The EBRD is providing a US$42.4mn loan to develop the 50MW Salkhit wind farm − the first significant renewable energy generator in Mongolia.
The project will provide approximately 5% of Mongolia’s electricity needs, which are currently served mainly by coal-fired power plants.
Special purpose vehicle (SPV) Clean Energy will build the wind farm. The SPV is currently 25% owned by the EBRD and 75% owned by Newcom – a Mongolian incorporated company that acts as a holding company for investments.
Clean Energy will also receive a number of equity investments towards the project, the EBRD tells GTR, one of which will be from Dutch development bank FMO. The EBRD is also taking a US$4.4mn equity stake in the company.
US-based General Electric will supply 31 1.6MW of wind turbines to the site.
"We hope this transaction paves the way for increased private interest in the renewable power sector which can reduce Mongolia’s dependence on coal and its carbon footprint and will contribute to Mongolia’s sustainable development," says NanditaParshad, EBRD's director for power and energy.
Bayanjargal Byambasaikhan, chief executive of Newcom, adds: “The EBRD and FMO have been relentless in developing this project together with Newcom. The Salkhit wind farm is a flagship project for Mongolia’s renewable energy. It marks the dawn for Mongolia’s aspiration to becoming Asia’s renewable energy champion.”
Mongolia has adopted a progressive renewable energy law which will give producers preferential rights to sell their output. The National Renewable Energy programme will mandate a quarter of energy from renewable sources by 2020, making the Salkhit wind farm a landmark project.
