Purchases from Hongsa plant agreed

Business News - Friday December 14, 2007

ELECTRICITY

Purchases from Hongsa plant agreed

YUTHANA PRAIWAN

The government has confirmed an agreement to buy electricity from the operators of the Hongsa power plant in Laos, according to Energy Minister Piyasvasti Amranand. The National Energy Policy Council (NEPC) yesterday approved a memorandum of understanding with the operators of the lignite-fired plant to purchase 1,473 megawatts of power over an agreement lasting for 25 years.

The US$2.61-billion Hongsa plant, with a total generating capacity of 1,800 MW, is 40% owned by Banpu Plc, the country's biggest coal mining company. Ratchaburi Electricity Generating Holding Plc also holds 40% and the Laotian government 20%.

Construction of the plant is scheduled to start next year and it will begin to generate power for the Electricity Generating Authority of Thailand (Egat) in 2013. The average price will 2.05 baht per unit throughout agreement period.

Honga is one of the power plants covered in an agreement made between Egat and the Vientiane government to purchase a total of 7,000 MW from hydroelectric and coal-fired plants to serve growing demand in Thailand.

The electricity from Hongsa will be transmitted via a 500-kilovolt line at the Thai-Laos border in Nan province, a total length of 313 kilometres from the site to the main grid.

Egat also has agreements to buy 1,517 MW from the Nam Theun 2 and Nam Ngum 2 hydroelectric plants, which are now under construction and will come online in 2009 and 2013 respectively.

Power-purchase contracts for an additional 1,520 M from five more hydropower plants are expected to be finalised soon.

They include Xeset 2 (76 MW), the Theun Hinboun expansion phase of 220 MW, Nam Ngum 3 (440 MW), Nam Theun 1 (523 MW) and Nam Ngiep (261 MW). Their output would be linked to the grid between 2009 and 2014.

As well, Thai officials expect to conclude an agreement with Laos for the Nam Ou hydropower plant, with a capacity of 1,043 MW, which is due to start operations by 2013.

Bangkok Post