Loxley Plc, one of Thailand’s largest trading conglomerates, has expanded into the renewable energy business by investing in solar farm projects in Thailand and exploring opportunities in neighbouring countries.
Piboon Piboontum, vice-president for financial management, said Loxley’s joint venture was building an 8.7-megawatt solar farm on 215 rai of land in Prachin Buri at a cost of 850 million baht.
Once construction is completed sometime between September and November, L Solar 1 will operate the largest solar plant in Thailand, said Mr Piboon, also a director of L Solar 1.
“We want to become one of the leading players in renewable energy with 24 MW of combined capacity from three sites within two years,” he said.
Founded last year with registered capital of 220 million baht, L Solar is 45% held by Loxley, 24.99% by MFC Asset Management through its Energy Fund, and 14% by a private investor who is a Loxley executive. Leonics, a leading Thai supplier of solar cells, owns the remaining 16%.
The Export-Import Bank of Thailand provided a 600-billion-baht loan to the project, which will take about eight years to break even. The company has already signed a power purchase agreement with the Provincial Electricity Authority, added Mr Piboon.
“This marks a return for Loxley into the power business after we exited projects in Thailand and Laos,” he said.
“We are also interested in wind and biomass projects,” he said, but noted the energy investment may be put off pending technological improvements that make wind farms more feasible.
Energy Ministry licences to build 500 MW of solar farms were fully subscribed and have already been issued. L Solar received one but Mr Piboon said the company had been in talks to buy more from other developers.
Several solar farm projects in Lop Buri are under development, he added.
Loxley has also discussed and worked with potential customers for rooftop solar-panel installations, while a two-year strategy to develop solar farms for sale is also under way, he noted.
The company is also investigating investment opportunities in Cambodia and Malaysia. Loxley is a leading player in gas-transmission substations in Laos with contracts worth 2-3 billion baht a year.
Gen Nipon Siriporn, Loxley’s adviser for special projects, said the reduced adder tariff for solar projects in Thailand from eight baht to 6.50 per kilowatt/hour had made investment here less attractive than in neighbouring countries. Solar energy projects now take longer to break even, he said.