Mongolia : Upscaling Renewable Energy Sector Project
The proposed project will support to (i) deploy the distributed renewable energy systems in remote and less developed regions in Mongolia, and (ii) enhance capacity of local public utilities in investment planning, project management, and grid control for sustainable renewable energy upscaling in the targeted region. Upon successful completion, the project delivers clean electricity to 70,000 households while annually avoiding 82,789 tons of carbon dioxide emission.
The impact will be imported electricity reduced and energy security improved. The outcome will be renewable energy supply in the country increased. The output will be (i) renewable energy capacity addition for electricity and heating supply in remote grid systems implemented, and (ii) capacity of local public utilities in investment planning, project management, and grid control enhanced.
Project Details
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Project Officer
Dagva, Byambatuya
Sectors Group
Request for information -
Country/Economy
Mongolia -
Modality
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Sector
- Energy
Related Projects
Project Name | Upscaling Renewable Energy Sector Project | ||||||||||||
Project Number | 50088-002 | ||||||||||||
Country / Economy | Mongolia |
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Project Status | Active | ||||||||||||
Project Type / Modality of Assistance | Grant Loan |
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Source of Funding / Amount |
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Strategic Agendas | Environmentally sustainable growth Inclusive economic growth |
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Drivers of Change | Governance and capacity development Knowledge solutions Partnerships |
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Sector / Subsector | Energy / Renewable energy generation - solar - Renewable energy generation - wind |
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Gender | No gender elements | ||||||||||||
Description | The proposed project will support to (i) deploy the distributed renewable energy systems in remote and less developed regions in Mongolia, and (ii) enhance capacity of local public utilities in investment planning, project management, and grid control for sustainable renewable energy upscaling in the targeted region. Upon successful completion, the project delivers clean electricity to 70,000 households while annually avoiding 82,789 tons of carbon dioxide emission. The impact will be imported electricity reduced and energy security improved. The outcome will be renewable energy supply in the country increased. The output will be (i) renewable energy capacity addition for electricity and heating supply in remote grid systems implemented, and (ii) capacity of local public utilities in investment planning, project management, and grid control enhanced. |
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Project Rationale and Linkage to Country/Regional Strategy | Mongolia currently has a total of 969 megawatt (MW) of installed capacity, but because of aging power facilities that are well past their economic life, only 769 MW is available. Growing power demand over the decade has also pressured such obsolete power system. It resulted in increasing high cost imported electricity which meets around 20% of the country's power demand in 2015. The energy sector in Mongolia relies heavily on coal-fired power generation which accounts for 91% of total installed capacity. Such coal dependent power system has contributed to over 63% of carbon dioxide emission in the country which is the world's fifth most carbon-intense economy; whereas the country has tremendous renewable energy potential which could sufficiently meet long term domestic demand. Promoting a diversified energy mix with a higher share of renewable energy is a core priority both to reduce dependence on high cost imported electricity and to decarbonize the country's energy sector. The Government of Mongolia has taken several initiatives for renewable energy deployment since 2000, most notably (i) implementing the successful 100,000 Solar Ger Electrification Program (20002012) which provided access to modern energy to nomadic herders through solar home systems, and (ii) enacting the Law on Renewable Energy, which involves a set of regulatory arrangements with a US dollar denominated feed-in-tariff, facilitated the development of 50 MW Salkit wind firm, the first private power producer. However, a share of renewable energy in total capacity still stands at 7.6%. The country's power system is comprised of four grid systems which has successfully expanded electricity access to 97% of the population. The central energy system, which covers around 90% of power demand in the country, has already attracted a total of around 200 MW of private sector-led renewable energy projects so far. On the other hand, the other three grid systems in remote and less developed regions which supply power to 32% of the population, and witnessed above 10% of annual load demand growth for the last five years, has failed to attract private investment in renewable energy development due to smaller size of power demand, high transportation cost, and relatively lower renewable energy resource endowments. Inadequate investment in power generation capacity addition for remote grid systems has led to heavy dependence on imported electricity from neighboring countries to meet up to 70% of load demand in geographically scattered load centers, through long stretched transmission lines which has resulted in very high power loss. To address such unique challenges in remote grid systems, the government has sought to develop the first-of-its-kind distributed energy system utilizing renewable energy potential. It is comprised of a smaller scale and modular renewable energy system, which locally produces reliable electricity and thermal energy for local use while minimizing transmission loss. |
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Impact | Greenhouse gas emissions reduced and imported electricity reduced |
Project Outcome | |
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Description of Outcome | Clean sources of energy supply in the country increased |
Progress Toward Outcome | The Altai soum hybrid system was inaugurated in Aug 2022, the 5MW Uliastai solar PV package was inaugurated in Nov 2022 and the 10MW Altai solar PV was inaugurated in Sep 2023. The 10MW Moron solar PV works are ongoing. The SGHP Batch 1 (Khovd) was commissioned and turned over in Sep 2021 and accepted in Jan 2022. SGHP Batch 2 (Uiastai) was completed and commissioned in Apr 2023. |
Implementation Progress | |
Description of Project Outputs | Distributed renewable energy system developed Shallow-ground heat pump system developed Institutional framework strengthened and organizational capacity enhanced |
Status of Implementation Progress (Outputs, Activities, and Issues) | 1) - 5MW Uliastai solar PV: Technical commission was done in Oct 2022 and state commission was done in Nov 2022. The plant started to supply electricity to the soum grid from 26 Nov 2022. - Altai soum hybrid system: Technical and state commissioning was completed in Jul 2022. The plant started to supply electricity to the soum grid from 28 Jun 2022. The hybrid energy system was inaugurated in Aug 2022. - 10MW Altai solar PV: The plant started to supply electricity to the soum grid from Sep 2023. - 10MW Umunogovi wind and 5MW Telmen wind: Feasibility study for a combined subproject is being finalized. Bidding is targeted in Q4 2023. - 10MW Moron solar PV: Works are ongoing and expected to be completed by Oct 2023. 2) - SGHP Batch 1 (Khovd): The system was commissioned and turned over in Sep 2021, and accepted in Jan 2022. - SGHP Batch 2 (Uliastai and Bayankhongor): Uliastai was completed and commissioned in Apr 2023. Bayankhongor SGHP works are ongoing. - SGHP Batch 3 (Ulaangom and Altai): Works are ongoing.3) Contract for training of AUES staff for solar and battery storage systems has been signed by MOE on 21 Mar 2023 and submitted to ADB in Apr/May 2023. Training to be completed by Nov 2023.The consultant has submitted first draft of investment plan to PMU on 16 Jun 2020. Electricity and heat demand forecasts were prepared, and least cost supply expansions modelled in 2021/2022. Investment planning activities can resume with the Investment Plan/Renewable Energy Policy completed by end of May 2023. |
Geographical Location | Nation-wide |
Safeguard Categories | |
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Environment | B |
Involuntary Resettlement | C |
Indigenous Peoples | C |
Summary of Environmental and Social Aspects | |
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Environmental Aspects | The safeguard category for the first batch is B in environment. An initial environmental examination and an environment management plan will be prepared for the subsequent batches to demonstrate adherence to ADB's Safeguard Policy Statement (2009), and national law and regulations. |
Involuntary Resettlement | The safeguard category for the first batch is C in land acquisition and resettlement. A resettlement framework will be prepared for the subsequent batches to guide environment and social impact assessments and safeguard implementation while ensuring adherence to ADB's Safeguard Policy Statement, and national law and regulations. |
Indigenous Peoples | The tentative safeguard category for the first batch is C in indigenous people. An indigenous peoples planning framework will be prepared for the subsequent batches to guide environment and social impact assessments and safeguard implementation while ensuring adherence to ADB's Safeguard Policy Statement, and national law and regulations. |
Stakeholder Communication, Participation, and Consultation | |
During Project Design | |
During Project Implementation |
Business Opportunities | |
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Consulting Services | The consulting services will be implemented over an 18-month period and is expected to start in November 2016 and be completed in April 2018. The technical assistance (TA) will require a total of 28 person-months of international and 65 person-months of national consulting services. The consulting firm will be engaged by ADB using the quality-and cost-based method with a standard quality and cost ratio of 90:10, in accordance with the Guidelines on the Use of Consultants (2013, as amended from time to time). The proceeds of the TA will be disbursed in line with ADB's Technical Assistance Disbursement Handbook (2015, as amended from time to time). |
Responsible ADB Officer | Dagva, Byambatuya |
Responsible ADB Department | Sectors Group |
Responsible ADB Division | Energy Sector Office (SG-ENE) |
Executing Agencies |
Ministry of Energy |
Timetable | |
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Concept Clearance | 09 Nov 2016 |
Fact Finding | 30 Apr 2018 to 09 May 2018 |
MRM | 25 Jun 2018 |
Approval | 20 Sep 2018 |
Last Review Mission | - |
Last PDS Update | 28 Sep 2023 |
Grant 0610-MON
Milestones | |||||
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Approval | Signing Date | Effectivity Date | Closing | ||
Original | Revised | Actual | |||
20 Sep 2018 | 02 Nov 2018 | 12 Feb 2019 | 29 Feb 2024 | - | - |
Financing Plan | Grant Utilization | ||||
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Total (Amount in US$ million) | Date | ADB | Others | Net Percentage | |
Project Cost | 6.00 | Cumulative Contract Awards | |||
ADB | 0.00 | 19 Oct 2023 | 0.00 | 5.91 | 98% |
Counterpart | 0.00 | Cumulative Disbursements | |||
Cofinancing | 6.00 | 19 Oct 2023 | 0.00 | 6.00 | 100% |
Status of Covenants | ||||||
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Category | Sector | Safeguards | Social | Financial | Economic | Others |
Rating | - | Satisfactory | Satisfactory | Satisfactory | - | Partly satisfactory |
Grant 0611-MON
Milestones | |||||
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Approval | Signing Date | Effectivity Date | Closing | ||
Original | Revised | Actual | |||
20 Sep 2018 | 02 Nov 2018 | 12 Feb 2019 | 29 Feb 2024 | - | - |
Financing Plan | Grant Utilization | ||||
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Total (Amount in US$ million) | Date | ADB | Others | Net Percentage | |
Project Cost | 14.60 | Cumulative Contract Awards | |||
ADB | 0.00 | 19 Oct 2023 | 0.00 | 7.07 | 48% |
Counterpart | 0.00 | Cumulative Disbursements | |||
Cofinancing | 14.60 | 19 Oct 2023 | 0.00 | 7.08 | 48% |
Loan 3708-MON
Milestones | |||||
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Approval | Signing Date | Effectivity Date | Closing | ||
Original | Revised | Actual | |||
20 Sep 2018 | 02 Nov 2018 | 12 Feb 2019 | 29 Feb 2024 | - | - |
Financing Plan | Loan Utilization | ||||
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Total (Amount in US$ million) | Date | ADB | Others | Net Percentage | |
Project Cost | 45.62 | Cumulative Contract Awards | |||
ADB | 40.00 | 19 Oct 2023 | 20.90 | 0.00 | 52% |
Counterpart | 5.62 | Cumulative Disbursements | |||
Cofinancing | 0.00 | 19 Oct 2023 | 9.90 | 0.00 | 25% |
Status of Covenants | ||||||
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Category | Sector | Safeguards | Social | Financial | Economic | Others |
Rating | - | Satisfactory | Satisfactory | Satisfactory | - | Satisfactory |
Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.
The Access to Information Policy (AIP) recognizes that transparency and accountability are essential to development effectiveness. It establishes the disclosure requirements for documents and information ADB produces or requires to be produced.
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Safeguard Documents See also: Safeguards
Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.
Evaluation Documents See also: Independent Evaluation
None currently available.
Related Publications
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The Access to Information Policy (AIP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.
Requests for information may also be directed to the InfoUnit.
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Tenders
Contracts Awarded
Contract Title | Approval Number | Contract Date | Contractor | Address | Executing Agency | Total Contract Amount (US$) | Contract Amount Financed by ADB (US$) |
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DEIA for non-core subprojects | Loan 3708 | 24 Jun 2022 | Offset Consulting LLC | Ulaanbaatar, Mongolia | Ministry of Energy | 104,292.10 | 104,292.10 |
EPC for static var generator | Loan 3708 | 29 Jun 2022 | JV of Richwell Engineering LLC and NR Electric Co. Ltd. | Room 103, City Tower, Chinggis Khaan Square 5, Sukhbaatar District, Ulaanbaatar, 14280, Mongolia | Ministry of Energy | 1,145,846.00 | 1,145,846.00 |
10MW Altai solar PV | Grant 0611 | 16 May 2022 | MCS International LLC | Shangri-La office 7 floor 704 Olympics Street 19A 1 section Sukhbaatar district Ulaanbaatar 14241 | Ministry of Energy | 5,830,000.00 | — |
10MW Altai solar PV | Loan 3708 | 19 May 2022 | MCS International LLC | Shangri-La office, 7 floor 704, Olympics street 19A, 1 section, Sukhbaatar district, Ulaanbaatar, 14241 | Ministry of Energy | 10,442,254.00 | 4,612,254.00 |
10 MW Moron solar PV | Loan 3708 | 10 May 2022 | Xian Electric Engineering Co. Ltd. and Changjiang Survey Planning Design & Research Co. Ltd | No. 7 Tangxing Road, Xian, Shaanxi, PRC / No. 1863 Jie Fang Avenue, Wuhan City, Hubei, PRC | Ministry of Energy | 9,498,866.00 | 9,498,866.00 |
Pkg 12: Hybrid system of Altai soum | Loan 3708 | 10 Aug 2021 | Consortium of ESPM International LLC and Shuangdeng Group Co., Ltd. | Suite 11, 107 Building, Chinggis Avenue, 2nd Khoroo, Khan-Uul district, Ulaanbaatar City | Ministry of Energy | 1,078,936.00 | 1,078,936.00 |
5MW ULIASTAI SOLAR PV | Loan 3708 | 20 Mar 2021 | JGC CORP-NGK INSULATORS LTD-MCS INTL LLC JV | 2-3-1, MINATO MIRAI, NISHI-KU, YOKOHAMA 220-6001, JAPAN JAPAN | Ministry of Energy | 7,533,236.73 | 2,510,166.37 |
PROJECT MANAGEMENT CONSULTANTS | Loan 3708 | 15 Aug 2019 | INTEGRATION ENVIRONMENT & ENERGY GMBH/RINA C | GERMANY GERMANY | Ministry of Energy | 1,548,347.00 | 548,347.00 |
Procurement Plan
Title | Document Type | Document Date |
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Upscaling Renewable Energy Sector Project: Procurement Plan | Procurement Plans | Dec 2022 |