Community Biomass and Biogas Power Plant

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Community Biomass and Biogas Power Plant
SectorMost major industry classification systems use sources of revenue as their basis for classifying companies into specific sectors, subsectors and industries. In order to group like companies based on their sustainability-related risks and opportunities, SASB created the Sustainable Industry Classification System® (SICS®) and the classification of sectors, subsectors and industries in the SDG Investor Platform is based on SICS.
Renewable Resources and Alternative Energy
Alternative Energy
Business Model Description

Through B2B model, companies can construct community biomass and biogas power plants to produce renewable energy and sell it to the grid. However, local communities must own certain percentage of shares in the power plants so they can also benefit from selling energy to the grid.

Moreover, the community biomass and biogas power plants can buy agricultural waste/byproduct or energy crops from the communities as raw materials.

This IOA will benefit the communities through additional income from selling energy to the grid and from selling agricultural waste/byproduct or energy crop as raw materials, benefit the planet from reduced greenhouse gas emissions and less air pollution from less open burning of agricultural waste/byproduct, and benefit society from reduced health risk from less air pollution. Investors can invest money into infrastructure and technology for companies that will construct and operate the community biomass and biogas power plants. examples of companies active in this space are:

UAC Global operated a biogas power plant in Chiang Mai, started in 1995. The company buys corn stalk as agricultural waste, and napier grass grown by local communities as the material used for generating electricity. In the fourth-quarter 2021, UAC Global has net profit USD 5.7 milllion (THB 192.23 million) and USD 34 million (THB 1,130.78 million) for sales. (1) (2)

EGAT, PEA, and private companies invested in community power plants. The pilot projects are VSPP (Very Small Power Plant), started from 2020, allocated USD 14.5 million (THB 480 million) by Power Development Fund of Department of the Energy Development and Promotion (DEDE). The communities will have 10-30% ownership of the power plants and can generate income from selling the electricity. The power plants will also buy agricultural waste, and energy crops such as napier grass and bamboo from the communities (8).

Expected Impact

This IOA helps low communities gain access to renewable energy, while also generating income from selling the electricity to the grid and from selling the raw materials used to make the electricity.

Indicative ReturnDescribes the rate of growth an investment is expected to generate within the IOA. The indicative return is identified for the IOA by establishing its Internal Rate of Return (IRR), Return of Investment (ROI) or Gross Profit Margin (GPM).
5% - 10% (in IRR)
Investment TimeframeDescribes the time period in which the IOA will pay-back the invested resources. The estimate is based on asset expected lifetime as the IOA will start generating accumulated positive cash-flows.
Long Term (10+ years)
Market SizeDescribes the value of potential addressable market of the IOA. The market size is identified for the IOA by establishing the value in USD, identifying the Compound Annual Growth Rate (CAGR) or providing a numeric unit critical to the IOA.
USD 100 million - USD 1 billion
Average Ticket Size (USD)Describes the USD amount for a typical investment required in the IOA.
> USD 10 million
Direct ImpactDescribes the primary SDG(s) the IOA addresses.
Affordable and Clean Energy (SDG 7) Affordable and Clean Energy (SDG 7) Good health and well-being (SDG 3)
Indirect ImpactDescribes the secondary SDG(s) the IOA addresses.
Climate Action (SDG 13)
Sector Sources
  • 1) https://sustainabledevelopment.un.org/content/documents/279482021_VNR_Report_Thailand.pdf 2) http://www.eppo.go.th/images/POLICY/PDF/PDP2018.pdf 3) https://www.pier.or.th/abridged/2018/16 4) https://www.krungsri.com/en/research/industry/industry-outlook/Energy-Utilities/Power-Generation/IO/io-power-generation-2 5) https://www.trade.gov/energy-resource-guide-thailand-renewable-energy 6) https://policy.asiapacificenergy.org/sites/default/files/Alternative%20Energy%20Development%20Plan%202018-2037%20%28AEDP%202018%29%28TH%29.pdf 7) https://www.sei.org/perspectives/thailands-energy-transition/ 8) https://mediamanager.sei.org/documents/Publications/Bangkok/SEI_2017_Report_USAID-CleanPowerAsia-GenderEquality-WhitePaper.pdf 9) https://www.boi.go.th/upload/content/alt_energy_5a4faa2f9dc0b.pdf 10) https://www.irena.org/-/media/Files/IRENA/Agency/Publication/2017/Nov/IRENA_Outlook_Thailand_2017.pdf
IOA Sources
  • 1) https://www.bangkokbiznews.com/news/888031" 2) https://www.uac.co.th/th/updates/company-news/press-release/364/uac-ไตรมาส4พีคบุ๊กกำไรเงินปันผล-bbf-10565-ลบ 3) https://policy.asiapacificenergy.org/sites/default/files/Alternative%20Energy%20Development%20Plan%202018-2037%20%28AEDP%202018%29%28TH%29.pdf 4) https://www.krungsri.com/en/research/industry/industry-outlook/Energy-Utilities/Power-Generation/IO/io-power-generation-21 5) https://sustainabledevelopment.un.org/content/documents/279482021_VNR_Report_Thailand.pdf 6) http://www.eppo.go.th/images/POLICY/PDF/PDP2018.pdf 7) https://uk.practicallaw.thomsonreuters.com/1-628-5906?transitionType=Default&contextData=(sc.Default)&firstPage=true 8) https://www.thebangkokinsight.com/news/environmental-sustainability/715586/ 9) https://www.irena.org/-/media/Files/IRENA/Agency/Publication/2021/Jun/IRENA_Power_Generation_Costs_2020.pdf 10) https://cdn.sei.org/wp-content/uploads/2021/02/210212c-killeen-archer-air-quality-in-thailand-wp-2101e-final.pdf 11) https://www.sei.org/perspectives/thailands-energy-transition/" 12) https://mediamanager.sei.org/documents/Publications/Bangkok/SEI_2017_Report_USAID-CleanPowerAsia-GenderEquality-WhitePaper.pdf 13) https://data.worldbank.org/indicator/SP.POP.TOTL?locations=TH 14) https://www.dede.go.th/ewt_news.php?nid=52580 15) https://www.boi.go.th/upload/content/BOI-A%20Guide_EN.pdf