IFC Green Loan to Help Boost Renewable Energy in Thailand, Indonesia, and Vietnam

A new investment through a green loan facility will help develop more renewable energy projects in Thailand, Indonesia, and Vietnam, with IFC’s $64 million to Sermsang Palang Ngan Company Limited (SPN) aiming to address the region’s growing energy demand.

The financing package includes an IFC loan of up to $32 million (THB1.2 billion) and a parallel loan from Siam Commercial Bank (SCB) for a similar amount. IFC’s funding will help SPN finance the acquisition, development, and construction of renewable projects—especially solar farms, solar rooftops, and biomass—in Thailand as well as in other ASEAN countries. IFC will also assist the company with a green finance framework as it expands its footprint in the East Asia and Pacific region.

SPN currently owns a 52-megawatt solar photovoltaic power plant in Lopburi province, north of Bangkok, which sells power to the Electricity Generating Authority of Thailand (EGAT) under a non-firm power purchase agreement.

“We are honored that IFC has supported us in developing projects which reflects our commitment to secure a future energy source for everyone, powering a better tomorrow with renewable energy investments in Asia” said Mr. Varut Tummavaranukub, CEO of Sermsang Power Corporation Public Company Limited (SSP) group, parent company of SPN.

The energy sector is the largest emitting sector in ASEAN countries, accounting for 55 to 70 percent of total greenhouse-gas (GHG) emissions. Despite significant potential for renewable energy, it currently represents less than 20 percent of the region’s energy supply. As a result, ASEAN countries are at risk of seeing an approximately 35 percent reduction of their GDP by 2050 due to climate change and natural hazards.

A shift to renewable energy is therefore urgent. According to the latest estimates, Asia’s overall power capacity is expected to see a steady increase in its capacity for renewables, reaching 63% in 2035. In Thailand, the government aims to ensure that renewables supply 34% of its energy consumption by 2037. According to its latest Power Development Plan, the solar capacity target has been revised from an earlier 6 GW to 15 GW by 2037.

“Renewables offer a viable path forward in meeting growing energy demand, especially for emerging markets,” said Jane Yuan Xu, IFC Country Manager for Thailand and Myanmar. “We are proud to work with companies such as SPN and develop a long-term relationship with a growing renewable energy company and help expand its footprint in the region.”

IFC has decades of experience in financing, structuring, and leading complex energy transactions in emerging markets, with more than 50 gigawatts of energy generation financed to date. At the end of FY22, IFC’s committed energy portfolio amounted to $6.1 billion, with half of that attributable to renewable energy projects. Every year, IFC portfolio clients provide electricity to 100 million people around the world.

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