Source: www.FT.com

General Electric, the US conglomerate, is set to help build Mongolia’s first wind energy park in a $100m deal with Newcom, a Mongolian private investment company.

The agreement, GE’s first project in Mongolia and the country’s first wind park, highlights the market potential for renewable energy in the resource-rich east Asian country. The two companies said Salkhit wind farm, which they plan to open next year 70km south-east of Ulan Bator, the Mongolian capital, would supply almost 5 per cent of the country’s electricity.

“Energy demand in Mongolia is increasing by 8 to 10 per cent a year,” said Bayanjargal Byambasaikhan, Newcom chief executive. “Salkhit will help support Mongolia’s growing demand and also help facilitate further infrastructure development for railway, road and electrical infrastructure.”

Salkhit is one of the largest contracts inked by GE since John Rice, vice-chairman and chief executive of GE’s Global Growth & Operations, moved to Hong Kong earlier this year in an assignment seen as a signal of the growing economic weight of Asia, and particularly China, in multinationals’ global strategies.

The increasing exploration of Mongolia’s ample natural resources such as coal and copper, which are powering large neighbouring economies led by China, has driven rapid economic growth in the country of just 3m people. In the first half of this year, its gross domestic product grew at a rate of 17.3 per cent, the fastest in the world, according to the World Bank.

But with its wide, windswept high plains, the country has also large untapped potential for wind energy.

Newcom, which will run the Salkhit wind farm, is a diversified conglomerate with interests in telecoms, transportation and finance. The group owns Mongolia’s largest private airline and introduced mobile phones to the country by founding Mobicom, the leading mobile operator, in 1996.