Context
Ulaanbaatar, the world’s coldest capital, is home to half of Mongolia’s population. Approximately 20% of the population lives in precast apartments, which represent 30% of the city’s building inventory. After 50 years of use, the insulation of these buildings is inadequate. Improving the energy efficiency of these buildings is a priority for the sector and the updated Mongolia’s Nationally Determined Contribution (NDC). However, the country’s transition to a carbon-neutral development pathway remains constrained due to several technical, financial, policy and institutional barriers.
Goals and approach to transformational change
The “Mongolia – Energy Performance Contracting for Residential Retrofitting in Ulaanbaatar City” project aims to bring a fundamental change in the energy efficiency of buildings in the housing sector by addressing the financing barrier for the energy efficiency improvements The project focuses on a thermo-technical retrofitting (TTR) program supporting the market conditions to scale up investments in energy efficiency. An estimated 14,068 households (over 53,000 residents) living in 375 precast building blocks benefit from the project through improved thermal comfort and indoor air quality, as well as increased value and lifespan of the buildings.
Components and support mechanisms
The Technical Cooperation (TC) component focuses on improving policy and strengthening institutional capacity to facilitate investment in thermal insulation. Training and capacity building activities benefit key stakeholders, including construction companies, homeowners’ associations, the Municipality of Ulaanbaatar (MUB), and the Housing and Public Utilities Authority and Ulaanbaatar District Heating Company (OSNAAUG).
The project supports shifting the heat tariff structure to market-based rates and consumption-based billing. The project’s Financial Cooperation (FC) component supports investments in high-quality TTR renovations through grants. It leverages EUR 16 million public and EUR 5.6 million private co-funding. The project introduces first ever on-bill repayment (OBR) system for households in Mongolia.
Long-term impact
The project aims to directly mitigate approximately 220 000 tCO2e during the project duration and 2.4 MtCO2e over the lifetime of buildings at a cost efficiency of 15 EUR/tCO2e. Additional 2.3 MtCO2e of indirect emissions are mitigated due to continuous retrofitting efforts.
