The Electricity Generating Authority of Thailand (Egat) will invite the governments of China and Burma to jointly develop a multibillion-dollar hydroelectric scheme on the Salween River in Tak province. Higher profit margins from the low-cost electricity generated by the Salween scheme and extending the life of existing power stations will enable Egat to save USD 1.75 billion over the next 15 years. It also means that the company will not have to build greenfield plants or buy electricity from private producers. While Egat is prepared to finance the whole project at an estimated cost of USD 5.5 billion, it would welcome a partnership with the governments of China and Burma. Egat will acquire all output from the 5000-MW power plant, as there is no demand for electricity on the Burmese side of the river. The scheme will be built along the border in the Mae Sareng district of Thailand’s Tak province.
The Egat board also approved the extension of the lifespan of 10 retired power stations in Rayong, Bangpakong and Bangkok, with a combined capacity of 28,000 MW. The move is expected to save Egat at least USD 203 million over the next 15 years. Through renovating and reconditioning existing power plants, Egat will save 30% on the cost of building completely new facilities. For example, the cost of developing a new gas turbine is USD 400,000 compared to only USD 120,000 to recondition an old one, Sittiporn said. With the renovation of retired power stations, Egat will not need to expand its production capacity again until 2009. The assumption is based on existing power development analysis that forecasts Thailand’s electricity demand will grow 6.3% over the next 10 years to a maximum 16,661 MW.
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