EGAT pushes 2 projects

The two projects, which entail a combined investment of Bt14 billion, cover the transmission grid to connect independent power producers' plants and the transmission grid to connect the Hongsa power plant in Laos. The first project worth Bt8 billion will be carried out during 2009-2013 and the second project will be invested during 2009-2014.

"The two projects' schedule is moved up a year earlier and we're seeking more baht loans to finance them," said Sombat Sarntijaree, governor of the power agency.

From the Bt80-billion loan portfolio, only 10 per cent is denominated in foreign currencies.

Sombat added that Egat will invest totally Bt40 billion to Bt50 billion this year. Of the plan to issue Bt46 billion bonds throughout 2009, the agency has issued Bt43 billion.

The Bt3 billion remaining bonds will be issued in September, carrying maturity of three years and interest rate of 2 per cent per annum.

Deputy Prime Minister Korbsak Sabhavasu yesterday paid a visit to Egat. He instructed the agency to increase the baht-denominated financing so that the investment would not lead to further appreciation in the Thai currency.

"Egat will also discuss with the Provincial Electricity Generating and Metropolitan Electricity Generating authorities over measures to reduce power demand during peak times. They will also find ways to help reduce crude-oil imports," Korbsak said.

As a result of the economic problems, power demand in the first seven months of this year declined 3 per cent on year, according to assistant governor Sineenat Sittiratanarangsee. Egat's earnings have declined 10-20 per cent. In 2008, it earned Bt25 billion in net profit. Sineenat added that Egat had received some compensation for the agency's cost in maintaining the fuel tariff (FT), which amounts to Bt23 billion. She added that the FT maintenance cost is minimal thanks to the relatively lower fuel prices.

"Egat's liquidity condition should improve after the bond issuance. This year, Egat should be able to remit Bt10 billion to the government," she said, adding that Egat plans to invest Bt30 billion next year.