The Prospect of AI Data Centers in Georgia: A Real Opportunity or an Overestimated Ambition?

The expanding possibilities of artificial intelligence increasingly depend on data centers, which serve not only as spaces for storing and processing information but also as strategic pillars of energy security and digital sovereignty. Globally, demand for data center capacity could triple by 2030, with AI-driven workloads making up the majority of that growth (McKinsey, 2024; Goldman Sachs, 2024).

Where does Georgia fit into this process? Is the country ready to become a regional hub, or is it more realistic to remain a secondary player?

What are the global trends and why is energy the decisive factor?

According to Goldman Sachs, the spread of AI could increase global data center power consumption by 165% by 2030. By 2025, global demand is expected to surpass 82 gigawatts, equivalent to dozens of nuclear power plants. Investors are increasingly searching for locations where energy is stable, affordable, and low-carbon.

This competition is especially sharp in the region. Turkey is developing its market with large-scale investments, Azerbaijan—supported by European banks—is building sovereign cloud infrastructure, and Armenia is promoting smaller, specialized projects tailored to domestic needs.

What does this mean for Georgia?

Currently, only a few data centers operate in Georgia. The largest is Bitfury’s facility in Tbilisi, originally built for Bitcoin mining, with a capacity of around 40 MW. Smaller players like Cloud9 and WORLDBUS add to the landscape, but these numbers are far behind neighboring Turkey, which is planning a 100 MW AI-ready complex.

In this context, the planned tech park in Kutaisi, located in the former parliament building, has drawn attention. The project could allow Georgia to present itself as a technological hub, but its real significance will depend on parallel progress in energy and digital infrastructure.

Is energy Georgia’s strength or weakness?

Historically, Georgia has relied on hydropower, which accounts for about 79% of its electricity generation. This gives the country a “green energy” image attractive to international investors. Yet this advantage is undermined by seasonality. In winter, electricity imports surge—January 2025 imports were up 109% compared to the previous year. Despite its potential, Georgia cannot guarantee stability without diversifying generation into wind, solar, and storage systems.

Turkey enjoys the advantage of diversified supply, combining renewables with large natural gas imports. Azerbaijan, meanwhile, leverages its own oil and gas resources. Georgia’s strength lies in low-carbon output, but its weakness is seasonal shortfall.

How competitive is digital connectivity?

For years Georgia’s internet connectivity was limited, but this has started to change. The Black Sea fiber optic cable linking Georgia to Bulgaria provides a capacity of 12.6 Tbps. A new “Black Sea Digital Corridor” project aims to connect Georgia directly to Europe.

Turkey, however, is already linked to multiple subsea cables connecting Europe and Asia, while Azerbaijan is building its role as a transit hub between the Caspian and the Black Sea. Georgia’s geographic position is an advantage, but without more cables, backup networks, and higher capacity, it risks lagging behind.

How does climate affect data center development?

AI-ready data centers host high-power servers that generate significant heat and require effective cooling. In this sense, Georgia is in a mixed position. Its mountainous regions offer cooler climates, making data center operations more energy-efficient. For example, in northern and western areas, annual average temperatures are lower than in Turkey’s or Azerbaijan’s semi-desert zones.

On the other hand, summer temperatures in eastern Georgia often exceed 35°C, increasing cooling costs. Climate is therefore a double-edged factor: a potential advantage in some areas, but a vulnerability under global warming.

What is the state of human capital?

Efficient data center operations require highly qualified specialists. Georgia has a limited pool of such professionals, though new academic and research initiatives have emerged but still insufficient compared to regional competitors: Turkish universities partner directly with global companies, and Azerbaijan is strengthening its sovereign cloud through partnerships with Nokia and Gcore.

Does Georgia really need an AI data center?

This is the critical question. Building AI data centers requires significant capital and energy, but will they deliver enough economic return to justify the cost?

Georgia’s domestic market is small. Local companies and public institutions have limited demand for high-performance AI infrastructure. This means data centers cannot rely solely on domestic needs—their value depends on attracting regional or international clients. But here Georgia faces competition from Turkey and Azerbaijan, which already have scale and strong partnerships.

On the other hand, an AI data center in Georgia could be significant not so much for direct economic output as for digital sovereignty and geopolitical positioning. A country with its own infrastructure is less dependent on external actors and better able to protect data. Such facilities could also stimulate education and innovation, providing universities and startups with direct access to computing power.

Could this become a major sector for Georgia’s economy?

It is unlikely that AI data centers will become the central pillar of Georgia’s economy, which remains grounded in services. However, the sector could play an important complementary role, setting new standards for the technological ecosystem. Its economic contribution may be modest in the short term but strategically significant in the long term.

If investments are guided wisely, AI data centers could become more than just businesses: they could serve as tools for national security, education, and regional integration. If not, Georgia risks becoming only a peripheral player—an experimental site overshadowed by larger competitors.