N.Boldkhuu: Energy Infrastructure is the Top Priority

By B.Khash-Erdene

Given Mongolia’s current state of energy resources and production, the country may experience power shortages in 2014, if not sooner. The expansion of the more than 30-year-old thermal power plants and the construction of a new power plant (Power Plant No.5) are expected to meet all electricity demand. Industry officials have stated that by 2020 all domestic demand for energy will been met.

Journalists discussed this issue with the Head of the Fuel Department of the Ministry of Energy, N.Boldkhuu.

-There are confirmed reports that the capital city will experience electrical shortages by 2014. What is the domestic energy shortage situation in Mongolia today and what is needed to resolve this issue?

-Lately, constructing new buildings and housings has become close to impossible. The necessary infrastructure just isn’t there. We need to at least meet the 300 megawatt power demand in the first place. This will allow energy to be supplied to 100,000 more households. If the 100 megawatt extension for Power Plant No.4 and the construction of Power Plant No.5 in Bayanzurkh District are completed, domestic demand for electrical power will be met by 2020.

-Can you give us an official explanation for the increased power outages experienced this winter? Was it due to electrical shortages?

-There is a false notion among the public that if the power keeps going out, it means that the power supply is experiencing hiccoughs and soon all power will go out. I want to clarify that these power outages were due to damage and faults in the electrical network system. But we might start experiencing real shortages from next year.

-How many power generating plants are operating at the moment? Building a power plant will require a hefty amount of funding. Though there are ways to raise the capital necessary, the value of the currency isn’t gaining strength. What are your thoughts on this?

-At the moment, there are three power plants operating in the capital city and there are plants in Darkhan, Erdenet, Dornod Province, Umnugobi Province, and two hydroelectric stations. There are also sub power stations. You are right, it will require a huge investment to establish new plants. My opinion on this is that the power issue needs to be addressed before the massive railway projects. Whenever someone wants to build something, the infrastructure isn’t there and this is a big problem. I think it is better to address the energy infrastructure issues before thinking about profits from exports. Instead of importing energy from abroad, we have to think about supplying the needs domestically.

-It has been said that the railways are the only way to benefit from the mineral wealth, so shouldn’t this be a priority?

-Of course it is necessary. We have to think about supplying sufficient infrastructure for the big upcoming mining projects so that they can work at full capacity and produce commercial products that will eventually be transported by railway. When the mines are working at full capacity will there be a need to increase exports. Our nation is located in an advantageous position. The world market is focusing more on Asia and, more specifically, on China. Our biggest economic partner, China, buys the majority of its coal from Australia, Indonesia and USA. So obviously we need to improve exports in order to keep our biggest buyer.

Short URL: http://ubpost.mongolnews.mn/?p=3110

Posted by on Feb 28 2013. Filed under Business & Economics. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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