Ulaanbaatar Thermal Power Plant No. 5

From Global Energy Monitor
This article is part of the CoalSwarm coverage of Mongolia and coal
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The Ulaanbaatar Thermal Power Plant No. 5 (also referred to as CHP-5) is a proposed 450-megawatt (MW) coal-fired combined heat and power station in Ulaanbataar, Mongolia. The original plans are presumed shelved or cancelled.

However, a new proposal for a Plant No. 5 based at Ulaanbaatar Thermal Power Plant No. 3 was announced in 2021.[1]

Location

The map below shows the location of Ulaanbaatar Thermal Power Plant No. 3, the approximate location of the current proposal. The plant was previously proposed on the east side of Ulaanbaatar.

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Background

Project

The power station was proposed to be built on the eastern side of the city of Ulaanbataar. The cost was originally estimated at US$650 million. In a May 2008 briefing on energy developments in Mongolia, the State Secretary of the Ministry of Fuel and Energy stated that "the international bidding is planned to be announced in the near future."[2]

In a July 2010 presentation, a Mongolian government official stated that the current heating demand in Ulaanbaatar was only marginally more than demand. Electricity generation capacity was 690 MW while peak demand in 2010 reached 711 MW. He also explained that the small existing combined heat and power stations, the 21 MW CHP‐2 and the 48 MW CHP-3, are old and will be "out aged by 2015". He also projected that by 2020 heat demand would increase substantially and electricity demand would grow by 700 MW. "These factors show that there will shortage of heat and electricity capacity in [Ulaanbaatar] from 2011 and necessity of construction CHP‐5," he argued.[3]

For its part, the Asian Development Bank (ADB) noted that the proposal was most likely to be for a 300 MW owned and operated by a private operator. "The government will allocate the land and determine coal standards for the plant operations. Whether the prices at which the [Government of Mongolia] will buy the outputs would justify investment (estimated cost is 1 million USD per 1 MW of capacity109) remains to be seen," the ADB stated.[4]

In June 2014, POSCO Energy announced that it had "has won the license to build and run" CHP-5 which was described as a 450 MW plant. POSCO announced that construction of the project would commence in 2015 and that the build-operate-transfer contract would run for 25 years at which time the plant would be transferred to the Mongolian government free of charge.[5] The estimated cost was US$1.2 billion and the project was to be completed by 2017.[6]

In July 2015, Posco Energy of South Korea and partners Engie (formerly known as GDF Suez SA) of France, Sojitz Corp. of Japan, and Newcom Group of Mongolia signed a PPA with the Mongolia government for the plant. Under the agreement, the Engie-led group would pay for and build the plant, operate it for 25 years, sell its power to the central grid, and then transfer the facility to the government. The power station was planned to be operational by 2020.[7]

In October 2015, ADB released the draft Environmental and Social Impact Assessment (ESIA) for CHP-5. In April 2016, the companies submitted a revised edition of the ESIA to ADB.[8]

According to Bankwatch (April 2017), the project is on hold due to ongoing negotiations between the government and the sponsors on the tariffs for electricity and heating.[8]

According to the UB Post (February 28, 2018), the consortium for the project was disbanded.[9] China Energy Storage Network News reported that public opposition due to the poor air quality in Ulaanbaatar led to the suspension of the coal project in favor of clean energy projects.[10]

International consortium

POSCO Energy held a 30% stake in the project consortium. Other members of the joint venture were Engie, Sojitz Corporation, and Newcom.[5]

Funding

The project sponsors were seeking finance from the Asian Development Bank private sector arm, the Japanese Bank for International Cooperation (JBIC), and Nippon Export and Investment Insurance (NEXI).[8] An IJGlobal report from 2015 also identified Korea Trade Insurance Corporation (K-Sure), the European Bank for Reconstruction and Development (EBRD), and private banks Credit Agricole, HSBC, Sumitomo Mitsui Banking Corporation, and MUFG as potential funders.[11]

Plant No. 3 infrastructure

In 2021, it was reported that there were plans to "establish Ulaanbaatar’s Fifth Thermal Power Plant based on the infrastructure of the Third Thermal Power Plant. Minister of Energy N.Tavinbekh said, 'Most of the plant’s main infrastructure is becoming outdated. As the Third Thermal Power Plant was put into operation in 1966-1968, it is possible that the plant’s operations could come to a stop at any given moment.'"[12][13]

At a Cabinet meeting on October 20, 2021, Minister of Energy N.Tavinbekh "introduced the progress of the construction project for Ulaanbaatar’s fifth thermal power plant which planned to be established based on the infrastructure of the Third Thermal Power Plant." As project implementing bodies, ‘Thermal Power Plant-3’ JSC of Mongolia and ‘Inter RAO-Export’ company of Russia signed a memorandum of cooperation, and reached an agreement on the volume of works to be carried out by both sides. The Russian company agreed to submit a feasibility study of the project in 180 days. Based on the study, the matter concerning export loans from the Government of Russia could be introduced by the first quarter of 2022. Despite its location and being one of the main sources for heat supply in Ulaanbaatar, the operations of the Third Thermal Plant were reportedly "at risk" due to outdated core equipment.[14]

A January 2022 news article stated: "Since the feasibility study was prepared, the construction of Thermal Power Plant 5 has been stalled for almost 10 years. It is already scheduled to be commissioned, but not a single brick has been laid to date."[15]

The Ulaanbaatar Thermal Power Plant No. 3 wiki page provides additional information about the site.

Website

CHP5 Energy For Tomorrow (former)

Project Details

  • Sponsor: Thermal Power Plant-3 JSC, Inter RAO-Export
  • Parent: Mongolia Ministry of Energy, Inter RAO-Export
  • Location: Ulaanbataar, Mongolia
  • Coordinates: 47.895556, 106.865055 (exact) [formerly - 47.9259478, 107.0494938 (approximate)]
  • Status: Announced
  • Gross Capacity: 450 MW (Units 1-3: 150 MW) [uncertain; capacity for new proposal unknown]
  • Type: Subcritical
  • Projected in service:
  • Coal Type:
  • Coal Source:
  • Source of financing:

Articles and resources

References

  1. "5-р цахилгаан станц баригдаагүй байхад 6-р цахилгаан станц баригдах уу?," asuult, May 10, 2021
  2. S. Tserenpurev, State Secretary of the Ministry of Fuel and Energy, "Energy Development in the South Gobi Region", World Bank, May 2008, page 9.
  3. Sh. Batrenchin, Senior Expert, Energy Policy Department, Ministry of Mineral Resources and Energy of Mongolia, "Energy Projects in Mongolia", Ministry of Mineral Resources and Energy of Mongolia, July 2010, page 3. (Pdf)
  4. "Private Sector Assessment for Mongolia", Asian Development Bank, April 2009, page 42.
  5. 5.0 5.1 "POSCO Energy Sets Foot in Mongolian Power Plant Business", KoreaTimes, June 23, 2014.
  6. "Mongolia, GDF Suez-led Group Sign 450MW Power Plant Agreement", Bloomberg, June 20, 2014.
  7. "Accord for $1.4 Billion Mongolia Power Plant Could Reduce Pollution", Bloomberg, July 29, 2015.
  8. 8.0 8.1 8.2 "Mongolia's energy sector", Bankwatch, April 15, 2017.
  9. "On the quest to energy independence", The UB Post, February 28, 2018.
  10. "蒙古国清洁能源发展迅速,火电项目已被彻底抛弃?", 中国储能网新闻中心, October 18, 2018.
  11. Mongolia’s CHP5 mandates four lenders, IJGlobal, Sep. 1, 2015
  12. "Prime Minister becomes acquainted with works to renew Third Thermal Power Plant," Montsame, November 15, 2021
  13. "5-р цахилгаан станц баригдаагүй байхад 6-р цахилгаан станц баригдах уу?," asuult, May 10, 2021
  14. "Feasibility study being carried out for Ulaanbaatar’s fifth thermal power plant," Montsame, October 20, 2021
  15. ""Аньсан" цахилгаан станцууд аминд орно," news.mn, January 28, 2022

Related GEM.wiki articles

External resources

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