Energy Ministry panel to determine authority on power purchase contract
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THE ENERGY Ministry has set up a committee to determine whether it has the full authority to terminate the power purchase contract of Independent Power Development, the sole winner of two independent power producer( IPP) contracts with total capacity of 5
Independent Power Development is a joint venture of Gulf Energy Development Co (Gulf JP) and Mitsui and Co (Thailand).
A source at Gulf JP said yesterday that the company has yet to receive any notice cancelling the contract from the Electricity Generating Authority of Thailand, so it has moved ahead to develop the project.
If the contract is cancelled, the company would definitely take legal action against the government for damages.
A ministry source said that recently Permanent Secretary Areepong Bhoocha-oom received a letter from the junta-sponsored committee examining state spending saying that the auction process allegedly lacked transparency.
The auction was held by the Energy Regulatory Commission last year. The letter also asked the ministry to inform the bid winner that its contract with Egat will be terminated.
After receiving the letter, Areepong set up the panel to examine if the ministry can terminate the contract in a way that the winner will have no right to file a claim for compensation against the government.
The panel is chaired by ministry’s deputy permanent secretary Tawarat Sutabutr.
The source said it would become a big deal in case of contract termination, since it could affect foreign investors’ confidence in Thailand.
If the government finds that the auction really lacked transparency, the ministry might have to ask for the junta to cancel the contract.
Tawarat said the panel needs time to thoroughly study all details.
