POWER SECTOR OF MONGOLIA POLICY AND

CHALLENGES

Mr. YEREN-ULZII Batmunkh,

Head,
Investment and Production Division

Smart Energy Forum, Ulaanbaatar

14 May 2018
CONTENT

• Current State of Power Sector

• Policy Documents

• State Policy on Energy, 2015

• The Mid-term National Program for Implementation of State

Policy on Energy, 2018

• Key Projects of Power sectorin near term

• Cooperation Possibilities
 POWER SECTOR: SYSTEMS AND STATISTIC

Western Power System, 32 MW

Central Power System, 1166MW
Eastern Power System, 63 MW

Ulaanbaatar

Altai-Uliastai Power
System, 18 MW

Installed Capacity, 1366 MW Electricity Supply – 6.1 TWh in 2017

CHP/Coal CHP/Coa
/ l/
Renewabl 80.74%
es 76.55%
Import
/capacity 20.00%
is lower
than 5… Diesel
Diesel Solar Wind HPP 0.05% 3
1.35% 4.39% Solar Wind HPP
11.34% 1.68%
0.26% 2.03% 1.11% Source: National Statics Office, Energy Regulatory Committee
 POWER SECTOR: SYSTEMS AND STATISTIC

Source: Energy Regulatory Committee

 POWER SECTOR: SYSTEMS AND STATISTIC

CROSS BORDER INTERCONNECTION AND EXPORT AND

Chadan, Russia, 110 kV line connection
• Import 107 GWh /75% of western system/
IMPORT
Buryat Energo, Russia, 220 kV line connection
• Import 176 GWh /5% of central system/
• Export 54 GWh

IMPC, China, 220 kV line connection

10-35 kV line connections
• Import 1200 GWh /15% of central system/
5
 CHALLENGES IN POWER SECTOR

Recent Challenges:
• Capacity Shortage

Utilization of Installed Capacity in 8000 Domestic Production and Import,

CES,%, /Winter load/ 7000 GWh
97 94 94 94 98 6000
90 92 92 93
88 88
77 5000

4000

3000

2000

1000

0
CHP 2 CHP 3 CHP 4 CHP Dar CHP Erd CES
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

2016 2017 Domestic Production Import

6
 CHALLENGES IN POWER SECTOR

Daily load curve of Central power system, 5th Dec 2018

1200
Max transmission
1100 Import capacity of import line
Solar PVs from Russia, 240 MW
1000
Wind Farms
900

800

700

600
CHP#4, 703 MW
500
Coal fired thermal
400 power plants

300

200 CHP#3, 186 MW

100

0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
CHP#2, 21.5 MW Darkhan CHP, 48 MW
Erdenet CHP, 28.8 MW Erdenet Copper CHP 53, MW
Dalanzadgad CHP, 9 MW Ukhaa PP, 18 MW
CHP#3, 186 MW CHP#4, 703 MW
Solar 35 MW: Gegeen+Monnaran+Khongor Wind 155 MW: Salkhit+Tsetsii+Sainshand 7
Import from Russia
 CHALLENGES IN POWER SECTOR

Recent Challenges:
• Aged equipment

Utilization of Existing main Power Plants Aging of Distribution Network in UB

60 1400 700

Number of Transformations
56

Length, km
Year

52
49 48 1200 600
50

40 1000 500
34
31 800 400
30
600 300
20 17
400 200
10
200 100
0
ДЦС-2 ДЦС-3 ДЦС-4 ДДЦС ЭДЦС ДоДЦС ДзДЦС
0 0
5-10 жил 15-30 жил 35-50 жил 55-аас дээш

35, 10, 6 кВ-ын ЦДАШ 6, 10 кВ-ын ЦДКШ

35/10-6, 6-10кВ-ын трансформатор

8
 CHALLENGES IN POWER SECTOR

Recent Challenges:
• Efficiency

16

14 13*

12 Transmission and Distribution loss, %

10
10
8
8 7
6
6 5
4 4
4 3
2

9
* - excluding OT import
 STATE POLICY ON ENERGY 2015-2030

Mongolian Parliament approved “State Policy on Energy” in 2015

Vision

To fully provide reliable operation of the energy

sector, energy security, sustainable development and
economic growth of the country and become an
energy exporting country with efficient and
environmentally friendly technology based on
regulated and competitive market dominated by
private sector

10
 STATE POLICY ON ENERGY 2015-2030

“State Policy on Energy” 2015-2030

PRIORITY AREAS AND STRATEGIC GOALS

SAFETY • Ensure energy safety and
• Transfer the state reliable supply
dominated energy sector • Develop mutually beneficial
into private based cooperation with regional
competitive market countries
• Support innovation and • Develop a human resource
advanced technology in
energy sector, and
STATE POLICY
implement conservation
ON ENERGY
policy

EFFICIENCY ENVIRONMENT
• Increase the production share of renewables and
reduce negative environmental impact from
traditional power generation and greenhouse11gas
 STATE POLICY ON ENERGY 2015-2030

“State Policy on Energy” 2015-2030

Expected Results
In the 1st stage 2015-2023: The stage to develop energy safety resources and
backup capacity, establish a foundation for the development of renewable,
enhance normal documents and improve legal environment.
• The installed power capacity will be doubled, and start using critical
technology with high parameters. Hydro will be taken place at least 10% of the
total installed power capacity and it will increase backup capacity to 10%, and
create fundament for renewable sector to development intensively, enhance
tariff system.

In the 2nd stage 2024-2030: The stage to export secondary energy and
develop sustainably the renewable sector.
• The backup capacity of power system will be reach at 20% and share of
renewables will be reach at 30%. Integrated smart energy system will be
created by connecting regions with high capacity transmission lines. State
owned Power companies will be become a public company. Distribution and
supply service will be privatized and energy sector will be worked as a
competitive marked with regulation. Secondary energy will be exported by
connecting with North east Asian countries with high capacity DC lines.
 THE MID-TERM NATIONAL PROGRAM FOR
IMPLEMENTATION OF THE STATE POLICY ON ENERGY
(2018-2023)

“Mid-term National Program for Implementation of the State Policy on Energy 2018-
2023” was approved by Government resolution on 24th Oct 2018.

Nexus between State Policy on

Energy and The mid-term National
Program Vision

Strategic Strategic State Policy on

Goal Goal ……. Energy,
15 years

Objectives Objectives ….

Actions
Mid-term National Program for
Actions Implementation of the State Policy
Actions on Energy,
How to implement 5 years
……….
the Goals and
Objectives?

13
 THE MID-TERM NATIONAL PROGRAM FOR
IMPLEMENTATION OF THE STATE POLICY ON ENERGY
(2018-2023)

4.1.Fuel supply projects

Estimated cost*
№ Projects Funding sources
/Billion tugrugs/
1 Capacity expansion of Baganuur mine 450 IPO, long term soft loan
2 Capacity expansion of Shivee-Ovoo mine 287,6 IPO, long term soft loan

4.2.Power plant projects

Estimated cost*
№ Projects Funding sources
/Billion tugrugs/

4.2.1. Export oriented

1 Shivee-Ovoo complex /mine expansion, 5280 MW power plant 17500 Foreign direct investment
4.2.2 Domestic supply projects
4.2.2.1 Capacity expansion and modernization of existing plants
1 Capacity expansion of Darkhan CHPP 35 MW 67 Long term soft loan from foreign sources

Renovation of turbine of the CHPP 4, 89 MW 233,4 Long term soft loan from domestic and
2 foreign sources

3 Capacity expansion of Erdenet CHPP 35 MW 127 Long term soft loan from foreign sources

4 Capacity expansion of Dornod CHPP 50 MW 160 Soft loan from domestic source

5 Capacity expansion of CHPP -3’s high pressure section 75 MW 230.8 Soft loan from domestic source

Expansion of Amgalan heat plant by combined heat and power plant 120.5 Soft loan from domestic source
6
with 50 MW
7 Capacity expansion of CHPP 3 by 250 МВт 1016 Long term soft loan from foreign sources

Capacity expansion of CHPP 2 by 300 MW/ including one block of gas 723 Long term soft loan from foreign sources
8 turbine and generator/

*- at current price of 2018

 THE MID-TERM NATIONAL PROGRAM FOR
IMPLEMENTATION OF THE STATE POLICY ON ENERGY
(2018-2023)

4.2.Power plant projects (continued)

Estimated cost*
№ Projects Funding sources
/Billion tugrugs/

4.2.2.2 New power plant projects

1 Tavantolgoi power plant 2500 Private investment

A new power plant for the central region /Baganuur700MW,

2 2200 Public-private partnership
Booroljuut 300 MW/

3 Power plant for Altai-Uliastai system/100 MW/ 441 Public-private partnership

4 Power plant for western 5 aimags 300 Public-private partnership

Heat plants for Arkhangai, Bayankhongor, Gobi-Sumber, Dundgobi,

5 367,5 Long term soft loan from foreign source
Zavkhan, Ovorkhangai, Khentii, Sukhbaatar, and Tuv aimag centers

4.2.2.3 Renewables including hyfro

1 315 MW hydropower plant at Egyn Gol 1987,7 Long term soft loan from foreign source

2 Erdeneburen hydropower plant 700 Long term soft loan from foreign source

3 Big sized battery storage 100 МW 590,4 Long term soft loan from foreign source

4 SREP 30MW 159,8 SREP grant and soft loan

5 60 MW solar PV 120 Private investment

6 100 MW wind farms 482 Private investment

*- at current price of 2018

 THE MID-TERM NATIONAL PROGRAM FOR
IMPLEMENTATION OF THE STATE POLICY ON ENERGY
(2018-2023)

4.3.Power and heat transmission projects *- at current price of 2018

Estimated cost*
№ Projects Funding sources
/Billion tugrugs/
1 UB-Mandalgobi 330 kV, 2 circuit 260 km OHTL and substation 291 Long term soft loan from foreign source
2 220/110/35/6 kV Choir substation expansion 30.0 PPP

3 Choir-Sainshand-Zamyn Uud 220 kV 2 circuit 404 km OHTL and substation 250 Long term soft loan from foreign source

220 kV 2 circuit 118 km OHTL between Baganuur substation and Ulaanbaatar

4 76.1 Long term soft loan from foreign source
substation, and expansion of substations

5 110 kV OTHL between Taishir HPP and Esonbulag soum and substation 11.2 State budget

Baganuur-Undorkhaan-Choibalsan 220 kV 2 circuit 518 km OHTL and

6 270 Long term soft loan from foreign source
expansion of 220 kV substation
220 kV 2 circuit 178 km OHTL between Baganuur substation and Choir
7 88 Long term soft loan from foreign source
substation, expansion of Baganuur substation
State budget, Long term soft loan from
8 Uliastai-Dorgon-Myangad 220 kV 2 circuit 380 OHTL 240
foreign and domestic source

9 Technical study for ultra high voltage OHTL between Ulaanbaatar-Uliastai 0,5 State budget, soft loan and grant

Long term soft loan from foreign and

10 Expansion and renovation for the central power transmission system 57,1
domestic source
Energy loss reduction for Erdenet Bulgan, and Baganuur South distribution
11 73,5 Long term soft loan from foreign source
system
12 Energy efficiency project for Ulaanbaatar district heating system 36,7 Long term soft loan from foreign source
Planning and construction of small scale district heating systems for remote
13 38 Long term soft loan from foreign source
ger distrct areas

14 Expansion and renovation of district heating systems urban areas 20 State budget, internal capital investment

Increase coverage of digital control and information system of power and heat Internal capital investment, soft loan and
15 20
transmission and distribution systems, and digitalization substation control grant
 THE MID-TERM NATIONAL PROGRAM FOR
IMPLEMENTATION OF THE STATE POLICY ON ENERGY
(2018-2023)

Key projects that need to be implemented in the urgent matter

Generation recourses to stabilize load fluctuation 1200

Daily load curve of Central power system, 5th Dec 2018

•
Max transmission
Hydro Power Plants 1100

Solar PVs
Import capacity of import
line from Russia,
1000
240 MW
To Peak
• Eg HPP, Erdenburen HPP load 900
Wind Farms

Regulation 800

•
700
Gas Turbines 600

•
CHP#4, 703 MW

Create gas turbine units using infrastructure of 500

400
Coal fired
thermal power

existing CHP’s 300

plants

200
CHP#3, 186 MW

• Storages in Central Power System 100

• Hydro Pumped storage 100 MW or above 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

• Big sized battery storage 100 МW 17

17
 THE MID-TERM NATIONAL PROGRAM FOR
IMPLEMENTATION OF THE STATE POLICY ON ENERGY
(2018-2023)

Key projects that need to be implemented in the urgent matter

Capacity Extension Projects on Existing CHPs in short-term
• Capacity expansion of CHPP -3’s high pressure section 75 MW
• Expansion of Amgalan heat plant by combined heat and power plant with 50 MW
• Capacity expansion of CHPP 3 by 250 МВт
• Capacity expansion of CHPP 2 by 300 MW/ including one block of gas turbine and generator/

Expansion of regional power transmission networks

• 220 kV 2 circuit 118 km OHTL between Baganuur substation and Ulaanbaatar substation, and
expansion of substations
• Choir-Sainshand-Zamyn Uud 220 kV 2 circuit 404 km OHTL and substation
• 220 kV 2 circuit 178 km OHTL between Baganuur substation and Choir substation, expansion

213 (max 235)

-9

of Baganuur substation (119) (52) - 180 - 61

-6

-5

- 462 (710) - 12
-8 -6
- 25 (23)
(80)
-6 (6) - 16

-5

- 10
-7 -8

- 10 - 10 (2)
-8 (6) -7 (109)

- 10 (8)

- 6 (15)
18
- 15 (78)

-7 (10) - 150 (150)

 COOPERATION POSSIBILITIES ON THE PROJECTS

• For planned and potential projects of power plant and transmission lines:
– As a financier, Contractor, Equipment supplier, Consulting service
• Concession agreement: Built-Operate-Transfer, . . . . . . . . .
• Independent Power Producer

• For existing power projects:

– In the Projects of Operational enhancement and Restructuring:
• Operator company
• Consultant
– In the Projects of Rehabilitation and Capacity Extension:
• Investor, Contractor, Equipment supplier, Consulting service

19
THANK YOU