Strategic Research Centre Hosts Roundtable on Energy Solutions

SUKHUM / AQW’A — Abkhazia is grappling with a severe energy crisis that has left residents and businesses facing widespread electricity shortages. At a roundtable discussion on 27 December, the Strategic Research Centre under the President of Abkhazia brought together experts to explore alternative solutions to the region's electricity woes. Participants emphasised the urgency of the crisis and debated the most viable pathways to stabilise and improve the energy sector.

The roundtable began with Viacheslav Chirikba, Head of the Strategic Research Centre, outlining the roots of the energy crisis. “The discussion’s purpose isn’t to assign blame,” he clarified, “but to identify the systemic factors behind this collapse and draft a realistic action plan.” Chronic underfunding and low payment collection rates were cited as long-standing issues. These challenges were compounded by a surge in electricity consumption linked to cryptocurrency mining, which placed immense pressure on the region’s ageing infrastructure.

“We are witnessing a dramatic yet predictable collapse of an essential sector,” Chirikba noted, stressing the need to move beyond reliance on Russian subsidies and the seasonal water levels of the Ingur Reservoir. Instead, he called for exploring small hydropower plants and other renewable energy sources while instituting a complete ban on cryptocurrency mining.

Cryptocurrency Mining: A Strain on Resources

Said Blabba, head of the energy distribution department at Chernomorenergo (the state-owned power distribution company), highlighted the stark impact of cryptocurrency mining. “Banning mining altogether could save approximately 2 billion kWh annually,” he stated. With the Ingur Hydropower Plant generating about 1.8 billion kWh for Abkhazia each year, this measure alone could stabilise the energy supply.

Blabba also addressed the critical issue of payment collection. Currently, Abkhazia’s payment rate for electricity consumption is significantly low, but the installation of electricity meters has raised collection rates to 80-85% in some areas. “Achieving a consistent 60-70% collection rate could help keep the system afloat,” he said, though he acknowledged that raising tariffs might lead to non-payment due to high unemployment and seasonal income patterns.

Debating Privatisation and Market Reforms

The roundtable also saw spirited debate over the potential privatisation of Chernomorenergo. Alhas Argun, CEO of mobile provider Aquafon, argued that the current state-run model is unsustainable. “The company is burdened with tasks it cannot manage,” he said, advocating for the creation of a joint-stock company with a representative board of directors to ensure transparency and efficiency.

While Argun acknowledged scepticism about privatisation, he pointed to global examples of private-sector success in critical industries. “For instance, in the United States, even currency production is handled by private entities,” he remarked.

Not everyone agreed with this approach. Alhas Jinjolia, a Member of Parliament, countered that the energy sector’s strategic importance necessitates continued state ownership. “Regulatory control must remain firmly in the hands of the government,” he argued.

Green Energy and Renewable Alternatives

The discussion also touched on renewable energy, with Felix Chekheriya and Merab Kistauri from My Green Home presenting solar power as a promising solution. “Solar energy can gradually reduce Abkhazia’s reliance on traditional sources like the Ingur Hydropower Plant,” said Kistauri. He added that surplus electricity generated by citizens could be sold back to the state, providing an economic incentive for households.

However, Chekheriya pointed out a major roadblock: the absence of a “green tariff” law that would enable citizens to produce and sell electricity legally. “The technical hurdles are resolved; it’s the legislative framework that’s lacking,” he explained.

For a more immediate solution, Dr Eduard Kimketov proposed constructing gas-powered thermal power plants (TPPs). “Even one TPP could pull Abkhazia’s energy sector back from the brink,” he asserted. Kimketov suggested building such plants near the Russian border to minimise costs, noting that the closest gas source is in Tuapse, Russia.

“Thermal plants have high profitability,” he added, envisioning the eventual construction of multiple plants to supply both domestic needs and surplus electricity for export.

Payment Collection and Accountability

Boris Lazba, Deputy Director for Research at the Sukhum Institute of Physics and Technology, emphasised the need for fairness in payment collection. “Everyone must pay,” he said, dismissing claims of widespread financial hardship. “People can afford to buy firewood at inflated prices, so they can afford electricity if the system is equitable.”

Lazba also called for a comprehensive energy development strategy, encompassing detailed mechanisms for payment collection, tariff optimisation, and legal regulation.

The roundtable concluded with a consensus on the need for decisive action to address Abkhazia’s energy crisis. Whether through banning cryptocurrency mining, improving payment systems, investing in green energy, or exploring privatisation, participants agreed that the status quo is untenable.

“It’s not just about keeping the lights on,” Chirikba summarised. “It’s about securing a sustainable energy future for Abkhazia.”