November 15, 2013
After the signing, Toshinobu Kato (left), chief representative of the JICA Mongolia Office shakes hands with Nyamjav Batbayar, minister of Economic Development
oday, the Japan International Cooperation Agency (JICA) signed a Japanese ODA loan agreement with the Government of Mongolia in Ulaanbaatar to provide a loan of up to 4.201 billion yen for assistance for the Ulaanbaatar Thermal Power Plant No.4 Optimization Project.
This project will install new equipment and update existing equipment at Ulaanbaatar Thermal Power Plant No.4, which has the largest power generating capacity in Mongolia. This will improve the power generation efficiency at the power plant along with stabilizing the power supply, contributing to stable socio-economic growth in the country. Funds from the loan will be allocated to the procurement and installation of the equipment, as well as consulting services (such as detailed design work, bidding and construction monitoring).
In recent years, Mongolia has achieved a remarkable rate of economic growth, driven by the development of mineral resources, reaching 12.3 percent in 2012. Accompanying this growth, the population has risen rapidly in recent years in Ulaanbaatar, the capital and center of Mongolia’s government and economic activity, reaching about 1.3 million people in 2012 (more than 40% of the country’s population), and the city has also seen a concentration of factories emerge. Given such rapid economic development, it is expected that the power demand on the central power system, which covers Ulaanbaatar, will increase annually between 6 and 7 percent, so that strengthening the power supply capacity is a priority. Ulaanbaatar Thermal Power Plant No.4 is one of the primary power plants of the country and provides approximately 60 percent of the country’s total power production capacity, but aging of the turbines, boilers and some of the other equipment has led to the problem of an unstable power supply with a drop in power generation efficiency and unplanned outages. Improving efficiency and stabilizing the power supply by restoring the plant’s functions is therefore an urgent issue in Mongolia’s power sector.
Through this project, the aging equipment will be restored and new equipment will be installed, which should improve the efficiency and power supply stability of the power plant. By improving the power generation efficiency, it is also expected that exhaust gases and air-polluting greenhouse gases will be curtailed.
Ulaanbaatar Thermal Power Plant No.4 has received long-term support from Japan, including grant aid and loan assistance since 1992, as well as support from experts and Senior Volunteers who have been dispatched there on a regular basis. Mongolia and Japan have built deep ties, such as when all employees at the Mongolian power plant donated their overtime pay to victims in the wake of the 2004 Chuetsu earthquake. JICA’s policy is to continue providing support to the power sector in Mongolia as assistance for stable socioeconomic growth.
1. Terms and Amount of Loan
|Annual interest rate (%)||Repayment
|Ulaanbaatar Thermal Power Plant No.4 Optimization Project||4,201||0.3||0.01||40||10||General untied|
2. Project Summaries
Ministry of Energy
Address: Government Building XIV, Chinggis Avenue, Khan-Uul District, 3 Khoroo, Ulaanbaatar 17026, Mongolia
3. Planned Implementation Schedule
(i) Completion of project: June 2020 – when the equipment is put into service
(ii) Issuing of letters of invitation for consulting services (including detailed design work): December 2013
(iii) Tender announcement of initial procurement package for international competitive bidding on project construction:
Procurement package titles: Installation of Turbine Governor and Distributed Control System, Installation of Boiler Soot Blower and Mill Roller of Pulverized Coal Firing Equipment
Release date: October 2014