Bangkok, May 18-Purchasing electricity from solar energy through the Green Power Project is expected to increase revenue for the solar power plant business from the sale of electricity in this project approximately 342 billion baht throughout the 25-year power purchase agreement (approximately 13.7 billion million baht/year). In addition, the green power project will generate income for related businesses approximately 182 billion baht.
Mr. Pongprapa Naphapruekchat, Krungthai COMPASS analyst, revealed that demand for electricity from solar energy has a good long-term growth trend, with the European Union expected to start collecting carbon fees on products imported from targeted industries by 2026. Non-EU producers such as iron and steel, aluminum, cement, and the Thai government plans to impose a carbon tax on the private sector in the future. which will pressure the private sector to adjust And turn to electricity from renewable energy to reduce the carbon fee of more products in the future. Especially solar energy that can reduce greenhouse gas emissions by up to 500 tCO2/megawatt/year. This is equivalent to planting 62,500 trees.
Most recently, on April 5, 2023, the Energy Regulatory Commission (ERC) announced the purchase of electricity from renewable energy. which includes solar energy Through the green electricity purchase project from those who have been selected in the said project to ensure the private sector's demand for electricity from clean energy in the period ahead for the green power purchase project in the first round Initially, it is expected that there will be a power purchase agreement for a period of 25 years and a total purchase of electricity from solar power of 3,362 megawatts, divided into 1) receiving electricity from solar power plants of 2,368 megawatts at a purchase price of 2.17 baht per unit of electricity. and 2) The remaining 994 megawatts will be purchased from solar power plants installed in conjunction with the Battery Energy Storage System (BESS) at a purchase price of 2. 83 baht/unit of electricity It is expected to start commercially operating electricity during 2024-73. In addition, this project is likely to enter into contracts to sell electricity to large operators for a period of 10-25 years, along with renewable energy production certificates. (Renewable Energy Certificate: REC), which can be used to claim the use of electricity from renewable energy. with entrepreneurs who buy electricity from this project as well
The project to purchase electricity from the solar energy mentioned above would have a positive effect on the solar power plant business. and related businesses such as solar panel installation business. It also helps entrepreneurs who want to export products to Europe reduce carbon fees in the long run.
Mr. Pongprapha added that The announcement of the government's purchase of electricity from solar energy through the Green Electricity Purchase Project in the amount of 3,362 megawatts will help stimulate the expansion of solar power plant investment in the future by approximately 130 billion baht and make operators The solar power plant business has more income from the sale of electricity in this project, about 13.7 billion baht/year.
The said policy is expected to generate about 128 billion baht in investment in solar power plant development, divided into 1) solar power plants, approximately 74.8 billion baht, and 2) solar power plants installed with energy storage systems. approximately 5.3 billion baht
In addition, it can increase all revenues for such businesses around 3.42 billion baht throughout the 25-year power sale contract in the green power project, or an average of 13.7 billion baht per year, which is 38% of the market value of solar power plants in the country. Year 2021, divided into 1) income from solar power plants about 2.21 billion baht or an average of 8.83 billion baht/year and 2) income from solar power plants installed with energy storage systems about 1.21 billion baht. or an average of 4.84 billion baht/year When all solar power plants in the aforementioned projects are able to supply electricity to the commercial system in accordance with the specified quantity and period of time.
Considering the payback period of the project to receive green electricity, it was found that the group of solar power plants and solar power plants installed with an energy storage system (BESS) will take payback time of 9.3 years and 9.8 years, respectively, compared to the 25-year contract period of the said project. The investment is approximately 32 million baht/megawatt and 53 million baht/megawatt, respectively, and there will be income from selling electricity to the government about 3.7 million baht/year/megawatt and 4.9 million baht/year/megawatt accordingly. number
However, it is expected that solar power plants And the solar power plant installed with BESS in this project has an internal rate of return (IRR) of approximately 9.1% per year and 7.4% per year, respectively, which is lower than the rate of return of solar power plants that listed companies have invested in. Which is approximately 10-15% per year because the purchase price of electricity from both types of solar power plants in the green electricity purchase project is 2.17 baht/unit of electricity and 2.83 baht/unit of electricity, respectively, which is lower than the purchase price of electricity of solar power plants that have started distributing electricity to the commercial system during 2016-23, which is about 2.97-5.66 baht/unit of electricity
The expansion of the solar power plant business through the latest renewable power purchase project will have a positive effect on the related industries. especially in the solar panel industry Because business operators of solar power plants tend to use the services of such industries more. To support business growth in the next 7 years from the green power purchase project
Considering the details of the supply chain of the solar panel industry, Krungthai COMPASS views that there are 4 groups of businesses that will grow outstanding from the green power purchase project in the future, namely:
• A group of contractors for installation and construction of solar cell systems. has the most outstanding growth direction in the group According to the demand for solar system installation and construction services of the operators who won the bidding in the said power purchase project It is expected to increase revenue for this group by about 9.7 billion baht.
• Solar panel manufacturers may benefit from selling solar panels up to 5.5 billion baht
• Manufacturers and distributors of connected equipment such as solar inverters expect to earn additional revenue from solar inverter sales to installation and construction service providers for power plants in the green power purchase project of about 8.7 billion baht.
• Manufacturers and distributors related to lithium batteries. It is expected to benefit from the sale of lithium batteries to solar power plants that won bids in the Green Power Purchase Project, about 22 billion baht.-
Source: Thai News Agency