GCF and XacBank finance large-scale solar project

XacBank has become Mongolia’s first private bank to fund the completion of a large-scale, solar plant in a financing partnership with the Green Climate Fund (GCF). The 10MWh solar photovoltaic (PV) plant, completed at the end of last year, has started feeding into Mongolia’s main electricity grid to help drive the country’s transition to renewables. The new solar plant is located in the Sumber Soum area of Mongolia’s Govisümber province.

XacBank’s ability to fund the construction of the Sumber solar power plant in a little over half a year was buoyed by GCF’s ability to plug the financial risk gap for initial renewable investment. GCF alleviated the financial risk through a long-term, concessional loan of USD 8.7 million.

The start of the solar power plant operations comes as GCF implements a growing number of climate finance initiatives around the planet from its current portfolio of 93 approved projects, worth a total USD 4.6 billion in investment.

The solar plant – built with a total investment of USD 17.6 investment – is forecast to reduce greenhouse gas emissions by 12,270 tons annually, while at the same time providing 15,395 MWh of electricity every year.

The power plant is being operated by Mongolian company ESB, with Japanese partner firm Sankou Seiki providing most of the technological input in its construction, including the assembly of the plant’s 31,000 solar panels.