Lao PDR is seeking for Thailand’s agreeing to buy wind power from Monsoon Wind Farm 600 MW

Mr. Viraphonh Viravong, Laos’ Deputy Minister of Energy and Mines, said at the “Global Wind Day 2016” forum hosted recently in Bangkok that Laos has been pursuing negotiations on power purchasing issue with the Thai Ministry of Energy in various occasions. The talks have been conducted at the meeting with Thai Energy Minister General Anantaporn Kanjanarat at the opening ceremony of Hongsa Power plant in Laos in late 2015, at a bilateral talks among the two countries at international conference and exhibition the Sustainable Energy &   Technology Asia 2016 (SETA 2016) in late March this year and at the most recent visit of the Thai counterpart to Xayaburi hydro power plant in Laos in May.

Consequently, the two neighbors initially agreed to expand the amount of power purchase under the existing MoU by another 2,000-3,000 MW, from 7,000 MW currently. Mr. Viraphonh said he expects the discussion on the enlargement of the electricity buying amount to up to 10,000 MW will be sorted out and commonly agreed before the start of the coming ASEAN Summit, which Laos will host in this September, and that the two partners will be able to sign the MoU on the subject during the meeting.

Besides, Mr Viraphonh also revealed that Laos has purposed to Thailand for another cooperation focusing on renewable energy. He asked Thailand to consider buying more electricity generated from other kinds of renewable energy from Laos, especially the wind power energy in which Laos can generate at a cost significantly lower than the cost of electricity generated by from Thailand’s own investment on a new power plant.  Mr Viraphonh said Thailand and Laos should have a separate MoU on renewable energy that indicate the areas of cooperation and an additional amount of power to be acquired.  

“This collaboration will reflect the leading role of the two nations on the development of renewable energy industry in the region.  It will also prove to global community that Thailand and Laos proceed according to the agreement to reduce greenhouse gas announced at the United Nation Climate Conference in Paris, or COP21, late last year”, Mr. Viraphonh said.

However, Thailand hasn’t yet agreed upon the proposed scheme, he said.

Mr Viraphonh elaborated that the MoU for renewable energy cooperation would help to accelerate more kinds of renewable energy to be included in power purchasing plan between the two countries. He pointed out that this first wind power project in Laos is developed by the Thai company and added that Laos is pleased to give any advantage from carbon credit derived from the wind power project in Laos to Thailand, given Laos is already accredited great quantity of carbon credit from numerous of its hydropower projects.

“Considering economic-wise, buying country generate 10 times benefit from electricity purchase. While seller country receives 10, the buyer country can multiply the benefit to 100. But we are good with this condition. What we are looking for at the moment is the mutual benefit of Thailand and Laos in longer term that we can together lift up renewable energy in our region to international standard. That’s why I have put everything on the table for discussion with the Thai government,” Mr. Viraphonh said.

Mr. Viraphonh elaborated that the Ministry of Energy and Mines of Laos will have to explicate more details of the wind power project to Thailand, especially on technical concerns, to ensure about the consistency and security of the electricity supply, the stability of the production and, in particular, the cost of electricity that is proven lower than the gas-plant power. In addition, Laos doesn’t request for renewable energy subsidy from Thailand when purchasing the wind power from Laos.

Mr. Nat Hutanuwatr, Chief Operating Officer, Impact Electron Siam Co., Ltd., or IES, said that the company has been granted exclusive right to develop the Monsoon Wind Power project that locates in Dak Cheung district of Sekong province and Sanxay district of Attapeu province in the southern part of Laos, around 150 kilometers from the Thai border at Ubon Ratchathani province and around 50 kilometers from the border of Danang, Vietnam.  The 600 MW wind farm is the first in Laos and the largest in ASEAN.

Mr Nat said that the project, if it is materialized, will help reduce greenhouse gas emission by 60.7 million tonnes throughout the project maturity of 25 years. This is one of main reason why the Laos government lends a full support to the project, he said.

The project is expected to cost approximately USD 1.5 billion, or around THB 54 billion. Of the total investment, around USD 1.2 billion will be allocated for wind power generation and the balance of USD 300 million will be set aside for electricity transmission system of 500 KV to connect to the buying countries. Laos gives a full authority to the wind power developer on selling decision so that the company can sell to anyone. However, the company give Thailand a priority as it is a hometown of the developer.

The recent organized Global Wind Day 2016 is also a timely platform for IES that it announced an official cooperation on engineering, technical solution and construction with the world leading wind turbine technology supplier from Demark, Vestas. On financial front, IES received a joint letter of intent from the Asian Development Bank (ADB) and the World Bank Group’s International Finance Cooperation (IFC) to provide financial support to the project for USD 1.05 billion, or around 70% of the total project cost.

The most distinguish advantage of the Monsoon Wind Power Project is that the project can sell electricity to Thailand at cost lower than those from gas plants all along the maturity of the project for 25 years. In addition, the Thai government doesn’t have to subsidise the cost in the form of Feed in Tariff rate of THB 6.06 per unit like it has done for wind power project in Thailand.

The Monsoon Wind Power Project, more importantly, will strengthen Thailand’s power security especially during drought period in the year when hydropower plants in Laos generate lower electricity and electricity consumption in Thailand would reach its peak and production at higher-cost power plants is required at the peak load.  With wind power from Laos, Thailand can reduce reliance on high-cost gas plant during the peak load, Mr Nat comment.    


“The project is waiting for Thai government to allow for further negotiation on the Power Purchasing Agreement. The project will take 3 years for construction and will be able to start supplying the power to the system right after that,” Mr. Nat said.


Credit to: Energy News Center

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