Gulf JP, a leading powerplant operator, makes good relationships with communities a priority to ensure smooth operations in the years to come, its president says.
Sarath Ratanavadi said that through more than a decade of operations in Thailand, the company had learned that good community relations, particularly with village leaders, is the key to success in light of legal complexities involving the industry.
Though Energy Ministry policy is to support the establishment of electricalpower generation using alternative energy sources and many are investing in this business, it is not easy to set up some kinds of power plants because of complicated environmental laws and local people's perception, he said.
"Our environmental legislation may be more complicated than in other countries. Some laws, such as requiring environmental impact assessments for renewableenergy power plants with a capacity less than 10 megawatts, are not necessary. This makes it difficult for investors to establish such power plants," he said.
Sarath said power plants could be constructed with little difficulty once people living nearby accepted the idea of having a power plant in their community. Moreover, the acceptance and understanding of village leaders were very important because villagers believe in what their leaders say.
"If you [investors] have serious intentions to operate power plants, you need to make the local villages understand what you are going to do," he said. "What can you do to make them happy about the environment after the power plant is in operation? And what can you give them back to help develop the communities? You have to realise these needs of local people."
Gulf Electric, the parent company of Gulf JP, had a plan to operate a coalfired power plant in Bor Nok, Prachuap Khiri Khan province, about a decade ago. But the project fell through because of the strong protests of local villagers, with the company struggling for years to come to an understanding with them. Finally, it decided to move to another location and so far has no plan to construct coalfired power plants.
Sarath is also an executive of Gulf Electric.
Gulf JP chose Kaeng Khoi, Saraburi, for the location of a naturalgasfired power plant. Kaeng Khoi 2 Power Plant, for which the company signed a power purchase agreement with the Electricity Generating Authority of Thailand, started operation in May 2007 with a capacity of 1,468MW.
Sarath said that before the Kaeng Khoi plant was constructed, Gulf JP reviewed local people's comments and concerns for a year. It set up a community participation committee and a plant inspection committee before it constructed the facility. The committees still meet every month.
The company also set up a community development fund for villages near the plant. The fund is a role model for the Community Development Fund implemented by the Energy Ministry. Before the community development fund was legally effective, Gulf JP allocated a budget of more than Bt100 million per year for it.
Gulf JP also invested about Bt100 million to establish stations to monitor water and air quality to assure local people that the water and gas released from the power plant is safe for the environment. As well, it built a reservoir for the power plant's operation to ease local residents' concerns about their water supply.
"The investment in Kaeng Khoi 2 Power Plant was about Bt30 billion to Bt40 billion, while those for the water and airquality monitoring stations and the reservoir were more than Bt100 million," he said.
"We were able to invest in those facilities to ease local villagers' concerns on the environmental impact from the power plant, and we decided we should do so.
"We invited them to attend many seminars about the environmental issues. Now they accept the power plant, and the community development fund can help improve their livelihoods."
Gulf JP is also successful in operating the Yala Green Power Plant, which generates 20.2MW of electricity from parawood (rubber tree) residue. This is the first powerplant project in the deep South. Sarath believes it is a good example of how projects can operate successfully amid the conflicts and problems in the southernmost provinces, as the company has created jobs for local people and boosted power security in the area.
The company plans to establish another power plant in Yala soon.
Sarath said many foreign companies had invited Gulf JP to coinvest in renewableenergy projects in Thailand, but the company preferred to invest by itself.
"We've learned a lot from the Bor Nok coalfired project. We won't give up on this business, as the country will need more power soon," he said.
"We're ready to come to an understanding with local people and do everything to make them happy to have power plants near their homes. If they're dissatisfied, we can move to other locations that welcome the power plant. Both sides will be happy."