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MONDAY, December 11, 2023

Banpu sees profits in transition to green energy and net-zero emissions

Banpu sees profits in transition to green energy and net-zero emissions
SATURDAY, September 23, 2023

Banpu's first carbon capture, utilisation, and storage (CCUS) system and facility is due to start operating in the fourth quarter of this year, a development its CEO, Somruedee Chaimongkol, described as a milestone.

The announcement was made during the panel discussion on Friday called "A Closer Look at Banpu Group's Strategic Progress Towards 2025 Transition Goals". It highlighted the company's accomplishments as well as the future direction of its four flagship businesses: mining, gas, power, and energy technology.

Banpu is Thailand's leading energy conglomerate, and it is currently transforming its business strategies to become a greener and smarter company in the face of climate change and digital disruption.

Somruedee Chaimongkol

Somruedee said Banpu was the first Thai company to invest in CCUS technology in the United States. The system assisted in improving the production process of its gas plant in the country in order to eliminate any possibility of carbon emissions.

This enhancement assures Banpu's customers that the energy it produces has no carbon emissions. As a result, the company can sell its gas at a higher price than the average market price, and customers are willing to pay for it.

CCUS increases the value of Banpu's gas products, Somruedee said.

She expects that CCUS technology will be scaled up to apply to Banpu's other energy production lines, ensuring the company and Thailand reach their net-zero emissions goal by 2065.

Banpu sees profits in transition to green energy and net-zero emissions

CCUS refers to a set of technologies that enable the reduction or removal of carbon dioxide (CO2) emissions from power plants, refineries, and other industrial facilities.

Thiti Mekavichai, head of Banpu’s oil and gas business, said the company is investing in two CCUS systems and considering a third. The first facility, with a capacity of about 210,000 tonnes of carbon capture and storage, will be operational by late December.

The second CCUS system will begin next December. It will be able to capture and store up to 60,000 tonnes of carbon, he said. The third CCUS system is still under consideration.

Banpu sees profits in transition to green energy and net-zero emissions

Apart from assisting Banpu in adding value to its energy products, he said the system is critical in generating revenue for the company. The technology allows the company to meet standards set by the United States Inflation Reduction Act of 2022, which includes incentives for investments in climate-change mitigation.

The regulations direct new US federal spending towards reducing carbon emissions, including tax credits for carbon capture and sequestration.

The technology will also enable Banpu to sell its carbon credits, which Thiti believes will be very useful to many companies around the world in the future.

Banpu sees profits in transition to green energy and net-zero emissions

Somreudee noted that all business units are gradually driving Banpu Transformation to achieve a common goal of creating energy sustainability and clean energy solutions.

"Banpu has been on a major transformation journey encompassing business, technology, and workforce reform for the past 10 years," she explained. "As we work towards our 2025 goals, we will continue to diversify our portfolio of greener energy and energy technologies."

The company will continue to offer new clean energy solutions that meet the business and lifestyle needs of the next generation, she said.

In terms of other flagship businesses, she said that no new investment is planned for the coal business. Instead, the primary focus is on generating cash flow for growing businesses that are consistent with Banpu's greener and smarter strategy, as well as optimising existing asset performance.

Banpu sees profits in transition to green energy and net-zero emissions

A feasibility study on transitioning to a strategic mineral business is underway, with a focus on critical minerals such as copper, nickel, and lithium, which are upstream resources for clean-energy solutions.

As for the gas business, the future goal is to expand the portfolio across the value chain, from gas sources, gas separation, compression, and natural gas pipelines.

Banpu sees profits in transition to green energy and net-zero emissions

The key focus of the power business is to accelerate the expansion of a greener portfolio, including natural gas-fired power plants, high efficiency- low emissions power plants and renewable power plants.

Banpu's power generation business has a total capacity of 4,974 megawatts, with 4,008 megawatts coming from thermal power plants and 966 megawatts coming from renewable power plants located in eight countries across the Asia-Pacific region.

Somreudee said that the company's goal is to reach a total capacity of 6,100 megawatts by 2025.

The primary focus of the energy technology business is expanding the customer base, leveraging combined solutions from digital technology to add value, and expanding investment opportunities with new partners.

Banpu sees profits in transition to green energy and net-zero emissions

Banpu has set several 2025 targets for its energy technology business:

  • Achieving total production capacity of 500 megawatts from its solar rooftop and floating business.
  • Achieving electricity sales of 2,000 gigawatt hours per year from its energy trading business.
  • Expanding integrated alternative mobility services, such as ride-sharing, car sharing, EV charger management, and EV fleet management.

Somruedee said that in addition to the four flagship businesses, Banpu established a venture capital unit in 2022 to oversee investments in new biotech and green-energy-related businesses. The move, she said, will also benefit the group's existing businesses.

"We are well-positioned to continue our transformation journey with the goal of delivering energy sustainability that meets the world's energy needs in the future," she said, adding that the company has set a total investment budget of US$ 2 billion for the next three years.

Banpu is an international energy provider with operations in Thailand, Indonesia, China, Australia, Laos, Mongolia, Japan, the United States, and Vietnam. Its three core business groups are energy resources, energy generation, and energy technology.