Salkhit Windfarm Development

Location:

Mongolia

Project number:

41112

Business sector:

Power and energy

Notice type:

Private

Environmental category:

B

Approval date:

10 Dec 2009

Status:

Repaying

PSD disclosed:

20 Jan 2012

Project Description

The EBRD is considering making an equity investment of up to US$ 5 milion in Clean Energy LLC to support the development, construction and operation of a 50MW wind farm to be constructed and operated 70km from Mongolia’s capital Ulaanbaatar.

The project will be the first renewable energy project and the first privately-owned generator connecting to the Central Grid in Mongolia.

The investment follows an early development equity investment made by the EBRD in 2009.

Transition Impact

The transition impact of the project stems primarily from the following:

  • The project has the potential to generate significant demonstration effects as this will be the first renewable energy project to be implemented in Mongolia. As such it has the potential to set an important precedent for further development of renewable energy, unlocking the exploitation of Mongolia's large renewable energy resources.
  • The Project would result in a private owner of generating capacity, in an otherwise state-dominated sector. It would thus set a model for further involvement of private investors in the sector and thus support further commercialisation and liberalisation of the Mongolian power sector.

The Client

Clean Energy LLC is a special purpose vehicle incorporated in Mongolia solely to develop the project. It is 75 percent owned by Newcom Group, one of Mongolia's leading commercial groups, and 25 percent owned by EBRD.

EBRD Finance

A US$ 5 million equity investment in Clean Energy LLC. Equity co-financing is expected to come from Newcom, a strategic investor, and other development institutions.

Project Cost

US$ 115 million.

Environmental Impact

The Project was categorized as B level, initially for the debt financing project under the Bank's 2003 Environmental Policy and then the equity financing under the 2008 Environmental and Social Policy. The environmental and social due diligence was designed to meet the requirements of both policies. Potential impacts of the Project are readily identifiable and able to properly mitigated. Due diligence determined the Company has the capacity to fully implement the Bank's Performance Requirements throughout the wind farm development, construction, operation and decommissioning.

An international consultant completed an Environmental and Social Impact Assessment (ESIA) in 2008, with a 60-day disclosure and comment period. The ESIA package - ESIA, Stakeholder Engagement Plan, NonTechnical Summary, and Environmental and Social Action Plan (ESAP) - are available on Newcom’s website, with links to the documents also found on EBRD’s website. The ESIA evaluated the potential impacts of construction and operation of the wind turbines and the associated substation, access roads, and transmission line. The assessment included surveys of large birds. The ESAP included tailored measures to mitigate potential impacts on birds and from construction-related erosion, and also a robust monitoring program during bird migration and breeding seasons during operation. The Bank will monitor implementation of the ESAP throughout the life of the project.

Non Technical Summary

Technical Cooperation

The Government of Japan, through the Japan-Europe Cooperation Fund, provided €290,000 to assist the Mongolian government and energy regulator to develop the regulatory framework for renewable energy.

The Government of Luxembourg provided €76,000 to assist in the preparation of the ESIA for the windfarm.

Company Contact

Neal Detert
Project Manager
Tel: (+976) 11-313-183 Ext. 61
E-mail: neal@newcom.mn

 

Business opportunities

For business opportunities or procurement, contact the client company.

For state-sector projects, visit EBRD Procurement: Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

Public Information Policy (PIP)

The PIP sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations. Please visit the Public Information Policy page below to find out how to request a Public Sector Board Report.
Text of the PIP

Independent Project Accountability Mechanism (IPAM)

If efforts to address environmental, social or public disclosure concerns with the Client or the Bank are unsuccessful (e.g. through the Client’s Project-level grievance mechanism or through direct engagement with Bank management), individuals and organisations may seek to address their concerns through the EBRD’s Independent Project Accountability Mechanism (IPAM).

IPAM independently reviews Project issues that are believed to have caused (or to be likely to cause) harm. The purpose of the Mechanism is: to support dialogue between Project stakeholders to resolve environmental, social and public disclosure issues; to determine whether the Bank has complied with its Environmental and Social Policy or Project-specific provisions of its Access to Information Policy; and where applicable, to address any existing non-compliance with these policies, while preventing future non-compliance by the Bank.

Please visit the Independent Project Accountability Mechanism webpage to find out how to submit a Request for review through our confidential online form, by email, mail or telephone. IPAM is available to discuss your concerns and answer any questions you may have about the submission or handling of Requests, which follow the Project Accountability Policy and Guidance. Requestors’ identities may be kept confidential, upon request.

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