ULAANBAATAR, October 22, 2025 - In a significant step to strengthen Mongolia's electricity infrastructure, the World Bank has approved a new project designed to bolster electricity service reliability and security, and support the country's transition to a low-carbon energy future. The Fourth Energy Sector Project will focus on increasing the capacity and reliability of the Central Energy System's transmission grid while promoting the integration of renewable energy sources.
"The World Bank is pleased to continue supporting the Government of Mongolia in its efforts to strengthen the reliability and sustainability of the country's electricity system," said World Bank Country Manager for Mongolia Taehyun Lee. "This project will help advance Mongolia's low-carbon development goals while supporting inclusive economic growth and job creation."
Closely aligned with Mongolia's New Recovery Policy and Government Action Plan for 2024-2028, the project will support the construction of a 220 kV transmission line from the existing Mandal Substation to the new Uvurkhangai Substation, the expansion and development of existing and new power substations in Mandalgovi, Arvaikheer and Bayankhongor, and associated 110kV connection lines.
These investments are expected to improve access to reliable electricity services for about 200,000 people in the Central and Western Regions. Over 590MW of increased transmission capacity would reduce electricity outages by about 50 percent in the project areas and enable the development and integration of about 150MW of wind and solar PV in the electricity system. Climate proofing measures will be implemented in the construction of transmission lines and power substations to enhance their resilience.
The Fourth Energy Sector Project is backed by US$78 million from the World Bank's International Bank for Reconstruction and Development. It is part of the World Bank's Accelerating Sustainable Energy Transition Multi-Phase Programmatic Approach which aims to accelerate the scale-up and grid integration of renewable energy in participating countries across the East Asia and the Pacific region.
