Page 11 - AsiaElec Week 50

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NEWS IN BRIEF
AsiaElec
renewables, LNG
Distributor Tokyo Gas Co Ltd will step
up overseas expansion, boosting stakes in renewable energy, liquefied natural gas (LNG) development and infrastructure projects, to triple its overseas profit by 2030, its president said, Reuters reported.
Last month, Japan’s biggest seller of city gas unveiled a long-term vision that targets a rise of 67% in operating profit by 2030 through overseas expansion.
Tokyo Gas and other utilities are grappling with falling demand at home as Japan ages rapidly with a declining birthrate, while
the liberalisation of its energy markets has spurred competition among old-guard utilities.
“Our priority is to increase renewables,” Tokyo Gas President Takashi Uchida told Reuters in an interview on Tuesday.
It wants renewables to generate 40% of its overseas profits of about JPY40bn ($368mn) by 2030.
The company’s renewable assets are only 490MW of capacity, mainly solar and onshore wind power assets in Mexico, but it aims
to raise global renewable assets tenfold to 5,000MW by 2030.
“We are interested in entering offshore wind projects,” Uchida said.
Another key source of growth will be LNG upstream assets and infrastructure projects in Southeast Asia, he added.
“Our focus is to invest in foreign companies in a way (that) we have control, instead of just buying stakes in upstream assets, as they could become engines for our future growth,” Uchida said.
Tokyo Gas is in final talks with First Gen Corp, a clean energy producer based in the Philippines, to build an LNG terminal there, he said.
“We want to do it as soon as possible, but we still need to discuss on how much risk we can take,” Uchida said, adding that he expected a final investment decision once power purchase agreements have been secured.
Tokyo Gas, which imports about 14mn tonnes of LNG a year, is likely to announce a deal “soon” to raise its stake in an existing LNG upstream project, Uchida said, without identifying it.
Another target is to boost LNG trading to 5mn tonnes by 2030 from practically nil now, to generate JPY10bn ($91mn) in profit, he said.
“We are not seeking profits from financial trading and all of our trades will be linked with physical supplies,” Uchida said.
The company’s main activities in this area will be swapping cargoes with overseas
partners or making seasonal swaps with other utilities, he said. It already has a trading desk with two staff in Singapore, but may hire more traders, Uchida added.
SOLAR
Azure Power secures 4GW solar project in India
New Delhi-headquartered Azure Power
has received a letter of award from the
Solar Energy Corporation of India (SECI)
to develop 2GW of grid connected solar generation capacity, with an option to double the figure.
The developer secured the capacity under SECI’s manufacturing-linked tender, in return for committing to establish 500MW of annual cell and module manufacturing capacity. Azure has an agreement with an Indian
solar panel manufacturer to jointly establish the production lines with Azure holding a majority stake and committing to an equity investment of around 26%.
SECI will sign a 25-year power purchase
agreement with Azure committing to pay INR2.92 ($0.04) per kWh for the solar electricity generated by the project capacity.1
The solar power project capacity – which can be developed anywhere in India – is expected to be commissioned in annual 500MW phases with the first slice expected to be commissioned by 2022 and the full, 2GW complete by 2025. A ‘greenshoe’ option in the contract offers Azure the option of doubling the capacity awarded, to 4GW, although a decision on that must be reached by Tuesday. The contract also includes a waiver of interstate transmission system [ISTS] charges and guarantees against curtailment of the electricity generated.
“This opportunity is attractive to us for many reasons,” said Azure Power CEO Ranjit Gupta, in a press release issued to announce the deal. “The tariff is 8% higher than the
last discovered tariff for an ISTS project
with SECI, which is one of the best solar counterparties in India. Now with a 5 GW portfolio, our scale and the predictability of our growth over the next five years should allow us to capture significant efficiencies.”
Week 50 18•December•2019
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