On March 22, the sixth annual Georgian International Oil, Gas, Energy and Infrastructure Conference began in Tbilisi. The event, embracing everything from transportation to energy security, caps a week of energy announcements from the government.

For the past two years, the idea of energy security – and diversifying energy suppliers – has been political holy ground. The usually divided opposition and majority parties have all come out in support of breaking Georgia’s ties to Russian energy. While the idea is popular at home, reality has been more complicated.

A few days before the conference opened, Energy Minister Nika Gilauri announced that nearly half of Georgia’s gas needs were provided by non-Russian sources, in his words a “historic moment” for the country’s energy security. While his statements were a tremendous step back from Georgian President Mikheil Saakashvili’s 2006 promise to break consumption of Russian gas completely, they do mark a victory for a country which has traditionally looked north for all its gas needs – and most of its electricity.

According to Gilauri, Georgia is consuming a million cubic meters from Azerbaijan’s Shah-Deniz field (at $62.50 per 1000 cubic meters), 1.3 million cubic meters from Azerbaijan’s State Oil Company (at $120 per 1000 cubic meters), 700,000-800,000 cubic meters as a transit fee for transporting Russian gas to Armenia, and finally 2.5 million cubic meters from Gazprom (at $235 per 1000 cubic meters).

The Shah-Deniz pipeline was re-launched on March 17 after technical problems forced it to stop its flow to Georgia in January, at the height of the gas negotiations with Russia.

On March 21, the energy minister also noted that the government is considering constructing gas storage units in Georgia. The proposal has come and gone from political favor over the past decade; according to reports, at least two feasibility studies have already been conducted on the project. Gilauri did not go into details, instead promising one more feasibility study to look into the idea. He did note two potential locations: Rustavi in the southeast of the country and Ninotsminda in the southwest.

Proponents of gas storage maintain it is the best source of security for a country with limited energy trading partners. A case in point occurred in 2006. When an unexplained “accident” in southern Russia cut gas supplies to Georgia in the middle of winter, Armenia did not suffer although it relies heavily on Russian gas and specifically that very pipeline, due to its own storage facilities.

United States diplomats have also been in the region over the past month to discuss energy security, and the U.S. government-funded Millennium Challenge Georgia Fund is already in the “active implementation” stage of its work on the two-year North-South Gas Pipeline rehabilitation project. On March 15, U.S. Deputy of Energy Clay Sell visited Georgia and supported the prospect of additional volumes of gas from the Shah-Deniz pipeline being made available to Georgia.

Georgia’s ongoing struggle to increase its energy independence has taken on international significance in light of Russia’s increased oil and gas revenues and assertive use of that instrument. The Shah-Deniz pipeline is just the latest in a series of gas and oil pipeline projects that are criss-crossing the region.

The country has few options. While some rehabilitation in the electricity sector has improved service – Georgia is enjoying its second year of nearly 24 hour electricity throughout the country – gas supplies remain a problem. The country is well situated for hydropower, but that is somewhat limited by seasonal weather and is hampered by the need for overdue reforms. Attempts to boost the energy sector via privatization got off to a rocky start when the government had to renegotiate prices after the winning company, Energy-Pro, backed out of its original bid this summer.

The government’s continued efforts to diversify energy supplies, particularly gas supplies, are laudable. However, there is a limit to what Tbilisi can do: on the one hand it wants to limit dependence on Russia, but on the other hand it cannot for political reasons become increasingly dependent on Iran. While Azerbaijan is a gas supplier, it does not currently have the supplies to be a major help for Georgia either. Turkey itself is looking for new pipelines to feed its need and bring gas to Central and Western Europe.

As long as the government continues to use the subject as political firewood, it will run the risk of disappointing Georgians with unrealistic expectations. A realistic look at the geopolitical – and natural – resources could make the transitional period easier.