The collective impacts of climate change, energy dependence, and environmental degradation are a lethal combination and are a severe hindrance to Mongolia’s development progress and peoples’ well-being. The analysis and the numbers, current and projected forward, point to major transformations required if to mitigate these impacts. That means Mongolia must invest in green transitions across key sectors of the economy. While the costs of such transitions can be significant in the short run, they are nowhere close to the costs of delay or inaction.

Why the Urgency of a Green Transition

Despite contributing only 0.1 percent of global greenhouse gas (GHG) emissions, Mongolia’s per capita emissions are still significantly high due to its heavy reliance on coal for energy production. The country faces severe challenges in meeting energy consumption needs and remains highly dependent on energy imports. Ranking 116 out of 120 countries on the Energy Transition Index highlights the significant challenges and a lack of progress in transitioning to renewable energy, including outdated energy infrastructure.

While mining contributes substantially to GDP, it employs only a small fraction of the labour force while resulting in environmentally damaging practices. Water and air pollution, for example.  In contrast, the agriculture and herding sector, which provides livelihoods for over a quarter of the households, is highly vulnerable to climate change.

Many of the recent international media coverage on Mongolia has been about the dzud. Why now? With accelerated climate change, the nature and severity of the dzud, otherwise a standard part of the country’s narrative, is also changing. The country experienced a 2.46°C increase in average temperatures over the past 80 years, leading to more frequent disasters such as dzuds, droughts, floods, sandstorms, and wildfires. During the last disastrous dzud, nearly 11.5 percent of the nation’s livestock was lost, severely impacting thousands of herders and the national economy. Over 70 percent of the land is degraded, and water resources are depleting rapidly. Over half of Mongolia’s population, residing in the capital city, suffers from one of the poorest air qualities in the world resulting from coal-based industrial air pollution and coal-heating solutions.

Pathways to a Sustainable Future

Mongolia’s development model, heavily dependent on the mining sector, particularly coal production, needs an upgrade if the green transition is to become a reality. And indeed, this is costly in the short term, for instance with initial clean-energy infrastructure to be introduced while divesting of stranded coal assets. Think of it like upgrading a house: while it requires an upfront investment, it pays off by reducing utility bills, increasing the house's market value, and preventing costly emergency repairs in the future. It makes the house remain strong as a safer, healthier shelter for generations to come. Similarly, investing in green transition might have upfront costs but will lead to long-term economic and social benefits, with improved environmental sustainability.

To successfully navigate a green transition, Mongolia will require a long-term plan that is developed through a consultative process, to ensure all stakeholders – communities, local leaders, government entities, businesses and service providers, current and potential investors - have a common understanding and can take coordinated actions. Understanding, for each sector and region, what constitutes a successful green transition and being transparent about pain points and gains, with winners and losers in the immediate term, is what also helps to manage a just transition process, politically, systematically and in a fair manner.

Mobilizing sustainable finance is an imperative to bridge the transition financing gap. Mongolia’s abundant renewable energy resources, estimated at around 2.6 terawatts (TW), offer a significant opportunity for not only supplying domestic needs but also to extend it to energy exports. Shifting away from coal towards renewable energy sources, such as wind and solar, also creates new economic opportunities and can be a significant contribution to the national budget. So, after the initial start-up cost outlays, the transition can begin to pay for itself, and more.

Beyond Business-as-Usual

Managing a green transition is a fundamental change process that requires a future-fit governance approach that strengthens the country’s capabilities for anticipation and preparedness. This involves fostering change through strong political will, collaborative leadership, and active civic engagement. Governance must also be adaptive, capable of making necessary course corrections to stay on track and respond to emerging challenges.

There is a growing momentum of support for a green transition among Mongolia’s leaders and policy- makers, who have made bold commitments to reduce greenhouse gas emissions by 22.7 percent by 2030 and achieve net-zero emissions by 2050. The Green Development Policy, as outlined in Vision 2050 is underpinned by the makings of a green and sustainable economy that also works to protect the country’s natural environment.

Social protection policies would need to accompany green transition strategies to ensure inclusivity and support for vulnerable segments of society, and those immediately impacted by the change. For example, those working in coal-fire plants who would need reskilling for new jobs, or adequate pensions if they are to retire.

From reducing GHGs through Nationally Determined Contributions (NDCs), and long-term low-emission strategies to explore Green Futures, Mongolia has a new agenda to deliver. And a business-as-usual approach will not suffice to achieve the pace of sustainable progress the country needs. Phasing out coal, developing carbon credit markets, investing in renewable assets, upgraded grids and storage capacity, and using strategic foresight planning and innovative finance mechanisms are all essential steps that require a determined all-of-society effort.

Strong and sustained domestic and global partnerships and expertise will be crucial in this journey, as it navigates local and global challenges and opportunities. For nearly 50 years, UNDP has been a trusted partner in Mongolia’s development journey, actively supporting the analytics, capabilities and systems changes needed together with the Government of Mongolia, civil society, private sector, and development partners to help the country reach its goals.

Mongolia’s sustainable future depends on a swift green transition. And not a moment too soon.

* Kanni Wignaraja is UN Assistant Secretary-General and UNDP Regional Director for Asia and the Pacific; Matilda Dimovska is UNDP Resident Representative in Mongolia