Mongolia inked a historic document declaring the development of a sustainable, resilient and interconnected energy system as a common goal for Central and West Asia with eight other countries on September 20 in Tashkent, Uzbekistan.
On behalf of the Minister of Energy Ts.Davaasuren, his advisor Ts.Sukhbaatar signed the 10-point declaration along with representatives from Afghanistan, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, and Uzbekistan at the end of the first Central Asia Regional Economic Cooperation (CAREC) Energy Ministers’ Dialogue.
The dialogue was marked as a “historic” event, bringing Central and West Asia closer to realizing a regional energy market, which could resolve the inadequate energy infrastructure, inefficient state-owned energy utilities, power shortages, and other major issues shared across the region.
Vice-President of the Asian Development Bank (ADB) for Private Sector Operations and Public-Private Partnerships Diwakar Gupta gave opening remarks, noting the significance of the gathering of regional energy leaders and the need for a sustainable source of power.
“This is a historic achievement and an important commitment. The energy sector drives economic growth in the region, so this unprecedented gathering of energy leaders is very important. Today, they have strengthened their commitment to work together to deliver an electricity supply for the region that is reliable and affordable, develop modern energy markets, and embrace clean energy as a more efficient, sustainable source of power,” he said.
ADB believes the declaration sets the region on a faster reform path toward more liberal energy markets with greater private sector participation and investment, increased power connections and exchanges between countries, and a strong commitment to tap renewable energy sources and clean technologies. A new CAREC Energy Strategy for the next 10 years was also endorsed during the meeting to provide the roadmap to reach the region’s goal of a secure energy future.
Reportedly, approximately 400 billion USD will be required to expand energy supply capacity in the region in order to meet the growing demand for power.
By signing into the declaration, Mongolia is now committed to continue the CAREC Energy Ministers’ Dialogue in the future to further enhance cooperation and promote sustainable energy development; implement the new CAREC Energy Strategy 2030 with the strategic vision of achieving reliable, sustainable, resilient and reformed energy markets in the region by 2030; cooperate to accelerate regional electricity interconnections and electricity exchanges and double current regional power flow by 2023; support to increase renewable energy sources (double up the current solar and wind power capacity in the region by 2023) to achieve diversified and cleaner energy mix; and prioritize actions to seek investment in energy efficiency.
Mongolia will also be required to take appropriate energy sector reforms and create transparent and investor-friendly regulatory frameworks to enable larger private sector participation; work toward attaining Sustainable Development Goal 7 – Affordable and Clean Energy, pay attention to reducing fiscal subsidy; and work closer with international financial institutions and various development partners in supporting emerging demands of the energy sector in the region.
Most importantly, along with other Central and West Asian countries, Mongolia has endorsed to increase the participation of women in the energy industry in recognition of the benefits of a diverse, inclusive and balanced talent pool in the sector. This endorsement was highly praised by experts who were observing the ministerial dialogue.
‘21st century without power is unimaginable’
Energy minister’s advisor Ts.Sukhbaatar joined the launch of the fourth CAREC Energy Investment Forum after the ministerial Dialogue.
The first session of the forum was “Energy Sector Reforms as a Catalyst for Optimal Investment Conditions” and energy ministers and leaders from the region got to personally intervene by sharing their countries’ energy policies and reform progresses in an effort to attract investors.
In this session, Ts.Sukhbaatar noted that Mongolia has started attracting more and more investment to the energy sector as it takes the necessary reforms to create stable, sustainable and long-term business environment.
“21st century without power is unimaginable,” he stated. “However, Mongolia faces challenges in distributing electricity evenly across the country as it has a sparse population. It is also expensive.”
However, the Mongolian government is taking numerous actions to address this issue, according to the advisor. He mentioned that the country has revised its energy laws, working to liberate electricity prices, and is studying the viability of using high-voltage transmission lines to reduce energy loss.
The two-day forum gathered energy leaders, policy makers, project developers, technology providers, investors, international financial institutions, members of the diplomatic community, academia, and young entrepreneurs and students to promote energy development through cooperation, attract investors to the region, and enable private investments in the region.
