Mongolia Plans to Restart the Arvaikheer Heating Station Project Through the 2027 Budget and PPP

en.Wedoany.com Reported - On September 19, Mongolian Prime Minister N. Uchral stated during an inspection tour in Arkhangai Province that the government plans to resolve the funding issue for the Arvaikheer heating station project within the framework of the 2027 national budget and accelerate subsequent construction through public-private partnership (PPP). The project is currently about 45% complete overall, and construction work has been at a standstill over the past year.

The Mongolian government plans to use future dividends from the Oyu Tolgoi project to complete heating station construction in 9 provinces, and the Arvaikheer project falls within the scope of this arrangement. The 2027 budget draft has now been submitted to the State Great Khural for deliberation, so this funding arrangement remains at the budget planning stage and cannot yet be described as fully secured project financing.

The Arvaikheer heating station has previously been supported by accompanying power supply and infrastructure construction. According to Mongolia's public investment data, the power supply and infrastructure project for the Arvaikheer heating station under construction was included in the national budget in 2024, with an implementation period through 2026 and a budget scale of approximately 11.164 billion tugrik, of which the 2025 public investment plan continues to allocate related construction funds.

As early as 2023, the Mongolian government had listed the expansion and renovation of the Arvaikheer heating station and its supporting heating network and power supply as key local infrastructure projects. The latest arrangement on September 19 mainly targets funding continuation and construction resumption after the standstill of the project under construction, and the next stage will depend on the approval of the 2027 national budget and the implementation of the PPP plan.

On the same day, the Mongolian government also disclosed that it had launched public bidding for renewable energy in 5 provinces for the first time, among which the Kharkhorin project in Arkhangai Province includes a 50MW photovoltaic power station and a 30MW/100MWh battery energy storage system. According to official disclosure on September 19, the 50MW photovoltaic project is currently about 45% complete and is planned to be put into operation before the winter peak load arrives in December this year. This project and the Arvaikheer heating station are different energy projects.