Project to contribute to Mongolia’s sustainable
economic development
Clean Energy Asia LLC together with its shareholders, Newcom LLC
and SB Energy Corp., signed today with the Japan International
Cooperation Agency (hereafter “JICA”) and the European Bank for
Reconstruction and Development (hereafter “EBRD”) financing
agreements to construct a 50MW wind farm in southern Mongolia.
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Image photo for completion of Tsetsii
Wind Farm at Tsogttsetsii soum, Umnugobi aimag, Mongolia (Photo:
Business Wire)
Clean Energy Asia LLC, (Head office: Ulaanbaatar city, CEO:
Gankhuyag Dagva, hereafter “Clean Energy Asia”), is 51% owned by
Newcom LLC, a Mongolian conglomerate with activities in
telecommunications, property and energy. The remaining 49% is owned
by a subsidiary of SB Energy Corp. (Chairman & CEO: Masayoshi
Son, hereafter “SB Energy”), a subsidiary of SoftBank Group Corp.
(the telecommunications and technology conglomerate).
Mongolia faces great challenges in meeting its growing demand
for electricity, almost all of which is currently met by ageing and
polluting coal-fired plants. The wind farm will help supply
Mongolia's power demand with clean, eco-efficient electricity by
harnessing Mongolia's vast and inexhaustible wind resources. The
project will help contribute to sustainable economic development
and the mitigation of climate change. Clean Energy Asia will aim to
launch operations in December 2017.
Mongolia has a power-supply capacity of 1130MW, consisting of
88% coal, 6% diesel, 6% renewable energy, and 2% hydropower sources
(Department of Energy, Mongolia, 2015). While being the world’s
eighth country most susceptible to climate change (Climate Risk
Index. Source: GERMANWATCH “Global Climate Risk Index 2014”),
electricity supply-demand balance along with its economic growth is
an urgent issue for Mongolia; accordingly, Mongolia is a country
that particularly requires safe and secure power sources such as
renewable energy. The State Great Khural approved a national power
policy in 2015 that sets Mongolia’s mid-to-long term target and
plan for 2015-2030 in the energy sector. The policy aims to
increase the power generation share of renewable energy to 20% by
2020 and to 30% by 2030, and it stipulates the promotion of
investment in the energy industry in cooperation with international
financial institutions and donor countries, utilizing the abundant
wind and solar resources in the Gobi region. Mongolia is the first
country to sign a memorandum with Japan on the Joint Crediting
Mechanism (JCM) to reduce greenhouse gas emissions.
In these circumstances, this Tsogttsetsii wind farm project will
help contribute to the increased adoption of renewable energy in
Mongolia.
This wind farm project is the first dollar-denominated project
finance debt transaction by JICA through its Private Sector
Investment Finance scheme in the renewable energy field, and the
second renewable energy project in Mongolia for Newcom and EBRD
following the 50 MW Salkhit Wind Farm, the first wind farm and
first private power generator in Mongolia, which began its
operations in 2013. The 50MW Tsetsii Wind Farm project marks the
first power generation business in Mongolia for SB Energy and the
SoftBank Group.
Masayoshi Son, SB Energy Chairman & CEO commented as
follows:“This project marks the first step to develop renewable
energy in Mongolia for the SoftBank Group. Power generated from the
wind farm will supply electricity in Mongolia by connecting to its
domestic grid, and I believe the project will help contribute to
the stable supply of power for the nation. With this project, the
SoftBank Group will have bases in Japan, India and Mongolia for its
renewable energy business. We will work to further expand our
global business to increase the adoption of renewable energy and
reduce CO2 emissions.”
Boldbaatar Tserenpuntsag, Chairman of Newcom Group commented as
follows:“Having first established the Salkhit Wind Farm Project, to
date the first and only wind farm and private power generator in
Mongolia, Newcom is proud to continue its investments into
Mongolia’s renewable energy sector. The Tsetsii Wind Farm project
is a further demonstration of Newcom’s commitment to the
development of Mongolia through strengthening infrastructure and
leading the liberalization of the power sector through sustainable
and long-term investments.
Newcom is proud to introduce our partnership with the SoftBank
Group through this pilot Tsetsii Wind Farm project. Founded and led
by the internationally renowned entrepreneur and business leader
Masayoshi Son, the leading global technology player, is now
actively engaged in building a more sustainable and peaceful world
through the development of renewable energy. Newcom is pleased to
play its part in this initiative.
I would also like to acknowledge and thank our international
lending partners, JICA and EBRD, for their contribution and support
to the project. The Tsetsii Wind Farm project is JICA’s first
private project financed transaction in the renewable energy sector
and will be EBRD’s second wind power project in Mongolia in
partnership with Newcom, a clear testament to our shared goal and
commitment to develop Mongolia’s power sector.”
JICA commented as follows:“The Tsetsii Wind Farm project in
Mongolia marks JICA’s first dollar-denominated project finance debt
transaction through its Private Sector Investment Finance scheme in
the renewable energy field. This project is also the first
co-financing arrangement with EBRD. The project is consistent with
the ‘Partnership for Quality Infrastructure’ being promoted by the
Japanese government with due consideration on life cycle costs,
environmental and social sustainability, and contribution to the
local society and economy.
JICA has been supporting the power sector in Mongolia,
especially Ulaanbaatar Thermal Power Plant No.4. JICA intends to
continue providing support to the power sector in Mongolia for
stable socioeconomic growth.
Going forward, JICA will coordinate with governments and
international agencies toward socioeconomic development in
developing countries and regions, promoting ‘quality infrastructure
financing’ and responding to climate change.”
Philip Bennett, EBRD's First Vice President and Chief Operating
Officer, said:“We are delighted to mark the tenth anniversary of
our operations in Mongolia today by singing the financing for our
second wind farm in the country. We are pleased to cooperate in
this transaction not only with our long established partner Newcom,
but also with our new partners JICA and the SoftBank Group. This
signing today builds on eight years of sustained work with the
Mongolian authorities to help them put in place the regulatory
framework that allows them to harness Mongolia's huge renewable
resources. Of the EUR 1.4 billion we have invested in the Mongolian
private sector in the last 10 years, the Salkhit and the Tsetsii
wind farms are amongst the projects we are most proud of."
SB Energy, Newcom, JICA, and EBRD will work to contribute to
Mongolia’s renewable energy business development and power
infrastructure system enhancement.
Summary of Wind Farm
Location Tsogttsetsii soum, Umnugobi aimag, Mongolia
Output scale 50MW: 2,000kW x 25 generators
About Clean Energy Asia LLC
Clean Energy Asia LLC (CEA) was established in 2012 as a joint
venture between Newcom LLC and SB Energy Corp., the renewable
energy arm of the SoftBank Group.
About SB Energy Corp.
SB Energy is a subsidiary of SoftBank Group Corp. and one of the
leading renewable energy companies in Japan. As of September 2016,
it had over 308.6MW of power in operation with 26 plants
(equivalent power needed to supply approximately 96,000
households). SB Energy is aiming to spread and expand the adoption
of renewable energy derived from natural sources, such as large
scale solar power generation (Mega Solar) and wind power
generation.
About Newcom LLC
Newcom is a Mongolian clean technology and infrastructure
investor committed to bringing global expertise and innovation to
Mongolia. Newcom Group has a diverse portfolio of investments
across telecommunication, information technology, financial
services, renewable energy, real estate and mining services
sectors. The company operates Mongolia’s first wind farm, with
capacity of 50 MW and located 70km from Ulaanbaatar city and is in
the process of constructing the 450 MW combined heat and power
plant #5 as part of an international consortium awarded the
concession agreement by the government. The company’s headquarters
are in Ulaanbaatar, Mongolia. For more information, please visit
www.newcom.mn.
About the Japan International Cooperation Agency
(JICA)
JICA assists and supports developing countries at the executing
agency of Japan’s ODA (Official Development Assistance). In
accordance with its vision of “Inclusive and Dynamic Development,”
JICA supports the resolution of issues of developing countries by
using the most suitable tools of various assistance methods and a
combined regional-, country- and issue-oriented approach.
About the European Bank for Reconstruction and Development
(EBRD)
The EBRD is a multilateral bank committed to the development of
market-oriented economies and the promotion of private and
entrepreneurial initiative in more than 30 countries from Morocco
to Mongolia and from Estonia to Egypt. The Bank is owned by 65
countries, the EU and the EIB. Follow us on the web, Facebook,
Instagram, Twitter and YouTube.
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version on businesswire.com: http://www.businesswire.com/news/home/20160928005711/en/
Media:SoftBank Group Corp.Kenichi Yuasa,
+81.3.6889.2300Corporate Communicationssbpr@softbank.co.jp