Price Of Power May Increase In Bangkok

Price of power may increase in Bangkok

BANGKOK: Power rates in greater Bangkok may have to be raised to ensure that the Metropolitan Electricity Authority (MEA) has a successful IPO.

Wuttikorn Yamskulna, director of MEA's finance department, said the Energy Ministry would set a clear tariff structure for electricity around February, prior to MEA's initial public offering.

"The tariff structure must be supportive of distribution companies like MEA so their stocks are attractive to investors," he said, adding that the utility must be allowed to earn an acceptable rate of return on capital.

At present Bangkok end-users are charged an averageBt2.78 per kilowatt-hour.

A government privatisation committee earlier approved MEA's listing on the local stock exchange in June of next year. Tisco, Bua Luang and National Finance were appointed the float's financial advisers.

MEA sold Bt101.1 billion of electricity in the fiscal year ended September, surpassing last year's total sales of Bt94.3 billion, Wuttikorn said. But net profit dropped to Bt3.59 billion from Bt4.68 billion due to a new accounting standard the agency has applied in preparation for its privatisation.

MEA chairman Yongyuth Wichaidit said the state enterprise would invest Bt30.6 billion during the 2004-2007 period to expand and improve its power-distribution system.

MEA would also aim to diversify its revenue sources. At present, 98 per cent comes from power sales, he said.

--The Nation 2003-11-24