The Minister of Energy, D.Zorigt, participated in the Prime Minister’s “30 Minutes with the Minister” online meeting on March 12, to give information about the current state of the energy sector, as reported by Montsame News Agency.
He said that heating and electricity plants built from 1960 to 1980 require immediate maintenance and renovations. “We have not commissioned any new power plants, however, power consumption is increasing dramatically. Our country takes 20 percent of its energy needed from sources of our two neighboring countries. Major projects and programs are being discussed, yet they have stagnated for many years,” he added.
The government has adjusted for energy prices and losses which have been an economic burden for the power plants, and the Minister pointed out that they have no financing available for technological renovation. Electricity that costs 144 MNT per watt to produce is sold to customers for 122 MNT. D.Zorigt added, “in 2014, our sector saw a deficit of 68.5 billion MNT.”
Eenergy consumption has been continually increasing. Mongolia used 6.7 billion kWh of electricity in 2014, of which 5.3 billion kWh was produced domestically and the rest was bought from Russia and China. In 2014 alone, the number of electricity consumers increased by 36,000 and the number of heat consumers grew by 40,000. “Unless we take decisive action towards the increasing demand, we are likely to have an energy resource deficiency.”
He also reported that the Cabinet resolved to commence the financial negotiations on the Eg River Power Plant project with the Chinese government, to advance the construction of hydroelectric power plants to be based on the Khovd River and of a 700 MW capacity power plant in Baganuur District. The latter project will be executed by Baganuur Power LLC on a concession contract on “build-operate-transfer” terms. These new plants will be commissioned in 2019-2020.
The Minister also mentioned the recent commissioning of a 50 MW extension of the Third Thermal Plant, and a conclusion of the Stove No.9 restoration. The turbine generator at the Fourth Thermal Power Plant of Ulaanbaatar has been connected to the central system, and the Thermal Plant of Amgalan will be commissioned this June, he said.
This year the energy sector set a goal to improve efficiency and reduce costs. A draft law on energy saving has been developed and will be submitted to Parliament in the near future, Zorigt told the meeting’s attendees.