diff --git a/examples/text-generation/quantization_config/act_maxabs_hw_weights_pcs_maxabs_pow2_quant.json b/examples/text-generation/quantization_config/act_maxabs_hw_weights_pcs_maxabs_pow2_quant.json
new file mode 100644
index 0000000000..3b69844e44
--- /dev/null
+++ b/examples/text-generation/quantization_config/act_maxabs_hw_weights_pcs_maxabs_pow2_quant.json
@@ -0,0 +1,10 @@
+{
+    "method": "HOOKS",
+    "mode": "QUANTIZE",
+    "observer": "maxabs",
+    "scale_method": "ACT_MAXABS_HW_WEIGHTS_PCS_MAXABS_POW2",
+    "whitelist": {"types": [], "names":  []},
+    "blacklist": {"types": [], "names":  ["lm_head"]},
+    "dump_stats_path": "./hqt_output/measure",
+    "dump_stats_xlsx_path": "./hqt_output/measure/fp8stats.xlsx"
+}
diff --git a/examples/text-generation/quantization_config/maxabs_measure.json b/examples/text-generation/quantization_config/maxabs_measure.json
new file mode 100644
index 0000000000..8db84a3b21
--- /dev/null
+++ b/examples/text-generation/quantization_config/maxabs_measure.json
@@ -0,0 +1,9 @@
+{
+    "method": "HOOKS",
+    "mode": "MEASURE",
+    "observer": "maxabs",
+    "whitelist": {"types": [], "names":  []},
+    "blacklist": {"types": [], "names":  ["lm_head"]},
+    "dump_stats_path": "./hqt_output/measure",
+    "dump_stats_xlsx_path": "./hqt_output/measure/fp8stats.xlsx"
+}
\ No newline at end of file
diff --git a/examples/text-generation/quantization_config/maxabs_quant.json b/examples/text-generation/quantization_config/maxabs_quant.json
new file mode 100644
index 0000000000..b83a880d65
--- /dev/null
+++ b/examples/text-generation/quantization_config/maxabs_quant.json
@@ -0,0 +1,10 @@
+{
+    "method": "HOOKS",
+    "mode": "QUANTIZE",
+    "observer": "maxabs",
+    "scale_method": "maxabs_hw",
+    "whitelist": {"types": [], "names":  []},
+    "blacklist": {"types": [], "names":  ["lm_head"]},
+    "dump_stats_path": "./hqt_output/measure",
+    "dump_stats_xlsx_path": "./hqt_output/measure/fp8stats.xlsx"
+}
\ No newline at end of file
diff --git a/examples/text-generation/quantization_config/unit_scale_quant.json b/examples/text-generation/quantization_config/unit_scale_quant.json
new file mode 100644
index 0000000000..0517bd784d
--- /dev/null
+++ b/examples/text-generation/quantization_config/unit_scale_quant.json
@@ -0,0 +1,10 @@
+{
+    "method": "HOOKS",
+    "mode": "QUANTIZE",
+    "observer": "maxabs",
+    "scale_method": "unit_scale",
+    "whitelist": {"types": [], "names":  []},
+    "blacklist": {"types": [], "names":  ["lm_head"]},
+    "dump_stats_path": "./hqt_output/measure",
+    "dump_stats_xlsx_path": "./hqt_output/measure/fp8stats.xlsx"
+}
diff --git a/examples/text-generation/run_generation.py b/examples/text-generation/run_generation.py
index ab308e7023..ecfbe15dca 100644
--- a/examples/text-generation/run_generation.py
+++ b/examples/text-generation/run_generation.py
@@ -22,6 +22,7 @@
 import json
 import logging
 import math
+import os
 import time
 from itertools import cycle
 from pathlib import Path
@@ -223,7 +224,7 @@ def setup_parser(parser):
     parser.add_argument(
         "--kv_cache_fp8",
         action="store_true",
-        help="Store kv-cache in float8 when kv-cache is used",
+        help="Store kv-cache in float8 when kv-cache is used. Can't use this argument together with QUANT_CONFIG env var",
     )
     parser.add_argument("--fp8", action="store_true", help="Enable Quantization to fp8")
     parser.add_argument(
@@ -239,6 +240,11 @@ def setup_parser(parser):
     if not args.use_hpu_graphs:
         args.limit_hpu_graphs = False
 
+    args.quant_config = os.getenv("QUANT_CONFIG", "")
+    if args.quant_config and args.kv_cache_fp8:
+        # can't use both quant_config and kv_cache_fp8, since quant_config may trigger kv cache quantization
+        # with habana quantization toolkit
+        raise parser.error("Can't use QUANT_CONFIG env var with kv_cache_fp8 argument")
     return args
 
 
@@ -539,6 +545,9 @@ def generate_dataset(batch):
         if prompt_length > 0:
             print(f"Graph compilation duration          = {compilation_duration} seconds")
         print(separator)
+    if args.quant_config:
+        import habana_quantization_toolkit
+        habana_quantization_toolkit.finish_measurements(model)
 
 
 if __name__ == "__main__":
diff --git a/examples/text-generation/run_lm_eval.py b/examples/text-generation/run_lm_eval.py
index f16c126af2..e59393d71b 100644
--- a/examples/text-generation/run_lm_eval.py
+++ b/examples/text-generation/run_lm_eval.py
@@ -78,6 +78,7 @@ def __init__(self, tokenizer, model, args, options):
         if self.model.config.model_type == "llama":
             self.model_inputs.update(
                 {
+                    "reuse_cache" : self.options.reuse_cache,
                     "attn_softmax_bf16": self.options.attn_softmax_bf16,
                 }
             )
@@ -125,10 +126,17 @@ def find_bucket(self, length):
         return [b for b in self.buckets if b >= length][0]
 
     def _model_call(self, inps):
-        seq_length = inps.shape[-1]
+        bs, seq_length = inps.shape
         padding_length = 0
         if self.options.static_shapes:
             bucket_length = self.find_bucket(seq_length)
+            if self.options.use_cache and self.options.reuse_cache:
+                self.model.allocate_kv_cache(
+                    bs,
+                    bucket_length + 1,
+                    bucket_length,
+                    False,
+                )
             padding_length = bucket_length - seq_length
             inps = F.pad(inps, (0, padding_length), value=self.model.config.pad_token_id)
         logits = self.model(inps.to(self._device), **self.model_inputs)["logits"].cpu()
@@ -164,6 +172,9 @@ def main():
                 print("{:35} = {} GB".format(k[:-5].replace("_", " ").capitalize(), v))
         json.dump(results, open(args.output_file, "w"), indent=2)
         print(json.dumps(results, indent=2))
+    if args.quant_config:
+        import habana_quantization_toolkit
+        habana_quantization_toolkit.finish_measurements(model)
 
 
 if __name__ == "__main__":
diff --git a/examples/text-generation/utils.py b/examples/text-generation/utils.py
index 5c03de7dc6..f7e94d82e5 100644
--- a/examples/text-generation/utils.py
+++ b/examples/text-generation/utils.py
@@ -96,7 +96,7 @@ def setup_distributed(args):
     args.global_rank = int(os.getenv("RANK", "0"))
 
 
-def setup_quantization(model):
+def setup_quantization(args, model):
     import habana_frameworks.torch.core as htcore
     from habana_frameworks.torch.core.quantization import _check_params_as_const, _mark_params_as_const
     from habana_frameworks.torch.hpu import hpu
@@ -104,8 +104,8 @@ def setup_quantization(model):
     print("Initializing inference with quantization")
     _mark_params_as_const(model)
     _check_params_as_const(model)
-
-    hpu.enable_quantization()
+    if not args.quant_config:
+        hpu.enable_quantization()
     htcore.hpu_initialize(model)
     return model
 
@@ -114,6 +114,8 @@ def setup_env(args):
     # Will error if the minimal version of Transformers is not installed. Remove at your own risks.
     check_min_version("4.34.0")
     check_optimum_habana_min_version("1.9.0.dev0")
+    #TODO: SW-167588 - WA for memory issue in hqt prep_model 
+    os.environ.setdefault('EXPERIMENTAL_WEIGHT_SHARING', 'FALSE')
 
     if args.global_rank == 0:
         os.environ.setdefault("GRAPH_VISUALIZATION", "true")
@@ -158,6 +160,9 @@ def setup_model(args, model_dtype, model_kwargs, logger):
         model = peft_model(args, model_dtype, logger, **model_kwargs)
     else:
         model = AutoModelForCausalLM.from_pretrained(args.model_name_or_path, torch_dtype=model_dtype, **model_kwargs)
+    if args.quant_config:
+        import habana_quantization_toolkit
+        habana_quantization_toolkit.prep_model(model)
     model = model.eval().to(args.device)
 
     if args.use_hpu_graphs:
@@ -178,7 +183,7 @@ def setup_distributed_model(args, model_dtype, model_kwargs, logger):
 
     logger.info("DeepSpeed is enabled.")
     deepspeed.init_distributed(dist_backend="hccl")
-    config = AutoConfig.from_pretrained(args.model_name_or_path, **model_kwargs)
+    config = AutoConfig.from_pretrained(args.model_name_or_path, torch_dtype=model_dtype, **model_kwargs)
     load_to_meta = model_on_meta(config)
 
     if load_to_meta:
@@ -227,6 +232,10 @@ def setup_distributed_model(args, model_dtype, model_kwargs, logger):
     model = model.module
     if model.config.model_type == "llama":
         patch_scoped_linear_all_reduce(model)
+    
+    if args.quant_config:
+        import habana_quantization_toolkit
+        habana_quantization_toolkit.prep_model(model)
     return model
 
 
@@ -359,7 +368,7 @@ def initialize_model(args, logger):
     tokenizer, model = setup_tokenizer(args, model)
     generation_config = setup_generation_config(args, model, tokenizer)
     if args.fp8:
-        model = setup_quantization(model)
+        model = setup_quantization(args, model)
     init_end = time.perf_counter()
     logger.info(f"Args: {args}")
     logger.info(f"device: {args.device}, n_hpu: {args.world_size}, bf16: {model_dtype == torch.bfloat16}")
diff --git a/optimum/habana/transformers/models/llama/modeling_llama.py b/optimum/habana/transformers/models/llama/modeling_llama.py
index d0e217c38d..136da16e84 100755
--- a/optimum/habana/transformers/models/llama/modeling_llama.py
+++ b/optimum/habana/transformers/models/llama/modeling_llama.py
@@ -39,7 +39,9 @@
 
 def update(prev, cur, dim, idx, inp_seq_len):
     orig_cur = cur
-    cur = cur.to(dtype=prev.dtype)
+    if prev.dtype == torch.float8_e4m3fn:
+        from habana_frameworks.torch.hpex.kernels.Fp8Ops import cast_to_fp8_v2
+        cur = cast_to_fp8_v2(cur, None, False, False, prev.dtype)[0]
     if cur.shape[2] > 1 and cur.shape[2] <= prev.shape[2]:
         # Initialize
         prev[:, :, :inp_seq_len, :].copy_(cur)
@@ -92,6 +94,32 @@ def __init__(self):
     def forward(self, x, y):
         return torch.matmul(x, y)
 
+class KVCache(torch.nn.Module):
+
+    def __init__(self):
+        super(KVCache, self).__init__()
+        self.cache = None
+        self.inp_seq_len = -1
+
+    def allocate(self, inp_seq_len, kv_cache_fp8, dtype, device, shape):
+        if self.cache is None or self.cache.shape != shape:
+            self.inp_seq_len = inp_seq_len
+            if kv_cache_fp8:
+                dtype = torch.float8_e4m3fn
+            self.cache = torch.zeros(shape, dtype=dtype, device=device)
+        else:
+            assert (
+                self.inp_seq_len == inp_seq_len
+            ), f"inp_seq_len must be the same. self.inp_seq_len:{self.inp_seq_len} inp_seq_len:{inp_seq_len}"
+            self.cache.fill_(0)
+
+    def get_shape(self):
+        if self.cache is None:
+            return None
+        return self.cache.shape
+
+    def forward(self, cur, dim, idx):
+        return update(self.cache, cur, dim, idx, self.inp_seq_len)
 
 class GaudiLlamaAttention(LlamaAttention):
     def __init__(self, config: LlamaConfig):
@@ -99,28 +127,19 @@ def __init__(self, config: LlamaConfig):
 
         self.matmul_qk = Matmul()
         self.matmul_av = Matmul()
-        self.past_key = None
-        self.past_value = None
+        self.k_cache = KVCache()
+        self.v_cache = KVCache()
         self.inp_seq_len = -1
+
         self.register_buffer("norm_factor", torch.tensor(1.0 / math.sqrt(self.head_dim)), persistent=False)
 
+
     def allocate_kv_cache(self, batch_size, max_seq_len, inp_seq_len, kv_cache_fp8):
-        key_shape = (batch_size, self.num_key_value_heads, max_seq_len, self.head_dim)
-        value_shape = (batch_size, self.num_key_value_heads, max_seq_len, self.head_dim)
-        if self.past_key is None or self.past_key.shape != key_shape:
-            self.inp_seq_len = inp_seq_len
-            device = self.k_proj.weight.device
-            dtype = self.k_proj.weight.dtype
-            if kv_cache_fp8:
-                dtype = torch.float8_e4m3fn
-            self.past_key = torch.zeros(key_shape, dtype=dtype, device=device)
-            self.past_value = torch.zeros(value_shape, dtype=dtype, device=device)
-        else:
-            assert (
-                self.inp_seq_len == inp_seq_len
-            ), f"inp_seq_len must be the same. self.inp_seq_len:{self.inp_seq_len} inp_seq_len:{inp_seq_len}"
-            self.past_key.fill_(0)
-            self.past_value.fill_(0)
+        cache_shape = (batch_size, self.num_key_value_heads, max_seq_len, self.head_dim)
+        device = self.k_proj.weight.device
+        dtype = self.config.torch_dtype
+        self.k_cache.allocate(inp_seq_len, kv_cache_fp8, dtype, device, cache_shape)
+        self.v_cache.allocate(inp_seq_len, kv_cache_fp8, dtype, device, cache_shape)
 
     def update_sincos_cache(self, seq_len):
         # Call rotary emb forward() to update cos/sin cache when infering more than self.max_position_embeddings
@@ -135,14 +154,14 @@ def reorder(self, tensor, beam_idx, dim_a, dim_b):
         tensor.copy_(updated)
 
     def reorder_kv_cache(self, beam_idx: torch.LongTensor):
-        if self.past_key is None:
+        if self.k_cache.cache is None:
             return (None, None)
 
-        head_dim = self.past_key.size(-1)
-        seq_length = self.past_key.size(-2)
-        self.reorder(self.past_key, beam_idx, seq_length, head_dim)
-        self.reorder(self.past_value, beam_idx, seq_length, head_dim)
-        return (self.past_key.shape, self.past_value.shape)
+        head_dim = self.k_cache.cache.size(-1)
+        seq_length = self.k_cache.cache.size(-2)
+        self.reorder(self.k_cache.cache, beam_idx, seq_length, head_dim)
+        self.reorder(self.v_cache.cache, beam_idx, seq_length, head_dim)
+        return (self.k_cache.cache.shape, self.v_cache.cache.shape)
 
     def pre_attn_forward(
         self,
@@ -212,17 +231,15 @@ def pre_attn_forward(
         if past_key_value is not None or reuse_cache:
             # reuse k, v, self_attention
             if reuse_cache:
-                past_key = self.past_key
-                past_value = self.past_value
+                key_states = self.k_cache(key_states, 2, token_idx)
+                value_states = self.v_cache(value_states, 2, token_idx)
             else:
-                past_key = past_key_value[0]
-                past_value = past_key_value[1]
-            key_states = update(past_key, key_states, 2, token_idx, self.inp_seq_len)
-            value_states = update(past_value, value_states, 2, token_idx, self.inp_seq_len)
+                key_states = update(past_key_value[0], key_states, 2, token_idx, self.inp_seq_len)
+                value_states = update(past_key_value[1], value_states, 2, token_idx, self.inp_seq_len)
 
         if use_cache:
             if reuse_cache:
-                past_key_value = (self.past_key.shape, self.past_value.shape)
+                past_key_value = (self.k_cache.get_shape(), self.v_cache.get_shape())
             else:
                 past_key_value = (key_states.contiguous(), value_states.contiguous())
         else:
@@ -289,11 +306,11 @@ def pre_attn_forward(
         return attn_output, attn_weights, past_key_value
 
     def attention_all_reduce(self, attn_output):
-        if self.o_proj.__class__ is ScopedLinearAllReduce:
+        if hasattr(self.o_proj, "all_reduce"):
             self.o_proj.all_reduce(attn_output)
 
     def post_attn_forward(self, attn_output):
-        if self.o_proj.__class__ is ScopedLinearAllReduce:
+        if hasattr(self.o_proj, "post_all_reduce"):
             self.o_proj.post_all_reduce(attn_output)
         return attn_output
 
@@ -322,13 +339,13 @@ def pre_mlp_forward(self, x):
         return output
 
     def mlp_all_reduce(self, x):
-        if self.down_proj.__class__ is ScopedLinearAllReduce:
+        if hasattr(self.down_proj, "all_reduce"):
             self.down_proj.all_reduce(x)
 
     def post_mlp_forward(self, x):
         if self.config.pretraining_tp > 1:
             return x
-        if self.down_proj.__class__ is ScopedLinearAllReduce:
+        if hasattr(self.down_proj, "post_all_reduce"):
             return self.down_proj.post_all_reduce(x)
         return x