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EBRD investing in Mongolian wind farm project

The European Bank for Reconstruction and Development (EBRD) is investing in the development of renewable energy in Mongolia. About 60 wind turbines with a total capacity of 50MW are planned to be installed on the Salkhit Mountain, 70km outside the capital Ulaanbaatar, in what is the country’s first wind farm project. EBRD will be involved in the project with a $700,000 equity investment.

EBRD  will purchase 25 per cent stake in Clean Energy, a local company wholly-owned by the Mongolian Newcom group, and will fund 25 per cent of development costs as the project progresses.

The Salkhit Mountain wind farm will be the first private power generator in a sector dominated by state-owned companies.

As a result of economic growth and increased urbanization, Mongolia is facing growing demand for electricity, currently met by coal-fired combined heat and power plants. This has long been leading to poor air quality in Ulaanbaatar, especially in winter.

In order to solve the environmental and health issue, the Mongolian Parliament has endorsed a renewable energy program aiming at rising wind power contribution to the country’s power grid from today’s mere 1 percent to 25 percent in 2020.

The governments of Japan and Luxembourg are providing an additional €366,000 in grant funds, to support the development of the regulatory framework for renewable energy in Mongolia and the assessment of the environmental and social impacts of the project.

‘The current discussions on climate change in Copenhagen have drawn the world’s attention to the critical issue of supporting developing nations in their transition to a low carbon power sector. As part of that effort supporting green energy is one of the key priorities of the EBRD and we are pleased to play a part, working with Newcom, on the first such project in Mongolia. The EBRD investment will help address the country’s increasing need for energy and at the same time support the liberalisation and diversification of Mongolia’s energy sector,’ said Nandita Parshad, director of EBRD’s power and energy team.

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