Thanks to its very high levels of solar irradiation and wind-power generation capacity, Mongolia has attracted interest from the private sector as a potential location to develop renewable hydrogen pilot projects. At the same time, the government has included the development of hydrogen production as an element of the energy pillar of its New Recovery Policy. Drawing on OECD experience and expertise in renewable hydrogen development and financing, this report aims at helping the government of Mongolia develop a vision for the potential role of this technology in its domestic agenda for decarbonising the economy. It identifies policy reforms and measures that will be needed to support such development.

While the competitiveness of any domestic industrial production requiring large economies of scale – such as renewable hydrogen – will depend on Mongolia’s ability to export such production, given the small size of its domestic markets, the existence of domestic demand for this technology will be critical to the success of a future national renewable hydrogen strategy . This is because early-stage development typically requires domestic offtake contracts, while the infrastructure needed for export will take years to develop. Mongolian industry remains in a very early stage of its own low-carbon transition. Within the industrial and investment policy framework, further and better incentives are needed to encourage firm-level investments in technology and infrastructure that can align future industrial output with emissions reduction objectives. Moreover, policy interventions will be required to foster technology transfer and innovation, while aligning on emerging international standards for the safe and sustainable production and trade of renewable hydrogen. Finally, de-risking investment and ensuring environmental sustainability will require the authorities to address the question of sustainable water usage for renewable hydrogen production . Beyond providing directions for a future national renewable hydrogen strategy, many of the recommendations provided in this report can help Mongolia align its investment and innovation policy frameworks with low-carbon development objectives which, in turn, is critical if the country is to reach its climate and economic goals.

See the full report https://www.oecd.org/.../towards-a-renewable-hydrogen...