Hongsa Lignite power sale deal approved

The original memorandum of understanding (MoU) approved by the Surayud Chulanont government had been abandoned by the project's developers after construction costs soared.

The next step is for the Electricity Generating Authority of Thailand (Egat) to re-negotiate a new price with the Hongsa developers.

Out of the Hongsa project's generating capacity of 1.65 gigawatts, 1.47 gigawatts will be sold to Thailand and up to 175 megawatts to Laos.

The developers are two Thai energy firms, Banpu and Ratchaburi Electricity Generating Holding with 40 per cent each, and the Laotian government with 20 per cent.

Tawarat Sutabutr, director of the Energy Ministry's Policy and Strategy Coordination Office, said last week that though the revised 2007 Power Development Plan calls for importing 450 megawatts per year from neighbouring countries from 2015-2018, Thailand could begin doing so from 2011-2015 if it could secure the supplies at an appropriate rate.

An Energy Ministry source said that recently Laos' Department of Energy Promotion and Development requested Thailand's Energy Ministry to discuss many power project issues.

Laos wants Thailand to prepare new power purchase agreements for its projects whose terms have expired, namely Nam Ngum3 and Nam Theun 1, as wells for projects whose MoUs became unfeasible due to rising construction costs. Among those projects are Hongsa, Nam Ou and Nam Ngiep 1.

Laos also wants to talk about adjusting the electricity price of the Nam Ngum 2 project, which is under development, to cover inflated construction costs.

And it asked for Thailand to add the Xayabury hydropower project to the existing six projects in Laos from which Thailand will purchase power.