MONGOLIA: Mongolia Sustainable Energy Sector Development Strategy Plan 2002-2010

Meta Data
Draft: 
No
Revision of previous policy?: 
No
Draft Year: 
2002
Effective Start Year: 
2002
Effective End Year: 
2010
Scope: 
National
Document Type: 
Plan/Strategy
Economic Sector: 
Energy, Power
Energy Types: 
All, Power, Gas, Renewable, Bioenergy, Hydropower, Solar, Wind, Other
Issued by: 
Government of Mongolia - Ministry of Infrastructure
Source: 
Open Society Forum
File: 
Mongolia Sustainable Energy Sector Development Strategy Plan 2002-2010
Overall Summary: 
Determines actions to be implemented in the energy sector in the short- and medium terms and will be used by the Government of Mongolia as the guidelines for activities to be implemented in the energy sector. The main objective of the Plan is to create a financially sustainable energy sector that will provide cost-effective energy access, thereby enabling poverty reduction and greater private sector and civil society participation. The document affirms that Mongolia’s energy sector should be developed within a regional energy context, while at the same time taking advantage of new technologies and sources of energy that might further promote economic efficiency and environmental sustainability.
Access
Bi-, multi-lateral mechanisms to expand access: 
To improve supply of electricity in rural areas: To attract the private sector and non-government organizations by resolving the necessary regulatory issues; To resolve financial issues jointly with rural financial institutions; [...] To cooperate with international environmental protection organizations to introduce wind energy use on a broad scale.
Energy access priorities: 
Basic principles of the strategy plan: [...] Energy access and affordability to improve energy access [...].---To expand and improve electricity transmission and distribution grids.---Performance criteria: [...] Improving energy access in rural areas, promoting broader utilization of renewable energy sources, introducing lifeline tariffs to low-income people enabling affordable and equal access for all citizens.
Energy access action plan: 
To improve energy supply in the central region.---To improve supply of electricity for 4 aimag centers and soum centers not connected to the grid.--- To implement the Government program "100 000 solar gers".---To improve electricity supply in rural areas using wind power.---Expected Results: Access to energy in rural areas will have been increased, and renewable sources of energy (solar, wind and hydro) widely used.
Clean cooking solutions: 
To reduce air pollution by improving stoves in cities and urban areas.---To introduce less-smoke, new design stoves in aimags and soums in order to reduce air pollution.---To study possibilities to supply improved stoves to the low-income population of rural areas and to take actions.
Efficiency
EE priorities: 
Basic principles of the strategy plan: Energy conservation to promote efficiency, consumer choice, and environmental sustainability.
EE action plans: 
Performance criteria: [...] Creation of necessary legal and institutional framework for improvement of energy conservation and efficiency; implementation of energy conservation projects in order to enable the public to benefit from improvements in energy conservation and efficiency.---Objective: Increase energy use and reduce air pollution by improving energy conservation;[...] improve energy efficiency by promoting ESCOs and approving and implementing the National Energy Management Program (NEMP). ---· To make efficiency as a priority consideration in licensing and approval of tariffs. ---To improve efficiency of heat-only boilers and or replace.---· To approve the Law on Energy Conservation.---To improve or replace small scale heating plants used in aimag and soum centers and heat-only-boilers boilers used in rural areas.
Energy Service Companies (ESCOs): 
Performance criteria: [...] [A]n involvement of the private sector through energy saving projects by encouraging ESCOs. ---To support ESCOs and introduce energy saving performance contracts.
EE financial incentives: 
To study budget subsidies and to replace inefficient boilers.
Renewable Energy
RE priorities: 
To improve electricity supply in rural areas using wind power.
RE action plans: 
To implement the Government program "100 000 solar gers".---To cooperate with international environmental protection organizations to introduce wind energy use on a broad scale. ---Expected Results: Access to energy in rural areas will have been increased, and renewable sources of energy (solar, wind and hydro) widely used.
Environment
Energy environmental priorities: 
Objective: Increase energy use and reduce air pollution by improving energy conservation; reduce emissions of green house gases.
Pollution control action plans: 
To reduce air pollution by improving stoves in cities and urban areas.---To reduce air pollution: · To replace not efficient diesel generators in soums; · To introduce new types of fuels, such as LPG, coalbed methane, charcoal, coal briquettes, and coke. ---To introduce less-smoke, new design stoves in aimags and soums in order to reduce air pollution.
Cooperation in env.: 
To cooperate with international environmental protection organizations to introduce wind energy use on a broad scale.
Pricing
Renewable energy subsidies: 
Performance criteria: [...] Improving energy access in rural areas, promoting broader utilization of renewable energy sources, introducing lifeline tariffs to low-income people enabling affordable and equal access for all citizens.
Energy pricing: 
Performance criteria: [...] Improving energy access in rural areas, promoting broader utilization of renewable energy sources, introducing lifeline tariffs to low-income people enabling affordable and equal access for all citizens. ---Actions to be taken: Introduce cost recovery tariff mechanisms for power production operations; Implementation of adequate policy on prices and tariffs · Improvement of tariff methodology · Introduction of cost-based bidding pool mechanism · Introduction of price and tariff mechanisms to fully cover the costs · Commercialization. [...] Improvement of revenue collection · Metering · Improving the collection system.---· To make efficiency as a priority consideration in licensing and approval of tariffs.
Energy Supply and Infrastructure
Infrastructure development priorities: 
To expand and improve electricity transmission and distribution grids.---To improve electricity supply in rural areas using wind power.
Regional integration priorities: 
Actions to be taken: To study possibilities of regional cooperation in the energy sector, participate actively in North-East Asian and regional collaboration in energy and learn from other experiences in regional cooperation.
Investment
Energy sector investment priorities: 
Actions to be taken: To assess the borrowing capacity of the Government and take loans for new investments in energy sector based on a rigorous financial rate-of-return analysis for each project proposal. Rehabilitation and new investment projects in the energy sector made on the basis of the return on the investment. ...] Attracting private investment to finance new investment projects in the energy sector.
Investment climate development: 
To improve supply of electricity in rural areas: To attract the private sector and non-government organizations by resolving the necessary regulatory issues; [...]. ---Actions to be taken: To study possibilities for attracting foreign investment (FDI), and to attract foreign direct investment into the energy sector by creating the necessary environment.---Expected Results: Cost efficient and competitive domestic and foreign private companies will be able to provide services on the energy market.---Performance criteria: Energy sector regulatory framework suitable to a market economy established thereby enabling private sector participation in energy sector both foreign and domestic which will result in delivery of cost efficient and competitive services in the energy market;[...]. ---[...] [A]n involvement of the private sector through energy saving projects by encouraging ESCOs.
Governance
Energy management principles: 
Basic principles of the strategy plan: [...] Financial sustainability to transform the energy sector into self sustainable sector; [...] Capacity building to ensure success of market transformation; and Energy access and affordability to improve energy access and mitigate social impact of reforms; Restructuring to complete commercialization and non-state participation. [...] Improved capacity building in policy making, formulation, regulation by building institutional capacity in the sector; improved operational capacity in energy production that meets market economy requirements. ---Actions to be taken: To resolve arrears between power plants, coal mines, distribution companies and consumers by introducing new mechanisms for resolving arrears.[...] Reduction of losses · Improvement of technical efficiency (to reduce technical and non-technical losses from 33% to 15%).---Objective: Deepen the restructuring process in the energy sector; establish an independent regulatory environment in the energy market; improve the regulatory environment as required for commercialization; thereby, to take actions to undertake phased privatisation.---Expected Results: Restructuring of the energy sector will be completed and a regulatory framework will be established conforming with market principles. [...] Capacity utilisation in energy generation, transmission and distribution will have been increased according to market requirements.---Expected Results: Cost efficient and competitive domestic and foreign private companies will be able to provide services on the energy market.
National policy structure: 
Performance criteria: [...] Creation of necessary legal and institutional framework for improvement of energy conservation and efficiency [...] Phased privatisation of selected state-owned enterprises in energy sector..---· To approve the Law on Energy Conservation. To approve and implement the National Energy Management Program (NEMP).---Actions to be taken: Improvement of energy policy planning capacity
M&E of policy implementation: 
Improve methodology to monitor achievements in improving access to modern energy services in rural areas.---The central government administrative authority in charge of energy issues shall manage implementation of the strategy jointly with relevant organizations, and shall report on implementation once a year to the Cabinet.
Statistics collection and management: 
Improve data collection on access to energy by different categories of customers based on their social status.