ENERGY EFFICIENCY CENTRE GEORGIA

2 Report title Project no. Date Energy Efficiency and Cleaner Production Capacity Building Programme in Georgia. Client Composed by Sign. Norwegian Ministry of Foreign Affairs Kristin T. Wæringsaasen Number of pages / annexes Approved by Sign. 21 pages Trond Dahlsveen Content 1 Summary Norwegian Capacity Building Programmes Energy Efficiency and Cleaner Production in Georgia Objectives Strategy Energy Efficiency Centre Georgia Establishment and development of the Centre Networking Combined Training and Project Development Cleaner Production and Energy Efficiency in Industry, Tbilisi (Programme 1) Cleaner Production and Energy Efficiency in Industry, Rustavi (Programme 2) Cleaner Production and Energy Efficiency in Industry, Tbilisi (Programme 3) Lessons learned from the CP&EE programmes Energy Auditing of Buildings (Programme 1) Energy Auditing of Buildings (Programme 2) Municipal Energy Efficiency Planning Project Implementation Revolving CP&EE Fund Examples of implemented CP&EE Projects Information Activities Centre information system International coordination and cooperation Contacts: EEC The Energy Efficiency Centre Georgia Address: 10, Lermontov Street Tbilisi, 0105 Georgia Phone / Fax: / url: g_abul@eecgeo.org ENSI - Energy Saving International AS, partner in NEEG - The Norwegian Energy Efficiency Group Address: Hoffsveien 13 N-0275 Oslo, Norway Phone / Fax: / url: ktw@ensi.no ENSI 2005 Page 2

3 1 Summary In the spring of 2003, the Norwegian Ministry of Foreign Affairs confirmed their willingness to support the long-term capacity building programme on "Energy Efficiency and Cleaner Production in Georgia". By developing local capacities and skills, the long-term objectives of the programme are to contribute to increased energy efficiency in industries and buildings, reduced pollution loads and improved environment in Georgia. The establishment and development of a Georgian Energy Efficiency and Cleaner Production Centre is one important mean in order to reach the objectives as well as to ensure long-term results with continued activities after the end of the Norwegian supported programme. The Energy Efficiency and Cleaner Production Centre in Georgia was established in May 2003 as the focal point of the joint Norwegian Georgian co-operation. During 2003, the first combined training and project development programme on Cleaner Production and Energy Efficiency in Industry was performed in Tbilisi. 16 representatives from 7 companies participated, and identified and developed measures for saving of energy, water and various resources. Some of these measures were implemented during the programme period, giving annual savings of almost USD As for today, the companies have implemented more measures and have achieved total annual savings of USD A revolving CP&EE Fund with an initial capital of USD was established within the Centre in 2003, and extended to USD during The companies that participate in the CP&EE programmes borrow money from the Fund enabling them to implement projects that otherwise would not be realised. In 2004, the second programme on Cleaner Production and Energy Efficiency in Industry was performed in the industrial town of Rustavi. 14 representatives from 6 companies participated in this programme. They also identified and implemented a number of measures, and by November 2005, total annual savings of USD was achieved. The first combined training and project development programme on Energy Auditing of Buildings" for specialists from Georgia and Azerbaijan was conducted within the period April-August The target groups for the programme were the staff of the two Centres, external consultants, representatives from building owners and educational institutions. Energy Audit Reports for 8 projects were developed during the programme (a total investment of USD which will give savings of USD/year, with an average payback of 2.6 years). 28 participants from Georgia and Azerbaijan were trained and certified (14 from each country). In the spring of 2005 it was decided to merge the Energy Efficiency and Cleaner Production Centre with the Energy Efficiency Centre Georgia (EEC). The EEC was created in 1999 in a project within the EU TACIS program with supervision of the Ministry of Fuel and Energy of Georgia. The Centre is located in the same building as the Ministry of Energy. By combining the forces of the two organisations active in this field in Georgia, the possibilities of achieving the overall goals for the Centre and the Norwegian Programme are significantly improved. The combined Centre has 10 employees and the main focus for the cooperation will be to further develop skills, services and financial schemes, enabling the Centre to increase the number of local projects on commercial terms. In June 2005, the third programme on CP & EE started in Tbilisi and it will finish in January managers and engineers from 6 different companies participate in the programme. In total, 26 different CP&EE measures are identified with a saving potential of USD per year. As of ENSI 2005 Page 3

4 November 2005 the achieved results in annual savings are USD More measures will be implemented during the programme period. The second programme on Energy Auditing of Buildings was officially started with the Information Seminar Energy Auditing of Buildings Combined Capacity Building and Project Development in July 2005 in Tbilisi. This programme includes close co-operation with the Georgian Technical University (GTU) and a trilateral co-operation agreement between GTU, the Energy Efficiency Centre Georgia and ENSI has been signed and an Energy Auditing of Buildings Team established. The first and second sessions for training of trainers were arranged in October and November, with a total of 16 participants. In September 2005, a framework agreement for the programme on Municipal Energy Efficiency Planning (MEEP) was signed between the Tbilisi Municipal Administration, ENSI and EEC. The main objective with MEEP is to establish a sustainable programme for reducing the cost of energy and water consumption in municipal owned properties. The first MEEP session was arranged in December 2005 with 13 municipal specialists participating. The Energy Efficiency Centre homepage ( is an important element in the Centre information system established to increase awareness about cleaner production and energy efficiency possibilities in Georgia. Information about the main results achieved during two and a half year of cooperation is presented in this Status Report. This report can be downloaded from together with several other reports on the programme in Georgia, and a number of other countries. 2 Norwegian Capacity Building Programmes Most of the CIS countries suffer from severe economic and environmental problems caused by inefficient and polluting energy systems as well as polluting industry. Cleaner production investments and improved energy efficiency are some of the few viable policy options for simultaneously addressing the environmental and social consequences of economic transition. At the same time, some of the best opportunities for reducing global greenhouse gas emissions come from energy efficiency investments in these countries. Although subsidised energy tariffs provided no incentives for energy efficiency and cleaner production investments, rapidly rising energy prices now make these investments profitable and essential for the economic development of the countries. However, the problem is that local decision-makers have little experience of policies to support cleaner production and energy efficiency investments. Although the theoretical skills are high, but local managers, energy managers, project developers, etc. lack the skills and experience needed to identify, develop, finance and implement real cleaner production and energy efficiency projects. Hence capacity building on these issues is essential to initiate and maintain a sustainable development on increased energy efficiency and an improved environmental situation in these countries. ENSI and NEEG have successfully implemented such long-term capacity building programmes in a number of CIS and Central and Eastern European countries, supported by the Norwegian Ministry for Foreign Affairs. Georgia has about 5 million inhabitants and became independent from the Soviet Union in The country imports the bulk of its energy, including natural gas and oil products. Being a net importer of energy, Georgian economy benefit strongly from energy efficiency projects. By ENSI 2005 Page 4

5 reducing the energy consumption, the Greenhouse Gas emissions would be reduced at the same time. 3 Energy Efficiency and Cleaner Production in Georgia 3.1 Objectives The long-term objectives of the programme are to contribute to: Increased energy efficiency in industries and buildings, reduced pollution loads and improved environment in Georgia. By proving that implementation of CP and EE projects leads to economic savings in addition to improved environment, the market for CP and EE services and products will increase. This will support the future development of Georgia as a whole. Accordingly the long-term effect of the programme will support: 3.2 Strategy A sustainable and market economy based development in Georgia. In order to achieve the long-term objectives, CP and EE projects must be developed, financed and implemented. Measurable results can only be achieved by getting projects implemented at a large scale. Therefore we are focusing on: Implementation of Cleaner Production and Energy Efficiency Projects. In order to initiate and support such a development, several activities are required as illustrated below, i.e. capacity building (training and education) on project development, financing and implementation and implementation of demonstration projects. Furthermore development of suitable financial mechanisms, introduction of new technologies; distribution of results and experiences through various information activities and establishment of networks for increased cooperation, exchange of lessons learned, information dissemination, awareness raising, etc are of great importance. The Norwegian programme aims at step by step development from demoprojects to commercial projects. Training, Education Financing Demo Projects New Technologies Networks Commercial Projects Information Development of a Georgian EE & CP Centre is one important mean for reaching the objectives for the project as well as ensuring long-term results with continued activities as a consequence of the Norwegian supported programme. ENSI 2005 Page 5

6 To increase the effects of the Norwegian programme, it is important to build local capacities and skills in several directions and among different actors in the market; authorities and municipalities, consultants and experts, within industrial companies as well as universities: Universities Consultants and experts Energy Efficiency and Cleaner Production Centre Manufacturing companies Authorities & Municipalities Initially all the local parties need training and support, and the various activities are implemented in close co-operation with Norwegian specialists. Step by step the activities are implemented with less support from the Norwegians, and at the end of the project period the Georgian parties will be able to implement all the activities by themselves. The local Centre act as the link between national authorities and industries, international companies, suppliers, institutions and organisations. The possibilities for cooperation with other international, and Norwegian, initiatives in Georgia are continually explored aiming at improved results based on joint efforts. A particular focus is directed to development of future new programmes and projects financed/cofinanced from other international organizations and donors, as a spin-off from the initial Norwegian programme. The long-term programme consists of a number of activities under the following headlines: 1. Establishment and operation of the local Centre 2. Combined training and project development programmes 3. Project implementation 4. Information activities 5. International cooperation and coordination 4 Energy Efficiency Centre Georgia 4.1 Establishment and development of the Centre The Energy Efficiency and Cleaner Production Centre in Georgia was established in May The founders of the Centre were: Energy Efficiency 21 Georgia Georgian Carbon Fund Energy Efficiency Centre Georgia Regional Environment Centre Caucasus ENSI Energy Saving International Since the establishment, Norwegian consultants have supported the Centre in all elements of its operations and business development, and step by step the Centre should improve their ability to carry out activities by themselves. In the spring of 2005 the Energy Efficiency and Cleaner Production Centre was merged with the Energy Efficiency Centre Georgia, which was created in 1999 in a project within the EU TACIS program with supervision of the Ministry of Fuel and Energy of Georgia. The Energy Efficiency Centre Georgia is a non-government, non-profit organization with the Ministry of Fuel and Energy, ENSI 2005 Page 6

7 Tbilisi Municipality, the Georgian Technical University as well as other physical and legal entities as founders. By combining the forces of the two organisations active in this field in Georgia, the possibilities of achieving the overall goals for the Centre and the Norwegian Programme are significantly improved. The Centre is located in the same building as the Ministry of Energy. After the merger, the Energy Efficiency Centre has 10 employees who have their individual, defined area of responsibilities. The Centre aims to provide consultancy services to local industry and building owners, and to develop and implement projects and programmes on EE&CP in industry, renewables and Energy Auditing of Buildings. Director of the Energy Efficiency Centre, Mr. George Abulashvili The professional skills of the Centre have been developed through the combined training and project development programmes on CP&EE in Industry, Energy Auditing of Buildings and Municipal Energy Efficiency Planning and as well as by implementation of a number of projects. The Energy Efficiency Centre also acts as the link between national authorities and industries, institutions and organisations. The possibilities for co-operation with other international initiatives in Georgia are continually explored aimed at improved results based on joint efforts. A particular focus is directed to new programmes and projects financed/co-financed from other international organizations and donors, as a spin-off from the initial Norwegian programme. The Centre homepage at is both used to increase the awareness about cleaner production and energy efficiency possibilities and to promote the Centre towards ministries, municipalities, manufacturing companies and international institutions and organisations. During 2005, the Centre has further developed its network of contacts and conducted various information activities. 4.2 Networking ENSI/NEEG is managing long-term capacity building programmes in a number of CIS countries, including development of Energy Efficiency and Cleaner Production Centres. All Centres are facing similar challenges, and a lot can be achieved by exchanging experiences and lessons learnt, dissemination of information and by facilitating cooperation. Therefore, in 2003 ENSI/NEEG initiated a network event for all the Energy Efficiency and Cleaner Production Centres established within Norwegian capacity building programmes Oslo Energy Efficiency and Cleaner Production Summit 2003 The Oslo Energy Efficiency and Cleaner Production Summit was arranged August 2003 with 90 participants from Norway, Russia, Moldova, Serbia, Romania, Azerbaijan, Georgia, Kazakhstan and Kyrgyzstan, as well as representatives from the UN ECE and the EU TACIS. The Plenary Session of the Summit included presentations from the Norwegian Ministry of Foreign Affairs, the Russian Ministry of Industry, Science and Technology, The Norwegian Energy Efficiency Group and the most successful Centres on the general perspectives of EE&CP capacity building programmes, lessons learned, barriers and opportunities. ENSI 2005 Page 7

8 Although the Centres were at different stages of development, it was very beneficial for the involved partners to meet and exchange experience Oslo Energy Efficiency and Cleaner Production Workshop 2004 One year later, the Energy Efficiency & Cleaner Production Workshop was organised in Oslo (23 27 August 2004). Representatives of the Centres from Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Moldova and Romania participated. Representatives of the Norwegian Ministry of Foreign Affairs and of the Environment also took part in the first plenary day of the workshop. The Workshop participants had an excellent opportunity to share with other Centres their experiences on the capacity building programmes, project implementation, marketing and sales as well as Centre development. This Workshop had a more internal approach than the 2003 Summit, allowing the participants to discuss lessons learned, various barriers and opportunities of common interest. To facilitate the discussions, a number of group work sessions were organised during the Workshop Oslo Energy Efficiency and Cleaner Production Summit 2005 The 2005 Oslo Energy Efficiency and Cleaner Production Summit was arranged with 90 participants from 15 countries, including project partners from Croatia, Czech Republic, Moldova, Georgia, Kazakhstan, Kyrgyzstan, Serbia and Montenegro, Slovakia and Russia, as well as experts from the Energy Charter Secretariat, EBRD, NEFCO, NIB, the Swedish Energy Agency and Norwegian Authorities, organisations and companies. The Summit was opened by Kim Traavik, Deputy Minister of Foreign Affairs (right). He explained why Norway is active in supporting all the economies in transition, and gave a short overview of activities and main achievements in the countries they have supported ENSI/NEEG in implementing their programmes. Mr. Traavik confirmed that the Ministry intend to continue their support to these programmes, and mentioned the renewed focus on cooperation within the Barents Region (incl. Northwest Russia). The Summit provided a broad update on the development, achieved results and lessons learned in each country. One of the participants commented: I am quite astonished. Two years ago we were listening to a lot of plans, now everyone is reporting on real results. Deputy Ministry of Foreign Affairs, Mr. Kim Traavik ENSI 2005 Page 8

9 During the whole week, several relevant and interesting subjects were presented and discussed. This included sessions on Financing of Energy Efficiency Projects, Joint Implementation & Clean Development Mechanisms - Possibilities within the Kyoto flexible mechanisms, Energy Efficiency Planning for Municipal Buildings and The new Key Number Software for Energy Auditing of Buildings. Representatives of Centres and Universities at the first plenary session The Excursion included visit to the Oslo Waste Incineration Plant and to the new Haugjordet school, were state of the art and energy efficient technologies and solutions were demonstrated. The Oslo Energy Efficiency and Cleaner Production Summit proved to be very successful, paving the road for closer co-operation and further development of the network. 5 Combined Training and Project Development One of the most important elements within the Norwegian long-term country programmes is the interactive Capacity Building and Project Development Programmes on various topics. The programmes consist of three or four classroom training sessions. Between the sessions, each participant carries out practical homework on a specific project (building, industrial process, district heating system, etc.). The result of their work is presented at each of the training sessions, followed by plenary discussions and individual consultations. Typical set-up of a combined capacity building and project development programme Using the Norwegian methodology, at the end of the programme, participants will have identified and developed specific measures and projects on EE and CP in their own facility, ready for implementation. In some programmes several measures are implemented also during the programme period. In addition, the participants achieve capacity and skills enabling them to carry out similar work for new projects in the future. ENSI 2005 Page 9

10 The effects of these programmes are multiple: Increased capacities and skills of the Centre staff, enabling them to offer commercial managerial and technical services on various cleaner production and energy efficiency projects. Substantial economic savings and improved environment from implemented CP and EE projects at the participating enterprises. Further savings and improvements are achieved by continued efforts from the trained representatives of the enterprises. Increased capacities and skills of consultants and experts, enabling them to offer their services for new projects. Improved University education on EE and CP. Increased awareness and further developed market for EE and CP services. Industrial enterprises in Georgia are now facing increasing costs due to higher costs of raw materials, fuel, utilities (in particular energy and water), environmental taxes and often new costs for waste disposal and pollution. These costs have reached a level that represents a considerable part of the total production costs, and they will continue to increase in the future. In order to ensure a sustainable production level, it is clear that companies have to keep these costs under control. A CP&EE programme is one of the most effective tools for simultaneously addressing the financial, environmental and social consequences of transition. The concept of CP&EE is new for Georgia. Most of the local companies have no experience in CP&EE, and for many of them application of the CP&EE philosophy may be the start up of a longterm internal process of reducing costs and improving the environment. Therefore, the Norwegian programme to implement combined training and project development programmes on CP&EE in industry in Georgia is highly needed. The main goal of the CP&EE in industry programme is for the companies to identify and implement measures that benefit both their finances and the environment. This is achieved by: 1. Assisting the industrial participants in identifying, developing and implementing their own CP&EE measures and in initiating a long-term internal process. 2. Disseminating know-how to local experts who can promote and implement future CP&EE programmes and projects. The CP&EE programmes last for a period of 6-7 months, supported by the Centre and the Norwegian trainers and specialists. During this period the participants identify and develop CP&EE measures at their own companies. The measures are evaluated both technically and economically and a plan for financing and implementation is prepared. Identified no and low cost measures should be implemented without any delays. ENSI 2005 Page 10

11 5.1 Cleaner Production and Energy Efficiency in Industry, Tbilisi (Programme 1) The first CP&EE programme in Tbilisi in 2003 had 16 managers and engineers from 7 different companies participating: 1. Bread Factory 1 2. Bread Factory 4 3. Mill Factory «Progress» 4. Milk Factory «Sante Walsh Products» 5. Non -Alcoholic Drinks Factory Oasis 6. TbilWine 7. Electroautomat The main outcome of the programme is summarised in the table below, both identified potential, achieved results as per November 2003 (at the end of the programme) and achieved results per November 2005: At the training session in Tbilisi Table 5.1 Results from CP&EE Programme 1 in Tbilisi Identified potential Achieved results Savings (Nov 2003) (Nov 2003) Achieved results (Nov 2005) Electric energy kwh/year savings Water savings m 3 /year Gas savings m 3 /year Raw material savings Unit (*) 15 t/year Economical effect USD/year (*) A variety of raw material savings were identified. These savings are included in the economical effect. As can be seen from the table, the participating companies continue their in-company work after the completion of the training programme. The achieved savings by November 2005 ( USD/year) are almost 35 % more than the savings achieved at the end of the programme ( USD/year). The results of this programme are presented in more details in the Programme's Completion Report which is available at Cleaner Production and Energy Efficiency in Industry, Rustavi (Programme 2) The second CP&EE programme was implemented in Rustavi, an industrial town in the vicinity of Tbilisi. The programme was carried out through an information seminar and four training sessions in ENSI 2005 Page 11

12 14 managers and engineers from 6 different industrial companies participated in the programme: 1. Bread Factory Beta 2. Bread Factory Burji 3. Bread Factory Krtsanisi 4. Printing House Poligraphy 5. Sausage Factory Georgia-2 6. Brewery Rustavi XXI It should be noted that the most developed industrial sector in Georgia is the food industry and, in particular, bread and baking industry. Therefore we had 3 bread factories as participants in the second programme. In total, 23 energy efficiency and cleaner production measures of different kind and size were identified, and some of them implemented during the programme period. The main results of the programme are summarised in the table below, both identified potential, achieved results by the end of the programme (September 2004) and achieved results as of November 2005: Table 5.2 Results from CP&EE Programme 2 in Rustavi Savings Electric energy savings Identified potential (Sept 2004) Achieved results (Sept 2004) Achieved results (Nov 2005) Unit kwh/year Water savings m 3 /year Gas savings m 3 /year Raw material savings 10 3 % Economical effect USD/year As can be seen from the table, the achieved results in November 2005 ( USD/year) are higher than the whole identified potential of savings in September 2004 ( USD/year). This proves that the in-company processes have continued, and the participating companies have been able to identify and implement new measures. 5.3 Cleaner Production and Energy Efficiency in Industry, Tbilisi (Programme 3) In June 2005, the third programme on CP&EE started in Tbilisi, and it will finish in January managers and engineers from 6 different companies participate in the programme; 1. Bread Factory Imerion 2. Bread Factory Puri Chveni Arsobisa 3. Marneuli Mill Factory 4. Meat Company Nikora 5. Machine tools plant Ilekro 6. Pharmaceutical Company Pharmacevtika In total, 26 CP&EE measures are identified, and some of them will be implemented during the programme period. ENSI 2005 Page 12

13 Group work at the training session One of the participant describes his measures The identified potential and already achieved results (before the programme has ended) are shown in the table below Table 5.3 Preliminary results from CP&EE Programme 3 in Tbilisi Savings Identified potential (September 2005) Achieved results (November 2005) Unit Electric energy savings kwh/year Water savings m 3 /year Gas savings m 3 /year Raw material savings t/year Reduction of solid waste 25 t/year Diesel savings 5.76 t/year Oil savings t/year Economical effect USD/year The companies are still in the process of identifying more measures. 5.4 Lessons learned from the CP&EE programmes The participants of the CP&EE programmes in Tbilisi and Rustavi have pointed out the following advantages and lessons learnt from the Norwegian programmes: Very important and useful for industrial companies in Georgia Dedicated to directly benefit the consumer High theoretical knowledge, very good pedagogical approach Opportunities for immediate implementation of no and low cost CP&EE measures Valuable information about CP&EE from foreign countries It s good to use Software programme to calculate savings We will do energy monitoring in our company ENSI 2005 Page 13

14 5.5 Energy Auditing of Buildings (Programme 1) As in most countries, there is a significant potential for increased energy efficiency in buildings like schools, hospitals, kindergartens, offices, apartment buildings, etc also in Georgia. Often the energy costs constitute a substantial part of the Municipal budgets. To reduce the energy consumption and costs, and to improve the indoor environment, it is necessary to renovate and implement energy efficiency measures in buildings. Projects should be developed and implemented in a structured and efficient way, requiring good Energy Auditing and Project Management methods and tools, as well as good skills of Georgian specialists. The first combined training and project development programme on Energy Auditing of Buildings" for specialists from Azerbaijan and Georgia was conducted within the period April - August, participants from Georgia and Azerbaijan were trained and certified (14 from each country). The Norwegian programme offered hands-on training on identification, development and implementation of energy efficiency projects according the ENergy CONservation Process (The ENCON Process). Energy Audit Reports were developed for eight projects during the programme. Key figures for the four projects developed by the Georgian participants are summarized in the table below, showing very profitable investments: Table 5.5 Key Figures form the Energy Audit Reports, Programme 1 Building Year of constr. Heated area Energy saving No. of measures Investm. USD Savings per year kwh USD Payback years School # 143, Tbilisi School # 161, Tbilisi Maternity Hospital, Tbilisi Infectious Hospital, Tbilisi Total ENCON measures % , % , % , % ,9 24 % ,3 As a part of the programme, Azeri and Georgian versions of the Key Number Software for energy calculations with specific climatic data for the two regions was developed and given to the participants. The participants very much appreciated the training and they acknowledged that the new knowhow will be very useful for them in the future, both for ENCON projects and other types of projects. 5.6 Energy Auditing of Buildings (Programme 2) The second programme on Energy Auditing of Buildings was started in 2005, including a close cooperation with the Georgian Technical University (GTU). A trilateral co-operation agreement between GTU, the Energy Efficiency Centre Georgia (EEC) and ENSI has been signed and an Energy Auditing of Buildings Team established. Participating at the capacity building programme, the trainees receive guidelines and manuals on Energy Auditing of Buildings, and licensed ENSI Software for energy and profitability calculations. The participants have also agreed to be trainers at future education and training programmes in Georgia, and to participate in the further improvement and adjustment of the software and materials to local conditions. In addition, it was agreed that ENSI will support GTU/EEC in the ENSI 2005 Page 14

15 process of development/adjustment of Georgian norms and regulations on energy efficiency and energy performance of buildings. This co-operation was officially started with the Information Seminar Energy Auditing of Buildings Combined Capacity Building and Project Development 18th July 2005 in Tbilisi. The participants at the information seminar were professors, lectures and specialists from GTU, PA Consulting Group and the Energy Efficiency Centre, in total 16 persons. The next step was a training of trainers programme for professors and teachers at the GTU and specialists from EEC. The first session was arranged in October, with a total of 16 participants. Participants at the Information Seminar The participants were divided into three groups and each group got two objects belonging to the Municipality of Tbilisi for which they should do an inspection and develop a Scanning. These were Kindergarten #24, Swimming Pool, Didube Municipality Building, Municipality Office Building, Metro Station and Maternity Home. The second seminar was arranged in November. Each group presented their Scanning Reports. Based on the presentations, it was concluded to develop a complete Energy Audit Report of three objects before the next session; Kindergarten #24, Didube Municipality Building and the Metro Station at the Freedom Square. 5.7 Municipal Energy Efficiency Planning Participants at the second session In September 2005, a framework agreement for the programme Municipal Energy Efficiency Planning was signed between the Tbilisi Municipal Administration, ENSI and EEC. The main objective with MEEP is to establish a sustainable programme for reducing the cost of energy and water consumption in municipal owned properties. This is done by training key persons in the municipality in using tools and methods for analysing, prioritising, developing, financing, implementation and monitoring of municipal energy efficiency projects. The first MEEP session was arranged by ENSI and EEC early in December municipal specialists participated. From these participants, a group will be selected and appointed as the Energy Efficiency Team of Tbilisi. The Energy Efficiency Team will be responsible for implementing the energy efficiency plan in the city of Tbilisi. ENSI 2005 Page 15

16 The main topics at session 1 were: - Introduction to Energy Efficiency project development; - Barriers to Energy Efficiency (which usually exist in all municipalities); - Project Financing; - Development of Municipal Revolving Fund; - Information Database, collection of necessary information about the buildings. Before the next session, the participants will describe the existing municipal organisational structure, budget structure, groups of municipal buildings, existing energy efficiency policy and strategy as well as look into existing building data and start collecting information of the building stock. In co-operation with the ongoing programme on "Energy Auditing of Buildings" described in the previous chapter, Energy Audit Reports will be developed for three municipal projects: 1. Kindergarten no 24; 2. Local Governmental Office Building, Didube Region; 3. Freedom Square Metro Station. The Municipality will later select one of these projects for implementation as a Demo Project. Kindergarten no 24 Didube Region office building Freedom Square Metro station The MEEP programme has just started, but it is already very clear that the Energy Efficiency potential in the Tbilisi Municipality is significant. In addition there is a need for improvement of indoor climate in the municipal buildings, an additional reason for giving this project high attention in the continuation of the Norwegian programme in Georgia. ENSI 2005 Page 16

17 6 Project Implementation To implement projects both in industry and buildings is important for a number of reasons, in order to: Obtain measurable results, thus contributing to increased energy efficiency and reduced emissions in Georgia (programme objective) Demonstrate the benefits of Cleaner Production & Energy Efficiency investments Create awareness, thus further supporting the market development Further develop the Centre capacities and skills on project implementation and monitoring Enable the Centre to obtain income from commercial services 6.1 Revolving CP&EE Fund As experienced in other CIS countries, very profitable and environmentally friendly measures with short payback are identified during the combined training and project development programmes on Cleaner Production & Energy Efficiency. Although many of these measures require small investments, several of them are not implemented due to lack of equity or availability of loans. The Centre confirmed that also Georgian companies may need a soft loan facility to increase the implementation of profitable projects. Therefore, in 2003, the Norwegian programme and the Centre decided to establish a revolving CP&EE Fund after having completed the first programme on CP&EE in industry in Tbilisi. The initial capital amounted to USD and during 2004 it was increased to USD The Fund offer loans for financing some of the most profitable measures developed by companies participating in the CP&EE programmes, measures that otherwise would not be implemented. The repayments to the Fund will be used as loans for new CP&EE measures in the future. Hence it should become a revolving mechanism, enabling the Centre to be involved as consultants in more projects and supporting the further development of the Centre. Revolving CP&EE Fund Loan for investment (x% of savings) Loan for new investments (x% of savings) Проекты 6 Проекты 5 Project 4 Project owner Savings Project 2 Project 3 (y% of savings) It was initially decided that the maximum loan amount should be USD per company, and the repayment period should be tied to the payback time of the financed measures. These conditions are currently reviewed. Five companies from the 1 st programme in Tbilisi and four companies from the 2 nd programme in Rustavi were provided loans from the CP&EE Fund. ENSI 2005 Page 17

18 The status for both programmes as per December 2005 is presented in the table below (all figures in USD). Table 6.1 Status of the Revolving CP&EE Fund Tbilisi programme, company Loan Debt service costs Repaid Outstanding Bread Factory Bread Factory Milk Factory Sante Mill Factory Progress Non-Alcoholic Drinks Factory Oasis Total Tbilisi programme Rustavi programme, company Loan Debt service costs Repaid Outstanding Bread Factory Beta Bread Factory Burji Bread Factory Krthanisi Poligrahy Total Rustavi programme (*) Balance CP&EE Fund (*) USD in loan provided by repayments from the previous loans For Programme 1 in Tbilisi, in total USD was provided as loan from the CP&EE Fund for implementation of developed measures, the rest was financed by the companies themselves. After having implemented all measures, the total annual savings per November 2005 equals USD. The average payback for these measures is less than one year. For Programme 2 in Rustavi, in total USD was provided as loan from the CP&EE Fund. Since one of the projects at the Rustavi programme was financed by the repayments from the first projects, the Fund is already revolving. By November 2005, the total annual savings from the Rustavi programme equals USD. 6.2 Examples of implemented CP&EE Projects As described in chapter 6.1, nine companies have been provided loans form the CP&EE Fund, enabling them to implement projects that otherwise would not have been implemented, or implemented at a much later stage. Several companies participating at the third programme is expected to apply for loans after completing the final training session in January Some examples of implemented projects are given in this chapter. For more information, please study the Completion Reports at ENSI 2005 Page 18

19 6.2.1 Milk Factory Sante The Sante factory, which has 110 employees, produces milk products and natural juice. During the CP&EE programme it was identified that considerable electrical savings were achieved by upgrading the power supply system through installation of a new, MW HV transformer: Investment USD, loan USD Electricity savings kwh/year or USD/year Raw materials savings 5 tons/year or USD/year Payback 0,7 year The project is implemented Bread Factory Burji The Burji factory produces different types of bread. They have 35 employees. In the course of the CP&EE programme the company identified a number of energy efficiency and cleaner production measures. One of the crucial energy problems at the factory is the high electricity consumption of the existing electrical baking stove. Considerable electricity savings were achieved by converting from electricity to a natural gas baking stove: Investment USD, loan USD Electricity savings kwh/year or USD/year Payback 0,5 year The project is implemented Imerioni Bread Company Imerioni is a middle size bread company, located in a densely populated area of Tbilisi - Saburtalo. The company produces several types of loafs, cakes and crackers, the low-cost products which are highly demanded by the local population. One of the largest cost elements are the leftovers of drybread returned from the groceries. Therefore, Imerioni choose to recycle the dry bread and plans to purchase a high efficient bread cutting machine: Investment USD Savings USD/year Payback 1,0 year The project is under implementation. ENSI 2005 Page 19

20 7 Information Activities To increase the awareness about cleaner production, energy efficiency, renewable energy sources as well as the EEC and the Norwegian Programme, information activities are needed. 7.1 Centre information system Web-sites The Centre has an information system consisting of several elements. One element is the Centre s web-site; available in Georgian, English and Russian. The homepage helps the Centre to promote their activities towards ministries, municipalities, manufacturing companies and international institutions and organisations. In addition, information about both EEC and the Norwegian Programme is published at ENSI s web-site; together with information from related projects and programmes in a number of countries. Brochures and newsletters New leaflets have been developed, published and distributed, containing information on services and activities of EEC. These leaflets are regularly distributed to interested parties. EEC also distributes information on new technological achievements in, renewable energy, energy efficiency and related environmental aspects and events through weekly e-newsletter to 140 subscribers. Seminars and conferences At October 2005, EEC participated at the 6th International Fair of Telecommunications, Power, Information Technology and Electrical Engineering. The Chairman of ExpoGeorgia, Mr. K. Gvelesiani awarded a Certificate of Gratitude to EEC. ENSI 2005 Page 20

21 27 October, 2005, Opening of the 6 th International Fair of Telecommunications, Power, Information Technology and Electrical Engineering. Information seminars Cleaner Production and Energy Efficiency in Industry The Information Seminar on Programme 3 was arranged 21 June 2005 with more than 35 participants from the Georgian Authorities, organizations, industry, international financing institutions and universities. The Information Seminar was very well received, and the response confirmed that the Norwegian Capacity Building programme is needed. Energy Auditing of Buildings The co-operation with the Georgian Technical University (GTU) was officially started with an Information Seminar 18 July 2005 in Tbilisi. The participants were professors, lectures and specialists, in total 16 persons. 8 International coordination and cooperation In accordance with the goal of the Norwegian-Georgian collaboration programme, the EEC shall be self financed when the Norwegian support is ended. To strengthen its possibilities, EEC is an (associated) member of; European Council for an Energy-Efficient Economy (ECEEE) World Renewable Energy Network (WREN) European Small Hydropower Association (ESHA) International Network of Organization for Promotion of Energy Technologies (OPET) International Network on Small Hydropower Renewable Energy and Energy Efficiency Partnership (REEEP) In addition to assist the EEC in getting commercial contracts for the local industry, the possibilities for getting the Centre involved in programmes and projects run by other international organisations and institutions are continuously being investigated. Amongst other, there have been extensive contacts with; USAID and the Rural Energy and Environmental Development (REED) Project EBRD, which now confirm that Tbilisi is qualified as a borrower in the Bank UNDP, which have received Norwegian grant for Caucasus ENSI 2005 Page 21