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4.97. The State Policy on Energy (2015-30) foresees two stages. During the first stage (2015-23), the capacity is planned to double (with the construction of six coal power plants and two hydropower plants), highly efficient equipment will be introduced, the share of hydropower is planned to reach at least 10%, and the tariff structure will be reformed to ensure the economic viability of the sector.

4.98. During the second phase (2024-30), the energy security reserve, i.e. the potential maximum capacity needed to face peaks, will increase by at least 20%, the share of renewable energy sources in total installed capacity is planned to reach 30%, a unified energy system with a smart grid will replace the five present systems, the distribution system will be fully privatized, and the sector will operate on a competitive market basis. (...)

Table 4.16 Detailed indicators and objectives of the State Policy on Energy (2015-30)
Indicators/objectives: Share of renewable energy in the installed capacity
2014 base: 7.62%
End of the first stage (2023): 20%
End of the second stage (2030): 30%

Table 4.16 Detailed indicators and objectives of the State Policy on Energy (2015-30)
Indicators/objectives: Greenhouse gas emission per Gcal of energy production
2014 base: 0.52 tonnes СО2 equivalent
End of the first stage (2023): 0.49 tonnes СО2 equivalent
End of the second stage (2030): 0.47 tonnes СО2 equivalent

Table 4.16 Detailed indicators and objectives of the State Policy on Energy (2015-30)
Indicators/objectives: Reduction of building heat losses
2014 base: 0%
End of the first stage (2023): 20%
End of the second stage (2030): 40%

Table 4.16 Detailed indicators and objectives of the State Policy on Energy (2015-30)
Indicators/objectives: Technologies used
2014 base: High pressure
End of the first stage (2023): Subcritical pressure technology; Natural gas technology; High-capacity energy storage technology; Hydro reserve plant
End of the second stage (2030): Supercritical and ultra-supercritical pressure technology; Hydrogen technology; Solar thermal power plant

4.100. The second element of this overall electricity strategy is the Mid-Term National Programme to Develop the State Policy on Energy (2018-23), (...) The programme's estimated budget includes USD 2.6 billion in foreign investment and USD 230.0 million from the state budget. This expansion strategy was revised in January 2020 to take into account the impact of the COVID 19 pandemic and the additional environmental studies now required for the construction the mega hydropower project on the Eg River.

Table 4.17 Electricity capacity expansion plans, 2020-24
Expansion plan: Construction of Erdeneburen hydropower plant and building of 220 kW Erdeneburen-Myangad-Uliastai overhead transmission line and substation.
Source of energy: Hydropower
Capacity: 90 MW
Calendar: 2021
Financing: Hydropower plant - concessional loan from the China: 95%; state budget: 5% ;Overhead transmission line and substation - state budget: 100%

4.102. The construction of the 90 MW Erdeneburen hydropower station in the western region will begin in 2021, and a 100 MW battery energy storage system and hydropower storage facilities are planned for the central region.

4.104. Second, two amendments, in 2015 and in 2020, to the Law on Renewable Energy of 2007 created and then reformed a Feed in Tariffs (FIT) system that is based on a location-, capacity-, and technology-specific competitive bidding and auction system. The electricity generated and supplied by wind power generators is presently valued at up to USD 0.085 per kWh, and that supplied by solar power generators at USD 0.12 per kWh.