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Date established: 16 April 2001. 3 Regulators + 27 staff members.
Mr. Ganjuur Radii was appointed as ERA Chairman in 2001. Regulators are nominated by the Cabinet Minister in charge of energy and appointed by the Prime Minister. Regulators are appointed for staggered terms 6, 4, 2 years which may be extended once for an additional six years and removal is for cause only.
The ERA is responsible for licensing of enterprises in electricity; district heating markets. According to the law the ERA issues operational licenses with the conditions and terms, which meets the interests of general public and society, sets and supervises prices and tariffs for electricity and heat and resolves disputes between consumers and licensees. The ERA approves electricity market rules. ERA is financed from the charges of regulatory service provided to licensees and is separate from the state budget.
| Industry and Market Structure |
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Electricity
- The Central electricity system consists of 5 co-generation, 1 electricity transmission and 8 electricity distribution companies. Except 1 private electricity distribution company they are all state owned joint stock company.
- The ERA introduced the Single Buyer Model (SBM) as a market model since September 2002 for central electricity system. In Mongolian case 5 generating companies sell its electricity at regulated price to the Single Buyer /The Central regional Electricity Transmission Company is market operator/ sells electricity to 8 distribution companies.
- Being tested in 2005, the spot market has been effective since 2006. The National Dispatching Center was selected to act as a Spot Market Operator. Electricity sales of the spot market were 8.3 million kWh in 2005, 7.0 million kWh in 2006 and 6.8 million kWh in 2007 indicating a gradual shrink.
- The ERA has started the auction market since August 2007, where an incremental electricity demand is auctioned among generating licensees for the best prices. There were only 5 transactions recorded for time being. The National Dispatching Center operates the auction market. Despite 35 million kWh of power being auctioned in 2007 only 7 million kWh were sold on the market.
Natural Gas
- Some companies just import liquefied gas from Russia and China by truck-tank for residential and industrial use.
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| Current Energy Issues |
- Preparation for transferring from the “Single Buyer Model” into the electricity wholesale contract market, development of the draft of the new market rule.
- Revision of tariffs of licensees considering the changes of external factors such as coal transportation, fuel oil, spares parts, depreciation etc.
- The draft of methodology for the two part tariffs of generating companies developed and its under discussion.
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