The “Mongolia Third Energy Sector Project” by the World Bank involves a USD 120 million loan to enhance the central grid’s capacity for renewable energy integration by constructing a 450km 220kV transmission line, with GGGI supporting environmental and social impact assessments as per Mongolian law.

The project supports renewable energy development in Mongolia by addressing grid infrastructure limitations through the World Bank’s “Mongolia Third Energy Sector Project,” which constructs an overhead transmission line to connect additional renewable sources, benefiting Ulaanbaatar and four surrounding provinces, impacting over half of the country’s population.

Mongolia has various resource rich reserves for gold, copper, coal and other elements. Despite rich resources such as spacious landscape and mineral mining potential in the country, the development in remote regions has been restricted to those that only require small power supply from the grid, or which are capable of equipping with mostly diesel-based private generation. Therefore, reinforcement of the transmission infrastructure will be crucial for the sustainable development of the whole country by meeting the increasing or unserved power demand for load in remote regions and bringing renewable energy from the south and east to the load center in Ulaanbaatar.

The project intends to achieve four key outcomes:

Outcome 1: Enhanced Grid Connectivity – Connection of central regions to the South and Southeast Gobi regions through improved transmission infrastructure.

Outcome 2: Economic Growth & Decarbonization – Promotion of economic growth in remote regions and reduction of
industrial carbon emissions.

Outcome 3: Investment Mobilization – Securing USD 120 million for the construction of 220kV transmission lines, divided into two phases: USD 47.8 million for the Baganuur to Choir line and USD 80 million for the Arvaikheer to Mandalgovi line.