Georgia's Tourism Sector - Tourism Market Watch | January 2017
9 Feb, 2017
The number of international arrivals was up 19.8% y/y to 0.39mn in January 2017. Out of the top four source markets, there was strong growth from Russia (+40.3% y/y), Armenia (+31.4% y/y), and Azerbaijan (+7.1% y/y), while the number of visitors from Turkey was flat (-0.8% y/y).
While the top four source markets accounted for 86.3% of international arrivals in January 2017, secondary source markets also posted robust performances. Ukraine, the 5th largest source market, posted a 28.2% y/y increase in January 2017, while the number of Iranian visitors was up over 7x to 8,000 visitors, albeit from the low base in January 2016, as visa-free regime with Iran was reinstated in February 2016. After growing 8.6% y/y in 2016, arrivals from the EU posted 26.1% y/y growth to over 10,500 visitors in January 2017, with Poland (+24.9% y/y), Germany (+32.0% y/y) and United Kingdom (+22.8% y/y) the top contributors to growth.
The tourist category continues to drive arrival growth in January 2017, after posting a 19.0% y/y growth rate in 2016. The number of overnight visitors (‘tourist’ category) was up 32.4% y/y and accounted for 39.8% of total international arrivals in January 2017. Same-day arrivals posted modest growth of 5.9% y/y, while the number of transit visitors was up 34.8% y/y in January 2017, after declining 5.7% y/y in 2016.
Georgia's Energy Sector - Electricity Market Watch | December 2017
8 Feb, 2017
Domestic consumption increased 6.2% y/y in 2016. The main contributor was Telasi (+15.3% annually), which doubled its 2015 annual growth rate (+7.5% y/y). The Abkhazian region, which led the growth in 2015, continued steady growth (+7.0% y/y) in 2016. Energo-Pro subscribers increased their consumption by 3.3% y/y in 2016, slightly lower than the growth in 2015 (+4.3% y/y). Consumption by Kakheti Energy Distribution subscribers increased by only 1.9% in 2016, following much larger increases in previous years (8.4% in 2015 and 8.1% in 2014). Consumption of eligible consumers decreased 1.0% y/y from the low base in 2015 (-21.4% y/y), but the decrease was the result of Rustavi Water Company giving up its eligible consumer status in 2016 (it accounted for 3.4% of direct consumption in 2015). Consumption of Georgian Manganese, the largest direct consumer, was up 4.4% y/y from the 2015 low base (-20.3% y/y).
The increased level of consumption was satisfied almost entirely by domestic generation sources. Domestic generation increased 6.8% y/y and comprised 96.0% of total electricity supply. HPP generation increased 10.4% y/y, while TPP generation decreased 6.0% y/y in 2016. Growth of hydro generation was mainly driven by regulated HPPs, with generation up 7.8% y/y by Enguri and Vardnili and 11.9% y/y by other regulated HPPs. Generation by deregulated HPPs was up by 16.6% y/y. 91.3% of total electricity supply was consumed by domestic consumers, 4.6% was exported, and 4.1% was consumed by power plants or lost during transmission.
Georgia became a net exporter of electricity in 2016 with 80.1gWh of net export. Electricity import decreased dramatically (-31.5% y/y) to 478.9gWh in 2016 and accounted for only 4.0% of total electricity supply. 77.1% of imported electricity came from Azerbaijan, the rest from Russia. Exports in 2016 were down 15.3% y/y to 559.0gWh. Exports to the main export market, Turkey (52.7% of 2016 export), decreased 29.8% y/y, largely due to the fewer export months for Paravani HPP, per the amended MoU with Georgian Urban Energy. There was a significant increase in export to Armenia (+57.4% y/y), while export to Russia declined 13.0% y/y and accounted for 26.4% of exported electricity. Total amount of electricity transit from Azerbaijan to Turkey reached 849.6 gWh in 2016.
Wholesale market prices in Georgia decreased 23.3% y/y to USc 4.2/kWh, 35.2% below the Turkish market clearing price in December 2016. Turkish electricity prices increased 12.6% y/y to USc 6.5/kWh from a significantly low base in December 2015 (-24.5% y/y). 22% of total electricity supplied to the grid in December 2016 was traded through the market operator, with the rest traded through bilateral contracts.
HPPs commissioned in late 2016 (164.9MW) are expected to account for 5.7% of total hydro generation in 2017. Generation of deregulated HPPs already posted a significant increase in Dec-16 (+27.5% y/y). An estimated US$ 733mn will be spent on the construction of the Namakhvani HPP cascade in the next 5 years. Number of Solar and wind projects are increasing.
Georgia's Tourism Sector - Tourism Market Watch | December 2016
10 Jan, 2017
The number of international arrivals was up 4.3% y/y to 0.49mn in December 2016. Out of the top five source markets, there was growth from Armenia (+9.5% y/y), Azerbaijan (+3.9% y/y), and Ukraine (+14.0% y/y), while arrivals were down from Russia (-2.3% y/y) and Turkey (-16.7% y/y). Arrivals from the EU were up 28.6% y/y to over 13,400 visitors.
The number of international arrivals was up 7.6% y/y to 6.35 mn visitors in 2016. The number of visitors increased from all major countries except for Turkey (-9.9% y/y) in 2016. Russia and Ukraine posted double-digit growth rates, while Azerbaijan (+9.3% y/y) was the single largest contributor to overall growth. Travel inflows were up 11.7% y/y to US$ 1.68bn in 3Q16. Based on our estimates, travel inflows will reach approximately US$ 2.1bn in FY16.
While the top four source markets accounted for 83.6% of international arrivals in 2016, secondary source markets also posted robust performances. Ukraine, the 5th largest source market, posted a 21.9% y/y increase in 2016. The number of Iranian visitors is up almost 5.9x to 148,000, while the number of Israeli visitors during the same period is up 1.6x to over 92,000 visitors.
The tourist category continues to drive arrival growth in December 2016. The number of overnight visitors (‘tourist’ category) was up 14.8% y/y and accounted for 36.6% of total international arrivals. Same-day arrivals posted modest growth of 5.1% y/y, while the number of transit visitors declined 15.8% y/y in December 2016. The number of tourist arrivals is up 19.0% y/y to 2.7mn in 2016, compared to 2.3mn in 2015. The number of same-day visitors is up 4.4% y/y, while the number of transit visitors is down 5.7% y/y in 2016.
Georgia's Energy Sector - Electricity Market Watch | November 2016
29 Dec, 2016
New Year - new tariffs. GNERC has announced new tariffs for certain HPPs and TPPs, as well as for commercial users of Telasi and Energo-Pro; residential tariffs remain unchanged in 2017.
Enguri and Vardnili tariffs were revised for the first time since 2006. The tariff was increased to 1.496 tetri/kWh (from 1.187 tetri) for Enguri and to 2.88 tetri/kWh (from 1.17 tetri) for Vardnili. Enguri and Vardnili are the largest state-owned HPPs, generating 38.9% of total and 51.7% of hydro generation, on average. Tariffs were revised for ten other HPPs (all owned by Energo-Pro), which together accounted for 18.1% of total generation in 11M16. Only one of them got a tariff increase, while tariffs were lowered by 12.5%, on average, for the remainder.
Tariffs were revised upward for all TPPs for the year 2017. Revisions varied from a 13.5% increase for the Gardabani CCGT to a 66.9% increase for GPower. The highest tariff (14.234 tetri/kWh) was received by Blocks 3 and 4, owned by Georgian International Energy Corporation Ltd (GIEC). According to Market Rules, this tariff is the new balancing electricity price that deregulated power plants will receive for electricity sold to ESCO without a contract September through April. The guaranteed capacity fee, received by TPPs for the number of days they are on standby, was decreased for Block 3 (-23.8%), Block 4 (-30.6%), and the Gardabani CCGT (-6.1%), while it was increased for Block 9 (+10.5%) and GPower (+1.4%). The guaranteed capacity payments are collected by ESCO from all consumers and exporters in proportion to their consumption or export.
Domestic consumption increased 11.5% y/y in November 2016, with Telasi and other DNOs driving the growth. DNO consumption was up 14.0% y/y, with the greater Tbilisi area (Telasi subscribers) posting an outsized 21.5% y/y growth rate. Usage of Energo-Pro subscribers was up 10.3% y/y, while Kakheti Energy Distribution usage was up 5.9% y/y. Consumption of the Abkhazian region was up 10.4% y/y, following a 20.8% y/y increase in October 2016. Eligible consumer usage was down 4.3% y/y from an already very low base in November 2015 (-32.7% y/y). Consumption by Georgian Manganese, the largest direct consumer (73.9% of direct consumption), was up 1.7% y/y from the November 2015 low base (-35.7 % y/y). Consumption by GWP, the second-largest direct consumer (24.8% of direct consumption), declined 6.3% y/y.
Domestic consumption needs were met almost entirely by domestic generation in November 2016. Imports accounted for a mere 1.3% of total electricity supplied to the grid. The newly commissioned wind power plant generated 1.8gWh, accounting for 0.2% of total electricity supplied to the grid. Total generation increased 17.9% y/y, with HPP generation up 17.0% y/y (63.5% of total) and TPP generation up 18.9% y/y (35.0% of total). The main drivers of the increase in hydro generation were Enguri and Vardnili (+43.3% y/y). Electricity imports in November 2016 were down 84.8% y/y to 12.7gWh, with 76.4% coming from Azerbaijan and the rest from Russia. The GC fee was down 5.4% y/y to USc 0.8/kWh. Guaranteed capacity was provided by each of the five guaranteed capacity sources for most of the month. Mtkvari Energy and Gardabani CCGT operated at full power for the whole month, while Blocks 3 and 4 and GPower were mainly providing reserve for the system.
Wholesale market prices in Georgia decreased 21.2% y/y to USc 4.3/kWh, 9.0% below the Turkish market clearing price in November 2016. Turkish electricity prices decreased 0.2% y/y to USc 4.7/kWh from a significantly low base in November 2015 (-42.4% y/y). 16.2% of total electricity supplied to the grid in November 2016 was traded through the market operator, with the rest traded through bilateral contracts.