Egat forecasts Bt632-bn investment

Pichaya Changsorn

The Nation April 5, 2014 1:00 am
The Electricity Generating Authority of Thailand will have to invest Bt632 billion during the next 10 years, about half to expand its transmission network, its officials say.

The Electricity Generating Authority of Thailand will have to invest Bt632 billion during the next 10 years, about half to expand its transmission network, its officials say.

Egat governor Soonchai Kumnoonsate said the state-owned power utility would have to spend about Bt330 billion to improve the stability and reliability of the national power grid between now and 2024.

The investment plans include major overhauls of transmission networks in the North and Northeastern regions to cope with increasing electricity purchases from neighbouring countries and from renewable and alternative-fuelled power producers, and a new 500-kilovolt transmission line to the Southern region.

Poonsuk Tochanakarn, deputy governor for accounts and finance, said Egat expected no difficulty in finding funding support for its investment projects planned for the next five years, which would require a total budget of Bt345 billion, or about Bt55 billion a year.

“During the past six years, our EBITDA [earnings before interest, tax, depreciation and amortisation, a measure of cash flow] averaged Bt58 billion per annum. We have the capability to invest,” he said.

A delay in the launch of Egat’s Bt17-billion infrastructure fund due to the political instability will not affect the authority’s financial liquidity, since its investment obligations total only Bt40 billion this year, Poonsuk said.

“As soon as we receive Cabinet’s approval, the fund can be launched within the following six months, plus or minus a month or two.”

He said the infrastructure fund, which would securitise future income from the North Bangkok Power Plant’s new generating unit, would incur higher financial costs for Egat than bank loans or issuing bonds. Nevertheless, Egat also has to consider the country’s overall need to keep public debt under half of gross domestic product.

“We have the capability to borrow at low cost. Most recently, we issued a 15-year bond at a coupon rate of only 4.725 per cent. A foreign bank has also offered to lend us a 10-year baht loan at only 3.5-per-cent interest and with no guarantee conditions,” he said.

Suthon Boonprasong, deputy governor for transmission systems, said that considering lower GDP growth forecasts and weather conditions, Egat had lowered its estimate for peak electricity demand this year slightly to 26,752 megawatts, compared with the previous forecast of 27,000MW and the peak consumption of 26,598MW last year.

Governor Soonchai said the estimate for power consumption in 2030, at the end of the latest 15-year Power Development Plan, was likely to be cut by 5,000MW to 47,000MW when the PDP is reviewed.

He said Thailand’s electricity tariff, already one of the highest in Asean, could go up to Bt5-Bt6 per kilowatt-hour in the future, compared with about Bt3.20 at present, if Egat could not build coal-fired power plants and had to rely more on liquefied natural gas as the domestic natural-gas supply dwindles.

Egat currently buys electricity from a privately owned coal-fuelled power producer at Bt2.90 per kilowatt-hour, compared with Bt4.2 from power plants that use LNG under the recently closed Independent Power Producers programme.

According to Egat data revealed yesterday, Thailand’s electricity tariff is currently about 10.8 US cents per kilowatt-hour, compared with 5.8 cents in Myanmar, 6.7 cents in Indonesia, 6.9 cents in Vietnam, 10.3 cents in Malaysia, and 15 cents in Cambodia.

Meanwhile, Soomchai said Egat and other involved agencies were devising plans to cope with the shutdown of the Thailand-Malaysia Joint Development Area’s gas fields from June 13 to July 10, which poses a risk to power-supply stability in the Southern region. The South will have to depend more on electricity supply from the Central region to an amount that exceeds a safety-zone level if it cannot successfully implement power-conservation measures.



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