Ulaanbaatar
Fifth Thermal Power Plant Project to Be Implemented Through Public-Private Partnership
Society
Ulaanbaatar, May 27, 2025 /MONTSAME/. During its 6th irregular session, the Citizens' Representative Khural of the Capital City discussed and approved the implementation of the Thermal Power Plant-5 Project through a public-private partnership.
The Project was presented by First Deputy Governor of the Capital City Davaadalai Tumendalai. The Plant, which will be built on the main site 400 meters from “TPP-II” in the XX khoroo of Bayangol district, will have a capacity to produce 300 MW of electricity and 340 Gcal/h of thermal energy. It will use environmentally friendly technology with CFB boilers, air cooling, and multi-stage air pollution control. The Project is regarded as a model project for public-private cooperation, which ensures Mongolia's energy security and is economically efficient and environmentally friendly. The Citizens' Representative Khural of the Capital City supported the implementation of the Project under a single partnership agreement under the "Design, Build, Finance, Operate, Maintain" method, which is commonly used in international practice, as specified in Article 15.1.1 of the Law on Public-Private Partnership.
The estimated cost of the Thermal Power Plant-5 Project is USD 658 million.
First Deputy Governor of the Capital Davaadalai Tumendalai said, “The total project investment is USD 658 million. A bid will be announced. After the selection, negotiation will be held on the contract, which will be presented to the Citizens' Representative Khural of the Capital City. The investment cost will not increase. The price of 1 kWh will be USD 0.095 over the period of 25 years, and this price will not be raised during the contract period. A preliminary estimate was made that 80 percent of the investment will come from the private sector and 20 percent from the Capital City budget. If the private sector invests 100 percent, we will renegotiate what discounts and benefits can be included in the contract.”
When TPP-5 becomes operational, USD 200 million is estimated to be generated in sales per year. In addition, officials noted that payments of the principal loan will be exempted in the first three years, and fully paid off in the next seven years.
The TPP-5 Project was initially presented 14 years ago, and now the Project is planned to be implemented in 2025-2028.
