In Mongolia’s capital, Ulaanbaatar, a climate tech startup is tackling the city’s severe air pollution with a sophisticated energy solution. URECA, the company behind the initiative, is transforming traditional ger households from sources of coal smoke into clean energy hubs, creating a powerful network known as a Virtual Power Plant (VPP).
How Virtual Power Plants Work
Virtual Power Plants represent a fundamental shift in energy management, unlocking flexibility in an increasingly decentralized energy future. Instead of a single, large power station, a VPP is a cloud-based system that aggregates the capacities of numerous Distributed Energy Resources (DERs). In Ulaanbaatar’s ger districts, these resources are individual homes retrofitted by URECA with solar panels, energy storage batteries, high-efficiency electric heaters, and improved insulation.
Each home is equipped with Internet of Things (IoT) sensors, connecting it to a central control platform. This allows the network to operate as a single, dispatchable power plant. By intelligently coordinating these small-scale assets, the VPP provides essential services to the national grid, enhancing stability and managing demand in a way that traditional infrastructure cannot.
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AI-Driven Optimization of Virtual Power Plants
The core of URECA’s system is an advanced AI platform that orchestrates the flow of energy across the network. Monitoring energy data and local air quality in five-minute increments, the AI optimizes power consumption, deploys stored solar energy during peak hours, and minimizes reliance on the central grid. This synergistic effect not only eases the strain on national energy infrastructure but also significantly reduces the coal consumption responsible for the city’s air quality crisis.
The environmental impact is significant, with each participating household projected to reduce its carbon footprint by 12-13 tons of CO2 each year. URECA has built a novel business model around this achievement. Through its platform, these verified emission reductions are converted into carbon credits that households can sell. As co-founder Orchlon Enkhzetsgeg explained, this empowers residents to finance their own clean energy transition, generating income from their positive environmental impact.
Supported by programs like the European Bank for Reconstruction and Development’s Star Venture initiative, URECA is demonstrating a scalable model for urban sustainability. By combining smart grid technology with a unique carbon monetization strategy, the project is clearing Ulaanbaatar’s air while building a more resilient and equitable energy future from the ground up.
Sources
- Asia Pacific Virtual Power Plant Market Outlook to 2030
- Virtual power plants: unlocking flexibility in a decentralised energy …
- Optimization of cross-regional virtual power plant collaborative …
- The Synergistic Effect of Smart Microgrids and Virtual Power Plants …
