Shedding light on solar energy second time around
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It might not be an exaggeration to say that Kietphong Noichaiboon, the founder of Ekarat Engineering, is breathing in the benefits of solar power, even though it was his solar-cell business that took him into bankruptcy in 2011.
Started as an electrical-transformer business 34 years ago by Kietphong, after he had been sent by his boss at a local transformer company to gain know-how from Israel and Westinghouse in the United States, Ekarat Engineering had never made a loss in any single year — that is, until it jumped into solar-energy business a decade ago.
“Had there been no government policy, I would not have invested in the solar plant,” said Kietphong, citing a policy enacted by the then-Thaksin Shinawatra government that required all fossil-fuelled power developers to invest 5 per cent of their new capacity in renewable-power facilities.
The policy was cancelled by the following government and, like thousands of solar-cell factories worldwide, Ekarat Engineering’s plant could not compete with solar cells dumped by Chinese producers, many of which also later went broke.
Kietphong told The Nation in an interview that if Ekarat Engineering had not invested in the solar plant, it would now have a net positive cash pile of Bt2 billion on its balance sheet.
However, although cheap Chinese solar cells are still flooding the world market, the company has announced a return to the solar-power business after completing a debt restructuring last year.
The company’s managing director, Danucha Noichaiboon, said Ekarat Engineering had reopened its solar-cell factory this month while negotiating with two potential customers for contracts to install and develop solar-farm facilities for a combined capacity of about 15-16 megawatts.
Ekarat Engineering is also hoping to grab around a 40MW share of the total 800MW solar-farm projects that Prime Minister General Prayut Chan-o-cha’s administration has agreed for state agencies and cooperatives to develop on their premises, as well as a slice of the remaining 69MW solar-rooftop projects.
Even though oil prices have halved to about US$50 (Bt1,630) a barrel at present, Kietphong is confident that this time around the solar-cell business will materialise to become a new growth engine for his company.
“Because the 800MW capacity is huge, our aim for a 5-per-cent share should not be regarded as too high,” he said.
Meanwhile, Ekarat Engineering expects its transformer business to grow by 10 per cent this year, resulting in sales of Bt2.2 billion.
Although factory investments are expected to remain sluggish due to the continuation of martial law, the company expects to boost sales as a result of work from backlogs of orders from state agencies that had delayed their purchases from last year.
Solar-power business is projected to add at least another Bt1.2 billion to the company’s 2015 revenues, said the company founder.
Despite the prevalence of cheap Chinese solar panels and the government’s reluctance to protect Thai solar-cell producers, Kietphong said solar-farm investors would look at Ekarat Engineering’s products if they considered a farm’s 25-year lifespan and opted for high-quality solar equipment that would operate efficiently for such a period.
Though they appear unrelated, Kietphong views solar energy and transformers as complementary.
“Wherever there are power lines, there are transformers. Where there are no power lines, there are solar cells,” he said, pointing to solar energy’s “distributed generation” advantage as it is produced at or near the point of use, which reduces high transmission losses and investment costs.
Once again breathing in the benefits of solar power, Kietphong said he believed the coming of LED (light emitting diode) lighting was also supportive to solar energy, because it consumed less energy.
For example, a house that runs on solar cells has to maintain low energy consumption, and therefore its owner will opt for LED lighting, which can be lean on solar power, he added.
