ADB, Gulf Chana Green Achieve Financial Close for Biomass Power Project in Southern Thailand
BANGKOK, THAILAND (16 March 2018) — The Asian Development Bank (ADB) and Gulf Chana Green Company Limited (Chana Green) achieved financial close today for a loan equivalent of up to B1,109 million ($35 million) to help increase Thailand’s share of renewable energy by developing a biomass power project in the southern part of the country.
“Diversifying Thailand’s energy mix will help the country meet increased demand for electricity and help reduce its carbon footprint,” said Michael Barrow, Director General of ADB’s Private Sector Operations Department. “ADB’s 18-year loan shows the bank’s long-term confidence in Chana Green and provides a positive signal to other banks and developers considering investing in infrastructure assets in the less-developed areas of southern Thailand.”
Thailand’s power consumption is expected to double from 2015 to 2036. To meet this need, the Government of Thailand has laid out plans to increase the share of renewable energy sources to the country’s final energy consumption to 30%, with biomass becoming the second largest renewable power source after solar. Installed generating capacity of biomass is expected to almost double from the current 2,943 megawatt (MW) to 5,570 MW by 2036.
ADB’s financing will help Chana Green construct and operate a 25 MW biomass power project located in Chana, Songkhla province in southern Thailand. The project will convert waste from rubber trees into renewable electricity. The project will receive a tariff incentive of B0.3 per kWh for utilizing biomass and B1.0 per kWh for investing in southern Thailand both for a period of 7 years from commercial operations.
ADB’s assistance will help provide an environmentally sustainable solution to the abundant agricultural waste that is produced from farming and wood industries by converting biomass into a renewable source of electricity.
Chana Green is a project company set up to own, develop, construct, and operate the project, which is wholly owned by Gulf Energy Development (GED), a leading private sector power generation company in Thailand. GED currently has a total gross installed power capacity of 11,125 MW under development and operation in Thailand.
ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members—48 from the region.