Author: Vato Bzhalava 

 

At the beginning of September 2024, the 8th ministerial meeting, within the framework of the Agreement on Strategic Partnership in Green Energy Development and Transmission between the governments of Azerbaijan, Georgia, Romania, and Hungary, was held in Bucharest, Romania. The recent launch of the Black Sea Submarine Cable Project, connecting Azerbaijan, Georgia, Romania, and Hungary, marks a pivotal moment not just for European energy security, but also for Georgia’s role as a critical energy transit hub. This ambitious project will deliver renewable energy from the Caspian region, while reinforcing the EU’s resilience in the face of energy supply challenges and geopolitical tensions.

At the heart of this initiative is the EU’s need to diversify its energy sources. The Black Sea power line will connect Europe to renewable energy generated in Azerbaijan, particularly wind and solar power. This energy will travel through Georgia, cross the Black Sea via a submarine cable, and arrive in Romania, where it will be integrated into the EU’s electricity grid.

The project is crucial for Europe and Georgia in several aspects: Energy security, economy, green policy, and interregional connectivity.

 

A Game-Changer for Europe, the South Caucasus, and the Caspian Region

This project is a vital component of the EU’s broader strategy to reduce its dependence on Russian energy. As the continent seeks to distance itself from Russia, particularly after the Russia-Ukraine war and the subsequent Western sanctions against Russia, securing alternative energy routes has become a top priority for the EU. By sourcing clean energy from the South Caucasus and linking it directly to the European market, the Black Sea power line will help diversify Europe’s energy portfolio and mitigate risks associated with reliance on traditional energy suppliers.

The Green Energy Corridor joint venture, established through a shareholders’ agreement between system operators from Azerbaijan, Georgia, Romania, and Hungary—CNTEE Transelectrica, Georgian State Electrosystem (GSE), AzerEnerji, and MVM Electrical Works—aims to create a critical energy link across these regions. With an initial budget of $2.3 billion, the project is set to become operational by 2029. Azerbaijan, a crucial player in the venture, boasts significant renewable energy potential, with 27 gigawatts onshore and 157 gigawatts in the Caspian Sea. By 2027, 4 gigawatts of this potential will be realized, with 80 percent allocated for export. This capacity is expected to rise to 25 gigawatts, with plans to add 6 gigawatts by 2037, further solidifying Azerbaijan’s role in the regional energy market.

The World Bank is one of the contributors to this project, having committed $35 million for preparatory activities as part of the broader ESPIRE Program. This funding focuses on geophysical and geotechnical investigations, identifying a suitable cable corridor, and strengthening institutional capacity for intergovernmental coordination. The project aims to enhance energy security, facilitate renewable energy transmission, and improve digital connectivity between the South Caucasus and Europe. This initial phase sets the foundation for further investments in the cable’s construction and associated infrastructure.

The Black Sea power line is not just about energy security — it is also integral to Europe’s green transition. With the EU committed to achieving carbon neutrality by 2050, renewable energy sources are critical to this effort. Azerbaijan, a country with vast renewable energy potential, particularly in wind and solar, is poised to be a crucial supplier of clean energy to Europe. By creating a direct energy link through this project, the EU will gain access to large quantities of renewable electricity, accelerating its shift away from fossil fuels. Integrating green energy from the Caspian region will help Europe to meet its ambitious climate goals, while reducing greenhouse gas emissions.

In addition, the Black Sea power line underscores the importance of international cooperation in achieving sustainable energy solutions. The partnership between Azerbaijan, Georgia, Romania, and Hungary reflects a shared commitment to tackling the global challenge of climate change through collaborative infrastructure development.

Beyond its energy and environmental impacts, the Black Sea power line carries significant geopolitical weight. The Caspian and South Caucasus regions have long been key players in the global energy market, particularly in oil and gas exports. This new project shifts the focus toward renewable energy, positioning the region as a future hub for clean energy exports.

The South Caucasus, often considered a crossroads between Europe and Asia, will play a critical role in bridging the energy needs of Europe with the resources of the Caspian region. The Black Sea power line will strengthen the region’s strategic importance by making it a vital energy corridor for Europe. This enhances regional stability and boosts cooperation among countries that have historically had complex relations. This project can also alter the geopolitical balance in the region by reducing Europe’s reliance on Russian energy, providing the EU with a more resilient and diversified energy supply chain, and reducing its vulnerabilities to geopolitical pressures from traditional energy suppliers.

However, the Black Sea Submarine Cable project faces several risks, particularly regarding its physical vulnerability, given its proximity to Russian-occupied Crimea and potential threats from Russia amid the ongoing Russia-Ukraine war. This creates potential security threats, including sabotage. Additionally, the project’s immense scale — at over 2,000 meters underwater — poses technical challenges, such as repair difficulties and cost overruns. Furthermore, doubts remain about Georgia’s ability to meet the energy export demands by the project’s completion, adding uncertainty to its feasibility and long-term success.

 

Why Is the Project Beneficial for Georgia?

From Georgia’s perspective, the Black Sea power line is more than just a transit route — it is a transformative opportunity. This project presents an opportunity for Georgia to mitigate its vulnerabilities to energy disruptions. The country has long relied on energy imports from neighboring countries, and the Black Sea power line could provide a more stable and diversified energy supply. By being part of this regional energy network, Georgia is not only improving its energy independence, but also positioning itself as a key partner in Europe’s broader energy strategy. As a critical intermediary in this project, Georgia stands to benefit in several ways:

Strengthening Georgia’s Role as a Strategic Transit Hub: Georgia’s geographical position between Europe and the Caspian region places it at the center of the energy exchange. By facilitating the transmission of renewable energy from Azerbaijan to Europe, Georgia reinforces its role as a vital energy transit country. This enhances the country’s strategic significance in regional and European energy networks, potentially attracting more investment and international partnerships.

Enhancing Energy Security: Historically reliant on energy imports, Georgia can leverage this project to improve its energy security. Georgia gains access to more stable and diverse energy sources by being part of a broader regional energy grid, reducing its dependence on external suppliers. This is particularly important in the context of regional instability and fluctuating global energy markets.

Promoting Renewable Energy Development: The Black Sea Submarine Cable Project could also catalyze the growth of Georgia’s renewable energy sector. With increasing demand for clean energy in Europe, Georgia could expand its renewable energy capabilities, particularly in hydropower, solar, and wind energy. This not only aligns with global trends, but also offers long-term economic benefits, as Georgia could eventually become an exporter of green energy itself.

Economic and Political Benefits: Participation in such a large-scale infrastructure project has broader economic and political implications for Georgia. The project is likely to bring in investment, technology, and expertise, boosting the country’s energy infrastructure and creating jobs. Politically, deeper energy cooperation with the EU strengthens Georgia’s ties with Europe and underscores its role as a key player in regional stability and development.

 

Conclusion

The Black Sea power line project represents a significant step forward for both Europe and Georgia, addressing critical challenges in energy security, diversification, and the green transition. For Europe, the project offers a solution to reduce its dependency on Russian energy, and aligns with the EU’s long-term goals of achieving carbon neutrality by 2050. By integrating renewable energy from the Caspian region, Europe not only enhances its energy security, but also accelerates its transition to a sustainable energy future. This project strengthens Europe’s resilience against supply disruptions and geopolitical risks by diversifying energy sources and routes.

The geopolitical implications of this project extend far beyond energy. The Black Sea power line will strengthen ties between the South Caucasus, the Caspian region, and Europe, fostering stability in a region marked by historical tensions. The project underscores the importance of international collaboration in addressing global energy and climate challenges. With active participation from countries like Azerbaijan, Romania, Hungary, and Georgia, the power line exemplifies how regional cooperation can promote energy independence and sustainable development.

For Georgia, the Black Sea Submarine Cable Project is more than an energy corridor — it is a strategic opportunity to redefine its position on the global energy map. By playing a central role in this multilateral initiative, Georgia solidifies its status as a critical energy transit hub between Europe and Asia. This enhanced connectivity elevates Georgia’s significance in the broader regional and European energy markets, opening doors to greater economic investment, international partnerships, technological advancements and security. Additionally, the project can catalyze the growth of Georgia’s domestic renewable energy sector, allowing the country to not only meet its own energy needs, but also to become a future exporter of green energy to Europe.

In the long run, the Black Sea power line is poised to transform the energy landscape for both Europe and Georgia. It will strengthen energy security, promote renewable energy development, and create new economic and political opportunities. As the project advances, Georgia’s role will be pivotal, not just as a transit country, but as a key player in Europe’s energy diversification strategy. Through continued collaboration with European and regional stakeholders, this landmark initiative will play a defining role in shaping the future of energy security and sustainability in the region, ensuring that both Georgia and Europe are better prepared to face the energy challenges of tomorrow.