During the COP17 conference in Ulaanbaatar, Mongolia offered potential data centre investors tax relief, data security, cheap energy, land, and cold weather.
Mongolia is positioning itself as a global data centre hub, signing agreements for 863 megawatts of data centre capacity on the sidelines of a United Nations conference on desertification that brought 197 delegations to Ulaanbaatar this month.

The move to attract data centre investment was the most concrete economic outcome of the 12-day COP17 conference of the UN Convention to Combat Desertification, where delegates are discussing how to restore land degraded by climate change.

According to Deputy Prime Minister Togmid Dorjkhand, Mongolia has three main competitive advantages: cheap renewable energy, a cold climate that reduces cooling costs, and a vast land area and stable legal framework.

"We have a lot of energy generation potential, above the ground and under the ground and we have all kinds of deposits, uranium and coal and other resources," Togmid told Euronews.

"And yes, we are a very cold country, eight months a year are very cold. Cold weather is important for the data centres because they need a lot of cooling, so the colder the weather the more you save on cooling."

"There is a third reason, that we are a democracy, we are governed by law and not by a person or a party. We have a strong legal environment that protects the investors,” Togmid said.

Togmid told Euronews energy costs for data centres in Mongolia would be below 4 cents per kilowatt-hour — compared with 14 to 16 cents in the US — and that grid connection could be delivered within 24 months.

He said investors could expect returns of around 18%. "We are 40% cheaper than other countries," he said.

Digital Development, Innovation and Communications Minister Chinbat Nomin presented Mongolia’s investment opportunities in green data centres, while Deputy Prime Minister Togmid delivered the closing remarks.

"We offer more than just natural resources, we offer safety and data sovereignty," Chinbat told investors. "Once you store data it is secure and the data connection is also sovereign and secure."

"We hope that Mongolia will become a data centre hub, especially for those who wish to serve one of the largest markets, China, but keep the data outside China."

Ten memoranda of understanding were signed at the event, Minister Chinbat said.

The government has drafted a Data Law and a strategic framework called "Sovereign by Design," built around three pillars: energy sovereignty, network sovereignty and legal and regulatory sovereignty.

The government has said it is not seeking to build and operate data centres itself, but to create the conditions for domestic and international investors to do so.

Up to $2 billion in financing is available for eligible green and renewable infrastructure projects. The government said it had benchmarked its investment framework against those of 26 countries.

Private-sector energy producers are developing hybrid power solutions that can supply new data centre projects within 24 months, allowing energy and construction to advance simultaneously.

COP17 and Mongolia's desertification crisis
The investment drive ran alongside the conference's main agenda. The UN Convention to Combat Desertification was adopted in 1994 and has 197 signatory countries.

Its conferences bring together governments, scientists and financial institutions to address land degradation, drought and desertification, processes that are accelerating globally due to climate change and are estimated to affect more than 3 billion people.

Mongolia is among the most affected countries: roughly 77% of its land is affected by desertification, a figure that has worsened as temperatures in the country have risen at more than twice the global average.

A local newspaper published a piece under the headline "World comes to Ulaanbaatar. Now what?", echoing a question on many minds: whether a country that hosted the conference would see concrete benefits beyond the diplomatic occasion.

In Mongolia's telling, the answer is the data centre push. The government used the concentration of visiting investors and ministers to advance an agenda that sits at the intersection of its environmental commitments and its economic development strategy, marketing renewable energy potential and cold climate as assets rather than liabilities.

Published Date:2026-08-26