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Renewable energy

Mongolia has abundant renewable energy potential, especially solar and wind power. Addressing national energy security, the Vision-2050 aims to become self-sufficient in energy production in the first stage, reduce coal-sourced energy, and in the second stage to become an exporter of energy. One of the ways to fulfill this goal is the development of the renewable energy sector. In order to support economic growth, effectively implement the long-term development policy of Mongolia Vision-2050, and improve the productivity of the government. Furthermore, as per the New Recovery Policy, Mongolia aims to develop renewable energy in an appropriate ratio, build hydropower and storage stations, and ensure the reliability and stability of the integrated energy system. In Mongolia, the installed capacity of renewable energy production reached 286 MW, accounting for 18.1 percent of the total installed capacity and 9.2 percent of production. Due to the difference in tariffs, 27 percent of the total sales revenue is allocated to these sources.

Renewable energy sector opportunities:

Legal Framework

 The Law on Renewable Energy dated 11 January 2007 sets the legal basis for use of renewable energy facilities, production and transmission, rights and obligation of renewable energy license holders and tariffs. Under the Renewable Energy Law, the energy sector’s central administrative organisation is the Ministry of Energy which is mainly responsible for developing and implementing government policy on renewable energy. The Energy Regulatory Commission (ERC) is also responsible for setting tariffs for electricity, issuing a license for some type of activities, and approve the contract template connected to the transmission network, and to monitor the implementation of the contract. Furthermore, the Energy Law dated 1 February 2001 is one of the main laws regulating the energy sector and details all types of energy licenses such as energy generation, transition, distribution, construction of energy facilities and so on.

Licensing requirements

According to the Energy Law, most of the activities relating energy sector are subject to relevant licenses. The ERC is the main regulatory body oversees licensing and monitors performance of license holders in accordance with the applicable laws.

Feed in tariffs

Renewable Energy Law provides the feed-in tariff scheme which ranges for on-grid installations as follows:

❑ Wind: up to USD 0.085/kWh,

❑ Solar: up to USD 0.12/kWh, and

❑ Hydropower up to 5 MW: USD 0.045-0.06/kWh.

Geography and climate

Bordered on the north by Russia and on the east, south and west by China, Mongolia has a total area of one point five million square kilometers, making it the nineteenth largest country in the world and the second largest landlocked country. For administrative purposes, the territory is divided into three cities and twenty-one provinces (aimags). The most significant population center is the capital Ulaanbaatar, home to approximately 1.3 million people.

Mongolia is situated on a plateau far from any oceans, with average elevation of one and a half kilometers. 5 This gives it an extreme continental climate which varies considerably across the country and between the seasons. Broadly speaking, elevation is lowest in the east of the country, rising to the Altai mountain range in the west. Mongolia’s highest point is a mountain peak marking the western border between Mongolia, Russia and China. Travelling from north to south, one would go from Siberian forests and lakes, pass through open steppe grassland and mountains, and ultimately reach the Gobi desert.

The country has long cold winters and short warm summers. Winters are dry and summer rainfall rarely exceeds three hundred and eighty millimeters in the mountains and is less than fifty millimeters in the desert areas. 6 Temperatures in Ulaanbaatar can regularly exceed thirty degrees Celsius from mid-June to mid-August, but are also often below minus thirty degrees Celsius in winter. Spring and autumn are unpredictable and snow can be seen in early June or late August. However, spells of warm weather also occur at early as April and as late as October.