The mission for Electricity Generating (Egco) Plc is simple but challenging -- reduce carbon dioxide emissions while continuing to increase revenue.
The power generation arm of Electricity Generating Authority of Thailand, Egco joined the international campaign to slow rising temperatures worldwide caused by global warming.
This led Egco to set a revenue target and a goal to cut carbon dioxide emissions via various measures, paving the way to carbon neutrality, a balance between carbon dioxide emissions and absorption.
The company wants to maintain revenue growth and cut its carbon dioxide emissions' intensity by 10% in the short term, while increasing the proportion of renewable energy in its total generating capacity to 30% by 2030.
Egco expects to achieve carbon neutrality by 2040, then strive for a net-zero target, which is a balance between greenhouse gas emissions and absorption, by 2050.
Jiraporn Sirikum, president of Egco, said the shift to cleaner energy and better energy management is central to Egco's three core businesses: fuels and utilities, power generation and energy solutions.
FUEL ADJUSTMENT
Using alternative, more eco-friendly fuels for power plants is among the measures that will make Egco a carbon-neutral company, she said.
The company depends greatly on natural resources for power generation, so the fuels it chooses are important for the campaign against global warming.
Egco is using hydrogen to replace a significant amount of natural gas at its gas-fired Linden Cogen Unit 6 plant in the US. The company mixes hydrogen, accounting for 40% of total fuels, with gas to run the generator.
"This increases overall efficiency of the power plant and can reduce carbon dioxide emissions by about 10%," said Ms Jiraporn.
Under a hydrogen blending programme, the company adopted combined combustion of both natural gas and off-gas, including hydrogen, at the 172-megawatt power plant in New Jersey.
Refinery off-gas is a mixture of gases generated during the refining of crude oil.
Linden Cogen Unit 6 uses off-gas containing hydrogen produced from an adjacent oil refinery and blends it with natural gas to fuel the power plant's gas turbine.
Last year Egco cooperated with two companies and a state agency for a project to use hydrogen-powered trucks in the logistics business.
The company signed a memorandum of understanding on the project with Thailand Post Co, Bangkok Industrial Gas Co and the Digital Government Development Agency.
According to Egco, the trucks, fuelled by grey hydrogen made from natural gas, will deliver parcels and postal items in the eastern province of Rayong.
CARBON CAPTURE
To reduce carbon dioxide emissions, Egco supports both natural and man-made methods, said Ms Jiraporn.
The natural method refers to an afforestation project implemented by the company, while the man-made method requires modern technology to capture carbon dioxide.
In 2002, Egco established the charitable Thai Rak Pa Foundation to promote the conservation and restoration of watershed forests and biodiversity.
This foundation protect forests, supporting the company's efforts to help Thailand reduce carbon dioxide emissions and deal with climate change-related problems, she said.
The foundation's action plans run until 2026, in cooperation with state agencies, communities and youth networks.
The foundation set a target to conserve and sustainably utilise 100,000 rai of forest areas, improve 15 nature trails and educate people on the importance of forest and natural resource protection in three target provinces: Chiang Mai, Nakhon Si Thammarat and Chaiyaphum.
Egco is also conducting a feasibility study on carbon capture, utilisation and storage technology, also known as CCUS, said Ms Jiraporn.
The company is interested in installing the technology at three of its power plants: BLCP plant in Rayong, Khanom plant in Nakhon Si Thammarat, and Paju plant in South Korea.
REVENUE MANAGEMENT
Egco wants to adjust its investment portfolio to improve revenue, in tandem with efforts to lift renewable energy development, she said.
The company previously announced its divestment in a combined cycle gas-fired power plant owned by US-based Risec Holdings Llc to seek new opportunities in other investment projects.
Egco decided to sell its entire 49% stake in Risec to Shell Energy North America. The transaction was completed on Jan 24.
Egco, through its wholly-owned Egco Risec II Llc, invested in Risec in early 2023. Risec owns a 609MW power plant in Rhode Island in the US.
The company's divestment aligns with its strategy emphasising portfolio management for asset recycling to create long-term, continuous growth, said Ms Jiraporn.
The move follows Egco's Triple P strategy announced last year: profitability; power-related businesses; and portfolio and people management.
Cash from the divestment will allow Egco to seek new investment opportunities in the US to ensure long-term revenue, she said.
Existing investment in US energy assets will remain unchanged and is expected to help Egco earn higher revenue this year, said Ms Jiraporn.
Part of the earnings will come from full-year revenue recognition from the acquisition of a 50% stake in US-based Compass Portfolio, which operates three power plants based on combined cycle gas turbine technology, she said.
Egco also expects revenue recognition from renewable energy project sales and commercial operations of US-based Apex Clean Energy Holdings.
Apex is carrying out all renewable energy projects under a hybrid business model. The company not only develops projects to increase its power generation capacity, but also sells some completely developed projects to other investors.
Elsewhere, Egco expects to earn revenue from the grid connection of its Yunlin offshore wind farms in Taiwan this year. The company holds a 26.5% share in the facility.
Egco also expects to gain revenue from new power purchase agreement negotiations for its Quezon power plant in the Philippines.
Many of Egco's renewable energy assets not only support the company's financial status, but also put it on track towards carbon neutrality, said Ms Jiraporn.
"We aim to increase the proportion of electricity from renewable energy to 30% by 2030, up from 22% at present," she said.
The BLCP power plant at Map Ta Phut deep-sea port in Rayong. Egco is interested in installing carbon capture, utilisation and storage technology at this facility.
The Paju power plant in South Korea is a facility where Egco may install carbon capture, utilisation and storage technology.
Egco recently divested from the Risec power plant in Rhode Island in the US to seek new investment opportunities.
Thailand Post staff handle parcels for delivery. The company teamed up with Egco to deliver parcels using hydrogen-fuelled trucks.
