The Win and Loss of Community Power Plant Projects in Thailand (Part 1)
These projects were initially called “Energy for All” scheme by the ex-Ministry of Energy, but the name has been changed since the Ministry of Energy took revamped it in August 2020. In the previous article we discussed about the origin and journey of Community Power Plant (CPP) projects in Thailand
This project provides support for biogas and biomass power plants by buying the exported electricity with Feed-in-Tariff. The main feedstocks come from agriculture areas via community enterprises. Hence, the benefits go back to the community.
In this article we will explore the statistics of this project and uncover the rise and fall behind the scenes. Due to a lot of demand for this project, only a handful of companies receive approval. I hope it will be useful for those who are interested in applying for the 2nd phase of this project. Kindly also note that Papop has helped several companies to win this project due to its technical excellence and strong track record in the biogas industry.
First let’s have a look at the number of companies or SPVs (Special Purpose Vehicles) who applied and won their projects in the below figures.
The above figure shows 246 SPVs submitted their application initially. This figure has come down to 169 SPVs who passed the 2nd technical screening which is accounted for 69% from the applicants. And finally, only 43 SPVs won their projects. These have been classified as 16 biomass and 27 biogas projects. The winning ratio is only around 18% from the total applicants or around 1 in 5.5. As a result, it shows that several companies and communities in Thailand are interested in this project. The competition is really high and the winning rate is quite low.
If we look at the winner from the biomass projects in the below figure, we can see that the large conglomerate firm like Mitr Phol Group has won 8 projects with 16 projects which is accounted for 50% of the total winners or 41 MW electricity export capacity. The remaining portions go to smaller companies.
For biogas projects, similar picture is found. The largest portion goes to Absolute Clean Energy (ACE) which has got 18 projects from the total of 27 projects. This is account for 66% of the total projects. The total electricity export capacity for ACE is calculated at 50 MW. The remaining are mostly smaller companies.
Large firms won so many projects in the competitive bidding scheme could be due to their cheaper financial costs and lower feedstock price. It is also possible that they are more prepared and better equipped to bid for the projects. This is why the bidding scheme has so far favor large firms rather than smaller firms or SMEs in Thailand.
In the next article, we will explore in details the discount rate of fixed Feed-in-Tariff (FiTf). These values are very important as they determined who wins the bid. Please click here to go to the next article.