As a result, Roi-et Green, a subsidiary of Electricity Generating Plc (Egco), was pressured last year to buy husks from its partners for Bt600 per tonne compared to about Bt150 before.

Husk prices boomed after Som Mai built the Bua Sommai Power Plant, a bio-mass operation, near the site of the Roi-et Green Power Plant. Many of the husks that should have been supplied to Egco's power plant went to the Bua Sommai instead. Pornchai Rujiprapa, deputy permanent secretary of the Ministry of Energy, said the conflict would affect country's policy of promoting investments in bio-mass power plants.

"The higher production costs of bio-mass power plants will consequently cause a rise in electricity prices," he said.

To resolve the shortage of materials, Pornchai said the ministry was mulling a move to enhance regulations for bio-mass power plants, to ensure they do not locate too close to one another.

Roi-et Green, with registered capital of Bt180 million, has a capacity of 8.8 megawatts. Its plant cost about Bt600 million. It has signed a contract with Egat Plc to supply it with electricity for 21 years, effective May 26.

Somyos Polachan, chairman, said that the Roi-et Green Power Plant was in the process of filing a lawsuit charging Som Mai Roi Et Rice Mill with breaching their contract.

Under the contract, Som Mai Roi Et Rice Mill, which holds a 5-per-cent stake in Roi-et Green Power Plant, had agreed to supply raw materials to the plant. But Som Mai, instead, supplied its own power plant, located nearby.

Somyos said the company's material costs had increased by Bt50 million over what it had expected to pay under the contract.

Watcharapong Thongrung

The Nation

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