THE ENERGY REGULATORY COMMISSION SENIOR OFFICIALS’ OFFICIAL VISIT TO GEORGIA
Representatives of the Ministry of Energy of Mongolia, the Energy Regulatory Commission, and the National Dispatching Center SOE visited Georgia from 15 to 17 December 2025 with the aim of gaining insight into Georgia’s energy sector reform process and exchanging mutual experience.
In accordance with the official visit program, the delegation familiarized themselves with the operations of the Electricity System Commercial Operator of Georgia (ESCO), the Georgian Energy Exchange (GENEX), the Georgian State Electrosystem (GSE), and the Georgian National Energy and Water Supply Regulatory Commission (GNERC). During the visit, the delegation studied good practices of these organizations, as well as the legal and regulatory framework of the energy sector, development planning, investment mechanisms, market models, tariff setting, licensing systems, consumer service standards, and regulatory oversight.
Georgia initiated reforming its electricity trading market in 2006. During the transition phase, and at present, the country operates a wholesale electricity market, a bilateral contract market, and a balancing mechanism. Since 2024, it has also launched the Day-Ahead Market.
The Day-Ahead Market serves as the main competitive trading platform for electricity. Market (competitive) prices are determined based on supply and demand bids submitted for each hour of the following day.
These markets are administered and operated by the Electricity System Commercial Operator (ESCO) and the Georgian Energy Exchange (GENEX), while the Regulatory Commission (GNERC) oversees and supervises market operations.
As part of the objective to fully liberalize the electricity market, Georgia plans to introduce an Intraday Market by 2027, bringing trading closer to real-time operations.
It was also noted that several challenges remain, including long-term power purchase agreements, winter capacity shortages, and market concentration on the supplier side, which continue to pose certain constraints within the sector.
The Georgian State Electrosystem (GSE) is responsible for nationwide centralized dispatching and operates electricity transmission through 220–500 kV high-voltage lines. It also conducts electricity import and export activities with the Russian Federation, Azerbaijan, Armenia, and Türkiye.
In addition, GSE provides system balancing and ancillary services, develops a ten-year transmission network development plan, and establishes and operates critical infrastructure required for the introduction of a competitive electricity market. Such infrastructure includes integrated data and information centers, automated metering systems, market management systems, and platforms for market participants.
The Georgian National Energy and Water Supply Regulatory Commission (GNERC) was initially established in 1997 and operates in line with the legislation of the European Union and the Energy Community. Its primary objective is to establish a transparent, competitive, and integrated market in the electricity, natural gas, and water supply sectors.
The GNERC places primary emphasis on the introduction of a competitive market framework. In 2020, the Government of Georgia approved the Concept of the Competitive Electricity Market Model, pursuant to which the market liberalization process is being implemented in a phased manner.
In this context, the Mongolian delegation paid particular attention to the regulatory practices implemented by the Georgian regulator, including cost-based and incentive-based tariff regulation, network investment planning, regulatory audits, cost control mechanisms, a unified accounting and chart of accounts system, normative losses in transmission and distribution, and consumer service standards. The parties engaged in detailed discussions on existing challenges, lessons learned, and achieved outcomes.
During the meeting, the Chairman of the ERC of Mongolia, Mr. E. Tuvshinchuuluun, and the Chairman of the GNERC, Mr. Davit Narmania, signed a Memorandum of Understanding aimed at developing and strengthening cooperation between the two countries in the field of energy regulation. 