Ratch to focus on renewable energy

SET-listed Ratch Group, the power generation arm of the Electricity Generating Authority of Thailand, is revising its non-power businesses due to uncertainties about its future revenue and will focus more on electricity generation, especially in the renewable energy sector.

The company, which holds a 10% share in each of two monorail businesses, involving the 34.5-kilometre Pink Line (Khae Rai to Min Buri) and 30.4-km Yellow Line (Lat Phrao to Samrong), is concerned about the impact on these electric train services under the state’s 20-baht fare policy, said chief executive Nitus Voraphonpiput.

The government earlier announced it plans to add these monorail routes to its low-cost fare policy in the middle of next year.

Authorities commenced the 20-baht price limit with the Purple and Red lines in September 2023.

The government’s policy to put a cap on the prices of public utilities caused Ratch to reconsider its investment in the non-power segment, especially the monorail business, said Mr Nitus.

The company will not inject new investment funds into businesses related to public utilities, but only push ahead with projects already in the pipeline, he said.

Ratch holds a 10% share in each of two motorway projects — a route between Ayutthaya’s Bang Pa-in and Nakhon Ratchasima and the Bangkok-Kanchanaburi route. The roads are currently under construction.

In the healthcare sector, the company holds a 10% stake in Principal Capital, which runs a hospital business, and a 10% share in Bangkok Chain Hospital.

It also owns a 15.5% share in Bangkok Aviation Fuel Service, which offers refuelling services at airports.

Despite the uncertainties in some of these businesses, Ratch will not sell all of its shares because it is only a small shareholder and the non-power businesses generate a net profit of more than 100 million baht for Ratch every year, said Mr Nitus.

Ratch plans to increase the proportion of renewable power to 30% of total electricity supply from its power plants within the next two years, up from 27% at present.

The company’s power generation capacity, from facilities in operation and under construction, currently stands at 10.8 gigawatts, with 7.8GW from fossil fuels and the remainder from renewable sources.

To increase its renewable power, the company will seek new opportunities in Thailand, Laos, Indonesia and Australia because they all promote greater renewable power generation.

The company plans to finalise six energy asset acquisition deals, with combined capacity of 500 megawatts, within this year.

Do you like the content of this article?