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DRAFT OF ENERGY CONSERVATION LAW OF MONGOLIA and STUDY OF THE ELECTRICITY AND HEAT (DESIGNATED) CONSUMERS

DRAFT OF ENERGY CONSERVATION LAW OF MONGOLIA and STUDY OF THE ELECTRICITY AND HEAT (DESIGNATED) CONSUMERS . S. TSETSGEE Member of Working group in Energy Authority Ulaanbaatar 2012. 05. 16. Relevance energy efficiency and energy conservation :.

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DRAFT OF ENERGY CONSERVATION LAW OF MONGOLIA and STUDY OF THE ELECTRICITY AND HEAT (DESIGNATED) CONSUMERS

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  1. DRAFT OF ENERGY CONSERVATION LAW OF MONGOLIA and STUDY OF THE ELECTRICITY AND HEAT (DESIGNATED) CONSUMERS S. TSETSGEE Member of Working group in Energy Authority Ulaanbaatar 2012.05.16

  2. Relevance energy efficiency and energy conservation: • Increasingly important topic from a social, economical and environmental perspective. • The working group in the Energy Authority drafted the Energy conservation Law for Mongolia with support from GIZ. The draft of Law was presented to the Ministry of Mineral Resources and Energy in 2011.

  3. Support a sustainable economic development, • Promote energy efficiency and energy conservation, • Save money for consumers of energy, • By adopting the concept “Saved energy is a source of energy”, new business opportunities in the energy sector will be created • Develop an energy services market Economical justifications for an energy conservation law:

  4. - Climate change, - Emission reduction - СО2 - Increase renewable energy penetration in energy system of Mongolia - Clean Development Management(CDM) - Bilateral Offset Credit Mechanism (BOCM) Environmental justifications for an energy conservation law:

  5. Integrated state policy on energy conservation, • Innovation to promote a know- how based economy, • Increase the number of employment opportunities, • Capacity building - arrange and organize training of personnel and specialists in the techniques for efficient use of energy and its conservation; Public and social justifications for an energy conservation law:

  6. Consumer’s willingness and economical criteria are key factors for energy efficient investments • Various supportive policies and regulations including tax and rebate preferences • New business opportunities for experienced organizations and specialists Specific characteristics of the energy conservation:

  7. The energy conservation is not aiming at limiting the consumption. Energy conservation means providing it efficiently. • Concept for the activities of all level of the institutional organizations and consumers the related with energy conservation • Using high technology and modern equipments to promote research and development in the field of energy conservation; Opportunities to conserve energy

  8. Advice of energy auditing, • Introduction of energy managers, • Energy conservation building codes; • To create integrated database for the annual report, information and promotion of the energy usage and its conservation. Implementation of the Energy Conservation Law

  9. Draft of Energy Conservation Act: Focusing on consumer innovation and voluntary work, and necessary power of State to enforce efficient use of energy and its conservation, the working team has considered principal elements in the draft of the Energy Conservation Law One of this expression is: '‘Determine and designate the consumers with high energy consumption and intensity''

  10. Determination of the Designated Consumers: Mongolian Integrated Power System : - Central Energy System, (793,4 МВт) - Eastern Energy System,(36 МВт) - Western Energy System,(12МВт) - Altai-Uliastai Energy System(11 МВт) Designated consumers include: - Companies that generate, transmit and distribute energy with a special license - End users of heat and electricity

  11. Graphic of daily peak load in Central Energy System Mongolian Integrated Power System : - Central Energy System, (793,4 МВт) - Eastern Energy System,(36 МВт) - Western Energy System,(12МВт) - Altai-Uliastai Energy System(11 МВт) Designated consumers include: - Companies that generate, transmit and distribute energy with a special license - End users of heat and electricity

  12. Parameter Unit TPP-2 TPP-3 TPP-4 Darkhan Erdenet Total Energy sale 125 833,8 685 644,7 3 101 543,1 266 194,1 134 594,0 4 313 809,6 mil.KWh value 19 268,6 144 859,0 410 778,2 49 672,5 28 586,4 653 164,7 mil.KWh own consumption percent 15,31% 21,13% 13,24% 18,66% 21,24% 15,14% % Electricity distribution 106 565,2 540 785,7 2 690 764,9 216 521,5 106 007,6 3 660 644,9 mil.KWh Heat distribution 164 102,0 1 847 839,0 3 128 831,0 453 630,0 521 674,0 6 116 076,0 GCal electricity 591,30 363,65 305,05 438,80 315,59 329,84 Fossil fuel gr/kWh calorific value heat 192,60 179,68 174,40 196,60 184,79 179,02 kg/GCal electricity 63 014,8 196 659,1 820 817,8 93 489,0 33 454,6 1 207 435,4 Fossil fuel t consumption heat 31 607,7 332 014,1 545 653,0 89 205,0 96 398,1 1 094 877,9 t electricity Coal consumption t 191 492,0 1 067 594,7 2 899 685,0 351 877,8 222 390,6 4 733 040,1 heat t Coal calorific value/ avarage 3 454,0 3 479,0 3 295,4 3 645,0 4 085,4 3 406,3 kCal/kg heavy oil consumption 105,3 921,7 1 096,0 84,6 43,2 2 250,8 t Plant efficiency 21,20% 37,80% 40,34% 28,00% 40,48% 37,91% % Rate of the installed capacity 71,90% 57,60% 65,57% 63,30% 58,30% 62,0% % Source: Energy Regulatory Authority Energy balance of the TPP in the CES in 2011: The power plants in CES are using 15.14% (653.2 mil.KWh) of total generated electricity for their internal consumption. This value means that the plants are using 49,5 gm lignite coal for 1 kWh electricity generation, in other words they burnt 66406.5 t actual coal a year. If we are reducing internal consumption of Thermal Power Plant by only one unit (down to 14.14% or 43.19 mil.KWh), then we are saving 5114.5 t actual coal a year.

  13. Huvsgul Transmission 6 distribution Unit UB EB DS BN Bayanhongor 6 distribution companies of CETCO Parameter "CETCO" Distributioncompanies Parameters Erchim huch companies of CETCO Unit Erchim huch of CETCO 1000kWh Bought energy 3 844 447,0 3 604 289,1 3 844 447,0 Bought energy 1000kWh 1 849 488,9 945 317,3 466 409,8 286 108,6 31 432,8 25 531,7 3 604 289,1 1000kWh 117 930,3 504 757,8 658 053,7 Distribution loss 1000kWh 378 137,4 36 459,6 51 834,6 27 051,7 6 804,0 4 470,5 504 757,8 Distribution loss % 3,07% 14,00% 17,12% % 20,45% 3,86% 11,11% 9,46% 21,65% 17,51% 14,00% Sold energy 1000kWh 3 726 516,7 3 099 531,3 3 186 393,3 Source: Energy Regulatory Authority Sold energy 1000kWh 1 471 351,5 908 857,7 414 575,2 259 056,9 24 628,8 21 061,2 3 099 531,3 Source: Energy Regulatory Authority Transmission and distribution loss of CETCO in 2011 : • Loss of transmission and distribution in the CETCO is 17.12% or 658.1 mil.KWh amount of electricity. If we are reducing loss of transmission and distribution in the CETCO by only one unit (down to 16.12% or 38.3 mil.KWh), then we are saving 25980.5 ton actual coal a year on the Thermal Power Plants.

  14. Energy 5000,0 thousand kWh 3000.0-5000.0 1000.0-3000.0 500.0-1000.0 500.0 ???.???? Company Consumer consumption and above thousand kWh thousand kWh thousand kWh thousand kWh thousand kWh 1 UB EDN 15 160 975,0 19 72 669,0 102 153 664,4 180 115 849,0 11836 471 727,2 12152 974 884,7 2 EB EDN 3 774 102,8 1 4 454,7 4 6 506,6 11 6 805,9 4429 52 622,5 4448 844 492,5 3 BN EDN 6 151 541,8 1 3 321,3 7 15 215,4 11 7 949,3 2526 35 286,3 2551 213 314,0 4 DS EDN 9 242 738,8 3 11 454,8 16 29 566,5 14 9 979,0 2613 57 929,6 2655 351 668,7 5 Khuvsgul erchim suljee 0 - 0 - 0 - 3 2 302,1 1327 7 289,1 1330 9 591,2 6 Bayankhongor erchim suljee 0 - 0 - 0 - 1 663,9 692 5 869,4 693 6 533,3 7 Nolgo 0 - 0 - 0 - 3 2 302,1 9 7 289,1 12 9 591,2 8 Erchim tugeekh suljee 1 6 553,0 3 10 833,3 3 5 217,5 0 - 57 715,6 64 23 319,4 9 Erdenet amidral 0 - 0 - 0 - 1 599,5 435 5 119,5 436 5 719,0 10 UBTZ 1 5 019,6 1 3 788,0 7 10 713,0 17 11 698,9 1626 21 001,4 1652 52 220,8 Total 35 1 340 931,0 28 106 521,1 139 220 883,4 241 158 149,8 25550 664 849,6 25993 2 491 334,9 Source: Energy Regulatory Authority Electricity consumers of the Central Energy System : The electricity worth 205.3 thousand kWh will be economized in case these consumers’ consumption is economized by 15%.

  15. Enterprises № Consumer category UB Heating Network TPPs Total Consumer study of the industrial companies and enterprises Heating for industrial companies and Paying fordwelling-space 3 830 1 202 22 5 054 1 enterprises Paying with measurement system 724 2 842 8 3 574 1,1 Paying fordwelling-space 132 449 7 588 Industrial companies 1,2 Paying with measurement system 5 925 3 933 1,3 Paying fordwelling-space 62 85 1 148 State organizations 1,4 Paying with measurement system 167 336 1 504 1,5 Paying fordwelling-space 3 636 668 14 4 318 Others 1,6 Paying with measurement system 552 1 581 4 2 137 Air-condition 2 1 96 0 97 Paying per person 101 223 1 325 Heating energy for enterprises hot 3 Paying per ton 1 016 0 0 1 016 water Paying with measurement system 1 772 48 1 1 821 Technology hot water 4 1 387 1 448 0 2 835 Condensate 5 0 0 0 0 Water loss of the network 6 48 0 0 48 heating season 0 0 7 Technology steam 140 140 not heating season 0 0 Total enterprises 8 879 5 859 312 15 050 Study of end user consumers Total number of heat consumption paying household 8 116 545 21 698 84 138 327 heating season/per person/ 154 012 11 789 526 166 327 Paying per person Not heating season /per person Heating energy for households’ hot 154 012 11 789 526 166 327 9 water Households’ number 85 902 3 931 84 89 917 Households, who is paying with measurement system 30 643 17 767 0 48 410 Source: Energy Regulatory Authority Thermal energy consumers of the Central Heating System in UB:

  16. Rated load (GCal/h) dwelling- space 1000 m3 Consumption Consumer load Num- ber 1000 GCal Heating Hot water Air condition Total License holder, 10 GCal/h and above 21 2 035 379,37 452,74 69,60 0,35 522,69 10 GCal/h and above 4 44 512,17 14,35-0,92 4,08-1,17 0-8,93 8,45-18,43 527,4-33,8 5.0-10.0 GCal/h 22 150 129,88 7,03-2,69 3,22-0,32 5,46-1,05 5,15-9,83 258,3-98,8 2.0-5.0 GCal/h 66 206 651,84 3,37-4,76 0,6-1,5 0,02-2,97 2,08-4,76 76,5-174,9 2.0-1.0 GCal/h 138 181 931,70 4,76-0,55 1,5-0,57 2,91-0,1 1,01-1,94 37,1-71,3 1.0-0.001 GCal/h 2239 1 084 666,28 Source: UBEDN Classification of organizations that use centralized thermal energy in Ulaanbaatar city : It is difficult to measure consumers’ actual consumption due to the insufficient measurement of consumption of thermal energy. Therefore we consider that first of all the consumers that have thermal energy consumption above 1500GCal and project load above 2.0 Cal/h annually, should be selected as the “designated consumer”.

  17. Decrease of Unit of Conserved electricity Conserved coal Designated consumers Energy usage conservation Energy usage • Own consumption of TPPs 15,14% 14,14% 1 unit • 43,19 mill.kWh 25 980,5 t • Transmission and distribution loss 17,12% 16,12% 1 unit • 38,33 mill.kWh • 23 561,7 t Consumerwith 1 mill.kWhand above 1668,3 mill.kWh • 1418,0 mill.kWh 15% • 250,3 mill.kWh • 169 627,4 t • Consumer with 1 Gcal/h and above • 583,2 mill.kWh • 495,4 mill.kWh 15% • 102,1 mill.kWh • 32 183,7 t 87,8 ???.???? • 251353,3 t • 433,9 mill.kWh • 3099,5 mill.kWh 13,99% Summarizing the results of energy conservation:

  18. THANK YOU FOR THE ATTENTION

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