Renewables Readiness Assessment Country Study for Mongolia Yong Chen International Renewable Energy Agency Ulaanbaatar, Mongolia 22 May, 2015 What is RRA? RRA is a process-oriented and country-driven methodology designed for:  a comprehensive assessment of the current renewable energy status in a country  providing an opportunity and international platform to initiate a national dialogue with all relevant stakeholders in order to pinpoint renewable energy drivers, comparative advantages, and areas requiring improvement, in order to determine the concerted actions needed to enable the development and scale-up of renewable energy  consolidating the existing efforts and mobilizing the resources needed for the implementation of actions identified Key Attributes of RRA Process  Country led: Initiated and conducted by national Governments. IRENA is a facilitator  Process oriented: Focus on building processes that will initiate changes in legislation, regulation and policy frameworks  Builds consensus: Incorporates expert viewpoints wide ranging actors  Lays a foundation for future collaboration: Forward looking framework of actions (5-8) based on realistic scenarios. Foundation also for engagement of private sector participation. 3 RRA Country Report for Mongolia: Context 20.00% 15.00% Economic growth is rapid GDP Growth Rate 10.00% 5.00% 0.00% 1985 1990 1995 2000 2005 2010 2015 2020 -5.00% -10.00% -15.00% Year but it comes at a cost…. 4 Key Facts  Coal contributes for more than 80% of the Mongolian total primary energy supply  The World Health Organization (WHO) listed Ulaanbaatar as one of most polluted five cities in the world – the fine particulates level reaches as high as 750 µg/m3 in winter season while the annual average ranges from 136 – 141 µg/m3, which is significantly higher than the WHO guideline level of 10 µg/m3  Actions: law issued and Committee was established  Strategic vision: balancing the short-term economic gain with sustainable development goal is no longer optional but necessary if the country aims to be on the track towards green growth 5 Growth of Demand The growth is continuing… 3500 3080 3000 2747 2321 2500 1915 2000 So are the concerns… 1500 1000 1002 907 1143 1284 1006 1022 1041 784 500 70 107 222 305 0 2011 2012 2013 2014 2015 2020 2025 2030 6 Total Demand Mining Sector Key Strategic Messages from the Report Man-made pollution requires manmade solution Mongolia has the solution - huge renewable energy potentials But, capitalizing on the potentials requires a systematic approach 7 Key Strategic Messages from the Report Political will cannot work alone, it needs economic driver, technological pusher, market integrator, capacity builder, and confident investor…. However, challenges are huge to get there…. 8 Key Challenges and Recommended Actions Lack of Institutional and Human Capacities Lack of capacity is really not a problem The real problem is how we are going to build it Institutional and Human Capacities need to be “renewable” and “sustainable” 9 Key Challenges and Recommended Actions Establishing a national renewable energy center focusing on: • Resource data collection, validation and verification • Researching on technologically adaptable RETs for Mongolia • Develop and demonstrate RE systems using PPP model – accelerator for scaling up innovative RE technologies in and for Mongolia • Carry out training and competency enhancement programs 10 Key Challenges and Recommended Actions Enhancing the capacity of Dispatching Center: • It is more difficult to change mindset than practice • Good practice exist and need to be disseminated • Dispatching center needs to be updated, not only once but periodically • We can do more with less…. 11 Key Challenges and Recommended Actions Uncertainties in, and Lack of Effective Enforcement of, Renewable Energy Law Law is good, effective enforcement is better, Review is necessary as things are changing, calling for updates and improvements Amending a Law should be done with great caution too… 12 Key Challenges and Recommended Actions Three recommended actions  Extend FiTs to a longer timeframe  Introduce RPS scheme  Budgetary allocation to RE and promote PPP model 13 Key Challenges and Recommended Actions Lack of knowledge of the current grid status causing concerns on grid stability As far as variable renewable energy sources are concerned, what is worrying is not for the current situation, but is what would happen if more VREs are put on-line, how to deal with them when flexibility is constrained 14 Key Challenges and Recommended Actions Recommendation: Conduct Grid Status Assessment  Diagnostics of present infrastructure  Measurement campaign to support the implementation and validations of simulation models.  Recommendations on technical interconnection requirements to support grid operation 15 Key Challenges and Recommended Actions How to utilize the vast potential of RE resources Domestic market is relatively small Scale of economy is calling for a larger market If not used, then simply wasted… Opportunities lie at trans-boundary grid infrastructure development for capitalizing on renewable energy resources However, huge challenges are ahead, too 16 Key Challenges and Recommended Actions Three recommended actions  Further joint study on feasibility of developing a regional grid and power market  Conduct Strategic Environment Assessment  Develop a regional infrastructure plan applying coordinated regional energy planning approach 17 Discussion questions  How should Mongolia develop its own energy sector development plan leading the country to a sustainable energy future?  What is the role of government in this action?  On government’s support to private sector’s involvement in RE business, how would government strike a sound balance? 18 Thank you!