Electricity price hike mooted to ease Egat sale
The Nation, 4 February 2004
Watcharapon Thongrung
ELECTRICITY CHARGES may rise by at least 3 per cent in the next few months in order to support the Electricity Generating Authority of Thailand's (Egat) share sale, Energy Minister Prommin Lertsuridej said yesterday.
Prommin said that after keeping electricity charges under the so-called fuel-adjustment tariff for the past eight months, the government might now have to make an adjustment.
"I have assigned Egat and related agencies to study in detail the proposed increase," he said.
Prommin, who has led Egat road shows to Singapore and Hong Kong , said potential investors were concerned with two main issues: the setting up of an energy-sector regulatory body and what type of return they could expect.
"Concerning the electricity tariffs, I told investors that the government has to seek a balance between the burden on the public versus the return on investment on Egat stock," he said.
Prommin did not elaborate on what concerns potential investors had regarding the establishment of the regulatory body.
He would only say that he had assigned Norkhun Sittipong, his deputy permanent secretary, to conclude the regulatory body's selection process by next month.
"It is now clear that the regulatory body will be independent from power producers but will come under a policy direction from the National Energy Policy Committee and the Energy Ministry," he said.
"You have to understand that there are several types of investors. We will try to focus on big investors from Europe and America who are looking for long-term benefits," he added.
Prommin said the current stock-market volatility due to the bird flu would not affect-Egat's planned initial public offering (IPO) on May 12 as he was confident investor confidence would return by the end of the month.
An Egat source said the government might need to cut its targeted IPO price while increasing national power charges to guarantee the successful launch of the IPO.
Back to Newsclippings | To top
|