CHOW and RATCH jointly invest is solar projects in Japan

Chow Steel Industries, parent company of PSCL, has entered into a partnership with Ratchaburi Electricity Generating Holding for joint investment in solar power projects in Japan.

The subsidiary companies of CHOW and RATCH, including PSCL, signed shareholders’ agreements to set up two joint venture companies, with 60% held by RATCH and 40% by the CHOW Group. The initial investment phase will cover two solar projects in Japan, with total approved capacity of 33 megawatts and expected commercial operation date in 2016.

Mr. Pongdith Potchana, CEO of RATCH, said that the agreement signing marked substantial progress for RATCH as it strives to be a leading integrated energy company in the Asia Pacific region, using a business strategy of seeking partners that enhance their potential and competitiveness while expanding into new markets. Japan is one of their targeted investment destinations, particularly for the renewable energy business.

“Partnering with the CHOW Steel Group, which has extensive experience and expertise in doing business in Japan, will help increase our business opportunities and competitiveness, according to Mr. Pongdith. “The common aim to expand renewable energy investment will also help drive our co-invested solar power projects in Japan towards success. The company strongly believes that both partners will be able to develop and extend cooperation in other projects in the second phase (of their investment plan).”

Mr. Anavin Jiratomsiri, CEO of the CHOW Steel Industries, stated that this partnership between the CHOW Group and the RATCH Group is a significant step towards expanding their renewable energy business in Japan, where there are great opportunities for investment.

The two partners will jointly invest in the Ueda Solar Farm Project in Nagano prefecture (10.8 MW approved capacity), and the Iwaki Solar Farm Project in Fukushima prefecture (22.6 MW approved capacity). Both projects have 20-year power purchase agreements and a 40-yen feed in tariff per unit (about Bt 12) from the Japanese government, a revenue stream that will strengthen the cash flow of both companies.

The joint venture investment is between RH International Singapore and Chow International, with a 60:40 equity ratio, while a joint venture management service company will be co-owned by Ratchaburi Energy and PSCL, also with a 60:40 equity ratio.