Thursday, 25th of July 2024

Single buyer model

One of the main objectives of the ERC is to transform the energy sector of Mongolia into a market oriented system. Currently, the Single Buyer model, which is adopted in the frame of the Central Energy System, is regulated by an automatic cash flow mechanism. Spot and auction markets are also implemented among the Central Energy System.

With the purpose of creating a market environment in energy production and supply, the Single Buyer Model has been in place since September 2002.

Single Buyer purchases electricity from the 5 Power Plants operating in the Central region and through import from Russia and sell it to the 10 electricity distribution companies. Central Regional Electricity Transmission Network has been operating as a Single Buyer since September 2002.

In 2011, the Single Buyer purchased 3844.4 million kWh of electricity, equivalent to MNT 231.7 billion, from the generators and through import from Russia. The amount of electricity purchased increased by 6.1% from 2010.

In 2001, before the inception of the Single Buyer Model, the rate of sales revenue collection was only about 76.5%. This rate has increased every year and reached 101.8% in 2011 and collected additional MNT 4.3 billion more than planned (MNT 231.7 billion) in 2011 and accumulated debts of previous years were reduced accordingly.