energy policy and energy security issues of mongoliapesforum.org/docs/2018/d204_ganzorig.pdf ·...

ENERGY POLICY AND ENERGY SECURITY ISSUES OF MONGOLIA

Mr. Ganzorig Shagdarsuren,Senior Officer,

Policy and Planning Department

Ulaanbaatar 2016-09-12

CONTENT

• Current state• Statistics• Challenges• Legal Environment • State Policy on Energy 2015-2030

3

2000 2005 2010 2015Annual average growth, (%)

’00-‘05 ’05-’10 ’10-’15

Total Primary Energy Supply (1,000 TOE) 2,564 2,800 3,545 5,968 1.8% 4.8% 28.7%

Energy per capita (TOE) 1.06 1.09 1.27 1.95 0.5% 3.1% 11.3%

Population (thousand) 2,408 2,562 2,781 3,058 1.3% 1.6% 1.9%

GDP (billion tog, at 2005 constant price) 2,100 2,780 4,154 7,614 5.8% 8.4% 12.9%

Energy/GDP Intensity (TOE/million Tog) 1.22 1.01 0.85 1.64 -3.8% -3.3% 14.0%

Import Dependency (%) 19.4% 21.4% 25.6% 22.6% 1.9% 3.7% -2.5%

2000 2005 2010 2015Annual average growth, (%)

’00-‘05 ’05-’10 ’10-’15

Indigenous Production 2,019 3,592 11,591 12,519 12.2% 26.4% 10%

Import 497.1 597.9 908.9 1346.76 3.8% 8.7% 20.6%

Export 3 1,405 9,028 7,987 236% 45.1% -16.9%

Total Domestic Energy Supply 2,564 2,800 3,545 5,968 1.8% 4.8% 14.1%

Primary Energy Supply and Economic Indicators

Domestic Production, Import and Export

(Unit : 1,000 TOE)

(Unit : 1,000 TOE)

ENERGY STATISTICS

4

2000 2005 2010 2012 2015Annual average growth (%)’00-‘05 ’05-’10 ’10-’15

Coal1,798 1,895 2,324 6,884 4,247 1.0% 4.2% 12.8%

70.2% 67.7% 65.6% 80.7% 71.2%

Oil472 584 879 1,284 1,243 4.3% 8.5% 7.2%

18.4% 20.9% 24.8% 15.1% 20.8%

Hydro+Wind0.25 0.28 4.73 8.96 18.72 2.1% 76.0% 31.7%

0.01% 0.01% 0.13% 0.11% 0.31%

Traditional Fuels & Others293 321 337 348 370 1.8% 1.0% 1.9%

11.4% 11.5% 9.5% 4.1% 6.2%

Total2,564 2,800 3,545 8,526 5,968 1.8% 4.8% 11.0%

100.0% 100.0% 100.0% 100.0% 100.0%

Structure of Primary Energy Supply by Source (Unit : 1,000 TOE, %)

Trend in Supply Share(2000"2005"2010"2012,"2015 %)

• Coal ê: 70.2 "67.7"65.6é "80.7"ê 71.2

• Petroleum Prodts é: 18.4"20.9"24.8"15.1"20.8

• Hydro é : 0.01"0.01"0.13"0.31

• Tradnl Fuels & Others ê: 11.4"11.5"9.5"4.1"6.2

ENERGY STATISTICS

01,0002,0003,0004,0005,0006,0007,0008,0009,000

1995 2000 2005 2010 2012 2015

5

Final Energy Demand by Sector (Unit : 1,000 TOE, %)

1995 2000 2005 2010 2012 2015

Industry502 464 721 623 735 883

31.9% 26.2% 36.5% 23.9% 22.2% 25.2%

Transport220 254 248 686 984 944

14.0% 14.4% 12.5% 26.3% 29.7% 27.0%

Residential516 585 548 812 947 995

32.9% 33.0% 27.8% 31.1% 28.6% 28.4%

Commercial/ Public/ Others333 467 456 490 644 677

21.2% 26.4% 23.1% 18.8% 19.5% 19.3%

Total1,571 1,770 1,973 2,611 3,309 3498

100.0% 100.0% 100.0% 100.0% 100.0% 100.0%

Trend in Demand Share(1995" 2000"2005"2010"2012"2015, %)

• Industry ê: 31.9" 26.2"36.5"23.9"22.2"25.2

• Transporté: 14.0"14.4"12.5"26.3"29.7"27.0

• Residentialê : 32.9"33.0"27.8"31.1"28.6"28.4

• Commercial-

/Public/Othersê:21.2"26.4"23.1"18.8"19.5"19.3

ENERGY STATISTICS

0

5001000

15002000

2500

30003500

1995 2000 2005 2010 2012 2015

ENERGY DEMAND AND SUPPLY IN MONGOLIA

6

Energy Production, Imports and Exports by Source in 2015

ENERGY TRADE

Sources Coal Crude Oil Petroleum Products Electricity

Indigenous Production 10’934.5 1’109.8 0.0 476.5

Import

0.0 0.0 1’224.9• 95% from Russia

• 4% from China• 1% from others

121.8• 85% from China

• 15% from Russia

Export6’872.5

• 100% to China

1’109.8• 100% to China

0.0 4.4• 100% to Russia

Domestic supply 4’247 0.0 1’242.9 593.9

(Unit : 1,000 TOE)

20193592

1159114038

0

2000

4000

6000

8000

10000

12000

14000

16000

2000 2005 2010 2015

1000 TOE

Indigenous Production Import Export Domestic Supply

CURRENT STATE OF POWER SECTOR

Western Power System, 32 MW

Eastern Power System, 63 MW

Ulaanbaatar

Altai-Uliastai Power System, 15 MW

Central Power System, 1115 MW

Power Systems

CURRENT STATE OF POWER SECTOR

538 576729 782 863 910 969 965

2001 2005 2010 2011 2012 2013 2014 2015

Peak Demand Growth in Central System, MW

/Excluding OT mine/

CHP/Coal/88%

Hydro2%

Diesel6%

Renewables6%

CHP/Coal/77.0%

Hydro0.6%Wind Farm

0.8%

Diesel0.6%

Import20.3%

Electricity Production + Import, 2015 by type of sources, total 7.1 billion.kWh,

Total Installed Capacity of Power Plants-1130 MW, by type

99

Recent Challenges:

• Capacity Shortage

CHALLENGES IN POWER SECTOR

79 73

98 98 97 9296

7483

98 9383

CHP 2 CHP 3 CHP 4 CHP Dar CHP Erd CES

Utilization of Installed Capacity in CES,%, /Winter load/

2014.12.2 2015.12.24

010002000300040005000600070008000

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Domestic Production and Import, GWh

Domestic Production Import

1010

Recent Challenges:

• Efficiency

34 4

56

78

10

14

0

2

4

6

8

10

12

14

16

Transmission and Distribution loss, %

CHALLENGES IN POWER SECTOR

11

LEGAL ENVIRONMENT, ITS RECENT AMENDMENTS

11

Ø LAW ON ENERGY– Approved- 2001.02.01,– Last Amendment- 2015.06.19

• Enhance correlation between institution in power sector to prepare the sector into free market• Enhance legal environment for foreign investment• Added methane gas regulation matters

Ø LAW ON RENEWABLE ENERGY– Approved - 2007.01.11,– Last Amendment- 2015.06.19

• Enhance financial situation of single buyer model of Power sector and ensure feeding tariffs in the Law• Enhance legal environment for investors in the sector

Ø STATE POLICY ON ENERGY‒ Approved by parliament order of #63 - 2015.06.19– Purpose:

• Determine the power sector policy up to 2015• Determine expected result of policy by stages and create its creteria

Ø ENERGY CONSERVATION LAW– Approved- 2015.12.26,

• Create institutional mechanism for energy conservation and legal environment of esco business

121212

STATE POLICY ON ENERGY

SAFETY

EFFICIENCY ENVIRONMENT

PRIORITY AREAS AND STRATEGIC GOALS

• Ensure energy safety and reliable supply

• Develop mutually beneficial cooperation with regional countries

• Develop a human resource

• Transfer the state dominated energy sector into private based competitive market

• Support innovation and advanced technology in energy sector, and implement conservation policy

• Increase the production share of renewables and reduce negative environmental impact from traditional power generation and greenhouse gas

“State Policy on Energy” 2015-2030

STATE POLICY ON ENERGY 2015-2030

13


- approved by Parliament in June 2015

STRUCTURE

• Current State andChallenges

• Vision, FundamentalPrinciples and PriorityAreas

• Strategic Goals and itsObjectives

• ImplementationStage, Criteria andIndicator and ExpectedResults

SCOPE

• Primary Energy andFuel Supply

• Power Sector• Generation• Transmission and

distribution• Supply

• Privatization andRestructuring

• Human Resource

• Tariff

• Regional Cooperation

TIME FRAME

• Base year - 2015• Vison, Goals and

Objectives - 15 years/2015-2030/

• Implementation Stages- 2015-2030

• 1st stage: 2015-2023

• 2nd stage: 2024-2030

• Medium-term NationalEnergy Program – 8years

1414

Following objectives have been set for Energyefficiency and Renewable, Environmental friendlytechnology development in the policy document.


1515

Objectives:In the frame of the fifth strategic goal for introducing

innovation, advanced technique and technologies;implementing energy conservation policy:• Fully transferring the control, supervision and data system

used in energy generation, transmission, distribution andsupply activities to a digital system and create an integratedsmart network;

• Introducing innovation, advanced techniques and technologiesin the energy sector;

• Reducing losses in energy generation, energy transmissionand distribution networks;


1616

Objectives:In the frame of the fifth strategic goal for introducing

innovation, advanced technique and technologies;implementing energy conservation policy:• Create a nationwide legal environment for regulating energy

efficiency and saving’s measures to improve management atconsumer level

• Fully provide metering systems on mechanisms for computingenergy consumption.


1717

ObjectivesIn the frame of the sixth strategic goal for scaling up of

energy generation by using renewable energyresources, reducing adverse environmental impacts ofconventional power system and emission of greenhousegases:• Conducting measurement campaigns assessing available

renewable energy resources (solar, wind, hydro, geothermaland biomass etc.) in Mongolia to create a database ofresource information; developing an organization to conductstudies on new technique, technologies and relevant analysis;

• Increasing the share of Renewable Energy in total installedenergy generating capacity of the energy sector up to 20% in2020 and 30% in 2030;


1818

Objectives:In the frame of the sixth strategic goal for scaling up of

energy generation by using renewable energyresources, reducing adverse environmental impacts ofconventional power system and emission of greenhousegases:• Creating a favorable legal and tax environment to increase

renewable energy investments and establish a financingmechanism for promoting Renewable Energy based powergeneration;

• Utilizing solar, wind, biomass energy, liquid and gasfuel, geothermal energy, fuel cell and other new sources forpower supply of households, entities, remote towns, bagcenters and individual consumers; promoting them to supplythe surplus energy to the grid;


19


19

Objectives:In the frame of the sixth strategic goal for scaling up of

energy generation by using renewable energyresources, reducing adverse environmental impacts ofconventional power system and emission of greenhousegases:• Reducing environmental adverse impacts of energy

generation, transmission and distribution activities; reducingnegative impact on ecology;


IMPLEMENTATION STAGES AND RESULTS

First stage /2015-2023/: period for establishing required capacity reserve marginof fuel and energy sources, establishing a foundation for renewable energydevelopment, accomplishing normative documents of the energysector, introducing and localizing international standards; improving the legalenvironment.

Outcome of the first stage: to double the installed energy generating capacity ofMongolia, start using highly efficient equipment with high parameter (e.g.supercritical), create a condition for intensive development of Renewable Energyby creating not less than 10% of hydropower capacity in the total installedcapacity and having 10% of capacity reserve margin. A real cost reflecting tariffand pricing system will be created thus enable the energy sector to operate in afinancially autonomous way.


IMPLEMENTATION STAGES AND RESULTS

Second stage /2024-2030/: Period for exporting electricity and sustainabledevelopment of Renewable Energy.

Outcome of the second stage: Energy generating capacity’s security reservemargin of Mongolia will have reached to no less than 20% and the share ofinstalled renewable energy capacity in the total installed energy generatingcapacity will be at 30%. Regions will be connected by high capacity high voltageelectricity transmission overhead lines and an integrated smart power systemwith complex unified information, control and supervision system. Distribution andsupply networks will be fully privatized and the energy sector will be operated bya regulated and competitive principle. Mongolia will be connected withneighboring countries through a high capacity direct current electricitytransmission lines and exporting electricity to abroad.


PLANNED POWER PROJECTS

Coal Coal bed Methane Oil Oil shale Uranium

Renewables

Hydro Solar Wind

Proven 172Billion ton

5-10 trillionì3

332 million ton

788 billion ton 75000 ton 6200 MW 4.5-6.0

kW/meter2 1100 GW

Utilizationin 2015 24 mln ton - 1 mln ton - - 62.2

Gwh0.96GWh

152.6GWh

PRIMARY ENERGY RESOURCE STATISTICS

COAL URANIUM

HYDRO WIND SOLAR

THANK YOU

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