During its plenary session on December 26, 2024, the State Great Khural of Mongolia discussed a draft Law on Ratifying the Agreement between the Governments of Mongolia and the Russian Federation on the Development of Design for the Project to Expand and Modernize the Thermal Power Plant No. 3 of Ulaanbaatar City.

Minister of Energy of Mongolia Choijilsuren Battogtokh noted, "The Thermal Power Plant No. 3, with its 48 MW medium-pressure section, was commissioned between 1968 and 1975, and the 100 MW high-pressure section was put into operation between 1976 and 1981. With the addition of a 50 MW turbine generator in 2014, the installed capacity reached 198 MW for electricity and 585 GCal per hour for heat. It has been in operation for 56 years now. The Plant is located in the most optimal place to support Ulaanbaatar's heat supply network. It provides 32 percent of the heat supply of Ulaanbaatar and 16 percent of the central region's electricity. During the winter, the operation of thermal power plants without proper preparation increases the risk of limiting heat supply to consumers due to technical malfunctions at Thermal Power Plant No. 3. To mitigate this risk, the Plant needs to be expanded and modernized in the near future."

The Government of Mongolia has included in its Action Program a two-phase expansion of the Plant. In the first phase, a new Thermal Power Plant with a capacity of 50 MW of electricity and 100 GCal per hour of heat will be built. The existing 48 MW plant will be decommissioned, and a new thermal power plant with a capacity of 250 MW of electricity and 400 GCal per hour of heat will be constructed in its place. The design work for this will be undertaken during the second phase.

During the official visit of the President of Mongolia to the Russian Federation in 2021, the "Thermal Power Plant No. 3" (TPP No. 3) JSC and "Inter Rao-Export" LLC signed a Memorandum of Understanding on Cooperation, launching the development of a feasibility study for the expansion project. "Inter Rao-Export" LLC financed the feasibility study with its funds and delivered it to TPP No. 3 in September 2022. To determine the total project cost and construction timeline accurately, the Ministry of Energy of Mongolia first developed a draft Agreement between the Governments of Mongolia and the Russian Federation on the Development of Design for the Project to Expand and Modernize the Thermal Power Plant No. 3 of Ulaanbaatar City.

In August 2024, the Government of Mongolia discussed the draft Agreement with the Standing Committees on Security and Foreign Policy, Economics, and Budget of the State Great Khural. Subsequently, based on the minutes of the meeting of the Standing Committee on Security and Foreign Policy and under Directive No. 48 of the Prime Minister of Mongolia, the Minister of Energy was authorized to sign the Agreement with the Russian side. On September 3, 2024, during the official visit of President of the Russian Federation Vladimir Putin to Mongolia, the two sides signed the Agreement, which specifies the scope and general conditions of the engineering surveys and research for the development of the project's design. It also designates "Thermal Power Plant No. 3" JSC as the client and the "Inter Rao-Export" LLC as the contractor.

Based on the presentation by Minister of Energy B. Choijilsuren, and the conclusions of the Standing Committee on Security and Foreign Policy, Members of the State Great Khural asked questions and made remarks. Following this, a vote was held on whether to approve the draft Law on Ratifying the Agreement between the Governments of Mongolia and the Russian Federation on the Development of Design for the Project to Expand and Modernize the Thermal Power Plant No. 3 of Ulaanbaatar City. A majority of the Members voted in favor, and the State Great Khural approved the draft Law.