The Upscaling Renewable Energy Sector Project will help develop a 40.5 MW distributed renewable energy system using solar photovoltaic and wind powers with advanced battery storage technology and energy management systems to supply clean and reliable electricity to geographically scattered local towns in western Mongolia, which rely on high-cost and high-carbonintensive electricity imports from neighboring countries. Meanwhile, the project will also showcase a 500-kilowatt thermal shallowground heat pump system, which will supply pollutant-free space heating in public buildings. This system could be scaled up in the future and, ultimately, help mitigate local air pollution during winter. The distributed renewable energy system financed by the project will help connect more than 258,313 people in the project areas to clean and reliable electricity and heat supply, while a total of 87,968 tons of carbon dioxide emissions annually will be avoided by 2023. The total cost of the project is USD 66.22 million, with the Government of Mongolia contributing USD 5.62 million. It is expected to be completed by 2023. “The Government of Mongolia has been making efforts to increase renewable energy use since 2000. However, the share of renewable energy in Mongolia’s energy mix remains low at 12 percent. ADB’s assistance for this project will help the government meet its goals under its State Policy on Energy, 2015– 2030, which aims to raise the share of renewable energy to 20 percent by 2023 and 30 percent by 2030,” the ADB highlighted.