-Translation-
Annual registration statement
As of December 31, 2011
Electricity Generating Public Company Limited
Content
Page
Part 1
Executive Summary
Part 2
Listed company
Section 1 Risk Factors
Section 2 Business Characteristic
Section 3 Operation of Business Line
Section 4 Research and Development
Section 5 Operational assets
Section 6 Future projects
Section 7 Dispute
Section 8 Capital Structure
Section 9 Management
Section 10 Internal Control
Section 11 Connected Transaction
Section 12 Financial Status and Operational Results
Section 13 Others
Part 3
The Certification of Information
Attachment 1 CV of the Management and the Control Persons
Attachment 2 The positions of the Management and the Control Persons
Attachment 3 Audit Committee’s Report
1
2
10
15
28
56
57
60
61
62
65
122
130
131
154
Glossary
1. Companies
EGCO
Group companies, EGCO
Group
AE
APMC
BLCP
BV
Conal
Coop
CPOI
Chaiyaphum
DGA
East Water
EGAT
EGCO BVI
EGCO Cogen
EGCO Green
Egcom Tara
ESCO
GCC
GEC
GECC
GEN
GIPP
GPG
GPIQ
GYG
KEGCO
NED
NED Wind
NKCC
NMPC
NTPC
North Pole
OneEnergy
OPDCI
PEPOI
PGS
Quezon
REGCO
Roi-Et Green
SCC
SPPC
TEPDIA
Electricity Generating Public Company Limited
Electricity Generating Public Company Limited and its subsidiaries
and joint venture companies.
Agro Energy Company Limited
Alto Power Management Corporation
BLCP Power Limited
New Growth B.V.
Conal Holdings Corporation
New Growth Cooperatief U.A.
Covanta Philippines Operating Inc.
Chaiyaphum Wind Farm Company Limited
Diamond Generating Asia, Limited
Eastern Water Resources Development and Management Public
Company Limited
Electricity Generating Authority of Thailand
EGCO International (BVI) Limited
EGCO Cogeneration Company Limited
EGCO Green Energy Company Limited
Egcom Tara Company Limited
EGCO Engineering and Service Company Limited
Gulf Cogeneration Company Limited
Gulf Electric Public Company Limited
General Electric Capital Corporation
Gulf Energy Company Limited
Gulf IPP Company Limited
Gulf Power Generation Company Limited
GPI Quezon Company Limited
Gulf Yala Green Company Limited
Khanom Electricity Generating Company Limited
Natural Energy Development Company Limited
NED Wind Company Limited
Nong Khae Cogeneration Company Limited
Northern Mindanao Power Corporation
Nam Theun 2 Power Company Limited
North Pole Investment Company Limited
OneEnergy Thailand Limited
Ogden Power Development Cayman Inc.
Pearl Energy Philippines Operating Inc.
Power Generation Services Company Limited
Quezon Power (Philippines) Limited Company
Rayong Electricity Generating Company Limited
Roi-Et Green Company Limited
Samutprakarn Cogeneration Company Limited
Southern Philippines Power Corporation
TEPDIA Generating B.V.
Theppana
Theppana Wind Farm Company Limited
WMPC
Western Mindanao Power Corporation
XPCL
Xayaburi Power Company Limited
2. Government Organizations
EPPO
ERC
IEAT
NEPC
PWA
SEC
SET
3. Other Institutions
IOD
JBIC
COSO
4. Technical Terms
Associated Company
Controlling Person
IPP
Major Shareholder
PDP
SPP
Energy Policy and Planning Office
Energy Regulatory Commission
Industrial Estate Authority of Thailand
National Energy Policy Council
Provincial Waterworks Authority
Securities and Exchange Commission, Thailand
Stock Exchange of Thailand
Thai Institute of Directors
Japan Bank for International Corporation
The Committee of Sponsoring Organizations of the Treadway
Commission
A firm is an associated company if :
A) listed company or its subsidiaries hold 20.00% (twenty percent)
or more, but not more than 50.00% (fifty percent) of its overall
voting stock.
B) A listed company or its subsidiary has influence, but not
controlling power, over its monetary and operational policies. (The
company is not deemed to be a subsidiary or joint venture.)
Shareholdings referred to above include those held by related
persons.
This is a shareholder or a person who, through their behavior, can
significantly influence the policy, management and operations of a
listed firm. This is irrespective of the source of their authority:
through their rights, contracts, or any others.
Specially, a “controlling person” includes, but is not limited to, one
who:
A) Has direct or indirect voted exceeding 25.00% (twenty-five
percent) of the total company votes.
B) Through their behavior, has control over the appointment
or removal of company directors.
C) Through their behavior, has de facto control or undue
influence over policy, controlling those company members
authorized to determine management and operational
policies.
D) Through their behavior, acts or has the power to act in the
same manner as the company management. This includes
those who hold other positions in the company, but are
able to act in the same manner as the company
management.
Independent Power Producer
Such person is a one whose holding in a listed firm exceeds
10.00% (ten percent) of the listed company’s overall voting stock.
Power Development Plan
Small Power Producer
Subsidiary Company
Is :
A) A company that a listed company holds over 50.00% (fifty
percent) of its total voting stock.
B) A company that the company referred to in (A) holds over
50.00% (fifty percent) of its total voting stock.
C) A company that is held by another company in a chain of
ownership, no matter how many number in the chain,
ending with the company referred to in (B) and
D) A company that the company referred to in (A), (B), or (C)
hold over 50.00% (fifty percent) of its overall voting stock,
either directly or indirectly.
E) A company that the company referred to in (A), (B), (C), or
(D) have controlling power over its monetary and
operational policies, and are able to direct and gain interest
on its activities.
The holding of (A), (B), (C), or (D) is included those held
by related persons.
Part 1 Executive Summary
Part 1
Executive Summary
The Notification of the Capital Market Supervisory Board No. Tor Jor 11/2009 Re: Criteria,
Conditions and Procedures of Reporting Disclosure of Financial Status and Results of
Business Operations of Issuance Companies dated March 13, 2009 revoked this part.
Page 1
Part 2 Listed Company
Part 2
Listed Company
1. EGCO Information
Name
: Electricity Generating Public Company Limited (EGCO)
Business
: Holding Company focusing on power business and other
related business
Registration
: 0107537008666 (Previously Number Listed Co. 333)
Sector
: Energy and Utilities
Industry
: Resources
Registered Capital
: 5,300 million baht
Paid up Capital
: 5,246.65 million baht
Par Value
: 10 baht
Foreign Limit
: 44.82%
% of Free Float
: 50.65% as of March 16, 2012
Head Office
: EGCO Tower, 222
Moo 5, Vibhavadi Rangsit Rd.,
Tungsonghong, Laksi, Bangkok 10210, Thailand.
Home Page
: http://www.egco.com
Tel.
: 66 0 2998-5000
Fax
: 66 0 2955-0956-7
Board of Directors
: Email address : directors@egco.com
Audit Committee
: Email address : auditcommittee@egco.com
Corporate Secretary
: 0 2998-5020-6
Email address : cs@egco.com
IR Contact
: 0 29985145-7
Email address: ir@egco.com
Page 2
Part 2 Listed Company
2. Referenced Persons
Regulator
Regulator
Share and Debenture registrar
Auditor
The Securities and Exchange Commission, Thailand
GPF Witthayu Building,
93/1 Wireless Road, Lumpini, Patumwan, Bangkok 10330,
Thailand
Tel +66 (0) 2695 9999, +66 (0) 2263 6499
Fax. +66 (0) 2256-7711
Corporate Affairs Department ext. 9535, 9509
E-mail: info@sec.or.th
Website: www.sec.or.th
The Stock Exchange of Thailand
The Stock Exchange of Thailand Building,
62 Ratchadaphisek Road, Klongtoey, Bangkok 10110,
Thailand
Tel +66 (0) 2229 2000, +66 (0) 2654 5656
Fax. +66 (0) 2229 2030, +66 (0) 2654 5649
S-E-T Call Center +66 (0) 2229 2222
E-mail: SETCallCenter@set.or.th
Website: www.set.or.th
Thailand Securities Depository Company Limited
The Stock Exchange of Thailand Building,
62 Ratchadaphisek Road, Klongtoey, Bangkok 10110,
Thailand
Tel +66 (0) 2229 2800
Fax. +66 (0) 2359 1259
Call Center +66 (0) 2229 2888
E-mail: contact.tsd@set.or.th
Website: www.tsd.co.th
1. Ms. Nangnoi Charoenthaveesub
Certified Public Accountant (Thailand) No. 3044
2. Mr. Prasan Chuaphanich
Certified Public Accountant (Thailand) No. 3051
3. Mr. Vichien Khingmontri
Certified Public Accountant (Thailand) No. 3977
PricewaterhouseCoopers ABAS Limited
15th Floor, Bangkok City Tower,
179/74-80 South Sathorn Road,
Bangkok 10120, Thailand
Tel +66 (0) 2286 9999, +66 (0) 2344 1000
Fax. +66 (0) 2286 5050
Page 3
Part 2 Listed Company
3. General Information
Company
Electricity Generating Public Company Limited (EGCO)
Registration
0107537000866 (No.BorMorJor.333)
Head Office
14th, 15th Floor EGCO Tower, 222 Moo 5,
Vibhavadi Rangsit Road, Tungsonghong,
Laksi, Bangkok 10210, Thailand
Tel. +66 (0) 2998 5000
Fax +66 (0) 2955 0956-9
Rayong Power Plant
Bangkok Office
12th Floor, EGCO Tower
Tel. +66 (0) 2998 5000
Fax +66 (0) 2955 0931
Rayong Office
35 Rayong Highway No. 3191
Huay Pong District, Amphur Muang,
Rayong 21150, Thailand
Tel. +66 (0) 3868 1012, +66 (0) 3868 1016,
+66 (0) 3868 1020
Business
Holding Company focusing on Power
business and others related to power
business
Independent Power Producer (IPP)
Electricity Generating and supply business
Sector
Energy & Utilities
Industry
Resources
Foreign Limit
44.81%
Share of Minor Shareholder (% Free Float) 51.90%
Website
www.egco.com
Page 4
Registered
Share Capital
(Million Baht)
5,300
Par Value
(Baht)
10
Paid-up
Share Capital
(Million Baht)
5,264.65
Ownership Interest
(Direct+Indirect)
(%)
-
Part 2 Listed Company
Subsidiaries
Company
Khanom Electricity Generating Company Limited (KEGCO)
Office
12th Floor, EGCO Tower
Tel. +66 (0)2998 5000
Fax +66 (0) 2955 0932
Site Office
112 Moo 8,
Tongnean District, Amphur Khanom
Nakhon Sri Thammarat 80210, Thailand
Tel. +66 (0) 7552 9173, +66 (0) 7552 9179
Fax +66 (0) 7552 8358
EGCO Engineering & Service Company Limited (ESCO)
Office
13th Floor, EGCO Tower
Tel. +66 (0) 2998 5000
Fax +66 (0) 2955 0933
Site Office
35 Rayong Highway No. 3191
Huay Pong District, Amphur Muang,
Rayong 21150, Thailand
Tel. +66 (0) 3868 2611-4
Fax +66 (0) 3868 2823
North Pole Investment Company Limited (North Pole)
Office
EGCO Tower
Tel. +66 (0) 2998 5000
Fax +66 (0) 2955 0956-9
Oversea office
6th Floor, Tower A, 1 CyberCity, Ebene,
Republic of Mauritius
EGCO International (B.V.I.) Limited (EGCO B.V.I.)
Office
EGCO Tower
Tel. +66 (0) 2998 5000
Fax +66 (0) 2955 0956-9
Oversea office
Akara Bldg., 24 De Castro Street,
Wickhams Cay 1, Road Town, Tortola,
British Virgin Islands, P.O. Box 3136
New Growth Cooperatief U.A. (Coop)
Office
EGCO Tower
Tel. +66 (0) 2998 5000
Fax +66 (0) 2955 0956-9
Oversea office
De Lairessestraat 154, 1075 HL Amsterdam,
The Netherlands
New Growth B.V. (BV)
Office
EGCO Tower
Tel. +66 (0) 2998 5000
Fax +66 (0) 2955 0956-9
Oversea office
De Lairessestraat 154, 1075 HL Amsterdam,
The Netherlands
Pearl Energy Philippines Operating, Inc. (PEPOI)
Office
EGCO Tower
Tel. +66 (0) 2998 5000
Fax +66 (0) 2955 0956-9
Oversea office: Barangay, Cagsiay I, Mauban, Quezon, Philippines 4330
EGCO Cogeneration Company Limited (EGCO Cogen)
Office
13th Floor, EGCO Tower
Tel. +66 (0) 2998 5000
Fax +66 (0) 2955 0956-9
Site Office
222 Moo 8,
Mabkha District,Amphur Nikhom Phattana
Rayong 21180, Thailand
Tel. +66 (0) 3863 7051-8
Fax +66 (0) 3863 7063
Business
IPP
Electricity Generating and supply business
Engineering, operation and maintenance
services for power plants and
manufacturers
Holding company focusing on investment in
electricity generating companies in foreign
countries
Holding company focusing on investment in
electricity generating companies in foreign
countries
Holding company focusing on investment in
electricity generating companies in foreign
countries
Holding company focusing on investment in
electricity generating companies in foreign
countries
Operation and Maintenance of QPL
Small Power Producer (SPP)
Electricity and steam generating and supply
business
Page 5
Registered
Share Capital
(Million Baht)
5,000
10
Paid-up
Share Capital
(Million Baht)
4,850
Ownership Interest
(Direct+Indirect)
(%)
99.99
400
10
400
99.99
5,724.76/1
31.6116/1
5,724.76/1
100
(181,096,921 USD)
(1 USD)
(181,096,921 USD)
11.06/1
31.6116/1
11.06/1
(350,000 USD)
(1 USD)
(350,000 USD)
2.23/2
4,088.28/2
2.23/2
(54,500 EUR)
(100 EUR)
(54,500 EUR)
1.12/2
4,088.28/2
1.12/2
(27,500 EUR)
(100 EUR)
(27,500 EUR)
Par Value
(Baht)
6.32/1
6.32/1
(200,000 USD)
(200,000 USD)
1,060
10
1,060
100
100
100
100
80
Part 2 Listed Company
Company
EGCO Green Energy Company Limited (EGCO Green)
Office
EGCO Tower
Tel. +66 (0) 2998 5000
Fax +66 (0) 2955 0956-9
Roi-Et Green Energy Company Limited (Roi-Et Green)
(EGCO Green is the company’s 95.00% shareholder)
Office
13th Floor, EGCO Tower
Tel. +66 (0) 2998 5000
Fax +66 (0) 2955 0956-9
Site Office
222 Moo 10,
Nua-Muang District, Amphur Muang
Roiet 45000, Thailand
Tel. +66 (0) 4351 9825-6
Fax +66 (0) 4351 9827
Agro Energy Company Limited (AE)
(ESCO is the company’s 99.99% shareholder)
Office
EGCO Tower
Tel. +66 (0) 2998 5000
Fax +66 (0) 2955 0956-9
Egcom Tara Company Limited (ET)
(ESCO is the company’s 74.19% shareholder)
Office
13th Floor, EGCO Tower
Tel. +66 (0) 2998 5000
Fax +66 (0) 2955 0945
Site office
- Plant 1
332 Moo 2, Pongsawai District,
Amphur Muang
Ratchburi 70000, Thailand
- Plant 2
250 Moo 1, Pangpuay District,
Amphur Damneansaduak
Ratchburi 70130, Thailand
Business
Holding company focusing on power
business
SPP utilizing Biomass as primary fuel
Trading/delivery service of fuel from natural
scrap
Piped water generating and supply
business
Page 6
Registered
Share Capital
(Million Baht)
175
10
Paid-up
Share Capital
(Million Baht)
175
Ownership Interest
(Direct+Indirect)
(%)
74
180
10
180
70.30
2
10
2
99.99
345
10
345
74.19
Par Value
(Baht)
Part 2 Listed Company
Joint Ventures:
Company
Business
Gulf Electric Public Company Limited (GEC)
Office
11th FL., M. Thai Tower I,
All Seasons Place, 87 Wireless Road,
Lumpini, Phathumwan,
Bangkok 10330, Thailand
Tel. +66 (0) 2654 0155
Fax +66 (0) 2654 0156-7
Website
http://www.gulfelectric.co.th
Gulf Power Generation Company Limited (GPG)
(GEC is the company’s 100% shareholder)
Site office
64 Moo 2 Ban Pa District,
Amphur Kaeng Khoi,
Saraburi 18110, Thailand
Tel. +66 (0) 3624 8305
Fax. +66 (0) 3624 8314, +66 (0) 3625 1344
Gulf Cogeneration Company Limited (GCC)
(GEC is the company’s 100% shareholder)
Site office
79 Moo 3 Tandeow District,
Amphur Kaeng Khoi,
Saraburi 18110, Thailand
Tel. +66 (0) 3624 6531
Fax +66 (0) 3624 8020
Nong Khae Cogeneration Company Limited (NKCC)
(GEC is the company’s 100% shareholder)
Site office
111/11 Moo 7 Nongplamor District,
Amphur Nong Khae,
Saraburi 18140, Thailand
Tel. +66 (0) 3637 3676
Fax +66 (0) 3637 3691
Samutprakarn Cogeneration Company Limited (SCC)
(GEC is the company’s 100% shareholder)
Site office
745 Moo 2 Bang Pu Mai District,
Amphur Muang,
Samutprakarn 10280, Thailand
Tel. +66 (0) 2709 0751
Fax +66 (0) 2709 1842
Gulf Yala Green Company Limited (GYG)
(GEC is the company’s 100% shareholder)
Site office
80 Moo 1, Pron District,
Amphur Muang,
Yala 95160, Thailand
Tel. +66 (0) 7325 2721
Fax +66 (0) 7325 2722
Holding company focusing on IPP and SPP
Registered
Share Capital
(Million Baht)
14,000
10
Paid-up
Share Capital
(Million Baht)
13,784.35
Ownership Interest
(Direct+Indirect)
(%)
50
Par Value
(Baht)
Independent Power Producer (IPP)
Electricity Generating and supply business
9,607
10
9,607
50
Small Power Producer (SPP)
Electricity and steam generating and
supply business
850
10
850
50
Small Power Producer (SPP)
Electricity and steam generating and
supply business
1,241.72
74
1,241.72
50
Small Power Producer (SPP)
Electricity and steam generating and
supply business
981.54
76
981.54
50
SPP utilizing Biomass as primary fuel
460
10
460
50
Page 7
Part 2 Listed Company
Company
Conal Holding Corporation (Conal)
(EGCO B.V.I. is the company’s 40% shareholder)
Office
EGCO Tower
Tel. +66 (0) 2998-5000
Fax +66 (0) 2955-0956-9
Oversea office
4th Floor, Alphaland Southgate Tower,
2258 Chino Roces Avenue Corner EDSA
Makati City, Philippines
Tel. (632) 836 4940, (632) 836 4403
Fax (632) 801 0593
Alto Power Management Corporation (APMC)
(Conal is the company’s 60% shareholder)
Oversea
4th Floor, Alphaland Southgate Tower,
2258 Chino Roces Avenue Corner EDSA
Makati City, Philippines
Tel. (632) 836 4940, (632) 836 4403
Fax (632) 801 0593
Western Mindanao Power Corporation (WMPC)
(Conal is the company’s 44% indirect shareholder)
Oversea
4th Floor, Alphaland Southgate Tower,
2258 Chino Roces Avenue Corner EDSA
Makati City, Philippines
Tel. (632) 836 4940, (632) 836 4403
Fax (632) 801 0593
Site office
Sitio Malasugat, Sangali,
Zamboanga City, Philippines
Southern Philippines Power Corporation (SPPC)
(Conal is the company’s 44% indirect shareholder)
Oversea
4th Floor, Alphaland Southgate Tower,
2258 Chino Roces Avenue Corner EDSA
Makati City, Philippines
Tel. (632) 836 4940, (632) 836 4403
Fax (632) 801 0593
Site office
Bo. Baluntay, Alubel,
Sarangani, Philippines
Business
Holding company focusing on power
business in the Philippines
Registered
Share Capital
(Million Baht)
827.63 /1
(26,181,409 USD)
Operation and maintenance
services for power plants and consulting
IPP
Electricity Generating and supply business
IPP
Electricity Generating and supply business
Page 8
15.69
/1
Par Value
(Baht)
103.37
/1
(3.27 USD)
78.40
/1
Paid-up
Share Capital
(Million Baht)
827.63 /1
Ownership Interest
(Direct+Indirect)
(%)
40
(26,181,409 USD)
7.84
/1
(496,278 USD)
(2.48 USD)
(248,139 USD)
410.18 /1
82.19 /1
307.47 /1
(12,975,535
USD)
(2.60 USD)
(11,719,503
USD)
257.74 /1
85.98 /1
237.55 /1
(8,153,289
USD)
(2.72 USD)
(7,514,615
USD)
24
17.6
17.6
Part 2 Listed Company
Quezon Power (Philippines), Limited Co. (QPL)
(North Pole is the company’s 52.125% indirect shareholder)
Oversea office
62 H. Dela Costa,
Mauban, Quezon Province,
Republic of Philippines
Site Office
Barangay, Cagsiay I, Mauban
Quezon, Philippines 4330
BLCP Power Limited (BLCP)
(Since January 30, 2007)
Office
No. 9, I-8 Road,
Map Ta Phut Industrial Estate,
Amphur Map Ta Phut,
Rayong 21150, Thailand
Tel. +66 (0) 3892 5100,
Fax. +66 (0) 3892 5199
Nam Theun 2 Power Company Limited (NTPC)
Office
Unit 9, Tat Luang Road
Nongbone Village, P.O. Box 5862
Vientiane, Lao PDR
Tel. (856-21) 263 900
Fax (856-21) 263 901
Natural Energy Development Company Limited (NED)
Office
45/F The Offices at Central World
999/9 Rama 1 Road, Patumwan
Bangkok 10330, Thailand
Website
www.ned.co.th
IPP
Electricity Generating and supply business
6,563.87 /1
6,563.87 /1
(207,641,268
USD)
(207,641,268
USD)
52.125
IPP
Electricity Generating and supply business
12,010
100
12,010
50
IPP
Electricity Generating and supply business
14,225.22/1
3,161.16/1
11,806.93/1
35
450,000,000
USD
100
USD
373,500,000
USD
2,304
10
594
Feasibility study on Renewable Energy
project in Thailand
33.33
Other:
Company
Business
Eastern Water Resources Development and Management Public
Company Limited (EASTW)
Office
23-26/F Eastwater Building, 1
Vibhavadi Rangsit Road, Jomphol,
Chatuchak, Bangkok 10900, Thailand
Tel. +66 (0) 2272-1600
Fax +66 (0) 2272-1601-3
Website
www.eastwater.com
Xayaburi Power Company Limited (Xayaburi)
Office
215 Lanexang Avenue, Ban Siang Yuen
Chantaburi District, Vientiane,
Lao PDR
Water resources development and
management for supplying raw water to the
customers
Feasibility study on Hydroelectric project in
Lao PDR
Note : The Exchange rate as at December 30, 2011
/1
1 USD
= Baht 31.6116
/2
1 EUR = Baht 40.8828
Page 9
Registered
Share Capital
(Million Baht)
1,663.73
1,000
1
Paid-up
Share Capital
(Million Baht)
1,663.73
10
1,000
Par Value
(Baht)
Ownership Interest
(%)
18.72
12.50
Part 2 Section 1 Rick Factors
1. Risk Factors
To create long term value for shareholders, EGCO recognizes the importance of
properly analyzing and managing its business risks. The Board of Directors entrusted the Audit
Committee to review the Company’s risk management policies while the Management has the
responsibility to implement such policies and report the progress to the Audit Committee and
the Board. In this regard, the Risk Management Committee has been set up at the Management
level which comprises EGCO’s top executives and the Managing Directors of EGCO
subsidiaries. EGCO’s President serves as the chairman of the Committee. Rayong Power Plant
and EGCO subsidiaries such as KEGCO, and ESCO also have their own risk management
committees to help ensure that their particular risks will be managed adequately.
EGCO Group has setup the risk management policy in a Risk Management Manual
which serves as a guideline for the EGCO Group.
About the flood situation in central Thailand and Bangkok areas, EGCO group’s
electricity generation and operation have not been affected by the floods. The details are
presented in this article.
A summary of key risk factors and associated mitigation measures is as follows:
1.
Investment Risk
EGCO invests in electricity generating business. Its main sources of income are
dividends from subsidiaries and joint ventures which sell and distribute power under long term
Power Purchase Agreements (PPA).
EGCO plans to continuously invest in new projects in accordance with EGCO’s
strategy. Such project development may entail risks that will affect EGCO’s investment target.
The investment risks are as follow:
1.1
Risks from Project Development
EGCO plans to expand its investment in order to maintain continuous growth, both in Thailand
and foreign countries. Key projects are listed in the investment plan so that EGCO can
appropriately allocate resources to those projects. Failure to add new assets to the portfolio
either through Greenfield development or Acquisition will affect EGCO’s long-term outlook.
Also, according to the decrease of revenue in electricity tariff structure, the earnings from new
projects may not timely substitute for the declining of revenue from existing power plants.
However, the environment of the project and the project itself are the risk factors of
project development caused by uncertainty and business competition which can occur regularly.
To ensure the success of project development, EGCO Business Development Team has
analyzed and identified the key risks involved. These include economic, political, and social
policies of target countries, economic situation, financial costs, as well as machine, equipment,
and construction costs. Moreover, compliance with laws and regulations to prevent
environmental, social, and health impacts are concerned as well.
EGCO has prepared risk mitigation measures. For instance, fundamental analysis of
target countries was conducted by gathering necessary information such as Power Development
Plan (PDP), electricity and tax structure. Project information such as factors of electricity
10
Part 2 Section 1 Rick Factors
generating will be studied to appraise whether the projects are feasible with acceptable cost and
competitive prices.
Besides the project feasibility, EGCO also set up the mechanisms and process to review
and scrutinize new investment. Such mechanisms include the review by EGCO Management
Committee which comprise EGCO’s top management, and the Investment Committee which is
the Board’s committee to ensure that all material risks are identified and managed. The
committees will also review the major conditions of the Shareholders’ Agreement such as
dividend policy, rights to audit before submitting those agreements for the Board’s
consideration.
2.
Operational Risks
2.1
Risk of Failure to Get Target Return on Investment
EGCO has the responsibility to properly monitor and manage its investment in order to
reach or exceed targeted return on investment. Without efficient mechanism to manage
investment assets, EGCO may not get return on investment at target. Typical measures imposed
to mitigate relevant risks are as follows:
-
Establish asset management policies and, where possible, assign management and
staffs to be EGCO Group representatives’ directors or management of its
subsidiaries and investment projects.
-
Monitor operating performances of each facility and analyze the actual return on
investment against the planned target.
-
Prepare regular progress reports to senior management and the Board of Directors
so that a timely and appropriate action can be taken. The exceptional operating
performance is to be reported as well.
-
Coordinate with partners for joint-audit in investment companies to ensure the
adequacy and effective of internal control system.
With these actions, EGCO will achieve target return on investment. According to the
2010 operating performance report, the incomes from EGCO’s portfolio have been received in
line with modeled results.
2.2
Plant Performance Risks
A commitment to generate and deliver electricity pursuant to a PPA with EGAT entails
the performance risks which may caused by staff, equipment and management approach. The
significant performance risks are as summarized below:
(1)
Plant Efficiency
There are various efficiency benchmarks under a PPA with EGAT i.e., Equivalent
Availability Factor (EAF) and Heat Rates. Failure to meet these performance requirements
would result in penalties and potential termination in certain extreme cases.
The cause of such risk may be power plant aging. With consistent, professional
maintenance being a policy in place for each of EGCO Group’s power plants, this risk is
11
Part 2 Section 1 Rick Factors
considered to be low. Despite that, the management has established systematic procedures to
ensure that all relevant performance targets are met. These procedures are as follows:
-
To include the key plant efficiency parameters in the Corporate Key Performance
Indicators of power plants in the EGCO group in order to ensure that the
production efficiency is closely monitored and all employees take part in the plant
efficiency.
-
To set up Early Warning Systems for critical information regarding the plant
operation processes.
-
To ensure that the scheduled preventive maintenance of power plant equipment is
carried out on a regular basis by qualified staff.
-
To ensure that spare part inventory is adequate and well managed.
-
To implement the Quality Management System (ISO: 9001:2008) to ensure that
those power plants operate in accordance with the terms of their PPAs
-
To continuously develop the competencies of the firms’ human resources.
With consistent operation along with these mitigation actions, the chance of this risk is low.
(2)
Raw Water Shortage for Electricity Generating
The electricity generating process requires pretreatment and demineralization of raw
water for cooling system and steam boiler system.
The risk of a raw water shortage can result in plant stoppages, revenue shortfall, or
penalty payments. The risk could be caused by climate change, overall increasing of water usage.
Not enough amount of rainfall or the delay of rainy season in some years may affect to sufficient
reserve of raw water.
Although EGCO Group has never before experienced any water shortage, the measures
are set to prevent and mitigate such risks by increasing the raw water storage capacity, seeking
additional sources of raw water supply and setting measures to maximize the benefit of water
usage. The risk of raw water shortage is quite low.
(3) Fuel Shortage for Electricity Generation The risks of a fuel shortage for electricity generation can result in plant stoppages,
revenue shortfall or penalty payments. The shortage of “coal and biomass” fuel type could be
caused by increasing demand or price fluctuation. Furthermore, natural disaster such as floods
may affect the quality and quantity of fuel.
From the past record, EGCO Group has never before experienced any fuel shortage.
However, the measures are set to closely monitor and to prevent and mitigate such risk for
continuous power generation as follows:
-
EGCO Group’s gas fired power plants, which contributed 54 % of 2010 total
electricity sales revenues, have enjoyed long term Gas Supply Agreements with PTT,
except for Rayong Power Plant and KEGCO which EGAT is the gas supplier under
the terms of their PPAs. The quantity and quality of natural gas and other key
parameters are all specified in the relevant agreements. With PTT and/or EGAT
being the main suppliers, the risks of fuel gas shortage is considered low.
12
Part 2 Section 1 Rick Factors
-
EGCO Group’s coal fire power plants “BLCP and Quezon”, which contributed 36
% of 2010 total electricity sales revenues, have long term Coal Supply &
Transportation Agreement. The suppliers must supply coal with the quantity and
quality as specified in the agreement. Efficient coal reserve management is a
significant measure which can reduce this type of risk as well.
Moreover, coal procurement from potential alternative suppliers when necessary is
another measure to ensure the adequacy supply under the terms of the PPA.
-
(4)
EGCO Group’s biomass power plants using rice husks and Para wood chips as fuel,
which contributed 2 % of 2010 total electricity sales revenues, may face the fuel risk
in terms of inadequate supply and volatile pricing. This is because those agricultural
products may have alternative uses in the market. Since long term fuel supply
agreements can not be established as there are few creditworthy suppliers of such
feedstock, the primary risk prevention measures are to reserve more fuel and to seek
alternative fuel sources in surrounding areas. This mitigation measures can help
manage the fuel price at a certain level. However, the biomass fuel is still a seller’s
market. As such, the impact of the inadequate of such fuel on EGCO’s revenues is
low.
Safety Health Environment and Social
EGCO realizes that the electricity generating process which uses natural gas and coal as
primary fuels will have certain impacts on the safety, environment and quality of life of
employees and surrounding communities. The cause of risk can arise from the inefficiency of
power plant or the inadequate measurement. Consequently, EGCO has taken the following
actions to mitigate any potential negative impacts and reduce the likelihood of such risks as
follows:
-
Develop and live by EGCO group’s Corporate Social Responsibility policy
-
Develop Safety, Health and Environment (“SHE”) Management Manual for all
EGCO owned plant as guidelines for implementation and audit.
-
Prepare the work manuals and emergency plan, implement training plan and testing
of plan, equipment and warning system while ensuring strict compliance with the
manual.
-
Develop a list of governing laws and regulations and designate responsible person to
monitor the compliance with related laws.
-
Monitor and ensure the compliance with SHE Management Manual
By complying with the above measures regularly, we can be ensured that this risk
likelihood is quite low.
(5)
Accident, Resistance, and Sabotage
EGCO business may face risk from accident that may cause fire. Besides, the operation
may subject to the community resistance if the electricity generating process has negative impacts
on the community. Such risks may be caused by the power plant aging condition, personnel
operation, or sabotage event.
13
Part 2 Section 1 Rick Factors
With existing mitigation actions and situation monitoring, this risk likelihood is quite low.
Management is well aware of the above risks and has set the following measures to
mitigate and reduce the likelihood of those risks.
-
To strongly encourage employees to prudently discharge their duties with the belief
that carelessness may lead to significant damages.
-
To periodically maintain all equipment as scheduled to ensure that they can work
efficiently.
-
To strengthen relationship with surrounding communities to foster the right
perception about EGCO business.
-
To strengthen relationship with local government authorities.
-
To set the security plan with regular drills and provide equipment such as closed
circuit TV.
-
To secure the insurance policy that covers all risks, machinery breakdown, business
interruption and third party liability to assure that assets and personnel will be
properly and adequately protected and the damages will be recovered even in an
unexpected case
-
In 2011, the management has considered to procure the political violence insurance
policy which covers the effects of political violation and terrorist attack. Effective
from 2012, the insurance will cover EGCO’s power plants and subsidiaries including
EGCO tower and Egcom tara. However, the insurance policy on terrorist attack
have already been procured for most of EGCO’s joint venture power plants.
3. Financial Risks
The investments of EGCO Group are capital-intensive. Since the primary funding
sources are loans from domestic and international bank loan markets, foreign exchange rate
fluctuation and interest rate fluctuation, are important risks to be monitored and mitigated. This
risk may be caused by mismatch of revenue and loan structure including the change of foreign
currency and interest rate. In case that the change of foreign currency and interest rate are
negative to EGCO structure, it will lead to decline in the Group’s operating performance.
Therefore, the mitigation measures are established as follows:
3.1 Foreign Exchange Rate Fluctuation
EGCO Group has a policy to mitigate currency mismatches for each of its investment
projects to prudent levels. In general, this is achieved by matching currencies of project
development and construction costs with funding source currencies and subsequently matching
the currency of long-term funding profiles with those of each project’s revenue stream during
the operation phase.
3.2 Interest Rate Fluctuation
EGCO Group has a policy to manage risk of interest rate fluctuation by using financial
hedging instruments (namely interest rate swaps) to fix floating interest rate exposure to prudent
levels in order to provide the most predictable cash flows over its long-term power purchase
contracts. If interest rate fixtures are not available for the full project terms required, EGCO will
seek to enter into or cause its project company’s to enter into financial instruments that can best
mitigate the interest rate risks subject to market availability and cost.
14
Part 2 Section 1 Rick Factors
With these measures, the impacts to EGCO group are not much.
4. Other Risks
4.1 Business Interruption due to flood situation
EGCO group’s electricity generation and operation have not been affected by the floods
occurred in 2011. However, flood situation and impact tend to occur more often in many areas
of Thailand. Thus, the flood situation will be monitored further.. EGCO’s risk mitigation
measures are as follows;
For EGCO Office:
-
Prepare procedure for flood protection plan at EGCO tower. The job descriptions,
responsible persons, and telephone numbers for contact are described.
-
Define procedure to turn off the electricity system in order to protect the loss of life
and the failure of office systems and computer systems.
-
Seek a reliable service provider to arrange a backup site at a safety zone to ensure that
EGCO can communicate with related parties and employees so that the
management’s policy and the situation of flood around EGCO tower will be
acknowledged.
-
Coordinate with business partners to arrange temporary office during flood situation.
For Power Plants: EGCO’s power plants are designed to be situated in highland and the
drainage systems are well-designed. However, the Management set the protection
measurement as follows;
-
Provide appropriate numbers of electric water pump.
-
Establish crisis management plan including procedures, job descriptions to mitigate
natural disaster such as floods.
-
Procure the “All Risks” insurance policy which cover flood insurance.
-
Monitor weather forecast and communicate with government authorities to take
actions as planned.
15
Part 2 Business Characteristics
2. Business Characteristics
2.1 Background and Major Development
The Electricity Generating Public Company Limited or EGCO is the first independent power
producer in Thailand incorporated on May 12, 1992 by the Electricity Generating Authority of
Thailand (“EGAT”). Such incorporation marked the commencement of the Thai government’s
privatization initiatives to allow broader private sector investment in the electricity generating sector.
On March 23, 1994, EGCO was transformed into a public company and then listed on the Stock
Exchange of Thailand (“SET”) on January 16, 1995.
Since EGCO is a holding company, its main source of revenue is from the dividend income from
subsidiaries and share of profits from joint ventures which are located in both Thailand and the
Asian region. EGCO Group companies either operate in the power sector with long term Power
Purchase Agreement (“PPA”) or conduct other related business.
Business Lines
EGCO businesses can be categorized into 4 groups as follows:
1. Independent Power Producer (“IPP”) Group: This Group comprises 4 power plants being
Rayong Power Plant, Khanom Electricity Generating Co., Ltd., BLCP Power Ltd., and Gulf
Power Generation Co., Ltd. The combined megawatt equity is 3,453 megawatt which accounts
for 78.12% of EGCO’s total asset capacity. The combined megawatt equity is less than last year
by 75 megawatt due to the expiration of PPA of Khanom power plant Unit 1 on June 19, 2011.
2. Small Power Producer (“SPP”) Group: This Group comprises 7 power plants being EGCO
Cogeneration Co., Ltd., Roi-Et Green Co., Ltd., Gulf Cogeneration Co., Ltd., Nong Khae
Cogeneration Co., Ltd., Samutprakarn Cogeneration Co., Ltd., Gulf Yala Green Co., Ltd. and
Natural Energy Development Co., Ltd. The combined capacity is 295.73 megawatt equity,
representing 6.69% of EGCO’s total asset capacity. The combined megawatt equity is more than
the last year by 2.67 megawatt due to Commercial Operation Date (“COD”) of the first stage of
Lopburi Solar power plant on December 22, 2011.
3. Overseas Power Producer Group: This Group comprises 4 power plants being Western
Mindanao Power Corporation, Southern Philippines Power Corporation, Quezon Power
(Philippines) Ltd., Co., in Philippines and Nam Theun 2 Power Co., Ltd., in Lao PDR. The
combined megawatt equity is 671.24 megawatt, representing 15.19% of EGCO’s total asset
capacity. The combined megawatt equity is higher than last year by 131.28 megawatt due to the
additional acquisition of 26.125% interest in Quezon Power (Philippines) Ltd., Co., on March
25, 2011.
4. Other Business Group: This Group comprises 2 operation and maintenance companies being
EGCO Engineering & Service Co., Ltd., and Pearl Energy Philippines Operating, Inc. In
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Part 2 Business Characteristics
addition, there are 2 water supply companies being Egcom Tara Co., Ltd., and the Eastern Water
Resources Development and Management Public Co., Ltd.
Details of each project are shown in the table at the end of this part.
2.4 Revenue Profile
The major source of income is from IPP group. The revenue structure of EGCO Group of each
business line as is shown below.
Page 16
Part 2 Business Characteristics
Revenue Structure
( Million Baht )
Product
Service
Electricity
Transaction
%
Shareholding
2011
Revenue
IPP
%
2010 (Restated)
Revenue
%
33.27%
2009
Revenue
%
38.31%
35.25%
/A
Rayong power plant (formerly REGCO)
Capacity Charge
Energy Charge
KEGCO
Capacity Charge
Energy Charge
SPP
Service
EGCO Cogen
Energy Charge
Roi-Et Green
Energy Charge
ESCO
/B
Water
Interest
income
Others
Share of
profit (loss)
PEPOI
Egcom Tara/C
EGCO
Rayong power plant
KEGCO
EGCO cogen, EGCO Green, ESCO,
Egcom Tara, PEPOI, North Pole/D
EGCO
Rayong power plant
KEGCO
EGCO cogen, EGCO Green,
ESCO, Egcom Tara
BLCP
GEC
NED
NTPC/E
Conal
Quezon/F
Total revenues (revenues item in consolidated)
2,201.28
57.05
16.54%
0.43%
2,454.12
81.16
16.25%
0.54%
3,674.60
47.49
23.30%
0.30%
2,098.32
72.08
15.77%
0.54%
2,772.83
15.61
18.36%
0.10%
2,304.26
13.55
14.61%
0.09%
99.99%
17.95%
15.26%
14.12%
80.00%
2,064.46
15.51%
2,002.04
13.25%
1,927.49
12.22%
324.60
375.93
198.75
268.56
141.21
4.38
9.71
2.44%
2.82%
1.49%
2.02%
1.06%
0.03%
0.07%
302.85
721.54
2.01%
4.78%
298.94
611.41
1.90%
3.88%
258.83
67.05
5.37
6.56
1.71%
0.44%
0.04%
0.04%
267.33
66.50
9.03
10.15
1.70%
0.42%
0.06%
0.06%
21.10
208.91
49.20
1.12
0.16%
1.57%
0.37%
0.01%
9.90
236.16
47.99
3.08
0.07%
1.56%
0.32%
0.02%
11.71
175.46
55.38
9.34
0.07%
1.11%
0.35%
0.06%
10.08 0.07%
2,851.98 18.88%
2,450.32 16.22%
(22.69) (0.15%)
107.27 0.71%
139.58 0.92%
582.76 3.86%
11.88
3,226.45
2,535.21
(10.91)
(38.83)
63.07
498.36
0.08%
20.46%
16.08%
(0.07%)
(0.25%)
0.40%
3.16%
15,767.89
100%
70.30%
99.99%
100.00%
74.19%
50.00%
50.00%
33.33%
35.00%
40.00%
52.125%
13.48 0.10%
1,849.03 13.89%
1,836.18 13.80%
(28.21) (0.21%)
1,045.62 7.86%
19.66 0.15%
477.41 3.59%
13,309.84
100%
15,104.40
100%
Page 17
Part 2 Business Characteristics
Notes
/A The acquisition of entire business of REGCO to EGCO occurred in October 2009, which hereinafter referred to Rayong power plant
/B EGCO purchased ordinary shares in PEPOI on March 25, 2011, increasing its ownership 100%
/C ESCO purchased additional ordinary shares in Egcom Tara on January 6, 2010, increasing its ownership interest from 70.07% to 74.19%
/D EGCO purchased ordinary shares in North Pole on July 16, 2010, increasing its ownership 100%
/E EGCO purchased additional ordinary shares in NTPC on September 29, 2010, increasing its ownership interest from 25% to 35%
/F EGCO purchased additional ordinary shares in Quezon on March 25, 2011, increasing its ownership interest from 26% to 52.125%
Page 18
Part 2 Business Characteristics
2.5
Business Target
EGCO focus to continue building upon its portfolio of power generation assets within both the
domestic and ASEAN markets by develop or buy the power plant projects upon the company
investment plan which concern in shareholders’ return maximization under the acceptable level of
risk. In essence, the Company’s corporate vision is:
“To be the leading Thai integrated electric power Company with comprehensive energy
services in Thailand and in the ASEAN region, with full commitment to environment
protection and social development support”
In this regard, EGCO has identified its key long term objectives as follows:



Seek to grow at a rate higher than the average growth of electricity demand in our target markets,
Achieve returns on equity (ROE) above the average of industry in Thailand,
Create a healthy organization which excels in terms of good corporate governance and
acceptance from the communities.
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Part 2 Business Characteristics
Table 1. EGCO’s Business Line:
1. IPP Group
1.1 Rayong Power Plant
Rayong power plant is the first IPP in Thailand located in Rayong province. It is a 1,232megawatt power plant comprising four identical 308-megawatt combined cycle power blocks
using natural gas as a primary fuel to generate and sell all net electricity output to EGAT under
the 20-year Power Purchase Agreement (“PPA”).
In 2011, Rayong power plant generated and sold 2,126.70 million kilowatt-hour electricity output
to EGAT. Its annual average Equivalent Availability Factor (“EAF”) was 93.09%.
1.2 Khanom Electricity Generating Company Limited (“KEGCO”)
EGCO directly holds a 100% stake in KEGCO which owns and operates Khanom power plant
which is known as the largest independent power plant in the southern area of Thailand located
in Nakhon Sri Thammarat province. It is a 824-megawatt power plant combining of two 75megawatt barge-mouthed power units and one 674-megawatt combined cycle power block using
natural gas as a primary fuel to generate and sell all net electricity output to EGAT under the 15year PPA for barge-mouthed power unit 1 and the 20-year PPA for barge-mouthed power unit 2
and combined cycle power block.
On June 19, 2011, barge-mouthed power unit 1 was permanently shut down due to the
expiration of the PPA.
In 2011, Khanom power plant generated and sold 5,816 million kilowatt-hour electricity output
to EGAT. Its annual average EAF was 95.28%.
1.3 BLCP Power Limited (“BLCP”)
EGCO directly holds a 50% stake in BLCP which owns and operates an IPP coal-fired power
plant located in Rayong province. It is a 1,434-megawatt power plant comprising two identical
717-megawatt pulverized coal-fired power units using high quality bituminous imported from
Australia as a primary fuel to generate and sell all net electricity output to EGAT under the 25year PPA.
In 2011, BLCP power plant generated and sold 10,616.59 million kilowatt-hour electricity output
to EGAT, while its annual average EAF for unit 1 and unit 2 were 93.79% and 92.74%,
respectively.
1.4 Gulf Power Generation Company Limited (“GPG”)
EGCO indirectly holds a 50% stake in GPG via its 50% ownership in Gulf Electric Public
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Part 2 Business Characteristics
Company Limited (“GEC”). GPG owns and operates an IPP gas-fired power plant, called
Kaeng Khoi 2 (“KK2”), located in Saraburi province. It is a 1,510-megawatt power plant
composed of two 755-megawatt combined cycle power blocks using natural gas as a primary fuel
to generate and sell all net electricity output to EGAT under the 25-year PPA.
In 2011, KK2 power plant generated and sold 8,813.30 million kilowatt-hour electricity output to
EGAT. The annual average EAF for block 1 and block 2 were 93.60% and 85.62%, respectively.
2. SPP Group
2.1 EGCO Cogeneration Company Limited (“EGCO Cogen”)
EGCO directly holds an 80% stake in EGCO Cogen which owns and operates a SPP
cogeneration power plant located in Rayong province. It is a 117-megawatt cogeneration power
plant with steam supply of 30 tons per hour using natural gas as a primary fuel. EGCO Cogen
can sell both electricity and steam outputs. Under the SPP firm cogeneration program, it signed a
60-megawatt contracted capacity with EGAT under the 21-year PPA, while the rest of capacities
were signed with the industrial users in Rayong Industrial Park under the long-term PPAs.
In 2011, EGCO Cogen power plant generated and sold 709.92 million kilowatt-hour electricity
output to its customers. Its annual average EAF was 98.12% and the steam output to the
industrial user was 52,218 tons.
2.2 Roi-Et Green Company Limited (Roi-Et Green)
EGCO indirectly holds a 70.30% stake in Roi-Et Green via EGCO Green Company Limited.
Roi-Et Green owns and operates a SPP renewable power plant located in Roi-Et province. It is a
9.9-megawatt biomass-fired power plant using rice husk as a primary fuel. Under the SPP firm
renewable program, it signed an 8.8-megawatt contracted capacity with EGAT under the 21-year
PPA.
In 2011, Roi-Et Green power plant generated and sold 60.35 million kilowatt-hour electricity
output to EGAT, while its annual average EAF was 86%.
2.3 Gulf Cogeneration Company Limited (“GCC”)
EGCO indirectly holds a 50% stake in GCC via GEC. GCC owns and operates a SPP
cogeneration power plant located in Saraburi province. It is a 110-megawatt cogeneration power
plant with steam supply of 16 tons per hour using natural gas as a primary fuel. GCC can sell
both electricity and steam outputs. Under the SPP firm cogeneration program, it signed 90megawatt contracted capacity with EGAT under the 21-year PPA, while the rest of capacities
were signed with the industrial users under the long-term PPAs.
In 2011, GCC power plant generated and sold 744.31 million kilowatt-hour electricity output to
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Part 2 Business Characteristics
the customers, while its annual average EAF was 98.16% and the steam output to the industrial
users was 126,528 tons.
2.4 Nong Khae Cogeneration Company Limited (“NKCC”)
EGCO indirectly holds a 50% stake in NKCC via GEC. NKCC owns and operates a SPP
cogeneration power plant located in Saraburi province. It is a 126-megawatt cogeneration power
plant with steam of 24 tons per hour using natural gas as a primary fuel. NKCC can sell both
electricity and steam outputs. Under the SPP firm cogeneration program, it signed 90-megawatt
contracted capacity with EGAT under the 21-year PPA, while the rest of capacities were signed
with the industrial users under the long-term PPAs.
In 2011, NKCC power plant generated and sold 842.34 million kilowatt-hour electricity output
to the customers, while its annual average EAF was 98.45% and the steam output to the
industrial users was 151,630 tons.
2.5 Samutprakarn Cogeneration Company Limited (“SCC”)
EGCO indirectly holds a 50% stake in SCC via GEC. SCC owns and operates a SPP
cogeneration power plant located in Samutprakarn province. It is a 126-megawatt cogeneration
power plant with steam of 24 tons per hour using natural gas as a primary fuel. SCC can sell both
electricity and steam outputs. Under the SPP firm cogeneration program, it signed 90-megawatt
contracted capacity with EGAT under the 21-year PPA, while the rest of capacities were signed
with the industrial users under the long-term PPAs.
In 2011, SCC power plant generated and sold 817.53 million kilowatt-hour electricity output to
the customers, while its annual average EAF was 98.63% and the steam output to the industrial
users was 140,586 tons.
2.6 Gulf Yala Green Company Limited (“GYG”)
EGCO indirectly holds a 50% stake in GYG via GEC. GYG owns and operates a SPP
renewable power plant located in Yala province. It is a 23-megawatt biomass-fired power plant
using parawood residue as a primary fuel. Under the SPP firm renewable program, it signed 20.2megawatt contracted capacity with EGAT under the 25-year PPA.
In 2011, GYG power plant generated and sold 157.99 million kilowatt-hour electricity output to
EGAT, while its plant annual average EAF was 94.33%.
2.7 Natural Energy Development Company Limited (“NED”)
EGCO directly holds a 33.33% stake in NED which owns and operates a 73 DC / 55 AC
megawatt thin film solar power plant (“Lopburi Solar”) located in Lopburi province. NED signed
a PPA with EGAT for the sale of all net electricity output generated. The term of the PPA is 5
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Part 2 Business Characteristics
years from the Commercial Operation Date (“COD”) and will be renewed for 5-year contract
each time. NED is subsidized with adder of 8 baht per kilowatt-hour on top for 10 years of its
wholesale tariff.
At December 31, 2011, the overall progress of construction project was 95% a slightly ahead
target. The first stage of 11 DC / 8 AC megawatt achieved the official COD on December 22,
2011 that was slightly delayed from the scheduled COD in November 2011. The full scale
generation of all seven phases are planned achieve within May 2012.
3. Overseas Group
3.1 Conal Holdings Corporation (CHC)
EGCO indirectly holds a 40% stake in CHC via EGCO International (B.V.I.) Limited (“EGCO
BVI”). CHC is the largest IPP in the Mindanao Island, Philippines. CHC holds the shares in 2
electricity generating companies and 1 operation and maintenance service company.
Western Mindanao Power Corporation (“WMPC”)
EGCO indirectly holds a 17.6% stake in WMPC via CHC. WMPC owns and operates an IPP
power plant located in Zamboanga city, Philippines. It is a 109.6-megawatt diesel power plant
using a bunker-c fuel oil as a primary fuel. Under the Build-Operate-Own (“B-O-O”) scheme, it
generates and sells all net electricity output to National Power Corporation (“NPC”) under the
18-year Energy Conservation Agreement (“ECA”).
In 2011, WMPC power plant generated and sold 442.88 million kilowatt-hour electricity output
to NPC, while its annual average EAF was 91.41%.
Southern Philippines Power Corporation (“SPPC”)
EGCO indirectly holds a 17.6% stake in SPPC via CHC. SPPC operates and owns an IPP power
plant called Gen Santos located in Sarangani province, Philippines. It is a 54.8-megawatt diesel
power plant using bunker-c fuel oil as a primary fuel. Under the B-O-O scheme, it generates and
sells all net electricity output to NPC under the 18-year ECA.
In 2011, SPPC power plant generated and sold 268.43 million kilowatt-hour electricity output to
NPC, while its annual average EAF was 90.26%.
Alto Power Management Corporation (“APMC”)
APMC provides operation and maintenance services including plant management and consulting
to the two above-mentioned power plants and also third-party power plants.
3.2 Quezon Power (Philippines), Limited Company (“QPL”)
EGCO indirectly holds 52.13% stake in QPL via North Pole Investment Company Limited
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Part 2 Business Characteristics
(“North Pole”) and EGCO BVI. QPL owns and operates a 502.50-megawatt pulverized coalfired power plant using the high quality coal imported from Indonesia as a primary fuel. Under
the 25-year PPA, it generates and sells net electricity output to Manila Electric Company
(“MERALCO”), the country's largest power distribution company, and also provides additional
load stability of Luzon power grid.
In 2011, Quezon power plant generated and sold 3,269.31 million kilowatt-hour electricity
output to MERALCO, while its annual average EAF was 86.52%.
3.3 Nam Theun 2 Power Company Limited (“NTPC”)
EGCO directly holds 35% stake in NTPC, which owns and operates a 1,086.80-megawatt
hydroelectric power plant located in Lao PDR. It generates and sells 948-megawatt contracted
capacity to EGAT and 75-megawatt contracted capacity to Electricite du Laos (EDL) under the
25-year PPAs.
In 2011, NT2 power plant generated and sold 5,956.68 million kilowatt-hour electricity output to
EGAT and 404.16 million kilowatt-hours electricity output to EDL.
4. Other Businesses
4.1 EGCO Engineering & Service Company Limited (“ESCO”)
ESCO is EGCO’s wholly owned subsidiary which provides operation, maintenance, engineering
and construction services to power plants, petrochemical plants, oil refineries and other
industries including the Group companies.
4.2 Egcom Tara Company Limited (“Egcom Tara”)
As at December 31, 2011, EGCO holds 74.19% stake in Egcom Tara via ESCO. Under a 30year agreement, Egcom Tara produces tap water according to Thai Industrial Standard (“TIS”)
and supplies to the 3 water stations of the Provincial Waterworks Authority of Thailand (PWA),
namely, Lak Muang Water Station, Damnoen Saduak Water Station and Samut Songkhram
Water Station.
4.3 Eastern Water Resources Development and Management Public Company Limited
(“East Water”)
As at December 31, 2011, EGCO holds 18.72% of shares in East Water which is responsible
for developing and operating the main raw water pipe network in the Thailand Eastern
Seaboard area covering 7 provinces namely, Rayong, Chonburi, Chachoengsao, Prachinburi,
Srakaew, Chantaburi and Trad.
Page 24
Part 2 Business Characteristics
Page 25
Part 2 Risk Factors
Business
Subsidiaries
Khanom Electricity Generating
Company Limited
IPP- Generating and Supplying electricity
Paid-up Share Capital
(Million Baht)
Owners
Cost Method
hip
(Million
Interest
Baht)
(%)
Other Shareholders
(%)
4,850.00
99.99
4,850.00
400.00
99.99
400.00
1,060.00
80.00
891.89
J-Power Holdings (Thailand)
Company Limited
20.00
J-Power Holdings (Thailand)
Company Limited
26.00
EGCO Engineering & Service
Company Limited
EGCO Cogeneration Company
Limited
Engineering, Operation and Maintenance Services
for Power Plants and Manufacturers
SPP- Generating and Supplying electricity
EGCO Green Energy Company
Limited
Holding Company focusing on SPP using
biomass as fuel
175.00
74.00
129.50
North Pole Investment Company
Limited
Joint Ventures
Gulf Electric Public Company
Limited
Holding Company focusing on SPP using
biomass as fuel in overseas
81.10 Million USD
100.00
11,678.21
Holding Company focusing on IPP and SPP
13,784.35
50.00
6,672.77
J-Power Holdings (Thailand)
Company Limited
50.00
BLCP Power Company Limited
IPP-Generating and Supplying electricity
12,010.00
50.00
10,433.60
Banpu Coal Power Limited
50.00
Conal Holdings Corporation
Holding company focusing on power business in
the Philippines
IPP-Generating and Supplying electricity from
hydro power plant in Laos
Development for the renewable energy projects
800 Million PESO
40.00
954.65
60.00
373.50 Million USD
35.00
5,569.94
33.33
198.00
IPP-Generating and Supplying electricity
207.64 Million PESO
26.00
4,833.29
Alsons Consolidated Resources,
Inc.
1. EDF International
2. Lao Holding State Enterprise
1. CLP Thailand Renewables
Limited
2. Diamond Generating Asia,
Limited
1. Covanta Energy Corp.
2. InterGen N.V.
18.72
2,071.10
Nam Theun 2 Power Company
Limited
Natural Energy Development Co.,
Ltd.
Quezon Power (Philippines) Limited
Co.
Others
Eastern Water Resources
Development and Management
Public Company Limited
Development and Management for supplying raw
water to the customers
594.00
1,663.73
Provincial Waterworks Authority
40.00
25.00
33.33
33.33
45.87
26.13
40.20
26 | P a g e
Part 2 Risk Factors
Business
Xayaburi Power Company Limited
Investment in generating electricity from a run-ofriver dam in Laos
Paid-up Share Capital
(Million Baht)
1,000.00
Owners
Cost Method
hip
(Million
Interest
Other Shareholders
Baht)
(%)
12.50
125.00
1. CH. Karnchang Public
Company Limited
2. Natee Synergy Company
Limited
3. PT Construction & Irrigation
Co., Ltd.
(%)
57.50
25.00
5.00
27 | P a g e
Part 2 Section 3 Operation of Business Line
3.Operation of Business Line
Since EGCO is a holding company, it has no product. It recognizes revenue from profit
sharing of investment in subsidiaries and joint ventures, as well as dividend income from
other businesses. EGCO’s business lines comprise the electricity business, service business
and water business.
1. Significant Events
As at December 31, 2011, EGCO Group operated 15 power plants with 4,419.99 MW equity.
The power sold to EGAT under a long term PPA was 3,864.19 MW which accounted for
12.29% of the national installed capacity of 31,446.71 MW. EGCO’s MW equity in 2011
increased from 2008 by 13.07 MW. Highlights of the events in 2009 were as follows:
1
January 4, 2011 and February 11, 2011, EGCO was awarded licenses for 2010 SPP
Cogeneration projects from EGAT in accordance with the resolution of the Energy
Regulatory Commission. The projects are TJ Cogen, TP Cogen and SK Cogen, which are
contracted with EGAT of 90 megawatt each.
2
March 1, 2011, EGCO acquired a 12.50% interest in Xayaburi Power Co., Ltd.
(“Xayaburi”) from CH.Karnchang PCL. Xayaburi plans to develop a 1,285 megawatt runof-river hydroelectric power plant on the Mekong River in Laos PDR. The COD is
currently scheduled for January 2019.
3
March 25, 2011, EGCO completed the acquisition of an additional 26.125% effective
interest in Quezon Power (Philippines) Ltd., Co., (“QPL”) bringing EGCO’s total
ownership interest in QPL to 52.125%. In addition, EGCO completed the acquisition of
100% of the outstanding shares of Covanta Philippines Operating Inc. (“CPOI”), the
entity which provides operation and maintenance services to Quezon power plant through
a long-term operation and maintenance agreement. Later on May 3, 2011, CPOI changed
its name to Pearl Energy Philippines Operating, Inc. (“PEPOI”).
4
March 29, 2011, EGCO Engineering and Service Co., Ltd., a subsidiary of EGCO signed
the operation and maintenance services agreement for a 110 megawatt SPP Cogeneration
power plant which is owned by Navanakorn Electric Co., Ltd. and Toyo-Thai Corporation
PCL.
5
April 1, 2011, OneEnergy Thailand Ltd. transferred all of its shares in EGCO to TEPDIA
Generating B.V., a joint venture vehicle owned by Tokyo Electric Power Co., and
Diamond Generating Asia, Ltd., a Mitsubishi Corporation’s subsidiary, on a 50:50 basis.
6
June 19, 2011, Khanom power plant Unit 1, a 75 megawatt barge-mounted power unit,
was permanently shut down due to the expiration of PPA.
Page 28
Part 2 Section 3 Operation of Business Line
7
November 25, 2011, three SPP Cogeneration projects entered into the PPA with EGAT.
Details are as below:
7.1 TJ Cogen, a 125 megawatt SPP Cogeneration project located in Pathumthani
province, entered into the PPA to sell 90 megawatt to EGAT for a 25-year term
with the Scheduled Commercial Operation Date (“SCOD”) on June 1, 2017.
7.2 TP Cogen, a 125 megawatt SPP Cogeneration project located in Ratchaburi
province, entered into the PPA to sell 90 megawatt to EGAT for a 25-year term
with the SCOD on June 1, 2018.
7.3 SK Cogen, a 125 megawatt SPP Cogeneration project located in Ratchaburi
province, entered into the PPA to sell 90 megawatt to EGAT for a 25-year term
with the SCOD on June 1, 2019.
8
December 22, 2011, the Lopburi Solar power plant, a 73 DC / 55 AC megawatt thin film
photovoltaic solar farm in Lopburi province, owned by Natural Energy Development Co.,
Ltd., started supplying electricity under the first stage (the 11 DC / 8 AC megawatt) to
EGAT.
2. Electricity Business
EGCO businesses can be divided into 4 groups namely Independent Power Producer (“IPP”)
Group, Small Power Producer (“SPP”) Group, Oversea Power Producer Group and Other
Business Group: This Group comprises 2 types of business that is maintenance and operation
business and tap water business as the following details.
2.1 Power Energy
2.1.1 Nature of Product/Service
Electrical power is a clean processing power that is easy to use and to transform into other
types of energy. Electrical power is vital to business operations, whether it be industry,
agriculture, communication or tourism. To generate sufficient electrical energy to satisfy
demand is therefore important. The manufacturing of electricity in Thailand at present can
be divided into two categories:
1.
Non-fuel electricity such as hydro power plants, and natural energy power plants
using inexhaustible sources of natural energy like solar power, wind power and geothermal
power.
2.
Fuel-based electricity such as steam power plants, gas turbine power plants and
combined cycle power plants.
Page 29
Part 2 Section 3 Operation of Business Line
A.
Types of Power Plant
The types of power plant operated by the EGCO Group are:
1.
A hydro power plant
generates electricity by the use of force and water
compression to rotate water turbines.
A power plant under this category is the Nam Theun 2 Power Plant.
2.
A thermal power plant produces electricity using heat derived from combustion.
The fuels used in this type of plant can be natural gas, coal, or fuel oil which generate heat
to water until it becomes high-pressure steam. This steam will force the electricity
generator to rotate, creating electricity. It takes several hours each time to operate such a
process from boiling the water in a kiln to starting up the power generator. Therefore, it is
suitable for use as a base load plant.
Power plants under this category are Khanom Power Plants 1 and 2, BLCP Power Plants 1
and 2, and Quezon.
3.
A gas turbine power plant operates by combustion in a compression chamber
creating force to rotate the gas turbine machine to generate electricity. The fuels used are
those such as natural gas or diesel. This type of power plant operates in a rapid manner
suitable for use as a standby power plant to generate electricity when it is most needed
during the process.
The EGCO Group does not have this type of power plant.
4.
A combined cycle power plant combines the use of a gas turbine machine and a
steam turbine machine by transporting heat from exhaust gases coming out from a hot gas
turbine machine to the boiler, then transferring the heat to water, boiling it, and turning it
into steam. This steam will later rotate the steam turbine attached to the shafts of the power
generator where electricity is produced.
Page 30
Part 2 Section 3 Operation of Business Line
Power plants under this category are Rayong Power Plants 1-4, Khanom Combined Cycle
Power Plant 3, GPG Power Plants 1 and 2.
5.
A diesel power plant is a thermal power plant using oil as fuel. This type of power
plant operates in the same manner as a car engine adopting the combustion principles of
diesel injected in the engine cylinder in which air is compressed to obtain high temperature.
This is called a compression stroke. In the meantime, injected diesel combusts with heat
and then explodes, forcing the pistons to move the crankshaft which is connected to the
engine shaft making it move the power generator where electricity is produced.
Power plants under this category are WMPC Power Plant and SPPC Power Plant in the
Republic of the Philippines.
6.
A cogeneration power plant is a medium-size power plant producing both electrical
power and thermal energy at the same time. At the plant, primary energy is converted to
electrical power and the thermal energy which will become useful heat energy following
the same process according to thermodynamics.
Power plants of this type are EGCO Cogen Power Plant, GCC Power Plant, KNCC Power
Plant and SCC Power Plant.
7.
A renewable energy power plant uses non-conventional energy such as wind
energy, solar power and mini hydro. It can also be agricultural waste or waste materials,
waste from agricultural or industrial product manufacturing, products made from
agricultural waste or waste materials, garbage, woods from reforestation for fuel. It can
also be waste fuel, for example, steam left from the manufacturing process of industrial,
agricultural products such as heat exhaust gases, or by-product energy such as dynamic
power which is a by product from reducing the pressure of natural gas.
Power plants under this type are Roi-et Green Power Plant where chaff is used as fuel, and
GYG Power Plant where lumber from rubber trees is used as fuel.
Page 31
Part 2 Section 3 Operation of Business Line
IPP Group
Electricity business which is considered the core business of the Company comprises the
investment in IPP, SPP and the overseas investment.
Tariff Rate
Both companies used the same tariff formula which consists of the following:
a.
Capacity payment (in case of REGCO) or availability payment (in case of KEGCO) is a
payment, which EGAT pays REGCO and KEGCO on a monthly basis for maintaining
the availability of the power plants, regardless of whether the electric power will be
supplied to EGAT or not. The capacity payment or the availability payment (as the case
may be) will cover financial cost of investment in the power plants, principal repayments
and interest, fixed operating and maintenance expenses, administrative expenses, major
maintenance cost and internal rate of return on EGCO’s equity.
b.
Energy payment is the payment for the actual net electrical output. It covers the variable
operating and maintenance expenses.
SPP Group
EGAT also encourages investors to invest in small power plants of which a portion of the
generation will be sold to EGAT under the SPP programs. EGCO’s investment in this area
comprises the following companies.
Tariff Rate
EGAT applies the power tariff formula to the SPPs as follows:
o Capacity payment is based on the monthly contracted capacity and charged on each
customer regardless of whether such customer actually buys electricity or not.
However, the capacity payment applicable to EGAT is different from that applicable
to customers in general. The capacity payment in case of EGAT is based on its long
run avoided capacity cost due to its purchase of power from SPPs while that applicable
to customers in general is calculated from contracted capacity that will vary to the tariff
structure of Provincial Electricity Generating Authority (PEA).
o Energy payment is the actual measured quantity of electricity delivered. Energy
payment charged on EGAT will cover variable operating and maintenance cost while
that applicable to customers in general will change according to the tariff structure of
PEA.
Overseas Investment Group
Tariff Rate
Power tariff to be charged from NPC is divided into four main components as below:
-
Capital recovery fee is the remuneration payable by NPC to SPPC on a monthly basis.
It covers financial cost of investment in the power plant.
Page 32
Part 2 Section 3 Operation of Business Line
-
Fixed operation and management fee is the remuneration payable by NPC to SPPC on
a monthly basis. It covers fixed operating and maintenance expenses of the power
plant.
Infrastructure fee is the remuneration payable by NPC to SPPC on a monthly basis. It
covers expenses on the transmission system owned by SPPC.
Energy fee is the remuneration paid for the electricity actually delivered. It covers
variable operating and maintenance expenses.
The tariff charged under the specified formula is calculated based on both the USD and
the Peso. Unit 1 quotes the tariff in both the US Dollar and the Peso, while unit 2 in
the German Mark and the Peso.
In addition to the PPA with EGAT, the Board of Investment also granted the tax privileges
to all IPPs and SPP in the Group with significant information as follows:
Salient Privileges
1. Exemption of corporate income tax for net profit from promoted business for eight years
from the first date of income earnings.
2. Exemption of calculating dividend from the promoted business as taxable income
throughout the period of corporate income tax holiday.
3. Reduction of corporate income tax for net profit from investment by 50% of the normal
rate for five years from the date following the end of the corporate income tax holiday.
Conditions:
 Having shareholders who are Thai nationals holding shares in an aggregate amount of at
least 51% of the registered capital.
 Having registered capital of at least as indicated.
 Power plant locating in Rayong province for 15 years from the first date of operation.
Relocation to other areas shall not be made unless with the BoI’s prior approval.
Tax privileges to all IPPs are details as follows.
Power Plant
REGCO
Date of
Promotion
Granted
April 20, 1995
KEGCO
September
1996
26,
BLCP
October
1997
10,
GPG
June 28, 2005
Promotion
Certificate
No. 1440/1995
dated June 15,
1995
No. 1742/1996
dated November
6, 1996
No. 1499/2000
dated August 21,
2000
No.
1660(2)/2005
dated July 25,
2005
Registered
Location
Capital of at
Least
December
7, Baht
4,700 Rayong Province
1994-December million
6, 2002
September 26, Baht
4,710 Nakorn
Sri
1996-September million
Thammarat
25, 2004
Province
October 1, 2006- Baht
12,000 Rayong Province
September 30, million
2014
November
3 Baht
1,850 Saraburi
2006-November million
and Province
2, 2014
shall increase the
registered capital
of at least Baht
9,030 million
Salient
Privileges
Page 33
Part 2 Section 3 Operation of Business Line
Tax privileges to all SPPs are details as follows.
Power Plant
EGCO Gogen
Date of
Promotion
Granted
January
10,
2003
Roi-Et Green
April 25, 2003
GCC
July 21, 1998
NKCC
June 1, 2000
SCC
April 1, 1999
Promotion
Certificate
Registered
Capital of at
Least
No. 1230/1999 January 10, 2003- Baht 1 million
dated June 7, January 9, 2011
1999 and the
revised version
No. 5106/2000
(3-1230/1999
and 6753/2002)
(4-1230/1999)
dated May 31,
2000, October 3,
2002
and
November 2002,
respectively
No.
1660(1) April 25, 2003- Baht 180 million
2001
dated April 24, 2011
October
19,
2001 and revised
version
No.
6871/2003 (21660 (1) 2001)
dated November
7, 2003
No. 1279/2540 July 21, 1998dated May 2, July 20, 2004
1997 and 3
revised versions
- No.
4553/1999 (21279/1997)
- No 6013/2542
(3-1279/1997)
Dated December
2, 1999
- No. 5279/2000
(4-1279/1997)
dated June 20,
2000
No. 1594/1998 June 1, 2001dated December May 31, 2008
28, 1998 and a
revised version,
No. 4735/2001
(2-1594/1998)
dated March 7,
2001
No. 1761/1998 April 1, 1999dated December March 31, 2007
15, 1998 and a
revised version,
No. 4100/2001
(2-1761/1998)
dated January 17,
Salient
Privileges
Location
Rayong Province
Roi-Et Province
Saraburi
Province
Saraburi
Province
Samutprakarn
Province
Page 34
Part 2 Section 3 Operation of Business Line
Power Plant
Date of
Promotion
Granted
Promotion
Certificate
GYG
November
2007
7,
NED
March 10, 2010
2001
No.
1549(2)/2004
dated July 9,
2004
No.
1443(1)
2553 dated April
12, 2010
Registered
Capital of at
Least
Location
November
7, Baht 1 million
2004-November
6, 2014
Yala Province
Salient
Privileges
The Project is Baht
during
the million
construction.
1,990 Lopburi
Province
2.1.2 Marketing and competition
1.1 Electricity generation and transmission system
EGAT is responsible for electricity generation and transmission to respond to demand
countrywide. It has its own power plants for power generation and also purchases
power supply from private producers, Laos and Malaysia. It then sells electricity to
Metropolitan Electricity Authority (MEA), Provincial Electricity Authority (PEA), and
other direct customers (some industrial plants designated by the Royal Decree).
EGAT dispatchs electricity through high-voltage power stations. MEA and PEA will
undertake the distribution and retailing to the general public. Electricity is purchased
from EGAT at the interconnection point and then transmitted to substations for
further distribution to consumers.
At present, EGAT has altogether 39 power plants scattering in many regions across
the country. Most of EGAT’s plants are hydroelectric power plants and the second
and the third are combined cycle power plants and thermal power plants, respectively.
The combined installed capacity of the thermal power plants is the largest installed
capacity.
Since 1992, the government has encouraged private sector to take part in electricity
generating. The National Energy Policy Council approved the establishment of
Electricity Generating Co., Ltd. (EGCO) and the regulations for the purchase of power
from Small Power Producers (SPP) as well as policy regarding the purchase of power
from Independent Power Producers (IPP). Power purchase from SPPs and IPPs helps
provide the reduction of EGAT ’s investment burden in power generating facility.
1.2 Power purchase from SPPs
Electricity generated by SPPs is partially for its own use or for sale to nearby factories,
and the remaining is sold to EGAT under the regulations for the purchase of power
from SPPs. There is currently also purchase of power from projects using other forms
of energy, i.e. residue or waste. The purchase agreements are of non-firm type, under
which no volume and time of purchase is specified. The purchase of electricity
depends on the consideration of EGAT’s threshold capability of power transmission
and distribution systems.
Page 35
Part 2 Section 3 Operation of Business Line
EGAT has regulation to purchase electricity from SPPs each at 60 MW, but that may
be extended to as high as 90 MW. From the beginning of the regulation to purchase
power from SPPs in 1992 fiscal year until December 2010, there were 87 producers
approved by EGAT with a total contracted capacity of 4,712.92 MW. Of the total, 61
producers with 3,786.30 MW capacity have been contracted on a firm type basis (with
power purchase agreement term of 5 years up and defined capacity), and the other 26
producers with 926.62 MW capacity on a non-firm type basis (no defined capacity). Of
these 87 producers, 59 producers have already dispatched 2,479.92 MW electricity to
the system (43 producers, with 2,182.30 MW, have firm contracts and 16 producers,
with 297.62 MW, have non-firm contracts).
Firm
Power Plant
Non - Firm
MW
Power Plant
Total
MW
Power Plant
MW
Already dispatched
43
2,182.30
16
297.62
59
2,479.92
Non dispatch
18
1,604.00
10
629.00
28
2,233.00
Total
61
3,786.30
26
926.62
87
4,712.92
1.3 Power purchase from IPPs
The seventh National Economic and Social Development Plan has allowed for the
private sector’s investment in power generation under the IPP scheme. The IPPs can
submit their own proposals thereby competition is encouraged in respect of
technology, location, generation source, type of fuel used, and power tariff.
Currently, there are IPPs that has begun commercially dispatching electricity to the
system :IPP
1. Electricity Generating PCL.
- Rayong Power Plant
- Khanom Electricity Generating
Co.,Ltd.
2. Ratchaburi Electricity Generating
Co., Ltd.
3. Independent Electricity Generating
(Thailand) Co., Ltd.
4. Tri Energy Co., Ltd
5. Glow IPP Co., Ltd
Installed
capacity (MW)
Fuel
1,174.99
natural gas
818.10
heavy oil, natural gas
3,481.00
heavy oil, natural gas
700.00
700.00
713.00
natural gas
natural gas
natural gas
Page 36
Part 2 Section 3 Operation of Business Line
IPP
6. , Eastern Power Co., Ltd
7. BLCP Power Co., Ltd.
(EGCO investment 50%)
8. Gulf Power Generation Co., Ltd.
(EGCO investment 50%)
9. Ratchaburi Power Co., Ltd
Total
Installed
capacity (MW)
350.00
Fuel
natural gas
1,346.50
Coal
natural gas
1,468.00
1,400.00
12,151.59
natural gas
IPPs that has not commercially dispatch electricity to the system :No.
1
2
3
4
Company
Fuel Type
Gheco-One
Siam Energy
National Power Supply
Power Generation Supply
Total
coal
natural gas
coal
natural gas
Capacity
( MW)
660.00
1,600.00
540.00
1,600.00
4,400.00
Commercial Operating
Date (COD)
Nov. 2011
Mar. / Sept. 2013
Nov. 2013/ Mar. 2014
June / Dec. 2014
1.4 Thailand’s total capacity
As of December 31, 2010, the total installed capacity of the Thailand’s power system
accounted for 30,920.01 MW, coming from:
Power plant
1. Total installed capacity of EGAT Plc.
2. IPP
3. Small Power producers – Firm type
Installed
Fuel
capacity (MW)
14,998.12 heavy oil, natural gas,
diesel, lignite
12,151.59
heavy oil, natural
gas, coal
2,182.30 heavy oil, natural gas,
coal
4. Foreign Country
- Nam Theun – Hin Bun hydroelectric
power plant
- Huay Hoh hydroelectric power plant
- Thailand-Malaysia transmission lines
- Nam Theun 2 Power Co., Ltd
Total installed capacity
214.00/1
-
126.00/1
300.00
948.00/1
30,920.01
-
Source: EGAT
Note
/1
Capacity at the interconnection point
1.5 Total power demand
(1) Statistics of power demand
Page 37
Part 2 Section 3 Operation of Business Line
Peak load demand is the maximum power required in the system during the day in
each year, and electricity generation refers to total units of electricity generated in a
certain period. Both values depend on weather condition, period of power
consumption, number of consumers, economic condition, etc. The historical data of
Peak load power demand and electricity generation are as follows:
Peak load demand
Fiscal year
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
MW
5,444.00
6,232.70
7,093.70
8,045.00
8,876.90
9,730.00
10,708.80
12,267.90
13,310.90
14,506.30
14,179.90
13,712.40
14,918.30
16,126.40
16,681.10
18,121.40
19,325.80
20,537.50
21,064.00
22,586.10
22,568.20
22,044.90
24,009.90
Electricity generation
Increase
MW
%
710.10
788.70
861.00
951.30
831.90
853.10
978.80
1,559.10
1,043.00
1,195.40
-326.40
-467.50
1,205.90
1,208.10
554.70
1440.30
1,204.40
1,211.70
526.50
1,522.10
-17.90
-523.30
1,965.00
15.00%
14.49%
13.81%
13.41%
10.34%
9.61%
10.06%
14.56%
8.50%
8.98%
-2.25%
-3.30%
8.79%
8.10%
3.44%
8.63%
6.64%
6.26%
2.57%
7.22%
-0.08%
-2.32%
8.91%
Million
Increase
units
Million units
31,996.94
3,803.78
36,457.09
4,460.15
43,188.79
6,731.70
49,225.03
6,036.24
56,006.44
6,781.41
62,179.73
6,173.29
69,651.14
7,471.41
78,880.37
9,229.23
85,924.14
7,043.77
92,724.66
6,800.52
92,134.44
-590.22
90,413.99
-1,720.45
96,780.72
6,366.73
103,165.20
6,384.48
108,382.46
5,217.26
116,669.98
8,280.70
127,756.41
11,086.43
134,893.25
9,097.85
142,112.18
7,218.93
146,884.92
4,722.74
148,435.98
1,551.60
145,214.62
-3,221.36
160,138.47
14,924.91
%
13.49%
13.94%
18.46%
13.98%
13.78%
11.02%
12.02%
13.25%
8.93%
7.91%
-0.64%
-1.87%
7.04%
6.60%
5.06%
7.64%
10.22%
5.58%
5.35%
3.35%
1.05%
-2.17%
10.28%
Source: EGAT
(2) Power demand forecast
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Part 2 Section 3 Operation of Business Line
Power demand can be forecasted based on possession and power consumption of
electrical appliances (end use). This requires a large amount of information, on
macro-level, e.g., economic growth, population size, number of households,
government’s principle in power, etc. and micro-level, e.g. power consumption to
value added of small business and industries, type of residence, income level,
consumption and efficiency of electrical appliances, applications for power
consumption and investment promotional privileges, power consumption to facility
service areas, temperature, etc.
Power demand is identified in two terms, i.e. energy demand and peak load demand.
Forecast of energy demand takes into account the above information with
mathematical models applied. Meanwhile, peak load demand forecast is figured out
by considering the derived energy demand forecast together with nature of
consumption by each user.
1.6 Dependable capacity
Dependable capacity refers to the maximum generating capacity sustained by the system
in a period of time under circumscribed environment. Dependable capacity of
hydroelectric power plants is the electricity generating capacity with reservoir water
availability and past water supply statistics taken into account. Dependable capacity of
thermal power plants is the electricity generating capacity when taking into account
various circumstances and their constraints, which can hinder thermal plants’
achievement of their full electricity generating capacity.
1.7 Reserve margin
Reserve margins come from the event when dependable capacity is higher than peak load
demand. In calculation term, it is the difference between dependable capacity and peak
load demand divided by peak load demand, expressed in percentage. In general, EGAT
will maintain the reserve margin at 15% to ensure adequate generating capacity.
The following table presents EGAT’s reserve margin during fiscal years of 1991-2010.
During 1991-1997, the country’s power demand expanded rapidly thereby the reserve
margin in the system falling below the level to be maintained by EGAT. In 1998, due to
the economic meltdown and baht volatility, several businesses had to close down or
suspend their production and expansion indefinitely. As such, domestic power demand
consumption dropped sharply resulting in increase in reserve margins. To contain the
excessive reserve margins, EGAT negotiated with SPPs and IPPs for their postponement
of power plant construction for 1-4 years and revised the power generating capacity
development plan by postponing the projects, which have not yet begun their
construction and temporarily shut down some power plants (cold standby)
Fiscal year
1992
1993
1994
1995
1996
1997
Reserve margins (%)
14.00
17.42
15.08
12.69
17.54
14.77
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Part 2 Section 3 Operation of Business Line
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
22.44
34.46
33.44
35.64
28.0
35.1
26.8
19.9
13.7
21.9
23.8
22.4
25.0
Source: EGAT
1.8 Thailand Power Development Plan (PDP)
Since December 2008, the electricity demand has decreased significantly due to depressed
economic conditions. To portray a clear picture of power sector development, the
Ministry of Energy has developed the new Power Development Plan (PDP 2010) and
designated as a “Green PDP” which highlights on greenhouse gas emission reduction,
promotions of efficient energy utilization and electricity generation through cogeneration
system. Not only did it corporate power purchase projects from domestic producers and
neighboring countries that were approved by the Cabinet but also power generation from
renewable energy as indicated in the Alternative Energy Development Plan (AEDP)
2008–2022. Besides, opinions and comments obtained from the public hearing of PDP
2007 Revision 2 were taken into account. Therefore, the new PDP will be a complete
guideline for power system development that encourages generation from renewable
energy and lessens greenhouse gas emission, and thus a balance of generation resources.
Thailand Power Development Plan 2010–2030 (PDP 2010) has been developed within
the following frameworks:
1. Extend the planning horizon from 15 years to 20 years (2010-2030)
2. Revise Thailand’s Load Forecast based on NESDB’s long term economic growth
3. Analyze and integrate the effects of DSM projects in both the load forecast and
the generation expansion planning
4. Combine the re-estimated amount of power purchase from renewable energy
regarding AEDP 2008–2022 into the plan
5. Review the amount of power purchase from SPPs in 2009-2015 and further
regarding the NEPC’s resolution on 24 August 2009 to promote power
production by cogeneration system
6. Reconsider power import from neighboring countries and identify only
promising projects
7. Lower greenhouse gas emission
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Part 2 Section 3 Operation of Business Line
PDP 2010 was approved by NEPC and endorsed by the Cabinet on 12 March 2010
and 23 March 2010, respectively.
2. Power Industry in Central Region
The central region of EGAT system, covering 22 provinces in four main areas:
1) Bangkok outskirts and nearby provinces
2) Eastern area
3) Western area
4) Lower central area
At present, the generating capacity of the central region derives from EGAT’s power
plants and other large private producers that EGAT has purchased electricity from.
Besides, there is supplementary capacity from North Bangkok power plant and
transmission facilities from the northern region. As of December 31, 2010, the
generating capacity of the Central region is 22,143.12 MW, consisting of:
Total generating capacity of EGAT
Rayong Electricity Company Limited (REGCO)
Ratchaburi Electricity Generating Plc.
Tri Energy Co., Ltd.
Independent Electricity Generating (Thailand) Co., Ltd
Glow IPP Co., Ltd. (Bowin)
Eastern Power Co., Ltd.
BLCP Power Co., Ltd
Gulf Power Generation Co.,Ltd
Ratchaburi Power Co., Ltd
Small Power producers
Total power generating capacity
8,788.13
1,174.99
3,481.00
700.00
700.00
713.00
350.00
1,346.50
1,468.00
1,400.00
2,021.50
22,143.12
MW
MW
MW
MW
MW
MW
MW
MW
MW
MW
MW
MW
3. Power Industry in Southern Region
Power generating capacity in the southern region comes principally from EGAT’s
power plants, KEGCO and transmission network connecting to the central region.
There is also supplementary capacity during peak period from Bang Lang and
Ratchaprapa hydroelectric plants. In addition, the southern power network also links
with that of Malaysia to allow for their power exchange in case of emergency or
necessity.
Power generating capacity in the south as of December 31, 2010 was 2,485.58 MW:
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Part 2 Section 3 Operation of Business Line
Total generating capacity of EGAT
Thai-Malaysian transmission networks
KEGCO
Small Power producers
Total power generating capacity
1,338.48
300.00
818.10
29.00
2,485.58
MW
MW
MW
MW
MW
4. Competition
4.1 EGCO’s market share compared with competitors’
As of December, 31 2010, EGCO has 14 operating plants with capacity totaling
4,361.08 equity MW, of which 3,931.43 equity MW is dispatched to EGAT under
long-term PPAs. This 3,931.43 equity MW represents 12.71% of Thailand’s total
installed capacity.
Power Plant
Portion of
investment
Install
Capacity
(MW)
Capacity
dispatched to
EGAT
(MW)
% of
Capacity
dispatched
to EGAT
IPP
1. Rayong Power Plant
100%
1,232.00
1,174.99
29.89%
2. Khanom Electricity Generating
100%
824.00
818.10
20.81%
3. BLCP Power Co., Ltd.
50.0%
717.00
673.25
17.12%
4. Gulf Power Generation Co., Ltd.
50.0%
755.00
734.00
18.67%
3,528.00
3,400.34
86.50%
Co., Ltd.
SPP
5. EGCO Cogeneration Co., Ltd.
80.0%
93.60
48.00
1.22%
6. Roi-Et Green Co., Ltd.
70.0%
7.00
6.19
0.16%
7. Gulf Cogeneration Co., Ltd.
50.0%
55.00
45.00
1.14%
8. Samutprakarn Cogeneration
Co., Ltd.
9. Nong Khae Cogeneration
Co., Ltd.
10. Gulf Yala Green Co., Ltd.
50.0%
63.00
45.00
1.14%
50.0%
63.00
45.00
1.14%
50.0%
11.50
10.10
0.26%
293.10
199.29
5.07%
380.40
331.80
8.43 %
Foreign Country
11. Nam Theun 2 Power Co., Ltd.
35.0%
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Part 2 Section 3 Operation of Business Line
12. Quezon Power (Philippines) Limited
Co.
13. Western Mindanao Corporation
26.0%
130.65
-
-
17.6%
19.29
-
-
14. Southern Philippines Power
Corporation
17.6%
9.64
-
-
Total
539.98
331.80
8.43 %
4,361.08
3,931.43
100.00%
4.2 Competition situation
As a prototype privatization, EGCO has enjoyed several privileges initiated to encourage
the private sector’s participation which makes EGCO to be at advantage in view of the
following
1. EGCO is creditable among the financial source and investors.
2. EGCO’s personnel are transferred from EGAT , which is the country’s sole source
of personnel in power industry, thus contributing to efficient operations. Its rivals,
which are just set up, on the contrary, need to recruit personnel that may have no
enough expertise or be costly or take time for training.
4.3 Opportunity of new entrants
At present, there may be new entrepreneurs, especially the international power company,
entering this industry. However, there are several obstacles due to the following:
1. Investment capital restriction: Since power plant construction is capital
intensive, the New entrants must have a very strong financial position.
2. Human resource restriction: Personnel with expertise in this area are scarce, so
recruitment is difficult and costly.
It is noted that some strong international power companies has entered the Thailand’s power
industry. EGCO has prepared the plan to enhance its competitiveness by sharpening the skills
and knowledge of its personnel, studying the domestic and overseas market analysis, and
conducting the strengths, weaknesses, opportunities and threats of EGCO in order to set up
the appropriate strategic plan to maintain its leadership and investment opportunities in the
market which will add value to shareholders and other stakeholders.
2.1.3 Process
The Company has the policy to supply electricity or to provide related services with high
quality. The Company will honor its promise to the customers and will continue to operate its
business safely with environmental friendliness. In this regard, the description of the service of
REGCO and KEGCO, the major power plants in EGCO Group, is provided as an example.
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Part 2 Section 3 Operation of Business Line
Capacity, Net Generation and capacity Factor
The capacity, net generation and capacity factor of REGCO and KEGCO during 2006-2008 is
as shown below:
units
2010
2009
2008
Available capacity/1
million
KW/hour
9,460
9,743
9,304
Dispatching net
generation/3
million
KW/hour
4,783
2,952
2,248
Capacity Factor(%)
%
49.36
30.30
24.17
Increasing rate of
capacity factor (%)
%
+19.06
+31.32
-42.26
Available capacity/1
million
KW/hour
6,880
6,880
6,486
Dispatching net
generation/3
million
KW/hour
5,655
5,643
5,577
Capacity Factor (%)
%
90.97
89.13
86.98
Increasing rate of
capacity factor (%)
%
+1.84
+2.15
-1.44
REGCO
KEGCO
BLCP
Available capacity/1
million
KW/hour
10,288.61
10,308.80
10,776.04
Dispatching net
generation/3
million
KW/hour
10,035.79
10,018.13
10,174.59
Capacity Factor (%)
%
97.54
97.18
94.42
Increasing rate of
capacity factor (%)
%
0.18
-1.53
4.65
GPG
Available capacity/1
million
KW/hour
11,275.71
11,541.42
11,152.40
Dispatching net
generation/3
million
KW/hour
9,857.32
9,329.09
8,960.32
Capacity Factor (%)
%
87.42
80.83
80.34
Increasing rate of
capacity factor (%)
%
5.66
4.11
155.86
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Part 2 Section 3 Operation of Business Line
Notes
Available capacity of each plant in each year is calculated from the total number of hours deducted by the
number of hours of planned maintenance outage.
2. Dispatching net generation in each year depends on the generating availability of the plant and the order from
the control center of EGAT based on the electricity requirement at each period of time. In this regard,
REGCO operate the power plant for 24 hours a day with 4 shifts of 16 operators each for 4 blocks of
combined cycle plant. KEGCO run the power plants throughout 24 hours a day with 5 shifts of operators.
Three operators are required for each shift of the thermal power plant while 4 are required for combined cycle
plants.
/1
3. In 2006-2007, it was the testing period for operating GPG power plant, unit 1, and GPG received the
commission fuel payment, which was the compensation for the fuel used during the testing period. The commercial
operation date for unit 1 and unit 2 was on May 5, 2007 and March 1, 2008 respectively.
Raw Material
Major raw material for power generation is fuel. Besides natural gas and heavy oil which are
primary fuels and diesel oil which is secondary fuel, other raw materials required for the
generating process are water and chemicals, e.g. water treatment agent, fuel additive, etc., as
can be summarized as follows:
(1)
Natural gas
Natural gas is a primary fuel used for both thermal and combined cycle plants. Under the
PPAs, EGAT will initially procure natural gas for REGCO and KEGCO, the payment for
which shall be made by EGAT directly to Petroleum Authority of Thailand (“PTT”). The
heat rate in the power generation must not exceed that specified under the PPAs. In case the
actual heat rate is higher, both companies have to bear the increase in the natural gas cost.
Once they directly enter into fuel supply agreements with PTT, they would be responsible for
the payment for the natural gas and pass it on to EGAT through the calculation formula of
energy payment.
(2)
Heavy oil
The Khanom power plant uses heavy oil as primary fuel like natural gas for its Barges 1 and 2
power plants. However, it will be used only when natural gas supply is insufficient. The plant
reserves heavy oil for serving 7 days of full generation.
(3)
Diesel oil
Diesel oil is reserved to cope with primary oil shortage and for use in case of machinery testrun and for operation after repair & maintenance. According to the PPAs, REGCO and
KEGCO have to make available diesel oil reserve to serve 3 days of full generation. Both
companies will operate the facility with the use of diesel oil only upon the instruction of
EGAT.
(4)
Water
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Part 2 Section 3 Operation of Business Line
Apart from the water purchase from East Water Resources Development and Management
Plc., Dok Krai reservoir in Amphur Pluak Daeng of Rayong, a reservoir covering an area of
around 50 rai with a 0.2 million m3 capacity was constructed in the company’s premises for
emergency use and can sustain a water reserve for about seven days. Moreover, REGCO has
a tap water unit that can produce tap water of up to 43,200 cu.m3 a day. The water supply is
required by the boilers and the cooling system of the power generation process.
For KEGCO, the water used in the thermal plant comes from Ban Klang canal as the primary
source and Tha Tok canal as the secondary source. A reservoir has also been built to
accommodate water reserve of 0.4 million m3 on an area of 85 rai 56 sq.wah. along the Ban
Klang canal, 9-10 km. far from the power plant, which can well cope with water shortage
during the dry season. KEGCO is constructing another reservoir with the capacity of 0.4
million m3 which is about 6 kilometer far from the plant.
BLCP purchases the water from the Industrial Estate Authority of Thailand (“IEAT”) with
the water reserve for using in the power plant compound for 3 days. Moreover, BLCP has the
desalination plant as the back up source to use in case that IEAT cannot deliver the water to
the power plant.
For PGP, the water used in the power plant comes from Pasak River as the primary source. A
reservoir has also been built to accommodate water reserve of 1.3 million m3 on an area of 120
rai 56 and can sustain a water reserve for about 30 days. Moreover, REGCO has a tap water
unit that can produce tap water of up to 54,413 cu.m3 a day.
(5)
Chemicals
Most chemicals used in power plants are for improving water quality, such as, hydrazene for
boilers, and hydrochloric acid (HCL), sulfuric acid (H2SO4) and sodium hydroxide (NaOH) for
use in regenerating resin and treating waste water, as well as kaolin and ferric chloride for tap
water system. All these chemicals can be procured locally.
3.2 Service Business
EGCO Engineering & Service Company Limited (“ESCO”)
ESCO is EGCO’s wholly owned subsidiary which provides operation, maintenance,
engineering and construction services to power plants, petrochemical plants, oil refineries and
other industries including the Group companies.
3.2.1 Service
Power Plant Operation and Maintenance Services (O&M)
ESCO aims to provide comprehensive operation and maintenance services with high
efficiency, i.e., high equivalent availability factor and low heat rate with reasonable O&M cost.
ESCO has extensive experiences to provide a full scope services to both thermal and
combined cycle plants
Maintenance Services
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Part 2 Section 3 Operation of Business Line
With the strong and competent workforce, ESCO can provide a variety of professional
maintenance services for power, petrochemical and oil & gas industries which covers the
following areas:
 Planned Outage maintenance
 Contract maintenance services
 Individual equipment maintenance
 Field service and emergency troubleshooting
ESCO has extensive expertise in mechanical maintenance, electrical maintenance, and control
and instruments maintenance services and can be on called on 24-hour basis.
Engineering & Construction Services
ESCO has a qualified team of engineer to provide services on civil, mechanical, electrical and
control and the testing and installation. The particular strength lies in erection and
commissioning of power plant main system such as gas turbine, steam turbine, generator,
HRSG, boiler and balance of plant. ESCO services also cover turn key of small to medium
projects such as pumping stations and power distribution substations.
In addition, ESCO also provides service on demand side management, technical and field
testing and technical training.
3.2.2 Market and Competition
ESCO has the highest market shares of around 90% for the SPP maintenance segment. This
was because the power plant maintenance work requires high expertise as the equipment is of
high price. The players in this market then are EGAT, OEM and ESCO. With the customers’
trust in ESCO services, ESCO could attract and retain both existing and new customers who
tend to be more interested in entering into a long term contract. For other maintenance work
such as that of the industrial and petrochemical plants, ESCO still has to compete with other
service providers. However, the market share is increasing.
With regard to the O&M service, the market is still limited as most private power producers
still prefer to use their own workforce.
For the engineering and construction, ESCO is competitive in term of financing apart from
the qualified workforce.
3.3 Water Business
Egcom Tara Company Limited (“ET”)
EGCO holds an indirect 74.19% stake in ET via ESCO. Under a 30-year agreement, ET
produces tap water according to Thai Industrial Standard (“TIS”) and supplies it to the three
water stations of the Provincial Waterworks Authority of Thailand (PWA), namely, Pak Tor
Water Station, Damnoen Saduak Water Station and Samut Songkhram Water Station.
3.3.1 Product and Service
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ET supplies tap water that meets the industrial standard to the PWA to replace the usage of
well water which may result in the mud slide. ET has supplied tap water to the waterworks
office in Ratchaburi and Samut Songkhram provinces under the 30-year water purchase
agreement with the combined capacity of 36,000 cubic metres per day starting from April 7,
2001. ET enjoys the BOI privileges with significant conditions as follows
1. Permission to use the foreign labor with expertise in the business as agreed by the BOI,
2. Exemption of import duty on machinery as approved by the BOI,
3. Exemption of corporate income tax for net profit from promoted business for eight years
from the first date of income earnings,
4. Exemption of calculating dividend from the promoted business as taxable income
throughout the period of corporate income tax holiday.
5. Permission to transfer the money in foreign currency out of the country.
3.3.2 Market and Competition
Since ET supplies tap water to the PWA under the 30-year contract, there is no competition.
ET focuses on maintaining the quality of water that meets the standard which was certified by
TIS and the Health Department, Ministry of Health as drinkable tap water. In addition, ET
commits to ensure that its production is environmental friendly without any pollution. Due to
its contribution to maintain a good working environment, it also wins the award on
“Distinguished Workplace” from the Health Department.
3.3.3 Process
Raw material used to produce tap water is the water from Mae Klong Rivier which incurs no
cost. The production process is summarized below.







Raw water pumpting from Mae Klong River,
Chemical addition,
Sedimentation,
Filtration,
Chorination,
Storage in clear water tank,
Transport to PWA, ready for distribution.
Apart from ET, EGCO also holds shares in Eastern Water Resources Development and
Management Public Company Limited (“East Water”). At the end of February 8 2010, EGCO
holds 18.72% of shares in East Water which is responsible for supplying raw water in the
Eastern Seaboard of Thailand covering 7 provinces namely, Rayong, Chonburi,
Chachoengsao, Prachinburi, Srakaew, Chantaburi and Trad.
3.4 Environment Impact
EGCO has the policy to conduct our business with commitment in compliance with relevant
environmental laws and regulations including the rules and regulations of the local government
such as a municipal authority, a tambon administration authority, etc. In case that no
enforceable law exists, EGCO will apply appropriate standards with responsibilities by;
 Encouraging employees to have strong concern and be responsible for the clean
environment,
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Part 2 Section 3 Operation of Business Line


Communicating with the public on environmental matters, share its experience with other
agencies to facilitate environmental improvements in industry performance, knowledge
and operating practices,
Managing our business with the goal to alleviate the adverse effects on the environment,
undertake appropriate reviews and evaluations of its performance to measure and to
ensure compliance with this environmental policy.
Safety, Occupational Health and Environment
To align our efforts and to extend our scope of responsibility to cover future power plants,
EGCO has included the projects on safety, health and environment in the strategic plan and
budget. With respect to this, the Safety, Health and Environment (SHE) Committee, has been
shored up comprising representatives from Group companies. The responsibilities of the SHE
Committee are to prepare the action plan on SHE implementation in alignment with the
corporate policy and goals as well as the strategic plan and to monitor and appraise the quality
of SHE program. At present, the Executive Vice President- Project Management from Asset
Management and Planning Group is the Chairman of the Committee
EGCO group considers SHE management as an essential part of our business to deliver our
commitment of “constantly adopting the best practices to continuously increase the
competitiveness and being sensitive to community and environment concerns”. In this regard,
the SHE Committee has set the EGCO Group’s SHE guidelines. In 2008, the SHE
Committee had cascaded the practice to EGCOM Tara, a subsidiary that supplies tap water
that meets the industrial standard to the Provincial Waterworks Authority.
SHE Committee’s Working Process
The SHE Committee has established the EGCO Group’s SHE guidelines and cascaded the
practices down to EGCOM Tara, a subsidiary supplying tap water that meets the industrial
standard to the Provincial Waterworks Authority.
The crucial principle of safety, occupational health and environmental management is
developed on the ‘knowledge and expertise sharing’ basis in order to pass on experience,
knowledge and skills to ensure standard practice across the board. The SHE Committee
monitors and assesses the working practices using EGCO’s assessment criteria with Khanom
and Rayong power plant being admired as the role models.
In addition, the SHE Committee has developed the SHE Management System Database which
is used for knowledge sharing on SHE policies and practices among Group companies.
Participations and feed backs from the Group companies are welcome of which the
information will be used for continuous improvement.
With a commitment to ensure that our SHE management system meet the international
standard, EGCO continues to study the best practices and relevant laws and standards in order
to update our SHE guidelines.
Safety and Occupational Health Management
As mention above, EGCO Group, which operates in the energy sector, put our priority on the
SHE management to ensure the compliance with the international standards. Our SHE
management covers not only our employees but also our partners and all relevant parties. With
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Part 2 Section 3 Operation of Business Line
this in mind, we set a policy that contractors must attend the SHE training and testing under
OHSAS 18001/TIS 18001 before discharging their duties.
EGCO Group realizes that preparation is the key success factor for safety management.
Consequently, risk management principles are applied to prepare all relevant units for any
unexpected incidents. Annual fire drills, regular check-up of workplace safety, safety
equipment trainings are carried out regularly. In addition, work place safety exhibitions are
organized to promote understanding on SHE management system to employees and
contractors alike. Highlights of activities to promote the SHE consciousness in the year 2009
are as follows.

Safety Projects in 2010
Suggestion system for workplace improvement campaign at Khanom power plant
ZERO Accident Campaign at Khanom power plant
Safety exhibition in collaboration with governments units to provide knowledge to
students, private and government organizations, and the general public at Khanom
power plant.
- Project to reduce accidents at work at Roi-Et Green power plant.
- Project to encourage employees to wear full safety gear while working at Roi-Et Green
power plant
-
 Occupational Health Projects in 2010
EGCO Group believes that the healthiness of the employees reflect the healthiness of the
organization. In this regard, EGCO takes care that all of our employees are in good shape.
Apart from such campaign, EGCO Group also ran the following occupational health projects
in 2010.
- Annual physical check-up for employees
- First-aid training for the employees
- Employees’ physical exercise for weight loss to promote physical fitness by providing
facilities for daily exercise, supporting the budget to the Sport Club to run sport
programs for employees and regularly host sport events for employees.
- Sport campaign with private and government units including local communities.
- Health and life insurance for employees and their families.
 Safety Records
With the commitment to high standard of SHE management, there is no labor dispute
between EGCO and the employees. In addition, there is no event that leads to loss time injury
in 2010. The accumulated safety hours of each company is shown below.
Power plants
Working
hours
Period
Rayong power plant
Khanom power plant
3,790,607.16
5,000,520
521,632
954,160
11 September 1999 to 31 December 2009
17 May 1998 to 31 December 2009
EGCO COGEN power plant
Roi-Et Green power plant
28 January 2003 to 31 December 2009
29 May 2003 to 31 December 2009
Energy Management
EGCO Group puts high priority on efficient energy usage by running energy saving campaign
which includes introducing energy efficient facilities, maintaining all equipment in a ready to
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Part 2 Section 3 Operation of Business Line
use stage and studying and developing the energy management system to meet the
international standard. Moreover, we promote the culture of sustainable energy use. In this
regard, Khanom power plant converted one of the existing buildings to be the demonstration
center for energy conservation powered by solar energy. This building is open as a learning
center for renewable energy usage for employees, students, and the general public.
Roi-Et Green has set the measure to clean the boiler heating surface during the planned outage
4 times a year. Since Roi-Et Green is a biomass power plant using rice husk as fuel, there is
slag in the boiler tubes. As such, the oxygen level in the exhausted gas and the boiler blow
down rate is adjusted down to maintain the boiler efficiency which results in a better heat rate.
Environmental Management
With the awareness that natural resources are major source for power generation, EGCO
Group put the prime focus on efficient use of natural resources and see to that the impacts on
the environment are well managed to reduce the impact from our operation. Such
environment management includes water resource management, water treatment from
production process, air pollution management, noise pollution management, waste
management, green house gas management, and biodiversity management.
Water resource management and Water treatment from production process
EGCO Group supports the efficient use of water resource. Apart from reducing the water
usage, we also adopt new technology in water treatment using sediment forming catalyst to
treat waste water from office building and implement a neutralization system to treat chemical
contaminated water from the operation process. In parallel, EGCO Group adheres to the
water management plan.




Construction of reservoirs to reserve water for power generation process
- Khanom power plant has constructed two water reservoirs with the capacity of
400,000 cubic meters and internal reservoir with the capacity of 35,000 cubic
meters. KEGCO has set the water level above the check dam so that it can
pump in water without disturbing the water consumption of communities
around the reservoir and above the check dam.
Using treated water for fish farming or plant watering
- Khanom power plant has run the Zero Discharge Program to re-use waste water
from office buildings, power plant and employees’ residences to water the plants.
- Rayong, EGCO COGEN and Roi-Et power plants used the waste water from
office buildings for watering plants. This helps cut 30% of the water
consumption.
The monthly monitoring of water quality was carried out to ensure that the waste water
is treated to the level that meets the standard before being discharged to reduce the
impact on the water resources. In addition, regular monitoring of the ecological system is
conducted.
Quarterly monitoring of the water treatment system to ensure efficient treatment
- Khanom power plant implements the grease and chemical trap in the water
drainage system to increase the efficiency of separating oil from discharged
water.
Page 51
Part 2 Section 3 Operation of Business Line
The tables below demonstrate water consumption of raw water and waste water during the last
three years.
A. Water consumption
Raw water consumption
(M3/GWh)
Rayong power plant
Khanom power plant
ECGO COGEN power plant
Roi-Et Green power plant
2010
1260.04
82.40
1,775.73
4,766.33
2009
2008
1,268.28
88.33
1,426.45
4,675.74
1,248.16
88.112
1,500.05
4,885.75
2009
2008
Remarks
B. Temperature of cooling water of the discharge
2010
Remarks
Temperature of cooling water of
the discharge
Rayong power plant
Khanom power plant
ECGO COGEN power plant
Roi-ET Green power plant
29.8
37.80
36.0
28.63
29.5
37.1
34.1
28.38
33.4
39.4
34.1
25.04
Legal requirement
<= 40.00 C
Air Pollution Management
With the efficient monitoring of the power generation process, the quality of air emission of all
power plants in EGCO Group is better than the legal requirements. EGCO Group has also
implemented continuous air quality control measures as follows:
 Bi-annual cross-checking of stack emission measuring.
 Checking of efficiency of air pollution control treatment equipment on a quarterly
basis.
 Enhancing of air quality management as follows:
- Rayong power plant reduced Nitrogen Oxide emission by spraying water into
the combustion chamber.
- Khanom power plant constructed a sandblasting room using Uncentrator and
cartridge to control the dust from the sandblasting process in order to maintain
a good working environment and control the air pollution in the nearby area.
- Roi-Et Green power plant, a biomass power plant using rice husk as fuel,
installed an electrostatic precipitator to trap flying ash in the fuel to be kept in
the ash silo before being transported by a truck with full cover and water spray
to prevent dusting. Ash is transported via conveyor belt to the storage for
future distribution to farmers in nearby areas to be used as fertilizers.
The table below demonstrates air emission from EGCO Group during the last 3
years.
Page 52
Part 2 Section 3 Operation of Business Line
2010
2009
2008
131.11
167.00
71.8
4.2
<1.0
147.37
152.00
92.3
26.71
12.46
149.79
139.00
58.9
117.41
45.63
หมายเหตุ
Remarks
Air emission from power
plants
Oxide Nitrogen Emission
Rayong power plant
Khanom power plant
EGCO COGEN power plant
Roi-Et Green power plant
Sulfur dioxide (ppm)
Legal requirements
<= 200.00 ppm
Legal requirements
<= 60.00 ppm
Remarks: The measurement of SO2 is not required for REGCO, KEGCO and EGCO COGEN power
plants due to the use of natural gas as fuel.
* Roi-Et Green applied the old measurement criteria, of which the results cannot be comparable to the
new measurement criteria in 2008.
Noise Management
Noise measurement is made at all power plants in EGCO Group on a quarterly basis. The
measurement is made at three areas being the original source in the power plants, the control
room and the boundary. It is found that the noise level at the control room and the boundary
areas are within the limit while the noise at the source will be controlled to be within the limit.
For example, employees who have to work in the operation area are required by internal
regulation to strictly follow the regulations and wear safety gadgets in order to reduce the noise
level. Warning signs are also displayed at the area.
In addition, KEGCO has increased the noise measurement at the residential area in the power
plant campus to ensure the safety and occupational health of the employees. The result
indicated that the noise level is within the limit.
The table below demonstrates noise emission during the last 3 years.
Noise emission from power
plants
2010
2009
2008
Legal requirement <= 90 dB(A)
Noise level at the production site
Rayong power plant
Khanom power plant
EGCO COGEN power plant
Roi-Et Green limited power plant
69.5
79.1
81.3
102.3 101.4 130.7
89.9 88.2
83.7
90.5
90.1 89.6
(dB(A))
Noise level at the control room
Rayong power plant
Khanom power plant
Remarks
Legal requirement <= 80 dB(A)
62.1
69.8
59.2
67.6
62.6
69.7
60.8
66.4
62.8
68.8
65.5
NA*
EGCO COGEN power plant
Roi-Et Green limited power plant
*
In 2006 and 2007, noise level which was below 80 DB(A) was not calculated for cumulative noise levels at
Page 53
Part 2 Section 3 Operation of Business Line
work.
Noise level at the boundary area
(dB(A))
2010
REGCO power plant
KEGCO
EGCO COGEN power plant
Roi-Et Green limited power plant
48.7
57.8
69.3
60.1
2009
2008
Legal requirement <= 70 dB(A)
53.2
57.3
63.4
60.5
50.9 Checked at a Security Kiosk
56.3
64.3
NA Unchecked
Waste Management
With the commitment to make the best use of natural resources, EGCO Group set the
procedure for waste management under the following principles.
 Employees must bear in mind to produce as minimum waste as possible and to recycle
waste.
o Khanom power plant organized project to produce organic instead of chemical
fertilizers.
o Roi-Et Green power plant has used ash from rice husk which is the by product
from the combustion process as fertilizers. Such knowledge is introduced to
local villagers to replace the usage of chemical fertilizers with the
environmental friendly one.
 Appropriate waste management procedures are set up starting from separation,
transportation and disposal.
 Advisors will be engaged to manage contaminated and hazardous waste which may
affect the environment to comply with the environmental laws.
Greenhouse gases and biodiversity management
With the awareness that climate change will significantly affect ecological and natural systems,
we at EGCO are determined to alleviate this problem by establishing a long term plan for
greenhouse gas and biodiversity management together with the following projects.



Rayong Power Plant’s Green Belt 2006-2010
Rayong Power Plant has started the project to increase the greenbelt around the power
plant to absorb as much as possible the carbon dioxide emitted from the electricity
generation process. The project started in 2006 with the objective to expand the green
zone to cover 120 rai within 2010. In the year 2009, Rayong power plant in
collaboration with locals planted trees for 45 rai. Until now, there have been 90 rai of
green zone.
Assessing species diversity and abundance of plankton and Benthic animals
Project
KEGCO has bi-annually assessed the species diversity and abundance of Plankton and
Benthic animals at Khanom Gulf and Khanom River. It is found that the diversity and
abundance were not directly impacted by the water discharged from the power plant
but were up to the environment of the Khanom canal such as the chemical and
physical conditions, light, nutrients, water discharge from households and development
for community use.
Sustainable forest Project at Khaonom Power Plant
Page 54
Part 2 Section 3 Operation of Business Line



In collaboration with local units at Khanom district, Khanom power plant has
managed to grow mangrove trees in the area of 20 rai. This also encourages the local to
set up conservation group to take care of natural pond, and local natural water sources
including landscape improvement by increasing green area for community.
Bring life to the water project, KEGCO
Khanom Power Plant raised 5,000 sea basses in baskets at its cooling water discharge
twice a year until they are large enough to be released to the sea. This project is
intended to be a showcase of good environment management in the power plant. At
the same time, the project helps increase the population of sea basses in the Khanom
area.
Improvement of the mountainous landscape by KEGCO
Recognizing the duty to contribute to the society as well as seeing the importance of
local plants, Khanom power plant has initiated the project to improve the landscape of
the mountains by planting trees that represent 14 provinces in the south in the park at
the foot of the mountain. Apart from being the resting and recreational area for
employees and the general public, this park also provides knowledge about local plants
to the community.
Banana Conservation Project at KEGCO
In order to conserve the different kinds of banana and increase soil humidity in the
foot of the mountain and the grass field, KEGCO has arranged a project to conserve
different kinds of bananas. More than 200 banana trees were planted. The project sign
to show the project name and the banana tree names are provided to provide
knowledge for employees and local community.
Compliance with Environment Laws and Regulations
EGCO Group has the policy to conduct our business with commitment to strictly complying
with relevant environmental laws and regulations. We will also try to go beyond the legal
requirement. For new project, we will adopt the EGCO’s SHE standard which will be in line
with the local requirement of such project.
Safety, Occupational Health and Environmental Operation Efficiency
With continuous effort in ensuring efficient SHE implementation, EGCO Group power plants
are well recognized by various institutions as shown below:
 Khanom Power Plant
- 11 consecutive years of winning the award on outstanding organization for
national safety, occupational health and environment at work place award.
 Rayong power plant
- Participating in the project of Corporate Social Responsibility – Department of
Industrial Work. (CSR-DIW)

Roi-Et Green
- “National Safety Awards for the first year, at the 24th National Work Safety
Week by Ministry of Labor.
4. Undelivered work
There is one project namely the Solar Power Plant Project, the Natural Energy Development
Co., Ltd. (“NED”)’s project, located in Lopburi province, which is currently under
development with the project’s COD target for November 2011.
Page 55
Part 2 Section 4 Research and Development
4.
Research and Development
The Notification of the Capital Market Supervisory Board No. Tor Jor 11/2009 Re: Criteria,
Conditions and Procedures of Reporting Disclosure of Financial Status and Results of Business
Operations of Issuance Companies dated March 13, 2009 revoked this part.
Page 56
Part 2 Section 5 Operational Assets
5. Operational Assets
5.1 Fixed Assets
The fixed assets of the company and subsidiaries as at December 31, 2011 comprise the
following items.
Items
1. Land and Building
Less Accumulated Depreciation
Total
2. Power Plant and Transmission System
Less Accumulated Depreciation
Total
3. Office Equipment and Cars
Less Accumulated Depreciation
Total
4. Work under construction
Value/1
(Million Baht)
5,539.28
(2,770.09)
2,769.19
36,103.55
(26,000.28)
10,103.27
583.53
(444.41)
139.12
11.00
Remark : /1 The number was shown in EGCO Group’s consolidated financial statement . EGCO
Group has recorded interest from joint ventures in the financial statement. Therefore, the values
of land, buildings and pledged of joint ventures were not shown in the financial statement.
Subsidiaries
EGCO Cogeneration Co., Ltd. has mortgaged land and buildings to secure its long-term
loan worth USD 27 million and Baht 1,182 million.
Roi-Et Green Co., Ltd. has mortgaged land and buildings and pledged power plant
equipment to secure its long-term loan worth JPY 1,260 million.
Joint Ventures
BLCP Power Co., Ltd. (“BLCP”) has mortgaged land and buildings and pledged equipment
to secure its long-term loan worth USD 558 million and Baht 25,063 million.
Gulf Power Generation Co., Ltd. (“GPG”) has mortgaged land and buildings and pledged
equipment to secure its long-term loan worth USD 323 million and Baht 16,388 million.
GCC, Nong Khae Cogeneration Co. Ltd. (“NKCC”) and SCC have mortgaged their land
and buildings and pledged all power plant machinery and equipment including parts of their
ordinary shares to secure its loan worth baht 5,800 million.
Page 57
Part 2 Section 5 Operational Assets
Gulf Yala Green Co., Ltd (GYG) has mortgaged land and buildings and pledged all power
plant machinery and equipment to secure its long-term loans worth USD 23 million and
USD 645 million.
Southern Philippines Power Corporation (SPPC) has mortgaged land and buildings and
pledged equipment to secure its long-term loan worth USD 12 million.
Western Mindanao Power Corporation (WMPC) has mortgaged land and building and
pledged equipment to secure its long-term loans worth USD 20 million.
Nam Theun 2 Power Co., Ltd. (NTPC) has mortgaged company’s assets to secure its longterm loans worth USD 500 million and Baht 20,000 million.
Quezon Power (Philippines), Limited Co. (QPL) has mortgaged company’s assets to secure
its long-term loans worth USD 758.7 million.
Natural Energy Development Co., Ltd. (NED) has mortgaged company’s assets to secure its
long-term loans worth Baht 5,216 million.
5.2
Intangible Assets
-
Concessions (Power Purchase Agreement and Water Supply Agreement)
Right in long-term power and tap water purchase represents the excess of the cost of an
acquisition over the fair value of the Group’s share of the net assets of the acquired
subsidiary undertaking or joint ventures at the date of acquisition. The EGCO Group
expected to receive benefits and bonus from the subsidiaries in return. Hence, right in longterm power and tap water purchase is amortized using the straight-line method over its
estimated useful life. Management determines the estimated useful life of long-term power
and tap water purchase within 16-25 years, based on the evaluations of EGAT and PWA ,
respectively.
One of EGCO’s intangible assets is a good will which occurred from businesses
acquisition. On December 31, 2011, the net good will was worth Baht 686 million.
EGCO’s Group will estimate an impairment of good will on the statement date.
The estimation is based on the value in exchange of each good will. So that, EGCO’s
Group will adjust the book values not greater than the value in exchange.
5.3 Investment and Management Policy in Subsidiaries and Joint Ventures
EGCO sets its corporate vision “to be the leading Thai integrated electric power Company
with comprehensive energy services in Thailand and in the ASEAN region, with full
Page 58
Part 2 Section 5 Operational Assets
commitment to environment protection and social development support. In this regard,
EGCO has identified its key long term objectives as follows.
1. Invest in the business in which EGCO Group has expertise to maximize profit and
create growth to the Group with the acceptable risks,
2. Allocate the appropriate shareholding proportion in its investment to possess the
governing right over joint venture companies,
3. Uphold the investment basis of Non-recourse or Limited Recourse Project Finance
with clear sponsor support and contingent liability,
4. Support Corporate Social Responsibility projects and comply to all governing laws.
The Company expects all of its subsidiaries and joint ventures to operate their business
in compliance with its corporate vision and mission, the code of conduct, the corporate
governance principles and acceptable risk profiles. In addition, we expect all of the Group
companies to carry out their business in accordance with the following values:
-
To conduct business with honesty, integrity and ethics.
-
To carry out business in compliance with all applicable business and
commercial laws.
-
To show respect and take into account the local traditions and cultures.
-
To use natural resources in an efficient and environmentally responsible
manner.
-
To carry out their responsibilities in a professional manner and with team
spirit.
The Board of Directors oversees the subsidiaries and joint ventures via the support of
the Group Business Committee in accordance with the following guidelines.
-
Implementing core policies via EGCO Group employees who are assigned
to be directors, management or shareholders of those companies. These
representatives must seek advance concurrence from the Board of Directors
upon the substantial matter of events,
-
Incentivizing Group companies to achieve corporate goal using a
performance linked based KPI.
-
Monitoring the progress and the operation of the subsidiaries and joint
ventures via the Asset Management and Planning with monthly reports to
the Board and the Group Business Committee. Should there be any urgent
matters for which the immediate action is required; such matters will be duly
reported to the Board on the first occasion.
Page 59
Part 2 Section 6 Future Projects
6. Future Projects
The Notification of the Capital Market Supervisory Board No. Tor Jor 11/2009 Re: Criteria,
Conditions and Procedures of Reporting Disclosure of Financial Status and Results of Business
Operations of Issuance Companies dated March 13, 2009 revoked this part.
Page 60
Part 2 Section 7 Dispute
7. Dispute
EGCO is not involved in any legal dispute based on the following definition.

Legal case that has negative impact on EGCO and its subsidiaries with the size larger
than 5% of the shareholders’ equity as at the end of the accounting year.

Legal case that has significant impact on EGCO business.

Legal case which is not related to EGCO’s normal business.
Page 61
Part 2 Section 8 Capital Structure
8. Capital Structure
The Company’s securities
(1). EGCO’s registered capital and paid up capitals as of December 31, 2011 is shown below.
Registered
Capital
Paid Up
Capital
: 5,300 million baht comprising 530,000,000 ordinary shares with the par
value at 10 baht per share.
: 5,264.65million baht comprising 526,465,000 ordinary shares with the
par value at 10 baht per share.
As at December 31, 2011, the numbers of NVDR (Non-Voting Depository Receipt) amounted to
41,216,942 units or 7.83% of the registered shares. The NVDR holders have no voting right at the
shareholders’ meeting.
Any shareholders who need additional information on the NVDR can look for the information at
www.set.or.th/nvdr/
Comparing to 2010, EGCO’s shares had a lot movement in 2011 with the highest trading price at
112.00 baht on January 19, 2011 and the lowest trading price at 80 baht on October 26, 2011. The
average price/earning ( P/E ratio) was 10.15 in 2011.
(2) Other Securities
KEGCO’s Amortizing Secured Debenture No. 1 due in 2011. The details is shown
below.
Type
Tenure
Total
Value of
Debentures Offered
Total Debentures Issued
Par Value
Offering Price/Share
Issuance Date
Redemption Date
Interest Rate
Interest Repayment Date
: Secured debentures in a registered form
with collateral agent
: 15 years starting from the issuance
All : 7,500,000,000 baht
:
:
:
:
:
:
:
750,000 units
10,000 baht
10,000 baht
June 14, 1996
June 14, 2011
11.56% per annum
Every 6 months on December 14, and
June 14 every year
Principal Repayment Date
: in installment every 6 months on
December 14, and June 14 every year with
the first payment on December 14, 1996
The Outstanding Debentures : - units
as of December 31, 2011
The Outstanding Principal as : - baht
of December 31, 2011
Page 62
Part 2 Section 8 Capital Structure
(2) Any commitment among major shareholders and the Company, which will affect the
issuing and offering securities or the management of the Company
-None8.2 Shareholders
The top ten shareholders as of September 6, 2011, the closing date of shareholders’ roster for the
right to receive the interim dividend payment on September 16, 2011, are as follows.
No.
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
Shareholders /1
Electricity Generating Authority of Thailand
TEPDIA Generating B.V.
Littledown Nominees Limited
Bangkok Life Assurance Public Company Limited
State Street Bank and Trust Company, for London
Social Security Office (Two-types)
Chase Nominees Limited 1
The Bank of New York (Nominees) Limited
Chase Nominees Limited 15
State Street Bank Europe Limited
Shares
% of
Total
133,773,662
126,054,178
28,943,528
10,019,300
7,449,805
6,387,300
7,120,247
4,632,091
4,330,760
4,165,941
25.41
23.94
5.49
1.90
1.41
1.21
1.35
0.88
0.82
0.79
Remarks
/1 1. Excluding 63,052,929 shares under Thai NVDR which account for 11.977% of the total
outstanding shares.
2. Excluding 3,298,645 shares under Thailand Securities Depository Co., Ltd. For
Depositors which account for 0.627% of the total of outstanding shares.
The ultimate shareholders of EGCO’s major controlling shareholders are as follows.
1. Electricity Generating Authority of Thailand (EGAT): EGAT is a state utility with the
objectives to generate, purchase, transmit and distribute electricity. EGAT also provides the
operation and maintenance services and invests in electricity related business. EGAT holds
25.41% of EGCO’s outstanding shares. EGAT has four representative directors of all 15
directors in EGCO.
2. TEPDIA Generating B.V. (“TEPDIA”): TEPDIA is a joint venture of Diamond Generating
Asia, Limited (“DGA”) and Tokyo Electric Power Company (“TEPCO”). TEPDIA, is jointly
owned 50% by each DGA and TEPCO, is a company that invests in energy business in South
east Asia and Taiwan. TEPDIA has four representative directors of all EGCO’s 15 directors.
The details of TEPDIA’s shareholders are as follows:
2.1 Diamond Generating Asia, Limited (“DGA”), a Mitsubishi Corporation (“MC”)’s subsidiary,
MC is a technology development and trading company in industrial and energy sector. MC
indirectly holds 11.972% of EGCO’s outstanding shares via TEPDIA Generating B.V.
Page 63
Part 2 Section 8 Capital Structure
2.2 Tokyo Electric Power Company (“TEPCO”): TEPCO is the largest electric power company
in Japan and the largest privately owned electric utility in the world. TEPCO indirectly holds
11.972% of EGCO’s outstanding via TEPDIA Generating B.V.
8.3 Company’s dividend payment policy
In the absence of unforeseen circumstances, the Company has a policy to dividend
approximately 40% of the net profit after taxation, or to increase the dividend amount in a
steady manner, to the shareholders. This dividend policy may change in the light of investment
opportunities that may become available to the Company or as a result of other economic or
financial factors or when a dividend payment may have a significant impact on the normal
operation of the Company”.
The details of the dividend payment for the past 6 years.
Approval
Date
Dividend
XD Date
Payment Date
(Baht/
Operation Period
Share)
August 22, 2011
September 6, 2011
September 16, 2011
2.50
January 1, 2011-June 30, 2011
February 28, 2011
March 16, 2011
May 4, 2011
2.75
July 1, 2010-December 31, 2010
August 23, 2010
September 8, 2010
September 17, 2010
2.50
January 1, 2010-June 30, 2010
February 23, 2010
March 10, 2010
May 6, 2010
2.75
July 1, 2009-December 31, 2009
August 24, 2009
September 8, 2009
September 17, 2009
2.50
January 1, 2009-June 30, 2009
February 23, 2009
March 10, 2009
May 6, 2009
2.50
July 1, 2008-December 31, 2008
August 28, 2008
September 1, 2008
September 11, 2008
2.50
January 1, 2008-June 30, 2008
February 25, 2008
April 1, 2008
May 7, 2008
2.50
July 1, 2007-December 31, 2007
August 25, 2007
September 5, 2007
September 21, 2007
2.25
January 1, 2007-June 30, 2007
February 26, 2007
March 28, 2007
May 8, 2007
2.00
July 1, 2006-December 31, 2006
August 28, 2006
September 7, 2006
September 26, 2006
2.00
January 1, 2006-June 30, 2006
March 20, 2006
March 29, 2006
May 10, 2006
1.75
July 1, 2005-December 31, 2005
August 22, 2005
September 1, 2005
September 20, 2005
1.50
January 1, 2005-June 30, 2005
March 18, 2005
March 30, 2005
May 23, 2005
1.50
July 1, 2004-December 31, 2004
September 23, 2004 September 1, 2004
September 22, 2004
1.50
January 1, 2004-June 30, 2004
March 19, 2004
May 12, 2004
1.50
July 1, 2003-December 31, 2003
March 31, 2004
The controlling subsidiaries have the policy to pay their dividend four times a year to their
shareholders at 100% of the net profits after tax, legal reserve and other reserve accounts applied
to terms and conditions of their credit facility documents.
In addition, EGCO Cogen has to maintain its Debt Service Coverage Ratio for the
previous six-month period not less than 1.1.
Page 64
Part 2 Section 9 Management
9. Management
9.1 Organization Structure
At the top of EGCO’s organization structure is the Board of directors, the standing committees, the President and
the top management.
1. Structure of the Board of Directors
The Board of Directors has main responsibility to conduct business in a way that will benefit EGCO, shareholders
and stakeholders including the employees and communities where EGCO operates its business. In this regard,
the Board works with the Management in formulating EGCO’s vision and policy and to approve the corporate
budget.
Currently, the Board comprises 15 members:
 14 non-executive directors (including six independent directors), and
 President, the only one executive member.
The Board of Directors and their share ownership in EGCO as of December 31, 2011 are as listed below:
No.
1
2
3
4
5
6
7
Name
Mr. Pornchai Rujiprapa
Mr. Aswin Kongsiri
Position
Chairman
Independent
Director / Vice
Chairman
Mr. Chaipat Sahasakul
Independent
Director
Mr. Thanapich Mulapruk
Independent
Director
Police Lieutenant General
Independent
Pijarn Jittirat
Director
Mr. Somphot Kanchanaporn Independent
Director
Mr. Phaiboon
Independent
Siripanoosathien
Director
65
Appointment
Date
January 1, 2009
April 24, 2009
No. of shares
December 31, December 31,
2011
2010
-
Increase
(Decrease)
-
April 21, 2010
-
-
-
April 24, 2009
-
-
-
April 24, 2009
-
-
-
April 22, 2010
-
-
-
April 21, 2010
-
-
-
Part 2 Section 9 Management
No.
Name
Position
8
Mr. Surasak Supavitipatana
Director
9
Mr. Kulit Sombatsiri
10
11
Mr. Hideaki Tomiku
Mr. Toshiro Kudama
12
Mr. Akio Matsuzaki
13
Mr. Ryota Sakakibara
14
Mr. Vinit Tangnoi1
15
Mr. Sahust Pratuknukul2
Appointment
Date
November 16,
2011
Director
December 13,
2011
Director
April 23, 2007
Director
February 23,
2011
Director
February 23,
2011
Director
February 23,
2011
President/Direct October 1, 2008
or
President
April 22, 2010
No. of shares
December 31, December 31,
2011
2010
-
Increase
(Decrease)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,890
1,890
-
Remark 1 Mr. Vinit Tangnoi’s contract as President expired on September 30, 2011. However, he continued his
directorship until his resignation on January 1, 2012.
2
Mr. Sahust Pratuknukul was appointed as a director and the President on April 22, 2010 and October 1,
2011, respectively.
The lists of directors who retired or resigned in 2011 together with their share ownership in EGCO are as shown
below.
No.
1.
2.
3.
4.
5.
6.
Name
Position
Mr. Peter Albert Littlewood
Mr. Mark Jobling
Mr. Shinji Tsuchiya
Mr. Wisudhi Srisuphan
Mr. Somboon Arayaskul
Mr. Kurujit Nakornthap
Director
Director
Director
Director
Director
Director
66
No. of shares
December 31, December 31,
2011
2010
February 23, 2011
February 23, 2011
February 23, 2011
February 28, 2011
October 1, 2011
December 1, 2011
Retiring/
Resigning Date
Increase
(Decrease)
-
Part 2 Section 9 Management
Independent Directors
The Board in the meeting no. 7/2008 on September 8, 2008 had early adopted the definition of independent
directors to comply with the qualifications of independent directors stated in the notification of the Capital Market
Supervisory Board no. 14/2008 re: “Filling for and Approval of Newly Issued Shares” before the effective date
and the Board in the meeting no. 2/2011 on February 28, 2011 had resolved to reduce the shareholding under
this item from not more than 1% to 0.5%. Under such definition, EGCO independent director shall have the
following qualifications.
1. Holding shares not more than 0.5% of the paid-up capital with the voting right of EGCO, parent company,
subsidiary company, associated company or any legal entity that may have the conflict of interest
(including the connected persons as stipulated in section 258 of securities laws),
2. Not being a director that takes part in the management (executive director, director who has the same
responsibility as management except for the signature in transactions approved by the Board and the joint
signing with other directors), employees, advisors who receive regular salary, and controlling person of
EGCO, parent company, subsidiary company, associate company and fellow subsidiary (subsidiary of the
same holding company) or any entity that may have a conflict of interest during the period of two years
before his/her appointment,
3. Not being a person who is related by maternity and by registration as parents, spouse, brother, sister,
and son and daughter including their spouses of the management, or major shareholders, controlling
persons or persons who will be nominated to be the Management or controlling persons of EGCO or its
subsidiaries,
4. Not having business relationship with and not being a major shareholder, non-independent director or
management of EGCO, parent company, subsidiary company, associate company or any entity that may
have a conflict of interest in a way that would affect the giving of independent opinions during the period
of two years before the filing date,
5. Not being an auditor or a major shareholder, director, management or partner of the audit firm that
provides auditing services to EGCO, parent company, subsidiary company, associate company or any
entity that may have a conflict of interest during the period of two years before the filing date,
6. Not providing any professional service or being a major shareholder, non- independent director,
management or partner of the company that provide professional service which include financial and
legal advices with the fee higher than 2 million baht per year during the period of two years before the
filing date,
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Part 2 Section 9 Management
7. Not being appointed as a representative to safeguard interests of EGCO director, majority shareholders or
shareholders who are related to EGCO’s majority shareholders, and
8. Not having any constraint that would affect the performance of giving independent judgment on EGCO.
The terms of independent directors
The term of independent directors is limited at 3 terms, of which the counting of the term would start from the
2011 Annual General Shareholders’ Meeting on wards.
The Nomination and Remuneration Committee shall review the appropriateness of the independent director
definition. Currently, there are 6 independent directors of all 15 directors who meet the above qualifications which
accounts for more than one-third of all directors.
Authorized Directors
EGCO determines that the authorized directors comprise the President to sign and affix the company’s seal
independently, or any two directors to sign jointly and affix the company’s seal. Such authorized directors shall
exclude (1) independent directors to maintain their independence under the good corporate governance principle,
(2) Chairman who is a senior government officer, and (3) directors who are also directors of the financial
institutions to avoid the limitation that such financial institutions cannot provide future financial service to EGCO.
Appointment, Resignation, and Dismissal of Directors
The Board of Directors, which comprises not less than five and not more than 15 directors, shall be elected by
shareholders, provided that not less than half of them must reside in Thailand. If a directorship becomes vacant
for any reason other than by rotation, the Board in the subsequent meeting shall elect a person who is qualified
to fill in the vacancy by the votes of not less than three-forth (3/4) of the remaining directors. The director who
fills in the vacancy shall retain the office for only the remaining term of office of the director whom s/he replaces.
At every annual ordinary meeting, one-third of the directors shall retire from office. If the number of directors is
not a multiple of three, the number nearest to one-third must retire from office. Additionally, any director who
wishes to resign from office may do so by submitting a resignation letter to the company. Such resignation shall
be effective from the date the resignation letter reaches EGCO.
In voting for the dismissal of any directors from office before the expiration of his or her term of directorship, a
four-fifth (4/5) vote of eligible shareholders present at the meeting shall be required.
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Part 2 Section 9 Management
Board of Directors’ Duties and Responsibilities
The duties and responsibilities of the Board of Directors are as prescribed below.
1. Duties to EGCO
 To devote time to EGCO and conduct the business in compliance with the governance principles
and EGCO’s Code of Conduct.
 To demonstrate independent judgment in overseeing EGCO business.
 To have full ethical and legal responsibility towards shareholders while taking into account the
interests of other stakeholders.
 To endeavor to recruit competent key management who will fully devote themselves for the
benefit of EGCO.
 To monitor EGCO’s business and the compliance with the laws, rules, regulations and contract
provisions and will require the Management to submit report on EGCO’s significant matters to
ensure effective corporate performance.
2. Duties to the Shareholders
 To endeavor to ensure that EGCO is financially viable, properly managed and constantly
improved so as to protect and enhance the interests of the shareholders.
 To endeavor to ensure that the information disclosure is materially correct, complete, transparent
and timely.
 To endeavor to ensure that shareholders are treated on equitable basis.
 Not to submit fault information and to ensure that true and accurate information regarding the
operating results and financial position is reported in accordance with the disclosure requirements.
3. Duties to Creditors
 To endeavor to ensure that EGCO complies with the loan provision and that EGCO’s financial
status is correctly disclosed.
 To seek professional advice in case of doubt about the likely impact on lenders such as when
EGCO’s financial position is uncertain or insolvency may be pending.
4. Duties to other Stakeholders
 To endeavor to ensure that EGCO complies with the governing laws and regulations while taking
into account the impact on employees, other stakeholders, community, society and environment.
5. Due Diligence

To attend all Board meetings but where meeting attendance is not possible; directors will take
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Part 2 Section 9 Management







appropriate step to obtain leave of absence.
To acquire knowledge about EGCO, the statutory and regulatory requirements affecting
directors in the discharge of their duties as EGCO director, and to be aware of the
environment that has the impact on EGCO.
To endeavor to ensure that necessary data are provided in advance to allow adequate time to
analyze, make thorough judgment and so discharge the duties of care and diligence.
To endeavor to ensure independent judgment and in case of dissent to any Board’s resolution,
to request the record of objection in the Minutes of Meeting.
To endeavor to ensure that the system is established within EGCO to provide the Board, on a
regular and timely basis, with necessary data to enable directors to make a reasoned and
careful judgment.
To endeavor to make sure that relations between the Board and the auditors are open and
that the auditor can work independently and efficiently with the full co-operation from
management and the internal auditors.
To strive to ensure that EGCO complies with the governing laws, rules, regulations and
business standard and ethics.
In any case of doubt in the capacity of directors and committee members, to seek advice from
EGCO’s advisors who are experts in each areas and to engage independent advisors for the
governance benefits such as legal advisors, financial advisors, HR advisors, other professional
advisors on EGCO’s expenses.
Board of Directors’ Performance Appraisal
The Board shall approve the self-appraisal form which will be reviewed and endorsed by the Nomination and
Remuneration Committee. In 2011 the Board adopted the same self-appraisal form as 2010. Such form is based
on the forms recommended by the New Zealand Institute of Directors and the forms adopted by other peer
companies in the energy sector. The self-appraisal form comprises two parts: collective appraisal form and
individual appraisal form.
The collective appraisal form comprises 15 sections, namely (1) shareholders, (2) stakeholders, (3) the Company,
(4) legal/ethical duties, (5) monitoring performance and agenda setting, (6) size, composition and independence
of the Board, (7) director orientation and development, (8) Board leadership and teamwork, (9) the CEO, (10)
Board (and Committee) meetings, (11) individual Board member contributions, (12) director and Board evaluation
and compensation, (13) management evaluation, compensation and ownership, succession Planning and (15)
other issues
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Part 2 Section 9 Management
The individual appraisal form comprises 7 sections, namely (1) strategic thought, (2) good corporate governance,
(3) competence, (4) independence, (5) preparedness as a director, (6) personal attributes and (7) awareness of
stakeholders. Result of the appraisals as well as directors’ recommendations will be used to enhance the Board’s
performance each year.
2. Standing Committees’ Structure
The Board of Directors has appointed 4 standing committees to help scrutinize significant matters. The details of
the standing committees are as follows.
Audit Committee
The Audit Committee comprises at least 3 independent directors for a 3-year term of service, with one year for
this purpose meaning the period between the Annual General Meeting (“AGM”) of shareholders when s/he is
appointed and the next succeeding AGM. One of the members shall have finance and accounting background.
(At present, Mr. Chaipat Sahasakul is the Audit Committee member that has such qualification.)
The Audit Committee undertakes its responsibilities as described in the Audit Committee Charter, which is
reviewed annually to be consistent with the changing internal and external environment. The responsibilities of
the Audit Committee are detailed below.
1. To review the accuracy and adequacy of EGCO’s financial reporting.
2. To review the appropriateness and effectiveness of internal control systems, and internal audit functions and
determine the Internal Audit Division’s independence, as well as approving the appointment, rotation and
removal, and performance development and appraisal of the Chief Internal Audit.
The Chief Internal Audit shall present the appointment, rotation, promotion, removal, and performance
development as well as appraisal of internal audit staff to the Audit Committee to consider whether the motion
of dissent would be raised.
3. To monitor EGCO’s compliance with Securities and Exchange Acts and Regulations of the SET, and any
other laws relevant to EGCO’s business.
4. To recommend the Board of Directors an independent person to be EGCO’s auditor as well as the audit fees
for appointment by the shareholders to audit EGCO’s financial statements.
5. To attend a non-management meeting with an auditor at least once a year.
6. To consider the connected transactions or any transactions that may cause conflict of interest complying well
as the audit fees for appointment by the shareholders to audit EGCO’s financial statements.
7. To review the Internal Audit Charter prior to submission to the Board of Directors for approval.
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Part 2 Section 9 Management
8. To approve the internal audit plan as well as budget and personnel.
9. To review the internal audit functions, including: independence of internal audit division and reporting
obligation.
10. To review with the Management the preparation of the Management’s Discussion and Analysis or MD&A and
its disclosure in the Annual Report.
11. To review with the Management the risk management policy, the practice compliance with such policy, as well
as EGCO’s risk management guidelines.
12. To prepare a report that describes the Audit Committee’s activities and responsibilities. This report shall be
signed by the Chairman of the Audit Committee and published in the annual report to the shareholders. The
Audit Committee’s Report shall consist of at least the following information:
(a)
an opinion on the accuracy, completeness and creditability of EGCO’s financial report,
(b)
an opinion on the adequacy of EGCO’s internal control system,
(c) an opinion on the compliance with the law on securities and exchange, the Exchange’s regulations, or
the laws relating to EGCO’s business,
(d) an opinion on the suitability of an auditor,
(e) an opinion on the transactions that may lead to conflicts of interests,
(f) the number of the Audit Committee meetings, and the attendance of such meetings by each committee
member,
(g) an opinion or overview comment received by the Audit Committee from its performance of duties in
accordance with the charter, and
(h) other transactions which, according to the Audit Committee’s opinion, should be known to the
shareholders and general investors, subject to the scope of duties and responsibilities assigned by the
Board of Directors.
13. To inspect any suspiciousness reported by EGCO’s auditor, that the President, the Management or any
person responsible for EGCO’s operation commits an offence under the Securities and Exchange Act (No. 4)
B.E. 2551 and report the result of preliminary inspection to the Office of the Securities and Exchange
Commission and the auditor within thirty days after being informed by the auditor.
14. To review the Audit Committee Charter at least annually.
15. To perform any other act as assigned by the Board of Directors with approval of the Audit Committee.
With regard to the above responsibilities, the Committee is accountable to EGCO Board of Directors whereas the
Board of Directors remains responsible for EGCO’s actions against the third parties.
The Audit Committee conducts the self-appraisal annually and reports the result to the Board. For 2011, the Audit
Committee used the questionnaire which was adapted from the Booklet: “Audit Committee – Good practices for
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Part 2 Section 9 Management
meeting market expectations – 2nd edition” which was studied by PricewaterhouseCoopers’ Global Corporate
Reporting.
There were 17 meetings in 2011 of which the attendance rate was 100%.
Investment Committee
The Investment Committee comprises 5 directors. The office term is the same as their directorship.
The Investment Committee has the responsibilities to scrutinize and endorse for the Board’s consideration the
Management’s proposals especially on investment and funding along with other related activities except for the
small and medium size transaction which it has the authority to approve with subsequent acknowledgement by the
Board. The Investment Committee’s responsibilities are described below.
1. To consider EGCO’s strategic plan, business plan and annual budget for presentation to the Board,
2. To formulate the overall investment strategy and investment policies in line with the EGCO’s policy,
3. To review major acquisition, investment, divestment and funding requests,
4. To review the financial operations of EGCO, including Group-wide financial and treasury management
policies and major financing transaction,
5. To approve activities in accordance with EGCO’s regulations,
6. To consider issues which are assigned by the Board, and
7. To review risks associated with investment and finance and other related issues.
There were 11 meetings in 2011 of which the attendance rate was 89%.
Nomination and Remuneration Committee
The Nomination and Remuneration Committee comprises 5 directors for a 3-year term of service with one year
for this purpose meaning the period between the AGM of shareholders when s/he is appointed and the next
succeeding AGM. In order to maintain continuity, members may be re-elected.
The mission of the Nomination and Remuneration Committee is detailed below.
1. To recommend the structure and composition of the Board and committees together with the qualification of
its members,
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2. To recommend the list of nominees for the Board of Directors to be proposed to the shareholders’ annual
general meeting in case of vacancies by rotation and to the board in case of casual vacancies,
3. To scrutinize the list of nominees for EGCO President in case of vacancy including the establishment of the
succession plan for executives,
4. To approve the appointment, promotion, rotation and removal of the senior executives of EGCO (Executive
Vice Presidents and Senior Executive Vice Presidents) and to nominate senior executives of subsidiary/joint
venture companies that EGCO had the right to nominate for a position equivalent to EGCO’s EVP level and
upward,
5. To approve EGCO representatives to be directors of the subsidiary or associated companies according to
equity proportion or shareholders’ agreement,
6. To endorse the performance evaluation of EGCO President,
7. To endorse the performance evaluation of EGCO Management (Senior Executive Vice President and
Executive Vice President),
8. To recommend the remuneration structure of the directors and senior executives of EGCO and subsidiary
and associated companies including meeting allowances, bonus, welfare and other benefits both in monetary
and non-monetary terms,
9. To recommend policies and guidelines in determining the remuneration package of the senior executives on
an annual basis,
10. To evaluate and approve the corporate performance of EGCO and the Group companies to determine the
bonus and annual salary increase across the whole Group,
11. To recommend EGCO’s salary structure and other benefits, and
12. To review risks associated with people management.
There were 10 meetings in 2011 of which the attendance rate was 98%.
Corporate Governance and Corporate Social Responsibility Committee
The Corporate Governance and Corporate Social Responsibility Committee (“CC Committee”) comprises 5
directors being 3 independent directors, 1 non-executive director and President. The term of office of each CC
director member is three years and can be re-elected. In order to maintain continuity, members may be reelected.
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Part 2 Section 9 Management
The mission of the CC Committee is detailed as follows.
1. To endorse corporate governance policy for consideration and adoption by the Board, to monitor compliance
with that policy, and to review and adopt such policy on continual basis as appropriate, and
2. To endorse policy and framework for activities for EGCO Group’s CSR and to consider resources and
budgets for CSR projects and activities.
There was 2 meeting in 2011 of which the attendance rate was 90%.
3. Management Structure
The President acts as the head of the Management team which comprises 3 groups as shown below:
 Business Development -International Group: This group is headed by a Senior Executive Vice President
(“SEVP”). Under the SEVP, there is one Executive Vice Presidents (EVP) who supervises the business
development (international).
 Business Development – Domestic Group: This group is headed by a Senior Executive Vice President
(“SEVP”). Under the SEVP, there are two Executive Vice Presidents (EVP) who supervise the business
development (domestic) and asset management.
 Finance and Corporate Services Group: This group is headed by SEVP with two EVPs to supervise
finance and corporate services performance.
 President’s Direct Report Group: This group comprises the strategy and corporate management group
headed by an EVP. There are also three divisions which are under the President’s supervision namely
Controller, Internal Audit and Corporate Secretary. The last two divisions report administratively to the
President, but functionally to the Audit Committee and the Board of Directors, respectively.
President
The President is responsible for managing EGCO’s business in consistent with the objectives, articles of
associations, regulations and the resolution of the Board. The President is also in charge of supervising
employees and completing activities assigned by the Board including the following activities.
 To manage EGCO’s day-to day business,
 To hire, appoint, remove, transfer, promote, demote, assign, and take disciplinary action against employees
and workers from division managers downward (excluding the internal audit manager and corporate
secretary), and
 To ensure the implementation of the policies, plans, and budgets approved by the Board.
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Part 2 Section 9 Management
In this respect, the President is allowed to delegate his authority to other employees but is still accountable for
the decision of his delegates.
Management Team
The list of the Management team and their share ownership in EGCO as at December 31, 2010 is as follows.
No.
Name
1 Mr. Sahust Pratuknukul
2 Mr. Piya Jetasanon
3 Mr. John Palumbo
4 Mr. Voravit Potisuk
5 Mr. Chumsak Desudjit
Title
President
Senior Executive Vice
President-Finance & Corporate
Services
Senior Executive Vice
President-Business
Development - International
Senior Executive Vice
President-Business
Development - Domestic
Director – Rayong Power Plant
6 Mr. Chankij Jearaphunt
Managing Director of KEGCO
7 Mr. Wajarapong
Managing Director of ESCO
Palakawong Na
Ayudhaya
8 Mr. Suvapan Chomchalerm Executive Vice President Finance
9 Ms. Somsiri Yoosuk
First Senior Vice President –
Finance Division
10 Mr. Nattanont
Senior Vice President –
Meesuksabai
Accounting and Budget Division
No. of Shares
December 31, December 31,
2011
2010
1,890
1,890
-
Increase
(Decrease)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Corporate Secretary
The Board in the meeting no. 6/2008 appointed Ms. Busakorn Kakanumpornwong the Corporate Secretary effective
August 18, 2008 with the duty and responsibility as prescribes in the Securities and Exchange Act (No. 4) B.E.
2551. Ms. Busakorn also serves as the Board secretary to handle functions to assist the Board as well as to
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Part 2 Section 9 Management
coordinate subsequent actions under the Board’s resolution. The Corporate Secretary directly report to the Board.
The Board also delegates the Nomination and Remuneration Committee to appraise the performance of the
Corporate Secretary.
Management Committees
EGCO has set up the following committees to ensure the appropriateness and efficiency of business
management.
Group Business Committee:
The Board of Directors appoints the Group Business Committee which comprises executives of EGCO Group in
appropriate number. The Committee is chaired by the President. The term of office for the executives is the same
as their executive terms.
The Group Business Committee is accountable for the following responsibilities
1. To act as the Board of Directors of the 100% equity subsidiaries namely KEGCO and ESCO,
2. To oversee that the operating assets comply with laws, regulations, governing documents and company’s
regulations,
3. To consider and endorse the business plan, annual budget and KPIs for the operating assets to the
Investment Committee for its consideration,
4. To direct asset management function to comply with the corporate plan and budget and meet both the
short-term and medium-term corporate targets,
5. To oversee EGCO’s operating assets to ensure that the operating results and return on investment are in
line with the plan and projection under the support of the Asset Management and Planning Group,
6. To propose/endorse the organizational structure, restructuring and governance of Group Companies
(Division level up), and
7. To recommend the appointment, rotation and removal of the Managing Directors and Deputy Managing
Directors of the wholly owned subsidiaries for the Nomination and Remuneration Committee’s approval.
The Group Business Committee’ meetings are called as necessary. In 2010, there were 5 meetings.
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EGCO Management Committee:
EGCO Management Committee comprises executives of EGCO Group in appropriate number. The Committee is
chaired by the President. EGCO Management Committee is responsible for formulating business policy of
EGCO Group, scrutinizing all proposals to be presented to the Board and standing committees and monitoring
the operation of the Group.
The EGCO Management Committee meetings are called as necessary. In 2011, there were 12 meetings.
Good Governance Committee:
The Good Corporate Committee comprises executives of EGCO Group in appropriate number. The Committee is
chaired by the President. The Good Corporate Committee is in charge of the following responsibilities.
1. To consider international criteria and practices of Good Corporate Governance and those of the SET and
SEC,
2. To formulate the policy, guidelines and practices of the Group in compliance with the Good Corporate
Governance, and
3. To revise the Code of Conduct to suit the business environment and to educate employees about the Codes
as well as providing cooperation to promote the practice in the Group.
The Good Corporate Governance Committee meets when necessary. In 2011, there were two meetings.
Risk Management Committee:
The Risk Management Committee comprises executives of EGCO Group in appropriate number. The Committee
is chaired by the President. The Risk Management Committee meets when necessary and directly reports to the
Audit Committee. Its responsibilities are as follows.
1. To determine the risk management criteria for EGCO and subsidiaries,
2. To determine the risk management evaluation and mitigation,
3. To monitor compliance with risk management framework,
4. To revise EGCO’s risk factors to comply with the regulations of the governing authorities, and
5. To report its performance to the Audit Committee and the Board of Director.
In 2011, the Risk Management Committee held six meetings.
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Part 2 Section 9 Management
Safety Health and Environment Committee:
The Safety Health and Environment Committee comprises executives of EGCO Group in appropriate number.
The Committee is chaired by EVP-Asset Management. The Safety Health and Environment Committee is in
charge of the following responsibilities.
1. To determine the policy and plan regarding safety, health and environment (“SHE”) of EGCO Group to be
in compliance with the strategic plan,
2. To implement the SHE action plan for EGCO Group,
3. To monitor and evaluate the SHE performance of EGCO Group, and
4. To improve and develop the SHE implementation of EGCO Group.
The Safety Health and Environment Committee meets when necessary. In 2011, there was no meeting.
4. Director and Management Selection
To ensure the appropriateness of director and management selection for efficient governance, EGCO sets up
the following framework.
Director Election and Appointment
EGCO endeavors to select capable directors to govern the company, designate the corporate policies and
sanction its business plans for the benefit of EGCO and shareholders. With respect to this, EGCO puts an
emphasis on the director nomination and selection process taking into account the following qualifications and
experiences in considering each individual candidates.
1. Legal requirement and regulations and notifications of SET and SEC regarding the directors’ qualifications,
2. Directors’ qualifications prescribed in Directors’ Code of Conduct namely honesty, virtue, initiative and
achievement, excellence, accountability, justice, independence, equality of shareholder opportunity,
3. Knowledge and experiences beneficial to EGCO’s business,
4. Trainings and experience at the policy making level in corporate governance,
5. Willingness to represent the best interests of all shareholders, and
6. Willingness to devote time and effort to contribute to EGCO’s development.
The Board has delegated to the Nomination and Remuneration Committee the duty of selecting and
recommending prospective nominees, whether they are to become the shareholders’ representatives or
independent directors, for the Board’s approval. The Nomination and Remuneration Committee is also
responsible for assessing the appropriate mix of skills and characteristics required of Board members in the
context of the needs of the Board at a given point in time and shall periodically review and update the criteria
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Part 2 Section 9 Management
as deemed necessary. The nomination of directors to succeed those who retire by rotation must be individually
approved at the shareholders’ meeting based on the voting guidelines in the Articles of Association as follows.
1. Each shareholder shall be entitled to the number of votes equivalent to the number of shares held by
him/her; one share shall have one vote.
2. Each shareholder shall elect one or more directors, provided that they shall not exercise their votes in
excess of the number of directors required at such time.
3. In a case that a shareholder elects more than one director, s/he may exercise all the votes s/he has,
provided that s/he may not split his votes among any such persons.
4. The persons receiving the highest number of votes in respective order shall be appointed directors
depending on the requirements of directors set at such time. In the event that a number of persons receive
an equal number of votes for the last directorship, the Chairman of the meeting shall have a casting vote.
5. Directors must be appointed by the vote not less than four-fifth of the shareholders present and having the
right to vote.
To ensure that shareholders have adequate information to make their selection, EGCO shall present details of
a given nominee such as education background, occupation, directorship in other companies, relevant
experiences, and illegal acts committed (if any) in the notice of shareholders’ meeting. In case of the reelection, the attendance records and performance during the past year shall also be presented.
In the case of casual vacancies, the Nomination and Remuneration Committee will nominate a qualified
candidate who does not possess any forbidden characteristics as stipulated under the Public Company Act for
approval at the subsequent Board of Directors' meeting. The director who fills in the vacancy shall retain the
office for only the remaining term of office of the director whom s/he replaces. The resolution of the Board of
Directors in this respect shall consist of not less than three-fourth the votes of the remaining directors.
Right of Minority Shareholders
To ensure that EGCO treats shareholders equitably, the Board encourages minority shareholders to make
recommendation on the director candidates with clear and transparent procedures as posted on EGCO website.
Director Orientation and Training
All new directors must participate in EGCO’s orientation program. This orientation will include presentations by
senior management to familiarize new directors with EGCO’s significant issues, Directors’ Manual and EGCO’s
Code of Conduct for Directors and Employees. Any sitting directors and other top management may attend the
orientation program.
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The information of the directors’ manual comprises role, duty and responsibility, Securities’ Dealing by Directors,
Notification of Personal Interest of Director, Meeting Management, Disclosure Policy, Contact with management,
Board’s and Committees’ Remuneration and Fringe Benefits, Table of Authority and EGCO general information.
EGCO encourages directors to attend both in-house and external courses to enhance their knowledge and
understanding on good corporate governance. Directors can apply for the training courses at the Thai Institute
of Directors or relevant organizations on EGCO’s expenses.
Management Selection and Appointment
The Board determines policies and principles for selection of the President and policies regarding succession in
the event of an emergency or the retirement of the President taking into account educational background,
experiences, capabilities, ethics and leadership. The Nomination and Remuneration Committee shall consider
and propose the qualified candidates to the Board.
The President is entrusted to select the knowledgeable, competent and experienced executives in accordance
with the qualifications and selection process stated in EGCO Regulation on Human Resource Management B.E.
2554 and the resolution of the Board as follows.
1. The Nomination and Remuneration Committee shall approve the appointment of Senior Executive Vice
President, Executive Vice President, the subsidiaries’ Managing Director and Deputy Managing Director.
2. The President shall appoint the division and section managers. The appointment of Secretary to the Board
and the Assistant Secretary to the Board shall be approved by the Board of Directors while the appointment
of Division Manager of Internal Audit shall be endorsed by the Audit Committee.
5. Director and Management Remuneration
EGCO sets the policy to reward directors and management with appropriate remuneration. In this respect, the
Nomination and Remuneration Committee is entrusted to review the appropriate rate that takes into account the
responsibility and the company’s financial status while being in line with the peer practices.
Director Remuneration
Director remuneration is appropriately set at a rate comparable to that of peer companies. The remuneration
comprises (1) monthly retainer fee to reflect directors’ responsibilities, (2) meeting allowance to reflect time
devotion and meeting attendance, and (3) bonus which is paid in accordance with the shareholder value creation.
The Nomination and Remuneration Committee will endorse the director remuneration for the Board’s
endorsement before seeking the shareholders’ approval on an annual basis. The guidelines are as follows:
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Part 2 Section 9 Management
 Retainer fee and meeting allowance will be set in accordance with peer practices, EGCO operating
performance, business size, and responsibility, knowledge, competencies and experience of the directors as
required by the company.
 Bonus will be considered from the Company’s net profit or dividend paid to shareholders.
In 2011, the Shareholders’ Meeting resolved the directors’ remuneration as shown below:
1. Monthly retainer fee of 30,000 baht and meeting allowance of 10,000 baht each. Members who do not
attend the meeting will not receive the allowance. Chairman and Vice Chairman of the Board received 25%
and 10% additional remuneration for both the retainer fee and the meeting allowance, respectively.
2. 2011 Bonus of 20 million baht, equal to 2010’s approved amount, taking into account the Company’s growth,
the recognition in terms of good corporate governance, the increasing of share price, peers’ director bonus,
and dividend payout ratio. Such bonus payment accounted for 0.29% of the net profit and 0.70% of 2010
annual dividend payment.
3. Remuneration for Board’s Committees being Investment Committee, Audit Committee, Nomination and
Remuneration Committee, and Corporate Governance and Social Responsibility Committee as follows.
Committee
Investment Committee
Audit Committee
Nomination and Remuneration
Committee
Corporate Governance and Social
Responsibility Committee
82
Retainer Fee (baht)
Chairman
Member
Meeting Allowance(baht)
Chairman
Member
25,000
25,000
25,000
20,000
20,000
20,000
25,000
25,000
25,000
20,000
20,000
20,000
-
-
30,000
24,000
Part 2 Section 9 Management
The overall directors’ remuneration for 2011 is summarized below.
No.
1.
2
3
4
5
Name
8
Mr. Pornchai Rujiprapa
Mr. Aswin Kongsiri
Mr. Chaipat Sahasakul
Mr. Thanapich Mulapruk
Mr. Somphot
Kanchanaporn
Police Lieutenant General
Pijarn Jittirat
Mr. Phaiboon
Siripanoosatien
Mr. Surasak Supavitipatana
9
Mr. Kulit Sombatsiri
10
11
Mr. Hideaki Tomiku
Mr. Toshiro Kudama
12
Mr. Akio Matsuzaki
13
Mr. Ryota Sakakibara
14
15
Mr. Vinit Tangnoi/3
Mr. Sahust Pratuknukul/4
6
7.
Appointment Date
No. of months in
service
Meeting
Attendance
(7 Times/Year)
2011
2010
January 1, 2009
April 24, 2009
April 21, 2010
April 24, 2009
April 22, 2010
12
12
12
12
12
12
12
12
12
12
7/7
7/7
7/7
6/7
7/7
April 24, 2009
12
12
7/7
April 21, 2010
12
12
7/7
November 16,
2011
December 13,
2011
April 22, 2010
February 28,
2010
February 28,
2010
February 28,
2010
April 21, 2008
April 22, 2010
2
-
2/2
1
-
1/1
12
10
12
-
6/7
6/6
10
-
4/6
10
-
6/6
12
12
12
8
7/7
7/7
Total Remuneration in 2011
(Monthly Retainer,
Meeting Allowance)
Bonus /2
Standing
Director
Committee /1
Total Remuneration
550,000.00
484,000.00
440,000.00
430,000.00
575,000.00
526,000.00
700,000.00
560,000.00
1,742,140.00
1,533,100.00
1,393,730.00
1,393,730.00
2,867,140.00
2,543,100.00
2,533,730.00
2,383,730.00
440,000.00
560,000.00
1,393,730.00
2,393,730.00
440,000.00
488,000.00
1,393,730.00
2,321,730.00
440,000.00
488,000.00
1,393,730.00
2,321,730.00
65,000.00
50,000.00
0
115,000.00
29,000.00
420,000.00
0
889,333.34
0
1,393,762.49
29,000.00
2,703,095.83
371,000.00
0
0
371,000.00
351,000.00
0
0
351,000.00
371,000.00
110,000.00
330,000.00
380,666.67
100,000.00
360,000.00
0
0
964,000.00
751,666.67
210,000.00
1,654,000.00
The summary of remuneration of Retired and resigned directors during 2010-2011 is as shown below
1
2
3.
4.
5.
6.
7.
Mr. Apichart Dilogsopol
Mr. Wisudhi Srisuphan
Mr. Peter Albert Littlewood
Mr. Mark Jobling
Mr. Shinji Tsuchiya
Mr. Somboon Arayaskul
Mr. Kurujit Nakornthap
Total
/1
April 22, 2010
February 28, 2011
February 23, 2011
February 23, 2011
February 23, 2011
October 1, 2011
December 1,
2011
2
2
2
2
8
9
4
6
6
12
12
12
-
1/1
0/1
1/1
1/1
5/5
5/5
0
67,000.00
52,000.00
62,000.00
62,000.00
320,000.00
333,000.00
0
0
0
154,666.67
0
344,000.00
0
429,730.00
1,393,730.00
1,742,195.00
1,576,675.01
1,576,675.01
1,393,730.00
0
429,730.00
1,460,730.00
1,794,195.00
1,793,341.68
1,638,675.01
2,057,730.00
333,000.00
6,167,000.00
6,175,666.68
20,714,387.51
33,057,054.19
Standing Committees are 1. Investment Committee 2. Audit Committee, 3. Nomination and Remuneration Committee, 5. Corporate
Governance and Social Responsibility Committee.
/2
Bonus for Board of Directors in 2010 was paid in May 2011, as resolved by the Shareholders in the Annual General Meeting
No.1/20101on April 21, 2011
83
Part 2 Section 9 Management
/3
/4
The retainer fee and meeting allowance be paid to Mr. Vinit Tangnoi during October 1, 2011- December 31, 2011 as the director.
The retainer fee and meeting allowance be paid to Mr. Sahust Pratuknukul during April 22, 2010 – September 30, 2011 as the director.
Management’s Remuneration
The Management’s remuneration which comprises both salary and bonus are designed in a way that will reflect
the corporate and individual achievement based on the remuneration structure approved by the Board. EGCO
periodically conducts the survey of the executive remuneration to ensure that the rate is comparable to their work
and those of the peer companies.
The summary of the Management’s remuneration for 2011 as shown below.
(Unit: Baht)
Remuneration
Total Salary
Bonus/3
Meeting Allowance
Total
Executive Director
(1 Person) /1
-
2011
Management
(6 Persons) /2
Total Remuneration
25,858,680.00
10,691,339.24
36,550,019.24
25,858,680.00
10,691,339.24
36,550,019.24
/1
Executive Director is defined as director who is also management of EGCO. In this regard, the President is the executive
director. He is not entitled to the retainer fee or meeting allowance as member of the standing committees.
/2
These included 7 management namely the President, Senior Executive Vice President –Business Development International, Senior Executive Vice President –Business Development –Domestic, Senior Executive Vice President –
Finance & Corporate Services, Director-Rayong Power Plant, two Senior Executive Vice Presidents who are seconded to
be the Managing Directors of KEGCO and ESCO. Since the salaries of MDs of KEGCO and ESCO are paid by those
companies. EGCO is responsible for the remuneration of only four managements.
/3
The 2010 Bonus was paid in January 2011.
Total Remuneration of Core Subsidiaries’ Management
The remuneration of the Management of core subsidiaries (subsidiaries of which the revenue account for more
than 10% of the consolidated revenue (KEGCO and EGCO Cogen) in 2011 is detailed below.
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Part 2 Section 9 Management
(Unit: Baht)
Year 2011
EGCO Cogen
Management
(1 Person) /3
Directors
(7 Persons)
KEGCO
Management
(7 Persons)
Total
Remuneration
Directors
(5 Persons)
Salary
-
15,870,960.00
15,870,960.00
-
1,616,400.00
1,616,400.00
Bonus /1
-
6,048,848.09
6,048,848.09
-
690,845.40
690,845.40
Meeting Allowance /2
Total
-
-
-
-
-
21,919,808.09
21,919,808.09
-
Remuneration
2,307,245.40
Total
Remuneration
2,307,245.40
/1
The 2010 bonus was paid in January 2011.
EGCO was responsible for the meeting allowance of KEGCO Board.
/3
EGCO COGEN Management was assigned from EGCO under the Service Agreement between EGCO and EGCO COGEN.
/2
Other Remuneration
In 2011, EGCO and its core subsidiaries contributed their parts to the provident fund for their respective
Managements as follows.
(Unit : Baht)
Year 2011
Company
Members
6
7
1
EGCO
KEGCO
EGCO Cogen
Provident fund
1,846,368
1,587,096
161,640
6. Employees
EGCO
As of December 31, 2011, EGCO has 268 headcounts which include the President, six Senior Executive Vice
Presidents, six executives who are seconded to be management of Group companies and 256 staffs. The
number of staffs in each reporting line is as show below:
Key Areas
1. President
2. Business Development - International
3. Business Development -Domestic
85
Members (Persons)
26
8
29
Part 2 Section 9 Management
Key Areas
4. Finance and Corporate Services
5. Strategic and Corporate Management
6. Rayong Power Plant
- Operation
- Maintenance
- Others
Total
Members (Persons)
53
15
59
40
38
268
Core Subsidiaries
A. KEGCO
Employees
1. Operation
2. Maintenance
3. Others
Total
Total (person)
KEGCO
67
53
31
151
B. EGCO Cogen
There are three permanent staff members who serve EGCO Cogen. The general manager is assigned from
EGCO under the service agreement between EGCO and EGCO Cogen. The Operation and Maintenance staffs of
31 headcounts are ESCO employees who work under the O&M service agreement between ESCO and EGCO
Cogen.
There has been no significant turnover and no illegal labor dispute during the past three years.
7. Employee Remuneration
EGCO has the policy that the employees in the Group have fair remuneration which is comparable to the peer
companies. Remuneration of employees of EGCO and core subsidiaries in 2010 is as shown below:
86
Part 2 Section 9 Management
(Unit: Baht)
Remuneration
Total Salary
Bonus /3
Provident Fund
Total
/1
/2
/3
Amount
EGCO
KEGCO
246,130,390.06 138,080,699.94
104,766,953.28 62,557,519.73
23,028,613.99 23,947,524.39
373,925,957.33 224,585,744.06
/1
EGCO Cogen/2
2,973,890.00
1,303,337.21
262,409.00
4,539,636.21
Include the salary and bonus of the executives on one year contract.
Include the salary and bonus of the General Manager who is seconded by EGCO and three permanent employees.
The 2010 bonus was paid in January 2011.
8. Human Resource Development Policy
EGCO Group believes in the value of our human resources and will strive to be the employer of choice by
promoting the participative management with equal opportunity for career advancement. Employees are
encouraged to enter the development program to enhance their capabilities to bring out their highest working
potentials to undertake tasks in competent manner and maintain our leadership in the business.
EGCO Group puts high priority on continuous development of the employee's ability and proficiencies which
includes core, functional, and managerial/leadership competencies. In this regard, various projects and training
courses have been developed covering individual studies, training with experts or resource persons, and sharing
of experiences among peers. As a result, we can develop our employees in all dimensions including intelligence
quotient (“IQ”), emotional quotient (“EQ”), moral quotient (“MQ”), and adversity quotient (“AQ”).
To ensure that the implementation of human resource development plan is a successful one, EGCO will prepare
a list of required skill sets for each position as a part of the career path development plan.
9. Other information related to the Board of Directors and Management
In 2011, there were no director and management who were recorded to be prosecuted by the following cases.
 Criminal prosecution, except the violation of traffic rules, minor offence or in respect of the same offence
 Bankruptcy or receivership.
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Part 2 Section 9 Management
Corporate Governance Report for 2011
The Board of Directors (“Board”) believes that the good corporate governance is a significant tool to ensure efficient
and transparent management to foster shareholders’ and investors’ trust. The Board then controls and oversees the
company to conduct the business under the Good Corporate Governance Principles issued by the Stock Exchange
of Thailand (“SET”) and the rules and regulations of Listed Company issued by the Securities and Exchange
Commission (“SEC”) and the Capital Market Supervisory Board (“CMSB”) to continuously raise the governance of
EGCO to international level for efficient management and sustainable business growth.
Corporate Governance Policies
For clarity and transparency, the Board has established the written corporate governance policies as guidelines for
directors, management and employees. The Policies include the statutory rights of shareholders as well as the Best
Practices issued by the SET. The Board annually reviews the good corporate governance policies to ensure
adherence with the following core issues:






Encouraging more understanding of the expectations of stakeholders;
Improving the risk management practices;
Enhancing the reputation of the organization and fostering greater public trust;
Enhancing employee loyalty and morale and improving the safety and health of employees;
Increasing productivity and resource efficiency and reducing waste; and
Contributing to the long term viability of the organization.
Communication of Corporate Governance Policies
The Board discloses the Corporate Governance Policies on EGCO website. Shareholders who want to receive a
hard copy can submit the form attached in the annual report to the Corporate Secretary.
During the past year, the Company communicates the Corporate Governance Policies to its employees via various
channels as follows:
 Good corporate governance E-newsletter was issued every Monday, Wednesday and Friday to communicate
news on good corporate governance, director information and best practices of other companies.
 Three trainings on good corporate governance were provided to the employees. The topics included Dhamma
Seminar on "Corporate Governance” and overall risk management. Good corporate governance was also
included in the orientation presentation kit for new employees.
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Part 2 Section 9 Management
Monitoring of the Compliance with Corporate Governance Policies
The Board requires the compliance with the Corporate Governance Policies as one of the key performance
indicators of EGCO Group of which the progress was monitored on a quarterly basis. In 2011, the Board
endeavored to ensure that directors, Management and employees adopted the above policies as the guiding
principles in discharging their duties. There is no report of any breach to the Corporate Governance Policies.
Based on the above commitment, EGCO is well recognized as an excellent showcase of good corporate
governance companies by various institutions.
 10th best listed companies in Thailand and 4th best public companies in energy and utility sector in a poll
conducted by Finance and Banking Magazine;
 5th best public company on net margin in a poll conducted by Money and Banking Magazine;
 An excellent showcase for shareholder meeting with the full score of 100 in the quality assessment of 2011
Annual General Shareholders’ Meeting organized by the Thai Investors Association;
 Top Corporate Governance Report Award and Corporate Social Responsibility Award for listed company with
the market capitalization over 10,000 million baht from the SET Awards hosted by the Stock Exchange of
Thailand (“SET”) and the Finance and Banking Magazine;
 Excellent Corporate Governance Performance in 2010 by IOD with the score of 96 out of 100 and full score in
three categories being the rights of shareholders and role of stakeholders; and disclosure and transparency;
 “Board of Directors for Exemplary Practices” for 2010-2011, “Board with Consistent Best Practice” and “Audit
Committee of the Year” in a contest organized by the Thai Institute of Directors, SET, the Thai Chamber of
Commerce, the Federation of Thai Industries, the Thai Bankers’ Association, the Listed Companies Association
and the Federation of Thai Capital Market Organizations
The SET asks listed companies to adopt the SET’s Good Corporate Governance Principles for year 2006 as
deemed appropriate and to notify with reasons and substitute measures/ actions to the SET for items which cannot
be complied. The Board then prepares this report accordingly.
1. Rights of Shareholders
EGCO realizes the importance of Good Corporate Governance and respects the shareholders’ rights as an investor
and an owner of the Company based on acceptable and reliable standard. In this respect, EGCO encourages the
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Part 2 Section 9 Management
shareholders to exercise their rights including legal basic rights. Examples are the right to share in the profit, the
right to receive adequate information, and the right to attend and vote for significant matters at the shareholders’
meeting such as appointment or removal of directors, remuneration of directors, appointment of auditor, auditors’
remuneration and other significant issues which impact EGCO.
Beyond such basic rights, EGCO endeavors to provide significant information to shareholders via the website,
newsletters and shareholders’ site visit.
1.1 Shareholders’ Meeting
The Board ensures that the processes and procedures of the Shareholders’ Annual General Meeting (“AGM”)
accommodate the shareholders to take part in EGCO’s governance. The AGM should be held within 4 months
after the end of fiscal year. In 2011, EGCO held an AGM on April 21, 2011. With respect to this, the AGM
Checklist issued by the Thai Investors Association, Listed Companies Association and SEC is used as the
guidelines. Details are as follows.
Before the Shareholders’ Meeting
EGCO prepares and delivers the notice of the meeting as well as supporting documents in advance so that
shareholders will have adequate information to support their judgments. The Board also encourages shareholders
to attend the meeting either in persons or by proxy. The practices in 2009 were as follows.

EGCO disclosed the schedule and the agenda of the AGM via the SET’s Community Portal system and
EGCO website on February 28, 2011, which was 52 days in advance of the AGM date.

EGCO delivered the notices of the meeting as well as the agenda document on March 18, 2011, which was
33 days before the AGM date. The notices included the objectives, Board’s opinions, and conditions to attend
the meeting. Similarly, at least three days ahead of each meeting, the invitation was announced through one
Thai and one English newspaper, each for three days, to allow the shareholders enough time to prepare
themselves for the meeting. All relevant information was posted on EGCO’s website to facilitate shareholders
to study the information in advance before receiving the hard copies. Contact phone number was also
provided for any relating inquiries.

EGCO joined hands with the Thailand Securities Depository Co., Ltd (“TSD”) to invite shareholders to notify
the intention to attend the shareholder’s AGM in advance via IVR system so that EGCO would provide
adequate facilities to accommodate shareholders.

EGCO encouraged shareholders to forward their questions with regard to the meeting agenda in advance to
directors@egco.com or facsimile number 0-2955-0956-7 in order that the shareholders could gain the utmost
benefits from the meeting and that their rights would be fully observed.
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Part 2 Section 9 Management
On Shareholders’ Meeting Date
EGCO ensures that the meeting is conducted in a way that is convenient and transparent as well as encouraging
shareholders for open discussion on EGCO business. The practices in 2011 were as follows:
 Directors, Management and the external auditor were encouraged to attend the AGM and answer
shareholders’ questions. All the fifteen directors including the Chairman attended the meeting which
accounted for 100% of the Board members. The chairman and members of each standing committee also
presented information to shareholders and answer shareholders’ questions.
 Services to facilitate shareholders who attended the meeting were provided. Map for meeting venue was
attached in the notice to the AGM. There was the shuttle service at the parking area at MRT station and the
entrance of the meeting venue for shareholders.
 Management, Investor Relation and Accounting Officers welcomed shareholders to the meeting and answered
their inquiries about EGCO business at the mini-exhibition and shareholder corner in front of the meeting hall.
 An officer from TSD, the company registrar, provided the shareholder services and answered questions
regarding dividend cheque and share registration and certificates in front of the meeting room.
 The barcode system was implemented to facilitate shareholders’ registration process.
 The shareholders who came late were allowed to vote for the ongoing agenda item and the remaining
agenda items.
 The Chairman convened the meeting in accordance with the priority notified in the agenda document.
Presentation for each agenda item included the background, supporting rationale and proposal.
 The meeting was broadcasted via closed circuit television so that shareholders who were outside the meeting
room could follow up the meeting proceedings.
 Shareholders were equitably treated and were allowed adequate time to address their concerns at the
meeting. The Chairman paid attention to clarify all shareholders’ inquiries of which the questions and the
clarifications were recorded in the minutes of meeting.
 PricewaterhouseCoopers Legal & Tax Consultants Ltd., (“PwCLT”) were engaged as the inspectors to look
over registration documents, meeting quorum, compliance of the voting procedure with EGCO Articles of
Association and the Chairman’s notification, voting card collection and vote counting. In this regard, PwCLT
reported that the meeting and the voting procedure of 2009 AGM was transparent and in compliance with the
governing laws and the Articles of Association.
 The form to assess the quality of the AGM was disseminated to gather feedbacks for future improvement.
The result of the survey in 2009 indicated that shareholders were satisfied with the quality of the notice to the
meeting, meeting arrangement and meeting conduct.
There were 411 and 544 shareholders attending the 2011 AGM in person and by proxy, respectively, representing
395,885,697 shares which accounted for 75.577% of the total units of shares. The attendance rate was
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Part 2 Section 9 Management
approximately the same as that of 2010 AGM in which 485 and 576 shareholders attended the meeting in person
and by proxy, respectively, representing 410,811,147 shares which accounted for 78.032% of the total units of
shares.
After the Shareholders’ Meeting
 EGCO posted the draft minutes of the meeting for shareholders’ review on EGCO website “www.egco.com”
on May 6, 2011 which was within 14 days after the meeting date (April 21, 2011) as required by the SET.
The minutes of meeting had included the significant matter of each agenda items, shareholders’ inquiries and
answers by the Board including the resolution and the voting for each proposal. The minutes of meeting was
duly filed for future reference.
 EGCO broadcasted on its web site that shareholders who could not attend the meeting could request for CD
of the meeting for free of charge.
 EGCO notified the meeting resolution on dividend payment via SET’s portal. EGCO also coordinated with the
registrar to ensure that all the shareholders would receive the dividend.
 EGCO took all the recommendations of the shareholders for consideration and improvement of the AGM.
As a result of the above efforts, EGCO was honored as an excellent showcase for AGM of listed companies with
the full score of 100 for three consecutive years.
1.2 Shareholders’ Visit
The Board sets the principle to invite shareholders to visit the Company and meet the management to better
understand EGCO business and monitor EGCO’s performance. In 2011, there are seven shareholders’ visits as
follows:



Shareholders’ visit to Kaeng Khoi Power Plant in Saraburi province (2 times),
Analysts’ and investors’ visit to Solar Power Plant in Lopburi (2 times), and
Investors’ and analysts’ visit to One Watershed Forest, One Energy Source project (3 times).
2. Equitable Treatment of Shareholders
2.1 Fair Treatment
The Board regularly reviews the governance structure and framework to ensure that the shareholders, including
minority and foreign shareholders, are treated equitably and that EGCO procedures do not make it unduly difficult
or expensive to observe shareholders’ rights. The Board encourages shareholders to take part in EGCO’s
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Part 2 Section 9 Management
governance and ensures that they are well informed about the significant decisions of EGCO as prescribed by
laws and the Articles of Association.






EGCO strictly follows its policy not to raise any agenda items which had not been submitted to the
shareholders in advance, to make sure that other shareholders would have a great deal of time to study
relevant information before making their decision. Every shareholder has a right to cast vote according to
their numbers of shares on “a one share one vote” basis. EGCO has never granted a privilege for some
specific shares which limits the rights of other shareholders.
To adhere to the best practice as recommended by the SET regarding the right of minority shareholders,
EGCO announced via EGCO’s website and the SET’s portal the clear and transparent procedures for
shareholders to recommend AGM agenda and to nominate director candidates to the Board during the
period of November 2, 2010-January 17, 2011 (about 60 days before the AGM date). The shareholders
who would like to propose the agenda or director candidates should hold not less than 100,000 shares
which are lower than the SET’s recommended practice of holding not less than 0.5% of the total voting
rights of the company. In 2011, no minor shareholders recommended AGM agenda nor nominate director
candidates in advance. (Remarks: The Board of Directors in the meeting on August 22, 2011 resolved to
offer minority shareholders the right to recommend agenda and questions for 2012 AGM along with the
director nominees to EGCO during the period of September 1- December 31, 2011 in accordance with the
criteria that the minority shareholders who were entitled to such right should hold the minimum shares of
0.05% of the total outstanding shares (equivalent to 263,230 shares as at September 1, 2011)).
Voting cards were provided for all agenda items for transparency and audit trail. Director election also
allowed shareholders to vote on individual nominees.
Shareholders who could not attend in person could vote by proxy. The three proxy forms as introduced by
Department of Business Development, Ministry of Commerce were provided which included the form that
allowed the shareholders to direct the voting. Three independent directors who did not have the conflict of
interests with the AGM agenda were offered as volunteer proxies. In a bid to facilitate the shareholders, the
proxy forms could be downloaded from EGCO’s website.
Since most of the shareholders attending the meeting were Thai, the meeting was conducted in Thai.
However, to facilitate foreign shareholders, EGCO prepared the notice of meeting in both Thai and English.
English interpreting service was also provided at the meeting room.
With the awareness that some shareholders might not be able to read the minutes of meeting on the SET’s
and EGCO’s website, a hard copy of the minutes of meeting no. 1/2011 were delivered to each shareholder
for review.
2.2 Prohibition of Abusive Conduct by Insiders
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Part 2 Section 9 Management
EGCO has set up the written guidelines in the Code of Conduct for Directors and employees to prohibit improper
insider trading and abusive conduct by insiders to ensure fairness to all shareholders.
Directors

Directors must not make improper use of information acquired by virtue of the directors’ position.

Directors must not disclose matters such as trade secrets, or sensitive business information to outsiders.

Directors must not buy or sell shares as a director of EGCO while in possession of information, which, if
disclosed publicly, would be likely to materially affect EGCO share price.

Directors must not provide to anyone any information which is not publicly available and which would have a
material effect on the price or value of EGCO’s securities.
Employees

Employees shall at all times observe the rules and regulations issued by the SET, the SEC and other
governing laws which include the equitable disclosure to shareholders and the public.

Any information disclosure to the public that will affect the business and EGCO’s stock must be approved by
the President. Only the President or the assigned staff member is authorized to disclose such information.

The Corporate Communications Division, the Corporate Secretary Division and the Investor Relations Section
are responsible for disclosing EGCO information to the public while it is the responsibility of the information
owner to provide the fact sheets.
EGCO also sets the policy that Management and employees who have the inside information relating to financial
statements should refrain from their own security trading within 45 days before and 24 hours after a disclosure
date. For other significant inside information, Management and employees should refrain from security trading
from the day of acknowledgement until 24 hours after disclosure to public. In addition, EGCO has put in place the
internal control system to prevent the leakage of any information before the public disclosure. Such measure was
a part of significant risk management. Supervisors also have the responsibility to ensure that the measure to
safeguard inside information is effective. Using inside information for own or other benefits of security trading
when that information has not made public is considered violating the Code of Conduct.
2.3 Disclosure of Directors and Management’s Interest in EGCO’s Business
The Board sets the guidelines that directors and Management discloses to the Board whether they have a
material interest in any transaction or matter affecting EGCO to ensure transparency and to prevent conflicts of
interest.
 Directors will promptly notify EGCO when they or their family member is a partner or shareholder of any entity
which may incur benefits or conflicts of interest with EGCO, acquire a direct or indirect interest in any contract
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Part 2 Section 9 Management
made with EGCO or hold shares or debentures of EGCO or any affiliate. Directors or management with
potential conflict of interest shall refrain from discussing and voting on such agenda item.
 Directors and Management should disclose to the Board their securities holdings at every Board meeting.
There is also a statement informing directors at every meeting that directors, management including their
spouses, minor children and related persons under Section 258 of the Securities and Exchange Act have a
responsibility to prepare and disclose any change in shareholding of the Company to the SEC within three
days.
In 2011, the Board also sets the policy for directors and management including related persons to report their
interest in the Company to comply with the Notification of the CMSB no. Tor Jor 2/2009 as follows:
1. Directors and executives should submit the form to report their interest to the Corporate Secretary on a
quarterly basis.
2. In case of any change during the quarter, the updated form should be submitted to the Corporate Secretary
as soon as possible.
3. The Corporate Secretary shall submit the form to the Chairman and the Chairman of the Audit Committee
within 7 days after getting such report.
In 2011, the Board did not get any complaints for not respecting shareholders’ rights or any accusation regarding
director’ and Management’s insider trading. This shows the efficient control of the Board on such matter.
3. Role of Stakeholders
3.1 Rights of Stakeholders
Apart from observing the rights of the shareholders, the Board takes due regard of and deal fairly with various
stakeholders and encourages active cooperation with them which include both business and corporate social
responsibility matters. The Board has set up the guidelines to respond to the requirements of each stakeholder in
the Corporate Governance Principle and “EGCO Group’s Code of Conduct” with the expectations that directors,
Management and employees shall be guided by those principles in discharging their duties.
Employees
EGCO believes in the value of its human resources and will strive to be the employer of choice. This is achieved
by promoting the participative management, supporting the employees’ professional development and providing
fair remuneration and suitable benefit scheme. EGCO strives to prevent accident, injury and occupational
illnesses. Physical check up was provided in accordance with the occupational health risks.
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It should be noted that during the past year, there was no legal dispute between the employees and EGCO. In
addition, there was no disabling injury in all subsidiaries. EGCO is proud to announce that the Rayong Electricity
Generating Co., Ltd. (“Rayong”) and the Khanom Electricity Generating Co., Ltd. (“KEGCO”) have been certified
the OHSAS 18001 : 1999 (Occupational Health and Safety Assessment Series) by RWTUV (Thailand) and
KEGCO has been honored the National Distinguished Workplace in terms of Safety, Occupational Health and
Environment for 12 years consecutively.
Customers
EGCO always commits to provide good quality and reliable services in accordance with the agreements with
EGAT and all customers. To ensure consistent quality service, the ISO 9001:2008 has been implemented at
Rayong, KEGCO, Roi-Et Green Co., Ltd. and Egcom Tara Co., Ltd.
During the past year, EGCO and its subsidiaries could generate the contracted electricity with higher equivalent
availability factors (“EAF”) than the value stipulated in the power purchase agreement. Rayong also made a
superior record in being awarded the EAF bonus for 15 years consecutively. EGCO also prepared our power
plant to meet any system emergency. It was notable that Rayong Power Plant could quickly execute the
restoration plan in case of brown out using black start emergency diesel in order to power up the eastern region.
Creditors
EGCO will endeavor to ensure that it complies with the loan provision and that the Company financial status is
correctly disclosed.
During the past year, EGCO and all the subsidiaries well observed the conditions in the loan agreement and there
was no event of default.
Suppliers and Contractors
EGCO will treat suppliers and contractors fairly and would not seek undue benefit from them. EGCO will comply
with the conditions in the agreements. In addition, EGCO aims at developing and securing sustainable
relationship with suppliers and contractors on the bases of value for money, technical conformance and mutual
trust.
Competitors
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EGCO will conduct its business on a fair play basis. We will not use a disgraceful approach such as bribery in
order to get competitors’ sensitive confidential information. EGCO will also refrain from attacking the competitors
with false allegations.
Community, Society and Environment
EGCO operates the business with commitment to social contribution and environment conservation. In this regard,
EGCO will foster the corporate culture that employees at all levels will be fully responsible for any social and
environment impact when discharging their duties. EGCO also sets guidelines in the Code of Conduct that
employees must deliver their duties in a safe manner to avoid any impact on themselves as well as people living
and working in communities near our facilities, and the environment. Our employees will strive to comply with
relevant laws, prevent accident and pollution, and will use the natural resources in an efficient and
environmentally responsible manner.
In addition, EGCO has implemented the social projects which cover the following area:
 Promotion and Development of Community's “Quality of Life”: EGCO Group will put the prime focus on the
quality of life of the surrounding communities both at the head office and at the power plants. In this regard,
EGCO has initiated and provided supports to projects relating to education, villagers’ occupation and
environment.
 Conservation of “Watershed Forest: Source of Life”: Apart from taking care of the working environment and
surrounding communities, EGCO Group plays a vital role in conserving the natural resources with the focus
on watershed forests, which nourish the well-being of all lives.
 Promotion of Learning and fostering a Public Mindedness among “Youths” for Sustainable Social
Development: We recognize that education is the key to national development. With the awareness that
development starts from early childhood, EGCO has supported the projects to encourage youths from preelementary, elementary to high school level to learn from both inside and outside the classroom to children.
We believe that such learning is the starting point for social and moral quotient, essential factors for long term
national development.
In 2011, EGCO set up the Corporate Governance and Social Responsibility Committee with the responsibility to
endorse the governance policy along with CSR policy and framework with the prime focus on the impact to the
shareholders and stakeholders. EGCO also prepare the CSR action plan comprising the plan on safety,
occupational health, and working environment, and community projects. Details were presented in the
Sustainability Development report.
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It should be noted that in 2010 there was no claim against EGCO from the stakeholders. Detailed information on
Corporate Social Responsibility is presented in the Stakeholders’ report.
3.2 Observation of Human Rights
EGCO requires that its directors, management and employees fully observe the following human rights.
 EGCO will treat our employees with respect and honor.
 EGCO will provide a communication channel for employees to submit questions and complaints relating to
work which we will seriously consider and remedy the problem to benefit and to promote good relations
among all concerned parties.
 EGCO encourages all employees to exercise their rights of citizenship in accordance with the constitution and
relevant laws.
 Employees’ personal information shall be kept with utmost discretion and confidentiality. Disclosure of
personal information such as employee’ biodata, health record, working experience or any other personal
information to non-related party without the permission of such employee is considered a violation of the
Code of Conduct and may result in a range of disciplinary action except when it is done in accordance with
the Company’s regulations or legal requirements.
 EGCO did not support the violation of human rights and frauds.
 Employees must refrain from any deliberate discrimination or harassment in word or action against others
based on the basis of race, gender, religion, age, and physical or mental disability.
EGCO also set clear guidelines for labor engagement of the Company and its business partners to strictly comply
with the Labor Act such as no engagement of child labor or abusive hiring. In addition, the working system is
designed to put priority on safety and occupational health. There has never been any report on the violation of
human rights by EGCO.
3.3 Intellectual Property
EGCO will comply with the legal requirements on intellectual property and copy rights. Employees must check
beforehand that the work or information that belongs to third parties can be used within EGCO Group without
violating the intellectual property of others.
3.4 Measures against Corruption and Bribery
EGCO set the policy to work against corruption and bribery. In this regard, EGCO Code of Conduct prescribes
that employees are prohibited from soliciting or accepting any advantage from third parties that may impair their
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objectivity or weaken their ability to promote the best interests of EGCO Group. Employees shall refrain from
offering the advantage to outside persons as a motive for him to do or refrain from doing any illegal and wrongful
act.
On November 9, 2010, EGCO joined the project on Collective Action Coalition to fight against corruption in the
private sector. Such coalition was initiated by the IOD, the Thai Chamber of Commerce, international chambers of
commerce and Thai Listed Companies Association. Such project was national project being supported by the
government and the Office of the National Anti-Corruption Commission.
3.5 Responsibility towards Environment and Resources
EGCO Group endeavors to optimize the usage of natural resources, taking into account the impacts on the
environment. In this regard, EGCO has monitored the situation and set the measures to alleviate such impacts. In
addition, Rayong and Khanom power plants have implemented ISO 14001 : 2004 environment management
system and the TIS 18001:1999 & OHSAS 18001 : 2007 Occupational Health and Safety Management System.
EGCO Group also factors in the following activities to ensure that EGCO business has taken into account the
social and environment issues for sustainable development.
 Preparing the investment plan with fuel diversification as part of the agenda to reduce the risk of heavy
dependence on only one type of fuel. At present, EGCO is the IPP with the most diversified fuel types in
Thailand.
 Investing in renewable projects to alleviate global warming and decrease the fossil fuel import.
 Operating business with environment concern and strict adherence to relevant laws and regulations including
the regulations of local administrative agencies.
 Supporting economic and social development while respecting the local tradition and culture. EGCO will
support the government policy and take a good care of communities surrounding the power plants so that
they will not only be protected from the negative impact of EGCO business, but will also have a better quality
of life.
3.6 Channel to Direct Corporate Issues to the Board of Directors and Corporate Secretary
To increase the corporate value, the stakeholders can direct their recommendations and concerns on corporate
issues to EGCO at the following address.
Board of Directors
Audit Committee
Corporate Secretary
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Electronic mail
directors@egco.com
auditcommittee@egco.com
cs@egco.com
Telephone numbers
0 2998 5021-5
Part 2 Section 9 Management
Corporate
Communications
Investor Relations
corp_com@egco.com
0 2998 5131-3
ir@egco.com
0 2998 5145-8
The mailing address is Electricity Generating Public Company Limited, EGCO Tower, 222 Moo 5, Vibhavadi
Rangsit Road, Tungsonghong, Laksi, Bangkok 10210.
The Corporate Secretary will be responsible for forwarding communications directed to the Board to the standing
committee or relating directors. The Corporate Secretary will summarize all directors’ communications received
during the most recent quarter to the Board, except for mails addressed to the Audit Committee which would be
directly forwarded to the Audit Committee without screening. Also, for the electronic mails addressed to the
auditcommittee@egco.com, Chairman of the Audit Committee would open them by himself.
3.7 Whistleblower System and Whistleblower Protection
The Board has set the channels for whistle blower programs at both management and director levels. For
management channel, the report on any suspected violation or crime shall be made to the supervisor and the
Good Corporate Governance Committee. For the Board’s channel, such report can be directed to either the Board
or the Audit Committee. It is the responsibility of the management to coach employees to meet their
responsibilities under the requirements of relevant laws and regulations. Failure to observe the Code of Conduct
will result in a range of disciplinary actions. The procedure to protect the whistleblower is also put in place. For
example, information will be kept confidential and will be known only among responsible parties. The
whistleblowers can identify themselves or can keep their identities anonymous. However, they must provide
adequate information for the Company to investigate the claims.
In 2011, EGCO was honored the CSR Award for listed company with the market capitalization over 10,000 million
baht from the 2011 SET Awards. In addition, Group companies also won the following awards.
 KEGCO won the National Safety Awards for 2009” for 12 consecutive years and Outstanding Achievement on
Labor Relations and Welfare” for 5 consecutive years.
 Roi Et Green Co., Ltd won the national Safety Award” for the second year.
 EGCOM Tara Co., Ltd. was presented the Certificate for Quality of Drinking Water for 9 consecutive years,
Certificate audit for Environment Management System: EMS Stage II by Ministry of Industry, and excellent
healthy workplace for 5 consecutive years.
4. Disclosure and Transparency
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4.1 Information Disclosure
Being aware of the impact of EGCO’s information on the decision of investors and stakeholders, the Board set a
policy to disclose material information in a timely and transparent manner in accordance with the requirements of
the SEC and SET via the following channels:
1. SET’s Community Portal system and SEC;
2. Public channels such as newspapers, magazines, television, and corporate news;
3. Company’s web site at www.egco.com both in Thai and English;
4. Company’s visits;
5. Road shows for both domestic and overseas investors;
6. Analyst meetings; and
7. EGCO news via post
EGCO has established a Disclosure Committee comprising President, Senior Executive Vice President-Finance
and Corporate Services, Senior Executive Vice President-Business Development- Domestic, Senior Executive
Vice President-Business Development- International, Senior Vice President-Corporate Secretary, Senior Vice
President- Corporate Communication and Vice-President-Investor Relations. The meetings are called on quarterly
basis in order to set communication plan, review disclosure policy, and prepare significant disclosure to ensure
that the information is correct and efficiently communicated.
Investor Relations
Investor Relations is responsible for communication with institutional and individual investors, and analysts on an
equitable basis. In this regard, annual Investor relations plan is prepared.
EGCO puts priority on sharing information via investor relations activities. Senior management always takes parts
in providing information to investors and analysts to create understanding on the Company, promote the
relationship, and encourage them to provide the feedback to the Company. Significant activities in 2011 included
meeting investors in 2011 Thailand Focus. Two trips were arranged for investors’ and shareholders’ visits to
Kaeng Khoi 2 Power Plant in Saraburi Province. EGCO also hosted three trips for analysts and institutional
investors to visit the “one watershed forest, one source of energy” project and two briefings and site visits the
Solar Power Plant in Lopburi. Besides, there were four analyst meetings in Thailand, three overseas road shows
to Hong Kong and Singapore. On top of that, there are newsletters and electronic mails. For those that cannot
join the investor relations activities, EGCO has posted the presentations, operating results, financial statements
and notice to the SET on our web sites.
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Corporate Communications
The Corporate Communications Division is responsible for communicating the movement of the Company to
media for public disclosures. Major events in 2011 included 3 press conferences on corporate results and
directions, 6 media trips, 12 executive Interview and 26 pieces of press releases.
Corporate Secretary
The Corporate Secretary discloses information as required by the SET and SEC on a correct and transparent
basis. In 2011, 20 notifications were submitted to the SET.
EGCO always updates the information on EGCO website. Quality of the disclosure was assessed after every
meeting with shareholders, investors and analysts for future improvement. In addition, EGCO also attached the
feedback form for shareholders to provide feedback on the quality of the annual report, additional document
required, and questions for the President to answer in the next AGM in the annual report and the notice to the
AGM. Such feedback form was well received by shareholders.
4.2 Financial Statement Preparation
EGCO aims at fostering the stakeholders’ confidence that EGCO’s financial reports are accurate, complete and
transparent in line with the generally accepted accounting standards to protect EGCO assets against fraud or
abnormalities. In this regard, the Board has entrusted the Audit Committee to assume key duties and
responsibilities of reviewing the financial statements to ensure its correctness and adequacy and compliance with
the accounting standards and relevant regulation. The Audit Committee sets the policy to have a nonmanagement meeting with the auditor at least once a year to ask questions and discuss with them about various
significant issues. Apart from disclosing the Auditor Report in the annual report, the Board also prepares the
report on Board of Directors’ Responsibilities on Financial Statements which covers important topics as prescribed
in the SET’s Best Practices for Directors of Listed Companies. In 2011, EGCO appointed auditors from
PricewaterhouseCoopers ABAS Limited as the Company’s auditor given that they had professional knowledge
and had no conflicts of interest to defect their independent judgment. This was aimed at fostering the Board’s and
shareholders’ trust that EGCO’s financial statements truly reflected the actual financial status and operating result.
EGCO also prepares the report on Management Discussion and Analysis to provide analytic information on the
Company’s financial status, operating results and major changes to investors and analysts on a quarterly basis.
Such report is submitted via SET’s portal along with the Company’s financial statements.
4.3 Information Disclosure on EGCO Website
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In order that shareholders and investors can quickly search and retrieve EGCO’s public information, EGCO
presented the following information on the website.
1. Corporate profile comprising history, vision and mission, organization structure;
2. Corporate governance comprising corporate governance principle, board of directors, board committees,
senior management;
3. Investor Relations comprising financial information, shareholder information, analyst information, investor
calendar;
4. Corporate information comprising brand information and press center; and
5. Corporate social responsibility comprising information about EGCO social contribution activities.
Investors can visit EGCO website at www.egco.com
It should be noted that SEC has never demanded EGCO to re-state the financial statements. In addition, the
quarterly and annual financial statements are disclosed before the deadline.
5. Responsibilities of the Board
5.1 Board’s structure
Structure and Composition
Currently, the Board comprises not less than 5 directors and not more than 15 directors as stipulated in the
Articles of Associations. The number of the directors will be reviewed periodically. The change in number of
directors requires the shareholders’ approval with the four-fifth majority votes of shareholders who attend the
meeting and have the rights to vote.
As at January 31, 2011, the Board comprised 15 directors, 14 of whom were outside directors which accounted
for 93% of the Board. From these outside directors, 6 were qualified as independent directors which accounted
for 40% of the total directors.
The Nomination and Remuneration Committee is entrusted to select and recommend prospective nominees,
whether they are to become the shareholders’ representatives or independent directors. The Nomination and
Remuneration Committee is also responsible for assessing the appropriate mix of skills and characteristics
required of Board members in the context of the needs of the Board at a given point in time and shall periodically
review and update the criteria as deemed necessary. The Board views that the existing structure and composition
of the Board which comprises directors with 100% in male and the background in engineering, economics and
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finance, and laws and political science at the ratio of 40%, 33.33%, and 26.67% respectively, was appropriate
with useful mix of skills and experience and an appropriate balance of power.
Term and Age Limit
One third of the directors shall retire by rotation at the AGM as prescribed in the Public Limited Company Act B.E.
2535 The Board views that there should not be limit on the number of terms a director may serve. Term limits
may cause the loss of experience and expertise important to the optimal operation of the Board. However, to
ensure that the Board remains composed of high functioning members able to keep the commitments to Board
service, the Nomination and Remuneration Committee will evaluate the qualifications and performance of each
incumbent director before recommending the nomination of that director for an additional term. On the other hand,
the age limit policy is imposed that director candidates cannot stand for election after age 72. Given such age
limit on the election date, directors will be able to serve on the Board until the expiry of their terms.
Chairman
The Board elected Mr. Pornchai Rujiprapa, a representative director of EGAT, as the Chairman because of his
knowledge in energy sector together with his leadership to lead EGCO to achieve the corporate vision and
mission. Although the Chairman is not an independent director, the Board remains independent and objective due
to the following mechanisms:
1. The Chairman is a non-executive director, is not the same person as the President and has no relations
with the management. His authorities are separate from those of the President, and there is a clear
distinction between supervisory policy-making and day-to-day business administrative roles. The
Chairman takes the role of the leader and assures that the Board’s meetings are efficiently conducted by
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2.
3.
4.
5.
encouraging involvement by all directors and providing recommendations to Management via the
President. The Board will not intervene with any routine activities under the President’s responsibilities;
The Chairman is not an EGAT’s employee but is entrusted by the State to be on EGAT Board of
Directors to protect the national benefits. The Board believes that the Chairman will act in the best
interest of all shareholders and stakeholders;
The Board is mostly comprised of non-executive directors and the Board’s seats are allocated in
accordance with the shareholding in the Company comprising 4 EGAT representative directors, 4 TEPDIA
Generating B.V. (“TEPDIA”) representative directors, and 6 independent directors which indicates a
proper balance of power;
The Board has appointed the Vice Chairman who is an independent director to work with the Chairman in
setting and scrutinizing the meeting agenda and the time allocation for each agenda item; and
The Board has assigned Board committees to oversee tasks where there may be a potential for conflict
of interest and to balance the need of each stakeholder. With respect to this, the Audit Committee is
entrusted for oversight of the integrity of financial and non-financial reporting and review and management
of related party transaction. The Nomination and Remuneration Committee is assigned to take care of
selection of Board members and key executives and their remuneration.
The result of the Board’s performance appraisal in 2011 indicates that the Chairman is effective in leading the
meeting and encouraging directors to participate in the debate around the Board table.
Independent Director
There are six independent directors on Board which is larger than one/third of the whole Board. Independent
directors set up the policy to call meetings as needed. In 2011, there was an independent director meeting to
discuss and exchange their views regarding the corporate governance and interesting issues and the result was
reported to the Board.
Segregation of Duties
There is a segregation of duties between policy making, which is the responsibility of the Board and routine
business, which is the responsibility of the Management. In this regard, the Table of Authority has been prepared
and approved by the Board. The Board will not intervene with any routine activities under the President’s
responsibilities.
Policy and the Procedure for Other Positions of Directors and Management
To ensure that the Board will be able to devote time for the efficient governance of EGCO, the Board agrees that
a director should not serve more than 4 companies if being executive director and 6 companies if being non-
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executive director. Currently, there is not any director who serves more than 6 companies. The Board has already
taken into account his meeting attendance as one of the criteria for his re-election.
Corporate Secretary
The Board has appointed Ms. Busakorn Kakanumpornwong as the Corporate Secretary with the duty and
responsibility as prescribes in the Securities and Exchange Act (No. 4) B.E. 2551. Ms. Busakorn also serves as
the Board secretary to handle functions to assist the Board as well as to coordinate subsequent actions under the
Board’s resolution.
 To provide primary advice pertaining to EGCO’s regulations and Articles of Associations, and to monitor to
ensure regulatory compliance on a regular basis, and report any significant changes to the directors;
 To arrange meetings of shareholders and the Board in accordance with the laws and regulations, including
EGCO’s articles of associations and procedures;
 To prepare meeting minutes of shareholders and the Board of Directors, and to monitor to ensure compliance
with resolutions of shareholders’ and Board meetings;
 To ensure that corporate information disclosure to regulatory agencies is in accordance with the laws and the
SEC’s and SET’s regulations;
 To inform general shareholders of their legitimate rights including EGCO’s news;
 To facilitate the Board activities including director orientation; and
 To file and keep record of EGCO’s paper such as directors’ registration, notice to the meeting, minutes of
meetings, annual reports, notice to shareholders’ meetings, shareholders’ minutes of meetings and reports on
directors’ and management’ interest.
In 2011, the Corporate Secretary attended seminars and provided opinion on the hearings hosted by the list
company regulators so that information should be used to enhance the efficiency of corporate governance.
5.2 Board’s Standing Committees
With the objective to enhance the governance efficiency, the Board assigns directors with knowledge and
expertise to be the members of the Board committees namely Audit Committee, Investment Committee,
Nomination and Remuneration Committee, and Corporate Social Responsibility Committee.
Each Board committee has its own charter which prescribes functions, composition, term of office, responsibilities
and meeting conduct. The committee’s charter, which is approved by the Board, will be reviewed as deemed
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appropriate. Each committee can retain outside counsels, experts and professional advisors, as deems
appropriate at EGCO’s expense. The committees will report their meeting results to the Board.
The Audit Committee comprises 3 independent directors. The Audit Committee’s mission covers the review of
the financial statements, legal compliance, risk management policy, internal control and appointment of auditor.
The Audit Committee also reviews the connected transaction or transaction with conflicts of interest to ensure that
such transaction is in compliant with the SET’s requirement, well-grounded and will be for the best interest of
EGCO.
The Nomination and Remuneration Committee comprises 5 non-executive directors, three of whom are
independent. The Nomination and Remuneration Committee members appointed Mr. Hideaki Tomiku, a
representative director from TEPDIA as the Chairman of the Committee as he has a wealth of experience in
policy implementation, human resources management and governance management. The Board trusts that
regardless of whom the Committee Chairman is represented, the Nomination and Remuneration Committee has
the appropriate process and mechanisms to mandate transparent procedure of (1) recruitment of directors and
Management in line with the best practices taking into account the recommendations from all shareholders; and
(2) transparent and clear guidelines for remunerating directors and Management at a rate comparable to those of
the peer companies and aligned with the long term benefit of EGCO and the shareholders.
The Investment Committee comprises 5 directors and has the responsibility to screen and endorse for the Board’s
consideration the Management’s proposals especially on the investments, funding and relating activities. Exception is
made for medium and small sized investment where the Investment Committee can approve business decision with
subsequent acknowledgement by the Board. Since this Committee is delegated to approve business decision within its
delegated authority, the Chairman of the Board is appointed the Chairman of the Investment Committee. He has proven to
be efficient chairman who conducts the meeting efficiently and be attentive to other members’ recommendations both at
the Board’s and the committee’s meeting. It should be noted that the Investment Committee was established in 2010.
The Corporate Governance and Social Responsibility Committee comprises 3 members being one non-executive director
and the President. The Chairman of the Committee shall be independent director. The Corporate Governance and Social
Responsibility Committee has the responsibility to endorse the corporate governance principle and the positions and
practices on issues of corporate social responsibilities, principally in relation to social and environmental matters that
affect shareholders and other key stakeholders.
The structure and duties and responsibilities of each Board committee as well as the number of meetings are reported in
the other article on “Shareholding and Management Structure”.
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5.3 Role and Responsibility of the Board of Directors
Duty and Responsibilities
The Board members well understand their role and responsibilities including the business of the Company. They
well serve the Company with honesty and prudent judgments for the utmost benefit of the Company and the
fairness to all shareholders. The Board has exercised independent judgment and devoted time in discharging their
duties in accordance with the Corporate Governance Principle as follows.
 To set the corporate vision, target and business strategy including risk management policy, annual budget
and business plan as well as setting the corporate performance targets while monitoring the implementation,
the result, significant investment cost, acquisition and disposal of the assets;
 To recruit, set the remuneration rate, monitor the performance and if necessary to change the key
management and plan for a smooth succession plan;
 To review the remuneration of directors and key management and ensure that the director selection process
is procedural and transparent;
 To monitor and resolve the conflicts of interests which may incur by Management, directors and shareholders,
and to ensure the independent audit and internal control with the focus on risk monitoring, financial control
and legal compliance;
 To monitor the effectiveness of the existing governance tools and instruments and implement change if
necessary;
 To monitor the information disclosure and communications; and
 To direct self - appraisal annually and declare in the annual report how well they carry out their duties and
oversee EGCO.
Leadership and Vision
The Board works with the Management in setting the vision, mission, strategies, goals and business plans both
over a short and long term. The corporate KPIs are designated for each key area being growth, finance and
organization excellence. The Board also endeavors to ensure that the significant working system such as the
internal control and risk management are in place. Management performance is also monitored through the
President’s report which is prepared on a monthly basis to ensure that EGCO business is carried out in an
efficient manner.
Code of Conduct
To maintain high ethical standards, EGCO has set up a Code of Conduct as a guideline so that directors,
Management and employees perform their duties with regard to ethical values. Directors’ Code of Conduct
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focuses on business ethics, ethics for directors, directors’ commitment, duties and responsibilities, conflicts of
interest and use of information. Employees’ Code of Conduct would be annually reviewed. Employees’ Code of
Conduct covers 1. Guiding principles, 2. Making the system work, 3. Compliance with laws and regulations, 4.
Business ethics, 5. Human resources, 6. Safety, health and environment and 7. Accountability.
EGCO continuously conducts the training on adherence to the Code of Conduct for the employees as well as
provides clarification on their frequently asked questions. Directors, Management and employees must obey and
respect the spirit of the Code of Conduct. Managers at all levels are required to promote the compliance with the
Code of Conduct and act as role models. Employees at senior vice president level and upward shall review their
compliance with the Code of Conduct before signing and submitting the Code of Conduct Compliance Statement
to their immediate boss annually.
Internal Control and Internal Audit
Realizing the importance of having sufficient and suitable internal control at all levels, EGCO clearly
determines responsibilities and authority of Management and employees in writing, taking into account
segregation of duties, check and balance, and control of Company’s assets. EGCO also set a correct and timely
financial report system. Apart from this, EGCO sets up an Internal Audit Division to audit EGCO and subsidiaries
and to provide consultation to relevant units to reduce the weaknesses in the system under the proactive audit
plan. The Audit Committee directly reports to the Audit Committee in order to make sure of its transparent
auditing process. The Audit Committee has a responsibility to approve internal audit plan, and to consider and
review the independence and the performance report of the Internal Audit Division.
EGCO emphasizes on developing the capabilities of internal auditors by self-development, experience
sharing and attending inside and outside seminar. In 2011, Vice President- Internal Audit was received the
Certificate Internal Auditor (“CIA”) and an Assistant Vice President-Internal Audit was waiting for taking the
examination to receive CIA.
The Board sets the policy to annually review EGCO’s internal control system using the questionnaires that
were developed in line with the guidelines of the SET and the Committee of Sponsoring Organization of the
Treadway Commission (“COSO”). Employees from section managers and upward are assigned to evaluate the
quality of the internal control of which the result will be proposed to each subsidiary’s Board of Directors, the
Audit Committee and EGCO Board of Directors, respectively. The evaluation result in 2011 showed that EGCO
and its subsidiaries had sufficient and appropriate internal control system. Details are presented in Internal
Control in this annual report under article Internal Control. To ensure compliance with internal control systems,
and rules and regulations, employees of EGCO and subsidiaries at senior vice president level and upward are
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required to thoroughly review their 2010 work practices before signing the General Representation Letter to their
managers up to the President. The President also signed the General Representation Letter addressed to the
Chairman of the Board.
Risk Management
The Board of Directors entrusts the Audit Committee to review with the Management the risk management policy,
implementation and guidelines. The Audit Committee reports the update on risk management issues to the Board
twice a year to consider the adequacy and effectiveness of risk management system so that the strategies, plan
and measures can be adjusted or put in place at an appropriate timing.
To implement enterprise risk management, the following measures are implemented:
 EGCO Risk Management Committee is shored up comprising top management of the Group companies with
the President as the Chairman of the Committee. The objectives are to closely monitor the risk management
of the Group and to present the result to the Audit Committee and the Board. In addition, Risk Management
Committee is also set up at each power plant to set up the policy and monitor the implementation to meet the
overall policy and the business characteristic of each power plant.
 Risk Management Section was also set up under Internal Audit Division to be fully responsible and
coordinating for risk management.
 Risk management process is embedded into the working process. Management and employees are
encouraged to take part in the process and to efficiently use the resources to identify, appraise and manage
risks.
 Risk management is implanted into the corporate culture.
EGCO has adopted the risk management policy and risk management manuals as guidelines since 2001. Risk
Management implementation is also included as one of the elements for internal control assessment. The result of
such assessment in 2011 indicated that EGCO Group has appropriately implemented risk management system.
Conflicts of Interest
EGCO has set the policy in the Code of Conduct for directors and employees to avoid the conflicts between the
personal interest and the corporate interest as follows.
 Directors and employees shall not be engaged as directors or advisors of other companies, organizations,
and associations that may conflict with the interest and the business of EGCO. Acknowledgment of such
engagement by the Board must be sought;
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Part 2 Section 9 Management
 Directors will promptly notify the Board when any of the conflict of interest occurs and must consider whether
to refrain from participating in the debate and/or voting on the matter, whether to be absent from discussion of
the matter, whether to arrange that the relevant board papers are not sent, or, in an extreme case, whether to
resign from the Board;
 The list of major shareholders is disclosed. Directors and designated Management will report the change in
their security holding to the regulatory body. The Corporate Secretary is assigned to report the security
holdings of directors and Management to the Board at every meeting;
 Employees should not borrow money from the customers/suppliers or from individuals or firms having
business dealings other than financial institutions as it may influence the way they handle EGCO business;
and
 The step for implementing connected transaction along with the approval authority and the disclosure of such
transaction shall be as required by the SET and SEC. The Corporate Secretary will identify the type of
transaction and the approval body and will submit the reports on connected transactions and any conflict of
interests to the Audit Committee for acknowledgement and disclose the information in the annual report and
annual registration form (Form 56-1).
Directors and management are required to prepare the report on the interest of their own and related parties to
the Company to enable the Corporate Secretary to ensure transparent practices. The Corporate Secretary will
submit a copy of such report to the Chairman and the Chairman of the Audit Committee.
To foster trust among all concerned parties that the connection transactions are aimed at optimizing the benefits
of EGCO and the shareholders, the Audit Committee is assigned to review the information and provide comment
with regard to the connected transaction that needs to be approved by the Board and the shareholders and to
ensure that the disclosure is adequate.
Fraud Risk Management
With a view that fraud risk was significant, the Board set a measure to manage fraud risk as follows.
 Preventive Measures: The organization is well designed for the purpose of governing and managing business.
The Code of Conduct is prepared in writing and the compliance with the Code is promoted. The internal
control system is established and appraised. The whistleblower program is in place.
 Investigation: Each supervisor assumes responsibility to prevent and control fraud risks and errors in the
system. In addition, there is an internal audit unit which is independent from senior management to review the
compliance with the regulations and test the early warning signals.
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Part 2 Section 9 Management
 Fairness: The fraud investigation will be made by a panel to ensure fairness to the defenders. In addition,
whistleblowers will be appropriately protected.
 Lesson Learn: Case study on fraud risks both in Thailand and overseas will be used to train supervisors on
fraud prevention.
In 2011, there is no claim or any fraud found in EGCO Group due to the above efficient preventive measures.
5.4 Board Meeting
To ensure that the Board takes full responsibility to meet the expectations of the shareholders, the Board reviews
significant business policy and corporate calendar. In this regard, it is determined that the Board meeting will be
held at least once every two months. Extra Meeting can be called if there is any major unplanned event that
needs the Board’s consideration. The Board can also authorize the committees to scrutinize or approve the
management’s activities within the delegated authority during the meeting interval. The Board also instructed
management to provide monthly performance report so that the Board can follow up the business progress
despite not having the Board meeting.
To facilitate the directors, EGCO plans the meeting dates and the agenda for the whole year in advance. The
Chairman and President fix the agenda for the Board’s meeting. Each director can propose the agenda to the
Chairman and can deliver their independent judgment. The Corporate Secretary shall serve written notice calling
for the Board meeting at least one week in advance except for necessary or urgent case to preserve the rights or
benefits of the Company where the meeting may be called by other methods and an earlier meeting date may be
chosen. Meeting document are sent to the directors in advance to allow adequate time for digesting such
information. Agenda is prioritized in terms of significance i.e., Matter Arising, Matter for Consideration, Matter for
Information to ensure that items that need the most careful deliberation are given adequate time.
The Chairman allocates adequate time for Management to present their issues and to permit directors to conduct
extensive discussion of agenda items and other topics of interest. The minutes of meeting are drafted for the
Board’s review within 14 days after the meeting prior to the adoption at the next meeting. The Board had called 7
meetings in 2011. Each meeting took approximately 2 hours and a half. The average attendance rate is 94.28%.
Since EGCO has a number of directors who do not reside in Thailand, EGCO has set the policy to allow those
directors to attend the meeting by teleconference so that EGCO and the Board will benefit from their opinion and
recommendation. Such attendance is not considered the meeting quorum and those who attend the meeting by
teleconference do not have the right to vote.
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Part 2 Section 9 Management
The Board encourages the President to invite top Management being the senior executive vice presidents to
attend all the Board’s meeting. Other Managements are invited to join the meeting as deemed necessary to
provide additional insights into the items being discussed because of personal involvement in those areas.
Managers with future potential are given exposure to the Board to support the consideration of the succession
planning. The Board can request for additional necessary information from the President or the Corporate
Secretary or other assigned management within the extent of the established policy. The Board can also engaged
independent advisor for the benefits of the business on EGCO’s expenses. Details of directors’ attendance in
2011 are illustrated in Table 1.
The Board set up a policy for non-executive directors to call a meeting at least once a year. There are two meetings in
2011. The agenda items cover board of directors’ meetings, risk management, structure, roles and responsibilities of
directors and management, good corporate governance, President’s performance appraisal and human resource
management.
5.5 Board Self-Assessment
The Board regularly conducts self-assessment for future improvement. In 2011, the Board agreed to use the 2009
self-appraisal form based on the forms recommended by the New Zealand Institute of Directors and the forms
adopted by other peer companies in the energy sector. There are two parts, the collective appraisal form and the
individual appraisal form. The grading code is “excellent” for the score of 85 and above, “very good” for the score
of 75 and above, good for the score of 65 and above, “fair” for the score of 50 and above and “poor” for the score
below 50. The result of the appraisal is concluded as follows.
Collective Self-appraisal
The collective self-appraisal form comprised 14 sections, namely (1) shareholders, (2) stakeholders, (3) the
Company, (4) legal/ethical duties, (5) monitoring performance and agenda setting, (6) size, composition and
independence of the Board, (7) director orientation and development, (8) Board leadership and teamwork, (9) the
President, (10) Board (and Committee) meetings, (11) individual Board member contributions, (12) director and
Board evaluation and compensation, (13) management evaluation, compensation and ownership and (14)
succession Planning. The result can be concluded that the Board protected the benefits of shareholders,
stakeholders and EGCO and that EGCO had good corporate governance. The average score was 88% which
was in the excellent level. The highlights were as follows:
 EGCO’s objectives reflect shareholders’ expectation and full and accurate reporting on EGCO affair had been
made. The Board understands who the key stakeholders are and have good relationship with them.
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Part 2 Section 9 Management
 The strategic plan is carried out of sufficient quality and content and is well reflected at operational level with
key performance indicators.
 The Board communicates proper ethical and legal responsibilities to its members and ensures ethical
behavior and proper compliance standards throughout the organization. The Board is sufficiently independent
of the Management. The Board has leadership and effectively managed the conduct of Board business as a
team.
 New directors are provided with adequate information about the Company and the Board. Director receives
proper training in corporate governance.
 The Board works well with the President and other managers to create an open culture that encourages frank
discussion. The Board avoids excessive intrusion in the President and/or management’s responsibility.
 The Board and committee meeting are productive.
 The Chairman carries out the role satisfactory and encourages director participation in a debate.
 The Board regularly evaluates the performance of the President and creates an appropriately designed
management compensation plan.
 The Board has a company wide succession plan in place.
 The Board has a working knowledge of competitors in the sector and plays a role in public service.
Despite an excellent score, the Board viewed that plan should be made to ensure that the director development,
succession planning, and director and management remuneration is perfect.
Individual Self-Appraisal
The individual appraisal form comprised 7 sections, namely strategic thought, good corporate governance,
competence, independence, preparedness as a director, personal attributes and awareness of stakeholders. From
the individual self-appraisals, most of the scores were higher than 92% which could be concluded that the
directors had appropriate deliberations and contributions in accordance with the recommended best practices.
Audit Committee Self-Appraisal
Apart from the Board, the Audit Committee also appraises themselves annually. The result of the self-appraisal in
2011 indicates that the composition, qualifications and roles and responsibilities of the Audit Committee are still in
line with the Audit Committee’s Charter B.E. 2551 and the international best practices.
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Part 2 Section 9 Management
5.6 Performance Appraisal of President and Top Executives
All the non-executive directors will appraise the President performance against the corporate and individual
achievement. Indicators include the following:
 Qualitative indicators being leadership, relationship with the Board, risk management and internal control,
human resources management, good corporate governance and Code of Conduct.
 Corporate achievements based on the committed Key Performance Indicators.
 Capabilities to enhance business development.
The Nomination and Remuneration Committee is responsible for endorsing the performance appraisal of the
senior executive vice presidents and executive vice presidents based on the individual achievement of each
executive.
5.7 Remuneration for Directors and Management
EGCO set the directors’ remuneration at the appropriate rate which is comparable to that of the leading
companies in the same sector. The remuneration comprises monthly retainer fee, meeting allowance and bonus
which is paid once a year and is tied with EGCO’s achievement. The Nomination and Remuneration Committee
shall recommend the remuneration framework to be endorsed by the Board before proposing to the shareholders.
EGCO has a policy to disclose the remuneration of each director for transparency. Directors that also serve as
committee members will be entitled to extra remuneration to match the increase in responsibilities. Management
who serve as directors and committee members shall refrain from taking director remuneration.
The non-executive directors shall set the remuneration of the President taking into account the performance
appraisal and the peer payment. The Board also approves the pay structure of the Company. EGCO periodically
conducts the survey of the executive remuneration to ensure that the rate is comparable to that of the peer
companies and adequate to attract and motivate the qualified executives.
The remuneration of directors and management is disclosed under the topic of shareholding and management
structure in this annual report.
5.8 Board and Management Training
The Board pays attention to continuous development of directors and management. In 2011,
The following development plan was implemented to ensure efficiency and effectiveness.
Director Development
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Part 2 Section 9 Management
Continued development is encouraged for all directors:
New Directors: Directors’ orientation is arranged where directors will have a chance to meeting with Management.
Directors’ manual is updated to equip incoming directors with knowledge about EGCO. Directors are also
encouraged to attend training programs at the Institute of Thai Directors (“IOD”).
Existing Directors: The Board encourages continued development covering in-house training and outside training
at the IOD or other relating academic institutes. In 2011, EGCO’s in-house training programs for directors were
risk management and fraud risk management, and new accounting principles and the Company’s governance.
The seminar on an overview of industry, business characteristics of the Group companies, current and future
plans were also provided to the Board. EGCO also arranged a Board visit to Solar Power Plant Project in Lopburi,
and site visits to overseas power plants to educate our directors on power business and future trend.
Company directors are well educated about the Company’s business and their responsibilities as a director. The
list of directors who attended the courses at IOD and outside institutes as of December 2011 is shown in Table 2.
Management Development and Succession Plan
EGCO supports the executive development program to enhance Management capacities and skills to be suitable
to perform their duties and to assign the suitable and challenging job.
The Board determines policies and principles for selection of the President and his successor in the event of an
emergency or the retirement of the President taking into account educational background, experience, capabilities,
ethics and leadership. The selection process is fair and transparent. The Nomination and Remuneration
Committee shall consider and propose the qualified candidates to the Board.
The President is entrusted to select the knowledgeable, competent and experienced executives in accordance
with the qualifications endorsed by the Nomination and Remuneration Committee. The approval of the candidates
shall be as stated in the Company’s Regulation on Human Resource Management B.E. 2553 and the resolution
of the Board as follows.


The Nomination and Remuneration Committee shall approve the appointment of Senior Executive Vice
President, Executive Vice President, and nominate senior executives of subsidiary/joint venture companies
that EGCO has the right to nominate for a position equivalent to EGCO’s EVP level and upward.
The President shall appoint the division and section managers.
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Part 2 Section 9 Management

The appointment of Corporate Secretary shall be by the Board while the appointment of Division Manager of
Internal Audit shall be endorsed by the Audit Committee.
The Nomination and Remuneration Committee has assigned the Management to prepare the succession plan for
17 key positions along with the executive development plan to ensure that qualified employees would be selected
under the D-R-I-V-E people attributes as follows:
Dedication to Excellence
Result Orientation
Initiatives and Dynamic
Value Differences and Work as a Team
Environment, Social and Safety Concern
The Management development plan is prepared to focus on development of core, managerial/leadership
competencies and functional competencies. Key courses and numbers of trainees for each course are as shown
below:
Courses
Director Certification Program
Executive Development by Thai Listed Companies
Association
Management of Public Economic for Executives at King
Prajadhipok’s Institute
117
No. of participants
2
2
1
Part 2 Section 9 Management
Table 1: Meeting Attendance
No.
Name
Board Meeting
8 times/year
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Mr. Pornchai Rujiprapa
Chairman
Mr. Aswin Kongsiri
Vice Chairman
Independent Director
Mr. Chaipat Sahasakul
Independent Director
Mr. Thanapich Mulapruek
Independent Director
Mr. Somphot Kanchanaporn
Independent Director
Police Lieutenant General Pijarn
Jittirat
Mr. Phaiboon Siripanoosatien
Independent Director
Mr. Somboon Arayaskul1
Director
Mr. Wisudhi Srisuphan2
Director
Mr. Kurujit Nakornthap3
Director
Mr. Surasak Supavititpatana4
Director
Mr. Kulit Sombatsiri5
Mr. Peter Albert Littlewood 6
Director
Mr. Hideaki Tomiko
Director
Mr. Shinji Tsuchiya6
Director
Mr. Mark Jobling6
Director
Mr. Toshiro Kugama7
Mr. Akio Matsusaki8
Mr. Ryota Sakakibara7
Mr. Vinit Tangnoi9
Director and President
118
Audit
Committee
17
times/year
7/7
Meeting (time)
Investment
Nomination and
Committee
Remuneration
11 times/year
Committee
10 times/year
Good Corporate
Governance and
Corporate Social
Responsibility Committee
2 time/year
11/11
7/7
10/10
2/2
7/7
10/10
2/2
7/7
9/10
2/2
7/7
17/17
6/7
17/17
7/7
17/17
5/5
7/8
1/2
1/1
5/5
2/2
1/1
1/1
0/1
6/7
0/0
10/11
7/7
1/1
1/2
3/3
6/6
4/6
6/6
7/7
8/9
8/8
2/2
1/1
2/2
Part 2 Section 9 Management
No.
Name
Board Meeting
8 times/year
Mr. Sahust Pratuknukul13
21
7/7
Audit
Committee
17
times/year
Meeting (time)
Investment
Nomination and
Committee
Remuneration
11 times/year
Committee
10 times/year
3/3
8/8
Good Corporate
Governance and
Corporate Social
Responsibility Committee
2 time/year
0/0
1
Resigned on October 1, 2011
Resigned on February 28, 2011
3
Being appointed director on February 28, 2011 and resigned on December 1, 2011
4
Being appointed director on October 25, 2011
5
Being appointed director on December 13, 2011
6
Resigned on February 23, 2011
7
Being appointed director in Shareholders’ Annual General Meeting no. 1/2011 on April 21
8
Being appointed director in Shareholders’ Annual General Meeting no. 1/2011 on April 21 and resigned on
January 29, 2012
9
Resigned due to the end of contract on September 30, 2011
2
Note: 3 members in Audit Committee comprising no. 3, 4, 5
8 members in Executive Committee comprising no. 1,8,11,14,16,19,20,21
8 members in Nomination and Remuneration Committee comprising no. 2,6,7,8,14,16,20,21
7 members in Corporate Social Responsibility Committee comprising no. 2,6,7,8,12,20,21
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Part 2 Section 9 Management
Table 2: List of directors who attended the courses at IOD and outside institutes
Directors
1. Mr. Pornchai Rujiprapa
Chairman
2. Mr. Aswin Kongsiri
Vice Chairman
Independent Director
3. Mr. Chaipat Sahasakul
Independent Director
4. Mr. Thanapich Mulapruek
Independent Director
5. Mr. Somphot Kanchanaporn
Independent Director
6. Police Lieutenant General
Pijarn Jittirat
Independent Director
7. Mr. Phaiboon Siripanoosatien
Independent Director
8.Mr. Surasak Supavititpatana
Director
9.Mr. Kulit Sombatsiri
Director
10.Mr. Vinit Tangnoi
Director
120
Chairman
2000/The
Role of
Chairman
Directors’
Certification
Program
Successful
Formulation
and
Execution of
Strategy
Audit
Committee
Program
Financial
Instrument
for Directors
Accounting
for nonaccounting
Audit
Committee
Director
Accreditation
Program (DAP)
Courses
The Role of
the
Compensatio
n Committee
Program
IFRS
Audit
Committee
and
Continuing
Development
program
Monitoring
the System of
Internal
Control and
Risk
Management
Monitoring
Fraud Risk
Management
Monitoring
the Quality of
Financial
Reporting
The Board’s
Role on
Fraud
Presentation
and
Detection
Monitoring
the Internal
Audit
Function
√
√
√
√
Risk
It all
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
Part 2 Section 9 Management
Directors
11. Mr. Hideaki Tomiko
Director
12. Mr. Toshiro Kudama
Director
13. Mr. Akio Matsuzaki
Director
14. Mr. Ryota Sakakibara
Director
15. Mr. Sahust Pratuknukul
Director and President
121
Chairman
2000/The
Role of
Chairman
Directors’
Certification
Program
Successful
Formulation
and
Execution of
Strategy
Audit
Committee
Program
Financial
Instrument
for Directors
Accounting
for nonaccounting
Audit
Committee
Director
Accreditation
Program (DAP)
Courses
The Role of
the
Compensatio
n Committee
Program
IFRS
Audit
Committee
and
Continuing
Development
program
Monitoring
the System of
Internal
Control and
Risk
Management
Monitoring
Fraud Risk
Management
Monitoring
the Quality of
Financial
Reporting
The Board’s
Role on
Fraud
Presentation
and
Detection
Monitoring
the Internal
Audit
Function
Risk
It all
√
√
√
√
√
√
Part 2 Section 10 Internal Control
10 Controlling System and Internal Audit
The Board of Directors has entrusted the Audit Committee the responsibility to review the
appropriateness and effectiveness of the internal control system provided by the management. This is
to ensure that EGCO’s internal control system is adequate, appropriate and in line with the guidelines
of The Stock Exchange of Thailand’s (SET) and the internal control framework of the Committee of
Sponsoring Organizations of the Treadway Commission (COSO). EGCO’s internal control covers
management control, operational control, financial control, and compliance control.
The Board set out the duties and responsibilities of the Internal Audit Division in the Internal Audit
Charter which was reviewed by the Audit Committee and approved by the Board. The Internal Audit
Division independently discharges its duties and functionally reports to the Audit Committee.
Meanwhile, the administrative tasks of the Internal Audit Division are reported to the President. The
internal audit scopes of EGCO and its subsidiaries are financial audit, operational audit, compliance
audit, information system audit, and management audit.
EGCO control framework and operation are described as follows:
Control Environment
- The Board set up the clear vision, mission, and objectives to be guidelines for the management
and employees. The operation is periodically reviewed to ensure conformity with the business
objectives while the fair treatment to stakeholders is also considered for long-term benefit of
EGCO.
- To support business growth, the organization structure has been properly set and adjusted by the
Board when the environment changes.
- Code of Conduct including good corporate governance guidelines are written and reviewed
periodically. All employees are advised to understand their responsibilities to uphold the Code of
Conduct which includes the measure to avoid the conflict of interest. Failure to observe the Code
of Conduct may result in a range of disciplinary actions.
- Regulations, instructions and Table of Authority for accounting, finance, budget, procurement,
and human resource functions are established and clearly announced to all employees for
acknowledgment and practices.
Risk Management
The Risk Management Committee (RMC) has been set up at the Management level which comprises
of EGCO’s top executives. EGCO’s President serves as the chairman of the committee. RMC
reviews risk management evaluation and mitigation of EGCO and subsidiaries and regularly reports to
the Audit Committee and the Board. The Board of Directors has focused on the likelihood of the
irregularities, risk mitigation and early warning systems. The Board entrusts the Audit Committee to
review with the management the risk management policy and the compliance with such policy.
The details of Risk Management of EGCO and subsidiaries are disclosed under “Risk Factors”.
Control Activities
To ensure that guidelines and policies set by the Board and the management are complied with,
efficient control of accounting, finance, operation, and governance are implemented as follows:
- Transactions and amount for approval authority of management are set forth in the Table of
Authority.
- Approval authority, operation or accounting record, and safeguard of asset functions are
segregated.
Page 122
Part 2 Section 10 Internal Control
-
-
The Asset Management Division is responsible for regularly monitor the operation results of
EGCO’s subsidiaries and joint ventures.
Approval process of connected transactions is clearly set out. The connected transactions are to be
approved by directors or management who has no conflicts of interest, taken into account the best
benefit to EGCO.
The Corporate Secretary is entrusted to ensure that EGCO and the Board’s practices together
with EGCO’s information disclosure are in compliance with the Securities and Exchange Acts, the
notification and regulation of the SET, Securities and Exchange Commission (SEC), and other
related laws and regulations. The Legal Division also provides consultation based on case by case
basis.
The Internal Audit Division is responsible for regularly reviewing adequacy and appropriateness of
internal control system. Internal Audit Plan is set to cover all major functions.
To ensure the compliance with Computer Related Crime Act, the Computer Related Crime Act
has been clearly communicated to all employees for acknowledgment and compliance. All
employees are required to sign IT Compliance Statement to confirm the non-violation of the law.
Information and Communication
EGCO has established information system to maintain adequate important information for
committees’ and management’s decision making via communication channels as follows:
- For internal communication, all employees will receive information about the company’s policies,
regulations, instructions and good corporate governance via intranet and different level of
meetings. Employees are encouraged to provide feedback on the improvement of operations
efficiency in the meetings.
- For external communication, EGCO’s information has been disclosed via the SET’s Community
Portal system and EGCO’s web site at www.egco.com as well as the quarterly analyst meeting,
EGCO newsletter, and press conference.
- The meetings among the Audit Committee, external auditors and concerned Management are held
to review the compliance of financial accounting with the General Accepted Accounting Principles
and International Accounting Standards.
- Information are recorded and maintained completely, correctly, timely and adequately to support
the decision making. Information such as power plant operation data along with information on
accounting, budgeting and finance are recorded and maintained.
- Accounting records and supporting documents which will be used to support the financial
statements preparation are completely kept in orderly manner. There is no deficiency in those
documents informed by the auditor.
- The compliance database is developed for reference and tracking. The Legal Division is
responsible for updating the compliance database and providing recommendation to employees.
- The Board of Directors receives invitation letters, meeting agendas and supporting documents far
enough in advance of the meeting. Discussion, remarks and recommendations of the Board and
standing committees including resolutions are recorded in the minutes of meetings for future
reference or audit trail.
- Communication channel is provided for employees to report suspected violations of EGCO’s
Code of Conduct to the Management or to the Board of Directors (whistleblower). The message
providers are well protected by the company.
Monitoring
To ensure that the established internal control system is sufficient and appropriate, the following
activities are implemented.
- The responsible unit is assigned to follow up, monitor and set appraisal criteria to benchmark
EGCO’s and its subsidiaries’ performance against the plan. Gap analysis is carried out and
scheduled reports are submitted to the Management and the Board.
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Part 2 Section 10 Internal Control
-
-
-
External auditors are independent and regularly report to the Audit Committee.
EGCO and its subsidiaries’ internal controls have been evaluated annually. The evaluation form
has been designed following SEC’s and SET’s internal control guidelines as well as COSO’s
internal control framework. The evaluation results have been reported to the Audit Committee and
the Board of Directors by the Internal Audit Division. The 2011 evaluation results can be
concluded that the internal control of EGCO and its subsidiaries are sufficient and appropriate.
To ensure the compliance with rules, regulations and Code of Conduct, employees from Senior
Vice President and upwards of EGCO and its subsidiaries are required to thoroughly review their
2011 work practices before signing the Code of Conduct Compliance Statement and the General
Representation Letter to his/her managers up to the President. EGCO’s President and the
Managing Directors of EGCO’s subsidiaries also sign the Code of Conduct Compliance Statement
and the General Representation Letter addressed to the Chairman of the Board of each company.
With regard to the auditor’s review of the financial statements, the auditor has also reviewed
internal control on accounting and finance to define the audit approach, duration and scope of
work. In 2011, no significant finding, regarding the improvement on internal control systems, has
been found.
The Audit Committee reviews the internal control system and risk management throughout the year
and regularly reports the result to the Board of Directors. As a consequence, the Board agrees with the
Audit Committee that the internal control system of EGCO and its subsidiaries is appropriate and that
it sufficiently safeguards EGCO’s assets from misuse or unauthorized use. The Audit Committee and
the Board have not received significant deficiency report on the internal control system from external
auditors and Internal Audit Division.
In addition, the 2011 Audit Committee’s Report is attached to this Report.
Page 124
Part 2 Section 11 Connected Transactions
11. Related Transactions
In conducting the normal business courses, there are related transactions between EGCO or its
subsidiaries and persons who may have potential conflict of interest. EGCO endeavors to
ensure that these transactions are justified and in compliance with the Stock Exchange of
Thailand (“SET”) and the Capital Market Supervisory Board’s rules and regulations. Apart from
designating the authorized persons to approve the transaction in accordance with the Table of
Authority, the Audit Committee is entrusted to review the related transactions that need to be
approved by the Board of Directors. The details of the related transactions are disclosed under
item 31 of the Notes to 2011 Financial Statements for the period ended December 31, 2011.
Procedure to Approve the Related Transactions
EGCO lives by the following policies and guidelines in treating and approving the related
transactions.
o In case of entering into any contracts or any related transactions between EGCO,
subsidiaries, joint venture companies, associated companies and/or outside parties, EGCO
will consider the necessity and justification of such transactions for the best interest of the
Company. Transaction prices are charged at fair market price like the transactions with other
outside parties (Arm’s Length Basis). If there is no such price, EGCO will apply the price of
similar market transactions. EGCO may also compare the price with the one recommended
by independent appraiser to ensure that such price is reasonable to maximize the Company’s
benefits.
o Related transactions that are considered connected transactions in accordance with the
SET’s regulation will be treated in accordance with the requirements of the SET’s and
Securities & Exchange Commission (“SEC”) and must be reviewed by the Audit Committee
in case such transaction must be approved by the Board of Directors.
o Financial assistance or guarantee provided to Group companies or connected persons will
be conducted prudently to ensure the utmost benefits of the Group companies. Fee will be
charged using the market rate as at the transaction date.
o The summary of transactions with commercial term that an ordinary person will agree to
deal with the counterparty under similar circumstances, on the basis of commercial
negotiation and without any dependent interest resulted from the status of the director,
executive or related person, as the case may be, shall be reported to the Audit Committee
annually. This is aimed to ensure that such transaction is well grounded and provide optimal
benefit to the Company and in line with the approved process. It should be noted that the
Management had already reported the transactions in 2011 to the Audit Committee and the
Board.
o In a case that a shareholders’ approval is needed, the major shareholder who is the
connected person can attend the meeting in order to constitute a quorum but will not have a
voting right. Since the voting will be based on the number of shareholders who are eligible
for voting, this criterion does not have the negative impact on the quorum or the voting.
o Directors and management with potential conflict of interest will not be allowed to vote or
attend the meeting
Related Transactions in 2011
EGCO’s related transactions in 2011 were normal business transactions with no objective to
siphon profits between EGCO or its subsidiaries and parties with potential conflict of interest.
Page 125
Part 2 Section 11 Connected Transactions
Each transaction was duly approved under the transparent process and the persons with
potential conflict of interests were not involved in the decision making. Such transactions were
well justified that they were carried out for the best interest of the Company like the transactions
with the third parties. The system to follow up and review the transactions was also in place to
ensure that they are carried out in line with the established process.
Details of related transactions in 2011 are as summarized below.
1. Related Transactions with EGAT
In carrying out the EGCO Group’s business, there were related transactions relating to the
power sale and maintenance services between the Group companies and EGAT, a major
shareholder which owns 25.41 stakes in EGCO and has 4 representative directors on EGCO
Board. However, all the transactions followed the established process and in line with the
disclosure and other requirements of the SET and SEC.
1.1 Power Sold to EGAT
EGCO (Rayong Power Plant) and three subsidiaries being KEGCO, EGCO Cogen and Roi Et
Green entered into the Power Purchase Agreement (“PPA”) with EGAT. The PPA terms for
EGCO (Rayong Power Plant) and KEGCO are twenty years while the terms for EGCO Cogen
and Roi Et Green are twenty one years each.
Such transactions are justified as power generation is EGCO Group’s core business and EGAT
is the single wholesale buyer. In addition, the pricing and conditions of those transactions are in
accordance with the standard contracts which have been endorsed by relevant government
agencies.
Companies
Relationship
EGCO
(Rayong Power
Plant)
KEGCO
Subsidiaries
EGCO Cogen
Roi Et Green
Transaction value for the period
ended December 31, 2011 (million baht)
Sale Revenue
Trade Receivables
2,258
202
2,171
1,263
325
94
189
61
The value of the related transactions between joint venture companies with EGAT are as shown
in the following table. Since EGCO has recorded the share of profit from joint venture
companies using equity method, the value of such transactions is not shown on the consolidated
financial statements.
Companies
Relationship
Transaction value for the period ended December
31, 2011 (million baht)
Sale Revenue
Traded Receivables
Page 126
Part 2 Section 11 Connected Transactions
GEC
BLCP
NTPC
Joint Venture
14,499
8,895
2,685
2,878
540
448
1.2 Maintenance Service to EGAT
ESCO, EGCO’s subsidiary which is an O&M service provider, has entered into a Maintenance
Agreements with EGAT to provide major maintenance work including other administrative and
relating services to the power plants.
Such transaction is justified as the price is charged on a “cost plus basis” with the annual CPI
escalation which is the same standard as the price charged to the third parties. The agreement is
effective for a period of eight years commencing September 24, 2007.
Companies
ESCO
Relationship
Subsidiary
Transaction value
for the period ended December 31, 2011
(million baht)
Maintenance Fee
Trade Receivables
51
3
1.3 Maintenance Service by EGAT
EGCO Group has entered into the operation and maintenance agreements with EGAT which
are defined as the transactions to support normal business of which the general trading terms
and conditions are applied and the agreed price can be calculated from the assets or the
referenced price in accordance with SET’s guidelines.

EGCO (Rayong Power Plant) and KEGCO has entered into the Major Maintenance
Agreement (“MMA”) with EGAT for the latter to provide major maintenance services,
repair services, administrative services, and additional services to their power plants. The
service fees are charged on a “cost plus basis” with the annual CPI escalation. The contracts
have been extended for another 8 years for EGCO (Rayong Power Plant) with the execution
date on December 7, 2006 and 4 years for KEGCO with the execution date on August 1,
2008.

ESCO enters into the long term agreement with EGAT with the term starting from January
2005-December 2017. However, EGAT started providing the service under the agreement
on May 23, 2007. The service fees are charged on a “cost plus basis” with the annual
escalation of 3%.
Companies
EGCO
(Rayong Power
Plant)
KEGCO
ESCO
Relationship
Subsidiaries
Transaction value
for the period ended December 31, 2011
(million baht)
O&M Fee
Trade Payables
131
56
82
2
9
-
Page 127
Part 2 Section 11 Connected Transactions

GEC has engaged EGAT as advisor for maintenance work. The fee is charged in
accordance with the agreed price.
Companies
Relationship
Transaction value for the period ended December
31, 2011 (million baht)
Maintenance Advisory
Account Payables
Fee
GEC
Joint Venture
0.58
1
2. Related Transaction between EGCO and Subsidiaries
EGCO has entered into three agreements with subsidiaries and joint venture companies, which
EGCO is a major shareholder and EGCO executives sit on their boards.
1. Agreements to provide office space and building services for 5 companies being KEGCO,
ESCO, EGCO Cogen, Roi Et Green and EGCOM Tara. The space and service scope is
specified in the contract with a one-year term.
Such transaction is considered justified as it helps maximize the building space usage and the
fee is charged at the market rate which is the same rate charged to the third party.
2. Agreements to provide management services to the above companies and PEPOI of which
the scope covers internal audit, legal counseling, Board’s secretarial work, technology, public
and community relations and financial work (exclude ESCO and Egcom Tara) and
agreements to dispatch employees to NTPC BLCP and NED.
Such transactions are well grounded because those Group companies do not have internal
staff to take care of such work while EGCO has the capability to provide the services. The
management service fee is charged in accordance with the actual operating hours based on
the cost plus basis.
Companies
KEGCO
ESCO
EGCO Cogen
EGCO Green
Roi Et Green
Egcom Tara
EGCO BVI
PEPOI
Total
for
subsidiaries
NTPC
BLCP
NED
Total
for
joint
ventures
Relationship
Transaction value
for the period ended
December 31, 2011
(million baht)
Financial Statements
Subsidiaries
16
9
8
1
7
2
1
16
60
Joint
Ventures
20
24
6
50
Page 128
Part 2 Section 11 Connected Transactions
3. Financial Support
EGCO provides financial support to subsidiaries and joint ventures in accordance with its
ownership in such respective companies. Such supports are normal business practices and are
aimed at optimizing shareholders’ return. They are duly approved by the Board in accordance
with the Table of Authority and disclosed in the notes to financial statements as at December
31, 2011.
3.1 Inter-company Loan
ESCO
On November 22, 2005, EGCO entered into an agreement to provide loan to ESCO in the
amount of 780 million baht. Principal payment of 46 million baht each is scheduled annually
commencing December 2009 to December 2025. The interest rate is set in accordance with the
market rate for long term loan at MLR minus a certain margin and payable on a semi-annual
basis. The outstanding loan amount as at December 31, 2011 was 642 million baht
3.2 Liabilities
EGCO provided the loan guarantee under the Sponsor Support Agreement to subsidiary, joint
venture and associated companies. Significant information is as follows.
3.2.1 Contingent Liabilities
EGCO Cogen
As of December 31, 2011, EGCO Cogen’s sponsors had a commitment to provide the loan to
EGCO Cogen if it has any financial liquidity problem and cannot service debt and expenditures
in accordance with the conditions in the contract in the amount not exceeding 200 million baht.
Since EGCO holds an 80% stake in EGCO Cogen, its guarantee portion is not exceeding 160
million baht.
This agreement is justified as it is the condition in the loan agreement and the financial support
is provided on a pro-rata basis in accordance with the ownership in the company.
Roi-Et Green
EGCO had a commitment to provide the loan guarantee in the amount not exceeding the total
outstanding loan and interest payment. As at December 31, 2011, the total commitment
amounted to 470 million yen equivalent to 194 million baht.
This agreement is justified as it is the condition in the loan agreement and the project
development condition.
3.2.2 Letter of Guarantee
EGCO has the commitment to the banks under Standby Letter of Credit (“SBLC”) and the
Counter Guarantee and issued on behalf of EGCO for the subsidiaries and joint ventures.
Details of the transaction are as shown below.
Page 129
Part 2 Section 11 Connected Transactions
NTPC
The Nam Theun II project’s finance is structured in a way that will allow sponsors who invest in
Lao PDR to inject equity on a back-end basis while lenders will allow loan drawn down during
the first phase. As such, lenders request the banks on behalf of the sponsors to issue the SBLC
to guarantee future capital injection. The face value of the SBLC will reduce in accordance with
each capital injection.
As at December 31, 2011, EGCO requested Mizuho Corporate Bank to issue the SBLC for the
purpose of providing a guarantee debt obligation in reserve accounts for The Nam Theun II
project’s amounting to US 5 million dollars (equivalent to 151 million baht) and amounting to
607 million baht.
Theppana
EGCO requested KASIKORNBANK to issue the SBLC for the purpose of providing a
guarantee for the PPA between Theppana and Provincial Electricity Authority. As at December
31, 2011, the guarantee value was 4 million baht.
Guidelines for Treating Future Related Transactions
Most of the existing related transactions will continue in the future. EGCO will seek to ensure
that all of the related transactions are transparent, fair and beneficial to the Company. The
Board will entrust the Audit Committee, the auditor or independent consultants to review and
recommend the appropriate pricing and the justification of those transactions. In addition,
material information about such transactions which includes types, value and the reasons for
entering into those transactions will be disclosed to the shareholders in accordance with the
regulations of the SET and SEC. EGCO will also provide the updated information, rules and
regulation with regard to the related transaction to relevant parties to foster understanding
which will lead to full compliance, transparency and the benefit of the shareholders.
Page 130
Part 2 Section 12 Financial Satatus and Operational Results
12.
Financial Position and Operational Performance
Financial statements
1. Auditor’s report
The Management prepares the consolidated and company’s financial statements for the
year ended December 31, 2011 in compliance with the Generally Accepted Accounting Principles
under the Accounting Profession Act B.E. 2547, appropriate accounting policies and consistencies
with adequate disclosure of significant information in the notes of the financial statements.
The Board of Directors has also issued the Company’s regulation on accounting, finance
and budgeting B.E. 2550 to which the Management must adhere. In addition, the Audit
Committee has been entrusted to ensure that the Company’s financial statements have been
prepared in a justified and prudent manner in compliance with such rules and regulations. The
appropriate accounting policies were consistently applied. Also, the Audit Committee has
reviewed the Company’s internal control systems to ensure its adequacy and effectiveness as a
means to safeguard the company’s assets from unauthorized persons and reveal the weakness to
prevent unlawful conduct and abnormalities.
The Management has prepared both consolidated and Company financial statements for
the year ended 31 December 2011 in compliance with the Thai Generally Accepted Accounting
Principles under the Accounting Profession Act B.E. 2547. The appropriate accounting policies
were consistently applied and the financial statements were prepared in a prudent and justified
manner with adequate disclosure of significant information in the notes of the financial
statements.
The Board of Directors is of the opinion that both the consolidated and company
financial statements for the year 2011, present the company’s financial position, operating results,
changes in shareholders’ equity and cash flows in a correct and reliable manner and that such
statements are in compliance with the Generally Accepted Accounting Principles and all
governing rules and regulations.
131
2. Summary of Financial Statements
132
Electricity Generating Public Company Limited
S tatements of Financial Position
As at 31 December 2011 and 2010
Consolidated
2011
2010
Company
2011
Restated
Notes
2010
Restated
Baht
Baht
Baht
Baht
8,401,866,377
7,748,266,006
5,674,226,709
6,641,233,520
1,717,680,697
108,217,105
1,576,075,477
943,871
222,000,000
505,981,000
222,000,000
515,715,500
9
343,952,162
964,776,625
-
-
Assets
Current assets
Cash and cash equivalents
7
Short-term investments
8
- Deposits at financial institutions
- M arketable securities
Short-term investments used as collateral
Trade receivables
Trade receivable from a related party
10
245,141,606
245,779,344
-
-
31(d)
549,230,689
544,949,244
202,016,743
219,944,810
13.4
6,089,418,454
5,756,143,305
7,018,039,732
7,109,556,304
31(f)
-
-
45,882,350
45,882,350
Dividend receivables from subsidiaries and
joint ventures
Current portion of long-term loans
to related parties
Amounts due from related parties
Fuel and spare parts and supplies, net
31(e)
51,081,780
59,997,506
22,779,474
19,576,599
2,043,819,652
2,126,889,696
833,986,690
993,274,921
455,163,627
516,010,592
112,637,703
20,386,911
20,119,355,044
18,577,010,423
15,707,644,878
15,566,514,786
1,937,293,740
2,074,097,214
1,930,947,778
2,071,097,214
31(e)
168,134,509
246,646,589
168,134,509
246,646,589
31(f)
-
-
596,470,600
642,352,950
11
Other current assets
Total current assets
Non-current assets
Long-term investments in marketable securities
12
Amounts due from a related party due
over one year
Long-term loans to related parties, net
Deposits at financial institutions used
282,300
282,300
-
-
Investments in subsidiaries, net
as collateral
13.2
-
-
17,901,783,196
11,940,361,196
Interests in joint ventures
13.3
22,874,309,238
36,444,572,866
30,711,750,853
23,150,309,238
Other long-term investments
12
127,000,000
2,000,000
127,000,000
2,000,000
Investment property
14
322,071,012
322,071,012
322,071,012
322,071,012
Property, plant and equipment, net
15
13,022,582,385
14,796,459,845
4,977,213,590
5,987,845,784
Right in long-term power and
tap water purchase agreements and operation
and maintenance agreement, net
16
685,946,459
175,339,183
-
-
17
128,834,166
134,757,515
11,779,387
11,527,548
Total non-current assets
52,836,717,437
48,463,404,511
49,185,709,310
44,098,211,531
Total assets
72,956,072,481
67,040,414,934
64,893,354,188
59,664,726,317
Other non-current assets
133
Electricity Generating Public Company Limited
S tatements of Financial Position
As at 31 December 2011 and 2010
Consolidated
2011
2010
Company
2011
Restated
Notes
2010
Restated
Baht
Baht
Baht
Baht
Liabilities and shareholders' equity
Current liabilities
Trade payables
253,078,447
232,804,758
27,636,013
20,798,381
Trade payable to a related party
31(d)
64,551,410
92,712,524
55,751,959
34,298,660
Amounts due to related parties
31(e)
9,701,695
11,845,750
4,458,738
6,311,636
18
535,728,282
223,697,707
289,380,906
-
19
-
496,621,203
-
-
- Interest payable
18,222,832
15,899,297
9,659,749
2,733,699
- Value added tax payable
78,063,073
84,008,213
35,525,577
40,192,146
- Corporate income tax payable
35,810,629
113,015,320
-
11,105,901
720,905,424
540,140,230
286,883,840
270,834,863
1,716,061,792
1,810,745,002
709,296,782
386,275,286
Current portion of long-term loans from
financial institutions, net
Debentures due within one year
Other current liabilities
- Others
Total current liabilities
Non-current liabilities
Long-term loans from
financial institutions, net
18
11,521,387,363
8,840,246,236
10,893,809,094
8,000,000,000
Retirement benefit obligations
20
199,408,660
180,533,136
91,767,927
82,159,491
Provision for decommissioning costs
21
972,895,496
874,279,974
386,414,269
370,839,030
13,267,003
6,091,897
30,590,721
26,111,871
Total non-current liabilities
12,706,958,522
9,901,151,243
11,402,582,011
8,479,110,392
Total liabilities
14,423,020,314
11,711,896,245
12,111,878,793
8,865,385,678
Other non-current liabilities
134
Electricity Generating Public Company Limited
S tatements of Financial Position
As at 31 December 2011 and 2010
Consolidated
2011
2010
Company
2011
Restated
Notes
2010
Restated
Baht
Baht
Baht
Baht
5,300,000,000
5,300,000,000
5,300,000,000
5,300,000,000
Liabilities and shareholders' equity (continued)
S hareholders' equity
Share capital
Authorised share capital
- 530,000,000 ordinary shares of Baht 10 per share
Issued and paid-up share capital
- 526,465,000 ordinary shares of Baht 10 per share
5,264,650,000
5,264,650,000
5,264,650,000
5,264,650,000
8,601,300,000
8,601,300,000
8,601,300,000
8,601,300,000
47,373,035
47,373,035
47,373,035
47,373,035
530,000,000
530,000,000
530,000,000
530,000,000
42,681,867,762
40,455,123,354
37,274,695,405
35,142,994,510
852,834,463
(79,022,179)
1,063,456,955
1,213,023,094
57,978,025,260
54,819,424,210
52,781,475,395
50,799,340,639
555,026,907
509,094,479
-
-
Total shareholders’ equity
58,533,052,167
55,328,518,689
52,781,475,395
50,799,340,639
Total liabilities and shareholders’ equity
72,956,072,481
67,040,414,934
64,893,354,188
59,664,726,317
Premium on share capital
Premium on treasury stock
Retained earnings
Appropriated
- Legal reserve
22
Unappropriated
Other components of equity
Total equity attributable to the parent company
Non-controlling interests
23
135
Electricity Generating Public Company Limited
Income S tatements
For the years ended 31 December 2011 and 2010
Baht
Consolidated
2010
Restated
Baht
Baht
Company
2010
Restated
Baht
7,661,035,192
(5,588,768,660)
8,608,979,776
(5,678,455,725)
2,258,324,928
(1,806,013,523)
2,535,275,542
(1,531,846,798)
2,072,266,532
449,118,661
21,978,720
2,930,524,051
386,196,878
(55,762,049)
452,311,405
5,892,735,667
7,412,030
1,003,428,744
6,697,157,118
(24,030,414)
(1,678,317,514)
(694,204,857)
(1,433,135,581)
(563,981,872)
(921,361,651)
(536,606,508)
(983,884,749)
(380,741,909)
5,199,684,409
6,109,227,948
-
-
Profit before corporate income tax
Corporate income tax
5,370,525,951
(254,702,346)
7,373,069,375
(455,179,284)
4,894,490,943
-
6,311,928,790
(142,951,141)
Net profit for the year
5,115,823,605
6,917,890,091
4,894,490,943
6,168,977,649
Attributable to:
Owners of the parent
Non-controlling interests
4,989,534,456
126,289,149
6,802,559,659
115,330,432
4,894,490,943
-
6,168,977,649
-
Net profit for the year
5,115,823,605
6,917,890,091
4,894,490,943
6,168,977,649
9.48
9.48
12.92
12.92
9.30
9.30
11.72
11.72
2011
Notes
Sales and service income
Cost of sales and services
Gross profit
Other income
Currency exchange gains (losses)
Administrative expenses
Finance costs
Share of profit from interests in
joint ventures, net
Earnings per share for the year
31(a),(b)
31(c)
24
31(h),(i)
26
13
2011
27
Basic earnings per share
Diluted earnings per share
136
Electricity Generating Public Company Limited
S tatements of Comprehensive Income
For the years ended 31 December 2011 and 2010
Baht
Consolidated
2010
Restated
Baht
Baht
Company
2010
Restated
Baht
Net profit for the year
5,115,823,605
6,917,890,091
4,894,490,943
6,168,977,649
Other comprehensive income
Unrealised gains (losses) on investments in marketable
securities - available-for-sale
Translation adjustments
(146,130,436)
1,077,987,078
664,398,097
(957,799,151)
(149,566,139)
-
657,060,271
-
Other comprehensive income (expenses)
for the year
931,856,642
(293,401,054)
(149,566,139)
657,060,271
Total comprehensive income for the year
6,047,680,247
6,624,489,037
4,744,924,804
6,826,037,920
5,921,391,098
6,509,158,605
4,744,924,804
6,826,037,920
126,289,149
115,330,432
-
-
6,047,680,247
6,624,489,037
4,744,924,804
6,826,037,920
2011
2011
Total comprehensive income attributable to:
Owners of the parent
Non-controlling interests
137
Electricity Generating Public Company Limited
S tatements of Cash Flows
For the years ended 31 December 2011 and 2010
2011
Consolidated
2010
2011
Restated
Notes
Cash flows from operating activities
Profit before corporate income tax for the year
Company
2010
Restated
Baht
Baht
Baht
Baht
5,370,525,951
7,373,069,375
4,894,490,943
6,311,928,790
1,972,553,321
2,175,204,520
1,053,132,812
1,076,811,397
217,216,514
247,138,340
121,740,689
135,970,288
25,988,046
22,299,447
10,310,096
10,889,865
(176,396,514)
(87,946,201)
(189,063,659)
(111,140,429)
466,647,642
569,080,001
380,541,269
365,794,461
50,892,632
35,239,692
15,575,239
14,947,448
163,988,568
(17,655,469)
140,490,000
106,583,177
Adjustments to reconcile profit before corporate
income tax to net cash provided by operations:
- Depreciation and amortisation
- Allowance for obsolescence
- Retirement benefit expenses
20
- Interest income
- Interest expenses
- Provision for decommissioning costs
- Unrealised currency exchange (gains) losses
- Losses from write-off and disposal of spare parts
and supplies
- Losses from disposals of equipment
- Gain on disposals of equipment
68,627
106,583,177
68,627
1,481,885
49,741
101,091
49,741
(1,476,528)
(3,450,742)
(170,865)
(4,697,184)
(330,000,000)
- Gains from dissolution of a subsidiary
-
-
(6,982,607)
- Gain on disposals of marketable securities
-
(4,812,935)
-
(4,812,935)
(115,233,980)
(118,348,412)
(115,233,980)
(118,348,412)
-
-
(5,364,452,040)
(5,906,465,803)
(5,199,684,409)
(6,109,227,948)
-
-
2,776,571,755
4,187,222,586
940,547,615
1,547,510,404
(56,747,588)
77,353,857
(380,946,787)
(13,780,021)
(69,231,794)
78,512,080
(128,243,728)
(14,141,579)
620,824,463
(467,955,680)
-
-
(3,360,613)
667,664,575
17,928,067
444,653,496
8,946,332
838,569
(3,225,854)
8,229,493
(117,590,329)
(7,526,810)
28,693,005
(43,277,518)
- Dividends received from other company
- Dividends received from subsidiaries and
joint ventures
- Share of profit from interests
in joint ventures, net
13.4
13
Cash flows before changes in operating assets
and liabilities
Changes in operating assets and liabilities:
(excluding the effects of acquisition of subsidiaries)
- Other current assets
- Other non-current assets
- Short-term and long-term investments
used as collateral
- Trade receivables and trade receivable
from a related party
- Amounts due from related parties
- Spare parts and supplies
- Trade payables and trade payable to
a related party
(7,911,130)
32,697,764
28,290,932
7,209,194
- Amounts due to related parties
(4,062,337)
(19,181,726)
(1,852,898)
(21,200,903)
- Retirement benefit paid
(7,112,522)
(6,968,516)
(701,660)
(3,995,690)
- Other current liabilities
(68,134,980)
10,743,722
231,501
29,466,466
1,162,381
(5,197,140)
1,153,981
(2,212,609)
3,219,939,289
3,997,610,536
1,020,344,975
1,823,997,026
152,419,869
(171,659,875)
95,589,690
(71,942,173)
166,871,516
(9,657,280)
117,129,117
-
3,200,699,283
4,021,258,053
1,177,559,211
1,941,126,143
- Other non-current liabilities
Cash generated from operations
- Interest received
- Tax paid
Net cash receipts from operating activities
138
Electricity Generating Public Company Limited
S tatements of Cash Flows
For the years ended 31 December 2011 and 2010
2011
Consolidated
2010
2011
Restated
Notes
Company
2010
Restated
Baht
Baht
Baht
Baht
Cash flows from investing activities
Investments in subsidiaries and interests
in joint ventures, net of cash and cash equivalents
13
(6,570,001,495)
(2,650,733,492)
(6,237,422,000)
(2,622,957,206)
Cash received from a joint venture for return of capital
transferred as part of acquisition
13
-
3,521,667
-
3,521,667
Cash received from dissolution of a subsidiriary and
a joint venture
13
Net cash receipts from (payments in) short-term investments
Net cash receipts from short-term investments used as collateral
-
24,047,071
6,982,607
354,047,071
(1,489,463,592)
-
47,338,009
450,000,000
(1,448,832,809)
-
84,636,476
450,000,000
-
Net cash payments from long-term investments
156,075,075
-
158,000,000
(125,000,000)
-
(125,000,000)
-
(76,474,101)
(90,212,402)
(21,302,557)
(23,590,046)
31(f)
-
32,000,000
45,882,350
77,882,350
13.4
6,403,252,203
4,536,948,586
5,455,968,612
4,920,419,170
115,233,980
118,348,412
115,233,980
118,348,412
(1,586,377,930)
2,471,257,851
(2,050,489,817)
3,362,307,894
(3,257,977)
(460,923,941)
(2,303,178)
(576,525,347)
(1,062,724)
(373,477,533)
(365,794,461)
3,042,700,000
-
3,042,700,000
-
Acquisition of other long-term investments
Net cash payments in purchases of equipment
Proceed from loans to related parties
Dividends received from subsidiaries
and joint ventures
Dividends received from other company
Net cash receipts from (payment in) investing activities
Cash flows from financing activities
Payments on finance leases
Interests paid
Proceeds from long-term loans from
financial institutions
Payments on long-term loans from
financial institutions and debentures
(724,073,518)
(1,121,751,334)
-
-
(2,844,842,618)
(2,855,935,925)
(2,762,235,948)
(2,762,599,106)
Net cash payment in financing activities
(990,398,054)
(4,556,515,784)
(94,076,205)
(3,128,393,567)
Net increase (decrease) in cash and cash equivalents
Beginning balance
Effect of exchange rate changes
623,923,299
1,936,000,120
(967,006,811)
2,175,040,470
7,748,266,006
29,677,072
5,854,559,912
(42,294,026)
6,641,233,520
-
4,466,193,050
-
Ending balance
8,401,866,377
7,748,266,006
5,674,226,709
6,641,233,520
Cash and cash equivalents are made up as follows:
- Cash in hand and deposits at financial institutions maturities within three months
2,539,090,823
2,669,712,841
339,646,491
1,740,221,779
5,862,775,554
5,078,553,165
5,334,580,218
4,901,011,741
8,401,866,377
7,748,266,006
5,674,226,709
6,641,233,520
27,512,619
-
3,998,070
-
15
242,058,511
718,446,962
141,847,753
219,764,097
15
(258,683,278)
(262,927,304)
(133,061,844)
(102,140,231)
- Increase in property, plant and equipment by other payables
10,877,070
-
8,344,308
-
Dividends paid to shareholders
28
- Short-term investments in promissory notes maturities within three months
Non-cash transactions
- Purchases of fixed assets by finance lease liabilities
- Reclassification of utilised capital spare parts to
property, plant and equipment
- Reclassification of unutilised capital spare parts from
property, plant and equipment
139
Part 2 Section 12 Financial Satatus and Operational Results
Electricity Generating Public Company Limited
S tatements of Changes in S hareholders’ Equity
For the years ended 31 December 2011 and 2010
Consolidated
Other components of equity
Other comprehensive income
Issued and
Notes
Opening balance as at 1 January 2010
- As previously reported
Retained earnings
paid-up share
Premium on
Premium on
capital
share capital
treasury stock
Legal reserve
Baht
Baht
Baht
5,264,650,000
8,601,300,000
47,373,035
Total other
(expenses)
Investments
Translation
components
Non-controlling
Unappropriated
available-for-sale
adjustments
of equity
interests
Total
Baht
Baht
Baht
Baht
Baht
Baht
Baht
530,000,000
35,914,439,291
545,189,294
(330,810,419)
214,378,875
521,174,207
51,093,315,408
- Retrospective adjustments from
changes in accounting policies
2.2.1
- As restated
Changes in shareholders' equity for the year
- Additional investment in a subsidiary
-
-
-
-
501,215,368
-
-
-
-
501,215,368
5,264,650,000
8,601,300,000
47,373,035
530,000,000
36,415,654,659
545,189,294
(330,810,419)
214,378,875
521,174,207
51,594,530,776
-
-
-
-
-
-
-
-
(19,422,872)
(19,422,872)
-
-
-
-
(2,763,090,964)
-
-
-
(107,987,288)
(2,871,078,252)
-
-
-
-
6,802,559,659
664,398,097
(957,799,151)
(293,401,054)
115,330,432
6,624,489,037
Closing balance as at 31 December 2010
5,264,650,000
8,601,300,000
47,373,035
530,000,000
40,455,123,354
1,209,587,391
(1,288,609,570)
(79,022,179)
509,094,479
55,328,518,689
Opening balance as at 1 January 2011
- As previously reported
5,264,650,000
8,601,300,000
47,373,035
530,000,000
39,943,589,830
1,209,587,391
(1,288,609,570)
(79,022,179)
509,094,479
54,816,985,165
- Dividends paid
28
- Total comprehensive income (expenses)
for the year (restated)
- Retrospective adjustments from
changes in accounting policies
2.2.1
- As restated
Changes in shareholders' equity for the year
- Dividends paid
28
-
-
-
-
511,533,524
-
-
-
-
511,533,524
5,264,650,000
8,601,300,000
47,373,035
530,000,000
40,455,123,354
1,209,587,391
(1,288,609,570)
(79,022,179)
509,094,479
55,328,518,689
-
-
-
-
(2,762,790,048)
-
-
-
(80,356,721)
(2,843,146,769)
-
-
-
-
4,989,534,456
(146,130,436)
1,077,987,078
931,856,642
126,289,149
6,047,680,247
5,264,650,000
8,601,300,000
47,373,035
530,000,000
42,681,867,762
1,063,456,955
(210,622,492)
852,834,463
555,026,907
58,533,052,167
- Total comprehensive income
for the year
Closing balance as at 31 December 2011
140
Electricity Generating Public Company Limited
S tatements of Changes in S hareholders’ Equity
For the years ended 31 December 2011 and 2010
Company
Other components of equity
Other comprehensive
Issued and
paid-up share
Premium on
Premium on
capital
share capital
treasury stock
Baht
Baht
Baht
Baht
Baht
Baht
Baht
Baht
5,264,650,000
8,601,300,000
47,373,035
530,000,000
31,270,451,013
555,962,823
555,962,823
46,269,736,871
Notes
Opening balance as at 1 January 2010
- As previously reported
- Retrospective adjustments from
changes in accounting policies
income
Retained earnings
2.2.1
Investments
Legal reserve Unappropriated
Total other
available-for-sale components of equity
Total
-
-
-
-
466,656,812
-
-
466,656,812
5,264,650,000
8,601,300,000
47,373,035
530,000,000
31,737,107,825
555,962,823
555,962,823
46,736,393,683
-
-
-
-
(2,763,090,964)
-
-
(2,763,090,964)
-
-
-
-
6,168,977,649
657,060,271
657,060,271
6,826,037,920
Closing balance as at 31 December 2010
5,264,650,000
8,601,300,000
47,373,035
530,000,000
35,142,994,510
1,213,023,094
1,213,023,094
50,799,340,639
Opening balance as at 1 January 2011
- As previously reported
5,264,650,000
8,601,300,000
47,373,035
530,000,000
34,649,480,851
1,213,023,094
1,213,023,094
50,305,826,980
5,264,650,000
8,601,300,000
47,373,035
530,000,000
493,513,659
35,142,994,510
1,213,023,094
1,213,023,094
493,513,659
50,799,340,639
-
-
-
-
(2,762,790,048)
-
-
(2,762,790,048)
-
-
-
-
4,894,490,943
(149,566,139)
(149,566,139)
4,744,924,804
5,264,650,000
8,601,300,000
47,373,035
530,000,000
37,274,695,405
1,063,456,955
1,063,456,955
52,781,475,395
- As restated
Changes in shareholders' equity for the year
- Dividends paid
28
- Total comprehensive income
for the year (restated)
- Retrospective adjustments from
changes in accounting policies
- As restated
Changes in shareholders' equity for the year
- Dividends paid
2.2.1
28
- Total comprehensive income (expenses)
for the year
Closing balance as at 31 December 2011
141
Part 2 Section 12 Financial Position and Operational Performance
Financial Ratios
Consolidated Financial Statements
Restated
2011
2010
2009
PER SHARE DATA (Baht)
Net Profit (loss) before Fx
Net Profit (loss)
9.44
Book Value
9.48
110.13
Dividend
N/A
13.03
15.01
12.92
15.07
104.13
96.06
5.25
5.25
RATIO ANALYSIS
Liquidity ratio (Time)
Cashflows liquidity ratio (Time)
Gross profit ratio (%)
Earnings ratio (%)
Return on equity ratio (%)
Return on assets ratio (%)
Debt to equity ratio (Time)
11.72
1.82
27.05
37.49
8.85
7.13
0.25
10.26
8.30
2.08
1.08
34.04
40.83
45.04
50.33
12.91
16.60
10.47
13.09
0.21
0.23
Page 142
Part 2 Section 12 Financial Position and Operational Performance
12.2 Explanation and analysis of financial position and oeprational performance
12.2.1 Management Discussion and Analysis
1. Operating results for year 2011
1.1 Operating results
Profit from operating of EGCO Group before foreign exchange (FX) ended December 31,
2011 was 5,301 million baht, a decrease 963 million baht compared to the same period of last
year. This was mainly due to:
In 2011, EGCO Group has increased the stakes in Nam Theun 2 Power Co., Ltd. (NTPC)
from 25% to 35% on September 29, 2010, which resulted in a fully booked of revenue in this
year and led to an increase in revenue of 213 million baht. EGCO Group also increased
additional 26.125% shares of Quezon Power (Philippines) Limited Co. (Quezon) to 52.125% on
March 25, 2011, which resulted in an increase in revenue of 355 million baht. In addition,
Khanom Electricity Generating Co., Ltd. (KEGCO)’s maintenance expenses, interest expenses
and income tax decreased 451 million baht and Rayong Power Plant’s expenses also decreased
140 million baht. With such an increase in revenue and a decrease in expenses, EGCO Group’s
would have recorded higher net profit of 1,159 million baht.
On the other hand, Available Payment (AP), according to the Power Purchase Agreement
(PPAs), of Rayong Power Plant, KEGCO, BLCP Power Co., Ltd. (BLCP) and Gulf Power
Generation Co., Ltd (GPG) decreased 1,404 million baht from the same period of last year.
EGCO Group also had extraordinary items in 2011 such as Quezon’s prepayment fee
from refinancing and withholding tax from special dividend payment and Conal Holdings
Corporation (Conal)’s change in the functional currency from the Philippine peso to U.S.
dollars, totaling of 748 million baht. These led to lower profit of 2,152 million baht.
From all above mainly causes, the profit before FX was 5,301 million baht, a decreased
963 million baht from the previous year.If exculding extraordinary items, EGCO Group’s profit
before FX would have been 6,049 million baht, a decrease of 215 million baht from the same
period of last year.
Page 143
Part 2 Section 12 Financial Position and Operational Performance
Summary results of net profit before FX ended December 31, 2011
Unit : Million Baht
EGCO and Subsidiaries
Power Generation
Others
Total Revenues
Total Expenses
Share of Profit
(Loss)
NCI* before FX
Joint Ventures
Power
Generation
2010
2011
Change
Total
2010
2011
2010
2011
8,005
7,253
991
856
-
-
8,109
(887)
(10%)
(7,451) (7,138) (647) (619)
-
- (8,098) (7,757)
(341)
(4%)
-
-
-
- 5,473 5,083
(76)
(93)
(31)
(41)
Profit (Loss)
before FX
FX
478
22
313
11
(158)
(32)
Net profit (loss)
489
(136)
281
2010
Increase/
2011 (Decrease)
8,996
%
5,473
5,083
(390)
(7%)
-
(107)
(134)
27
26%
196 5,473 5,083
6,264
5,301
(963)
(15%)
(166)
539
(311)
(850) (158%)
209 6,033 4,917
6,803
4,990
13
-
560
(1,813)
(27%)
* NCI: Non-Controlling Interests
1.2 Capacity
As of December 31, 2011. EGCO Group’s portfolio comprises 15 operating plants with
total contracted capacity with Electricity Generating Authority of Thailand (EGAT) under long-term
PPAs of 3,862 MW. This resulted in EGCO Group’s market share in Thailand of 12% from a total
installed capacity of 31,447 MW.
Significant events in 2011 can be summarized as follows:
1.2.1 The purchase of operating assets
On March 25, 2011, EGCO completed the acquisition of an additional 26.125% interest in
Quezon, bringing EGCO’s total ownership interest in Quezon to 52.125%. In addition, EGCO
completed the acquisition of 100% of the outstanding shares of Covanta Philippines Operating
Inc. (CPOI), a new registered name of Pearl Energy Philippines Operating Inc. (PEPOI). PEPOI
is an entity which provides operation and maintenance services to Quezon through a long-term
Operation and Maintenance Agreement.
1.2.2 Development of new projects
EGCO’s business strategy places emphasis on expanding its investment in power
generation in Thailand and the ASEAN countries, as well as an investment in related energy
Page 144
Part 2 Section 12 Financial Position and Operational Performance
projects or renewable energy, including hydropower, solar and wind energy etc. The target is to
provide optimum returns to shareholders by improving the profitability of our existing assets and
acquiring new projects with reasonable risk and return profiles, to maintain market share as a
leading energy company and to strengthen its financial position and operating results for EGCO
Group.
The development of new projects in 2011 can be summarized as follows:
- On January 4 and February 11, 2011, EGCO has been awarded the licenses for 2010
Firm Small Power Producer Cogeneration projects from EGAT in accordance with the resolution
of the Energy Regulatory Commission. The projects are TJ Cogen, TP Cogen and SK Cogen,
which have contracted capacity with EGAT of 90 MW each for 25 years and signed PPAs with
EGAT on November 25, 2011.
i. On March 1, 2011, EGCO acquired a 12.50% interest in Xayaburi Power Company
Limited (XPCL) from CH.Karnchang Public Company Limited. XPCL is a company dedicated to
the development of Xayaburi hydropower project which is a run-of-river dam on the Mekong
River in Laos PDR. XPCL has entered into the PPA with EGAT to sell 1,220 MW, the
commercial operation date is currently scheduled for January 2019.
ii. On December 22, 2011, Natural Energy Development Company Limited (NED) has
started its commercial operation of phase 1 of 8 MW and expected to complete the whole project
within first half of 2012. The company is the largest solar power plant using thin-film solar cells
in the world with total installed capacity of 73 MW (DC)/55 MW (AC). EGCO has 33.33%
ownership in NED.
Significant investments in the post statement of financial position can be summarized as
follows:
iii. On January 18, 2012, EGCO acquired 90% stakes in Theppana Wind Farm Company
Limited (Theppana). Theppana is the wind power plant, located in Chaiyaphum province.
iv. On January 23, 2012, EGCO acquired 99.99% stakes in SPP4 Co., Ltd (SPP4) from
MEMC Singapore Pte Ltd. SPP4 is the solar power plant with installed capacity of 6 MW, located
in the boundary between Srisaket and Ubon Ratchatani province. In addition, the plant is the first
private solar power project equipped with the tracking system. The commercial operation date,
electricity generation and distribution system for the Provincial Electricity Authority (PEA) was on
January 24, 2012.
Page 145
Part 2 Section 12 Financial Position and Operational Performance
The investment in both projects is in line with EGCO’s goal to expand its business
towards the renewable energy and also meets with the government policy regarding
renewable projects for 10 years.
2. Future Plans
EGCO has planned to increase its market shares in power business by development
or acquisition of domestic or regional projects taking into account the feasibility of the projects,
EGCO’s experiences and expertise to increase the value to the projects, costs of capital with
acceptable risks. The projects under study and development are as follows:
2.1 Prefeasibility study of Independent Power Producer investment using the existing
location of Rayong and Khanom power plants.
2.2 Development of 3 Small Power Producer projects in Phatumthani and Ratchaburi
province and NED’s solar project as mention in 1.2.2.
2.3 Study on the opportunity to invest in renewable energy projects. Current projects
under study are solar farms and wind farms.
2.4 Study on the opportunity to invest in overseas Independent Power Producer
projects. EGCO has high potential to be a partner in both existing and new investment projects
given its strong technical knowledge and financial strengths.
EGCO has also developed the knowledge on energy market, investment opportunities
and governance structure of other countries in the region to identify new investment projects,
which eventually would increase the value of the shareholders.
3.
Report and Analysis of the Operating Results
EGCO has invested in the Independent Power Producer (IPP), Small Power Producer
(SPP), Very Small Power Producer (VSPP), Operating and Maintenance (O&M) and Rayong
power plant as an operating company as follows:
(1) Subsidiaries which can be categorized into 2 businesses:
v. Power Generation
Khanom Electricity Generating Co., Ltd. (KEGCO)
IPP
EGCO Cogeneration Co., Ltd. (EGCO Cogen)
SPP
SPP
Roi-Et Green Co., Ltd. (Roi-Et Green)
SPP4 Co., Ltd. (SPP4)
VSPP
Page 146
Part 2 Section 12 Financial Position and Operational Performance
Theppana Wind Farm Co., Ltd. (Theppana)
vi. Others
EGCO Engineering and Service Co., Ltd. (ESCO), which
invested in
Egcom Tara Co., Ltd. (Egcom Tara)
Pearl Energy Philippines Operating Inc. (PEPOI)
North Pole Investment Co., Ltd. (North Pole)
(2) Joint Ventures in Power Generation business
Gulf Electric Public Company Limited (GEC), which invested in
Gulf Cogeneration Co., Ltd. (GCC)
Nong Khae Cogeneration Co., Ltd. (NKCC)
Samutprakarn Cogeneration Co., Ltd. (SCC)
Gulf Yala Green Co., Ltd. (GYG)
Gulf Power Generation Co., Ltd (GPG)
BLCP Power Co., Ltd. (BLCP)
Natural Energy Development Co., Ltd. (NED)
Nam Theun 2 Power Co., Ltd. (NTPC)
Conal Holdings Corporation (Conal), which invested in
Western Mindanao Power Corporation (WMPC)
Southern Philippines Power Corporation (SPPC)
Alto Power Management Coporation (APMC)
Quezon Power (Philippines) Limited Co. (Quezon)
VSPP
O&M
Water
O&M
Holding Co.
Holding Co.
SPP
SPP
SPP
SPP
IPP
IPP
SPP
IPP
Holding Co.
IPP
IPP
O&M
IPP
(3) Other investments
EGCO holds 18.72% of the outstanding shares in East Water Resources Development
and Management Public Company Limited (East Water) as long-term financial investment in
marketable securities.
EGCO holds 12.50% of the outstanding shares in Xayaburi Power Company Limited
(XPCL).
3.1 The Analysis of EGCO and Subsidiaries
3.1.1 The Analysis of EGCO and Subsidiaries in Power Generation business
Page 147
Part 2 Section 12 Financial Position and Operational Performance
Profit (loss) before FX for 2011 ended December 31, 2011 of EGCO and Subsidiaries
in Power Generation business decreased 456 million baht compared to the same period of
last year. This was mainly due to the Rayong Power Plant and KEGCO as follows:
Rayong Power Plant:
Unit : Million Baht
2010
2011
Increase/(Decrease)
%
Total revenues
2,589
2,312
(277)
(11%)
Total expenses
(2,112)
(2,069)
(43)
(2%)
477
243
(234)
(49%)
Profit (Loss) before FX
Rayong power plant’s profit (loss) before FX decreased 234 million baht. This was
mainly due to the decline in AP, according to the PPA, amounting to 253 million baht
and the increase in plant maintenance as planned amounting to 146 million baht.
However, other costs were lower by 266 million baht, mainly due to income tax and
provision of obsolete inventories.
-
Unit : Million Baht
KEGCO:
2010
2011
Increase/(Decrease)
%
Total revenues
2,798
2,181
(617)
(22%)
Total expenses
(2,358)
(1,907)
(451)
(19%)
440
274
(166)
(38%)
Profit (Loss) before FX
- KEGCO’s
profit (loss) before FX decreased 166 million baht. This was mainly due to the
decline in AP, according to the PPA, of 675 million baht. However, the decrease in
plant maintenance as planned and other costs from interest expenses and income tax
were 250 million baht and 200 million baht, respectively.
3.1.2 The Analysis of Subsidiaries in Other business
Profit (loss) before FX for 2011 ended December 31, 2011 of Subsidiaries in Other
business was down by 117 million baht. This was mainly due to ESCO as follows:
ESCO:
Total revenues
2010
2011
730
384
Unit : Million Baht
Increase/(Decrease)
%
(346)
(47%)
Page 148
Part 2 Section 12 Financial Position and Operational Performance
Total expenses
Profit (Loss) before FX
-
(511)
(348)
(163)
(32%)
219
36
(183)
(83%)
ESCO’s profit (loss) before FX sharply dropped 183 million baht, mainly from lower
maintenance service income and lower spare part sales to overseas power plants.
3.2 The Analysis of Joint Ventures in Power Generation business
Profits (Loss) before FX from Joint Ventures in Power Generation business for the results
of 2011 decreased by 390 million baht. This was mainly due to a decrease in profit from Conal,
Quezon, BLCP and GPG whereas an increase in profit from NTPC.
The details are as follows:
Conal:
Unit : Million Baht
Increase/(Decrease)
%
2010
2011
Total revenues
654
898
244
37%
Total expenses
(518)
(895)
377
73%
136
3
(133)
(98%)
Profit (Loss) before FX
- Conal’s profit (loss) before FX decreased 133 million baht, mainly due to the change in
the functional currency from the Philippine peso to U.S. dollars amounting to 96 million
baht.
Quezon:
Unit : Million Baht
Increase/(Decrease)
%
2010
2011
Total revenues
2,775
5,106
2,331
84%
Total expenses
(2,254)
(4,882)
2,628
117%
521
224
(297)
(57%)
Profit (Loss) before FX
- Quezon’s
profit (loss) before FX decreased 297 million baht. This was due mainly to an
increase in prepayment fee from refinancing of 440 million baht and withholding tax
from special dividend payment of 212 million baht. However, EGCO recorded higher
revenue of 355 million baht from additional shares of 26.125% on March 25, 2011.
Page 149
Part 2 Section 12 Financial Position and Operational Performance
BLCP:
2010
2011
Unit : Million Baht
Increase/(Decrease)
%
Total revenues
8,990
9,037
47
1%
Total expenses
(6,669)
(6,997)
328
5%
2,321
2,040
(281)
(12%)
Profit (Loss) before FX
-
BLCP’s profit (loss) before FX decreased 281 million baht, mainly due to the decline
in AP of 397 million baht, according to the PPA. In addition, BLCP’s coal supplier
could not provide sufficient coal stated in Coal Supply and Transportation Agreement
(CSTA) due to flooding situation in Australia. BLCP, thus, had to buy spot coal in the
market in order to maintain the minimum level of coal regarding PPA. This led to an
increase in fuel cost of 152 million baht.
GPG:
Unit : Million Baht
2010
2011
Increase/(Decrease)
%
Total revenues
11,447
11,381
(66)
(1%)
Total expenses
(9,671)
(9,722)
51
1%
1,776
1,659
(117)
(7%)
Profit (Loss) before FX
- GPG’s
profit (loss) before FX decreased 117 million baht. This was mainly due to the
decline in AP, according to the PPA, of 79 million baht and the increase in plant
maintenance as planned of 140 million baht. However, other costs were down by 84
million baht.
NTPC:
2010
2011
Unit: Million Baht
Increase/(Decrease)
%
Total revenues
1,728
2,703
975
56%
Total expenses
(1,175)
(1,937)
762
65%
553
766
213
39%
Profit (Loss) before FX
-
NTPC’s profit (loss) before FX increased 213 million baht, as a result of full-year
recogonition and the acquisition of an additional 10% to 35% stakes in the company,
Page 150
Part 2 Section 12 Financial Position and Operational Performance
which was completed on September 29, 2010. While in 2010 the company
recognized net porfit of 25% stakes for 5 months, and 35% stakes for 3 months
(NTPC’s COD was on April 30, 2010).
3.3 Financial Ratios
Profitability Ratios
2010
2011
Gross Profit Ratio
34.04%
27.05%
Operating Profit Ratio before FX
22.77%
14.60%
Profit Ratio before FX
45.41%
39.42%
12.96
9.75
13.15%
9.34%
Profit before FX per share (Baht)
Return on Equity before FX
4. Report and Analysis of Cash Flow Position
As at December 31, 2011, the ending balance of cash and cash equivalents was 8,402 million
baht, which was 654 million baht lower than the amount as at December 31, 2010. The
details of the sources and uses of funds are as follows:
- Net cash received from operating activities was 3,201 million baht, mainly from
operating activities of 2,777 million baht and working capital of 424 million baht.
- Net cash payment for investing activities was 1,557 million baht mainly due to
investment in joint ventures, Quezon, PEPOI and NED totaled 6,570 million baht and shortterm investment was 1,489 million baht. Meanwhile, dividend received from joint ventures and
others totaled 6,518 million baht.
- Net cash payment for financing activities was 990 million baht. This was mainly due
to the dividend payment to shareholders totaling 2,845 million baht, the loan repayments for
EGCO Cogen, Roi-Et Green and KEGCO’s debenture totaled 724 million baht, and the
interest payments of 461 million baht. Meanwhile, EGCO’s debt drawdown was 3,043 million
baht.
Financial ratios
2010
2011
Debt to equity ratio (Time)
0.21
0.25
Page 151
Part 2 Section 12 Financial Position and Operational Performance
Book value per share (Baht)
104.13
110.13
Current ratio (Time)
10.26
11.72
Quick ratio (Time)
5.59
6.69
Although, the ending balance of cash and cash equivalents was 8,402 million baht,
EGCO has investment plans in 2012, which will utilize funds from cash on hand and loans
from financial institutions. The debt to equity ratio may be higher than the present at 0.25
times.
Audit Fee
In 2011, EGCO and its subsidiaries paid the audit fee of 3,473,500 baht to the Office of the
Auditors, comprising EGCO’s and subsidiaries’ audit fees of 1,986,390 baht and 1,487,110 baht,
respectively. No other audit fee had been paid to the auditors or related parties to the auditors
and the Auditors’ office.
Non-Audit Fee
EGCO’s and subsidiaries’ total non-audit fee was 28,499,322 baht which was already paid of
25,501,221 baht. In addition, EGCO and its subsidiaries would also be responsible for the
expenses of undelivered work of 2,998,111 baht. The details of the non-audit fee were as
follows:
1. Payment to the Office of the Auditors:
In 2011, the non-audit fee for the advisory services on International Financial Reporting
Standards and the audit work at EGCO and its subsidiaries offices was 2,308,130 baht which
was already paid of 1,938,130 baht to the Office of the Auditors. In addition, EGCO and its
subsidiaries would also be responsible for the expenses of undelivered work of 370,000 baht.
2. Payment to Other Related Parties of the Auditors’ Office:
In 2011, the non-audit fee for the special purpose review and advisory services on offshore
investment structure was 26,191,202 baht which was already paid of 23,563,091 baht to other
Page 152
Part 2 Section 12 Financial Position and Operational Performance
related parties of the Auditors’ office. In addition, EGCO and its subsidiaries would also be
responsible for the expenses of undelivered work of 2,628,111 baht.
The engagements of the office of the Auditors and its related parties to provide the non-audit
work were reported to the Audit Committee to ensure that it would not involve any conflict of
interest or any review of their own work which would contaminate the independence judgment of
the auditors.
Page 153
Part 2 Section 13 Others
13. Others
As at December 31, 2011, there is no information which may significant impact to investors’ decision making.
Page 154
Part 3 The Certification of Information
Part 3
The Certification of Information
We, the Board of Directors or the highest ranking management in Accounting, have thoroughly
reviewed all information in this annual registration statement and hereby certify that all
information is true, accurate and not misleading nor does it fail to disclose material facts that
should be stated therein which may cause damage to the purchasers of securities. In addition,
we certified that:
(1) The financial statement and the financial information in this annual registration
statement has accurately disclosed the financial status, the performance, and the cash
flow of the company and its subsidiaries.
(2) We account for providing the good disclosure system to ensure that the company and its
subsidiaries have disclosed the accurate information as well as overseeing the compliance
with such system.
(3) We account for providing the good internal control system as well as overseeing the
compliance with such system. In addition, we have already disclosed the information on
the internal control appraisal to the auditor and the company’s audit committee on
January 11, 2555. The information consists the deficiency and significant change of the
internal control as well as the incorrect practice that may affect the preparation of the
financial statement of the company and its subsidiaries.
To certify that all documents are the same paper as we had certified correctness; we, hereby
assigned Mr. Piya Jetasanon to affix her signature on every single page of all same certified
series. If any page is not signed by Mr. Piya Jetasanon, we assume that such information is not
certified.
Position
Name
1. Mr. Sahust Pratuknukul
2. Mr. Piya Jetasanon
Name
Appointee
Mr. Piya Jetasanon
C
President
Signature
____________________
Senior Executive
____________________
Vice President - Finance
Position
Signature
Senior Executive Vice
President-
________________________
Page 155
Part 3 The Certification of Information
The Certification of Information
We have thoroughly reviewed all information in this annual registration statement and hereby
certify that all information is true, accurate and not misleading nor does it fail to disclose
material facts that should be stated therein.
To certify that all information are the same as I had reviewed and having no inquiries that such
information are incomplete, false, and misleading or failing to disclose material facts that should
be stated therein; I, hereby assigned Mr. Piya Jetasanon to affix her signature on every single
page of all same certified series. If any page is not signed by Mr. Piya Jetasanon, we assume that
such information is not certified.
Name
Mr. Sahust Pratuknukul
Name
Appointee
Mr. Piya Jetasanon
Position
Signature
President
________________________
Position
Signature
Senior Executive Vice
President-
________________________
Page 156
The positions of EGCO’s Board of Directors as of January 31, 2012
Name and Position
1. Mr. Pornchai Rujiprapa

Chairman

Chairman, Investment
Committee
Age
59
Education
-
-
-
2. Mr. Aswin Kongsiri
 Independent Director
 Vice Chairman
 Chairman, Corporate
Governance and Social
Responsibility Committee
 Nomination and Remuneration
Committee Member
66
-
-
Ph.D. (Regional Economics.),
University of Pennsylvania, USA
M.Sc. (Regional Economics.),
from University of Pennsylvania,
USA
M.P.A. (Programming Planning
Administration) from National
Institute
of
Development
Administration (NIDA)
B.Sc. (Agro-Industry) from
Kasetsart University
Certificate of Executive Program,
Class 7, Capital Market Academy
Certificate
of
Directors
Accreditation Program, Thai
Institute of Directors Association
National Defense Course (Class of
41), National Defence College
Bachelor’s Degree ( Honours) in
Philosophy, Politics and
Economics, Oxford University,
England
Banff School of Advanced
Management, Alberta, Canada
The National Defense Course for
the Joint State-Private Sectors,
Dispute
Family Relationship Amount of
between the
Shares (%)
management
-
-
0.000
Working Experience
Year
October
2006-Present
2010-Present
2006September
2010
December
2006-2008
2005 - 2009
2003-2006
1999-2003
-
-
0.000
November
2011-Present
October 2010Present
August 2010Present
April 2010November 2011
Position
Company
Chairman
Electricity Generating Authority of
Thailand
Permanent Secretary, Ministry of Ministry of Science and Technology
Science and Technology
Permanent Secretary, Ministry of Ministry of Energy
Energy
Director
PTT Public Company Limited
Chairman
PTT Chemical Public Company Limited
Deputy Permanent Secretary, Ministry Ministry of Energy
of Energy
Deputy Secretary –General, The Office of the Prime Ministry
National Economic and Social
Development Board (NESBD)
Member of Monetary Policy
Committee
Chairman
Bank of Thailand
Governor
The Stock Exchange of Thailand
Chairman
Krungthai - Axa Life Insurance Co.,
Ltd.(KAL)
Thai Orix Leasing Co., Ltd. (TOLC)
-
-
November
2010-Present
January20092010
January 20092010
October 2007Present
2007-Present
Class 6, National Defence College
Certificate of Chairman 2000
Program, Thai Institute of
Directors Association
Certificate of Directors
Certification Program, Thai
Institute of Directors Association
Chairman
Director and Audit Committee
Member
Chairman
Thoresen Thai Agencies Public Company
Limited
Thoresen Thai Agencies Public Company
Limited
Ch. Karnchang Public Company Limited
Chairman
Ton Poh Thailand Fund
Independent Director
Bangkok Aviation Fuel Services Public
Company Limited
The OHTL Public Company Limited (Mandarin
Oriental Hotel)
Thai Reinsurance Public Company Limited
2005 – Present Independent Director
3. Mr. Chaipat Sahasakul

Independent Director

Chairman, Audit Committee
57
-
Ph.D. in Economics, University of
Rochester, USA
M.A. in Economics, Thammasat
University
B.A. in Economics, Thammasat
University
Certificate of Executive Program,
Class 12, Capital Market Academy
The National Defense Course for
-
-
0.000
1999-Present
Independent Director
1993-Present
1981 - Present
2005 – August
2010
2003 –
November 2008
Independent Director
Independent Director and Executive
Committee Member
Padaeng Industry Public Company Limited
Krung Thai Bank Public Co., Ltd.
Independent Director
Thai Rating and Information Services
Company Limited
August 2010Present
May 2010Present
May 2009Present
July 2005Present
2001 – April
Governor
The Stock Exchange of Thailand
Independent Director and Audit
Committee Member
Chairman, University Research policy
Committee
Independent Director and Audit
Committee Member
Secretary - General
Thai Vegetable Oil Public Company
Limited
Bangkok University
Pylon Public Company Limited
Agricultural Futures Trading Commission
-
-
-
-
-
-
4. Mr. Thanapich Mulapruk

Independent Director

Audit Committee Member
62
-
the Joint Public-Private Sectors,
Class 21, National Defence
College
Politics and Governance in
Democratic Systems for
Executives Course 11, King
Prajadhipok’s Institute
Certificate of Directors
Certification Program, Thai
Institute of Directors Association
Certificate of Audit Committee
and Continuing Development
Program, Thai Institute of
Directors Association
Certificate of Monitoring Fraud
Risk Management, Thai Institute of
Directors Association
Certificate of Monitoring the
System of Internal Control and
Risk Management, Thai Institute
of Directors Association
Certificate of Monitoring the
Quality of Financial Reporting,
Thai Institute of Directors
Association
LL.M., Chulalongkorn University
LL.B., Chulalongkorn University
Thai Bar Certificate, Thai Barrister
at law of Thailand
National Defence College, 1998
(Class 41)
2009
2005 - 2006
1998 – 2001
1991 – 1996
-
-
0.000
October, 2009Present
February 2009Present
November 2008Present
Director, Audit Committee Member
and Chairman of Risk Management
Committee
Senior Executive Vice President
Government Housing Bank
Director General of Department of
Special Litigation
Director
Office of Attorney -General
MFC Asset Management Public Company
Limited
Senior Vice President and Spokesman Stock Exchange of Thailand
Spokesperson
The Airports of Thailand Public Company
Limited
Office of Attorney-General
-
-
-
-
-
5. Police Lieutenant General Pijarn
Jittirat

Independent Director

Corporate Governance and
Social Responsibility
Committee Member

Nomination and Remuneration
Committee Member
63
-
-
Certificate of Directors
Certification Program (class 78) ,
Thai Institute of Directors
Association
Certificate of Executive Program,
Class 7, Capital Market Academy
Certificate of Audit Committee
and Continuing Development
Program, Thai Institute of
Directors Association
Certificate of Monitoring Fraud
Risk Management, Thai Institute of
Directors Association
Certificate of Monitoring the
System of Internal Control and
Risk Management, Thai Institute
of Directors Association
Certificate of Monitoring the
Quality of Financial Reporting,
Thai Institute of Directors
Association
Master of Public Administration,
Chulalongkorn University
Bachelor of Public Administration,
Police Cadet Academy
Advanced
Course
in
Administration, Class 29, Institute
of Administration Development
Advanced Course in Police
Administration, Class 13
April 2008June2011
October 2005Present
April 2008October 2008
December 2006 –
September 2009
October 2007February 2008
2006
2004-2006
2003-2004
-
-
0.000
2006-2008
2005-2006
2004-2005
2002-2004
Director
The Port Authority of Thailand
Director
The Transport Company Limited
Director
The Bangkok Mass Transit Authority
Director General of Department of
Economic Crime Litigation
Director
Office of Attorney-General
Director General of Department of
Administrative Litigation
Deputy Director General of
Department of Economic Crime
Litigation
Executive Director of Office of
Economic Crime Litigation 1
Office of Attorney-General
Deputy Inspector-General
Commissioner, Office of Legal and
Investigation
Deputy Commissioner, Office of
Human Resources
Assistant Commissioner, Office of
Human Resources
Royal Thai Police
Royal Thai Police
The Marketing Organization for Farmers,
Ministry of Agriculture and Cooperatives
Office of Attorney-General
Office of Attorney-General
Royal Thai Police
Royal Thai Police
-
National Defense College Class 44
-
Certificate of The Board’s Role on
Fraud Presentation and Detection ,
Thai
Institute
of
Directors
Association
-
Certificate of
Role of the
Compensation Committee, Thai
-
6. Mr. Somphot Kanchanaporn

Independent Director

Audit Committee Member
65
-
-
-
-
-
Institute of Directors Association
Certificate of Directors
Certification Program, Thai
Institute of Directors Association
MBA, National Institute of
Development
Administration
(NIDA)
B.S. (Police Science and
Administration), California State
University at Los Angeles
Certificate
of
Directors
Accreditation Program (DAP),
Thai Institute of Directors
Association
National Defense College, (Class
41st)
Certificate of Executive Program,
Class 7, Capital Market Academy
Certificate of Monitoring Fraud
Risk Management, Thai Institute of
Directors Association
Certificate of Monitoring the
System of Internal Control and
-
-
0.000
2008November
2010
January 2009June 2010
2008-April
2009
October
2006-2008
December
2006-2008
2007
Chairman of the Inspector General
Ministry of Energy
Director
B N B Inter Group Public Company
Limited
PTT Aromatics and Refining Public
Company Limited
The National Legislative Assembly
November
2003November
2005
AugustNovember
Deputy Director (Executive Level 10)
Independent Director
Member
Chairman of Standing Committee on
Energy
Independent Director
Deputy Secretary-General
The National Legislative Assembly
Aromatics (Thailand) Public Company
Limited
The National Intelligence Agency
The Office of the National Security
Council
-
7. Mr. Phaiboon Siripanoosatien

Independent Director

Nomination and Remuneration
Committee Member

Corporate Governance and
Social Responsibility
Committee Member
48
-
-
-
-
-
-
Risk Management, Thai Institute
of Directors Association
Certificate of Monitoring the
Quality of Financial Reporting,
Thai Institute of Directors
Association
Master of Political Science,
Sukhuthai
Thammathirat
University
Bachelor
of
Engineering,
Chulalongkorn University
Certificate
of
Directors
Certification Program, Thai
Institute of Directors Association
Certificate of Public Law and
Management, Class 1, King
Prajadhipok’s Institute
Certificate of Democratic Politics
and Governance for High-Level
Administrators, Class 7, King
Prajadhipok Institute
Certificate of Management of
Public Economy, Class 1, King
Prajdhipok’s Institute
Certificate of Executive Program,
Class 3, Capital Market Academy
2003
2008-Present
Director
Independent Director
Independent Director and Audit
Committee Member
Independent Director
1998-Present
Managing Director
2009-Present
2009-Present
2008-Present
Government Saving Bank
Asia Credit Securities Company Limited
Finansia Syrus Securities Public Company
Limited
Metrostar Property Public Company
Limited
Trinity Plus Company Limited
8. Mr. Wisudhi Srisuphan

Director
(Authorized Director)
(Vacating the office by resignation
on February 28, 2011)
62
-
-
-
M.A.A. Business Economics,
Thammasart University
M.E. (C.E.) Lamar University ,
U.S.A.
LLB. (Second Class Honour),
Ramkhamhaeng University
B.Eng.in Civil Engineering,
Chulalongkorn University
National Defense Course (Class
38), National Defense College
Politics and Governance in
Democratic Systems for Executive
Course (Class 6), King
Prajadhipok’s Institute
CMA (Class 6), Capital Market
Academy
Certificate of Role of Chairman
Program, Thai Institute of
Directors Association
Certificate
of
Directors
Certification Program, Thai
Institute of Directors Association
-
-
0.000
November 2010- Independent Director
Present
June 2010-2011 Chairman
Pruksa Real Estate Public Company
Limited
CAT Telecom Public Company Limited
October 2006Present
August 2004Present
June 2010-Sep
2010
December 2009June 2010
October 20082010
July 2008-June
2010
2009
Director
Office of the Council of State
Chairman
Real Estate Information Center
Chairman
Sunshine Corporation Public Company
Limited
Siam City Bank Public Company Limited
Chairman
Director
Vice Chairman
Director-General
2008-2009
2006-2009
2006-2009
Deputy Permanent Secretary
Chairman of the Board
Director
2007-2008
Director-General
2006-2008
Chairman of the Board
2007
Director-General
2003-2007
Director-General
2005-2006
Chairman
The Electricity Generating Authority of
Thailand
Dhipaya Insurance Public Company
Limited
The Custom Department, Ministry of
Finance
Ministry of Finance
The Government Saving Bank
Thai Airways International Public
Company Limited
The Custom Department, Ministry of
Finance
Thailand of Tobacco Monopoly,
Ministry of Finance
The Excise Department, Ministry of
Finance
The Treasury Department, Ministry of
Finance
CAT Telecom Public Company Limited
2002-2006
Director
2000-2006
2000-2005
2002-2003
1999-2002
Chairman of the Board
Director
Director-General
Comptroller-General
PTT Exploration and Production Public
Company Limited
The Government Housing Bank
PTT Public Company Limited
Fiscal Policy Office, Ministry of Finance
The Comptroller’s Department, Ministry of
Finance
9. Mr. Kurujit Nakornthap

Director

Corporate Governance and
Social Responsibility
Committee Member
(Authorized Director)
(Vacating the office by resignation
on December 1, 2011)
56
-
-
-
-
-
-
-
10. Mr. Kulit Sombatsiri

Director

Corporate Governance and
Social Responsibility
48
-
Ph.D. in Petroleum Engineering,
University of Oklahoma, U.S.A.
Mater of Science in Petroleum
Engineering, University of
Oklahoma, U.S.A.
Bachelor of Science (with Special
Distinction)
in
Petroleum
Engineering, University of
Oklahoma, U.S.A.
The Civil Service Executive
Program for Senior Civil Servants
(Visionary Leadership, Class 46)
by OCSC, Bangkok
Senior Executive Program
(SEP60), at the London Business
School, U.K.
Certificate
of
Director
Accreditation Program, Thai
Institute of Directors Association
Certificate of Audit Committee
Program, Thai Institute of
Directors Association
National Defense College (Class
2551 (2008-2009)), Thailand
Top Executive Program in
Commerce and Trade (TEPCoT3),
2010
MBA, University of Southern
California, USA
MPA, San Diego State University,
USA
-
-
0.000
2011-Present
November 2010Present
September 2008November 2010
December 2006September 2008
Jan 2006December 2006
-
-
0.000
2011-Present
Director
Deputy Permanent Secretary
Electricity Generating Authority of
Thailand
Ministry of Energy
Director General, Department of Ministry of Energy
Mineral Fuel
Ministry of Energy
Deputy Permanent Secretary
Deputy Director General, Department
Ministry of Energy
of Mineral Fuels,
Director
Oct 2011-Present Inspector General
2009-Present Director
Electricity Generating Authority of
Thailand
Ministry of Finance
Krung Thai Asset Management Public
Committee Member
(Authorized Director)
-
BA, Public Administration,
Ramkhamhaeng University
Certificate of Executive Program,
Class 10, Capital Market Academy
Certificate
of
Directors
Certification Program, Thai
Institute of Directors Association
Company Limited
Mar 2010-Sep State Enterprise Development Advisor The State Enterprise Policy Office,
Ministry of Finance
2011
The State Enterprise Policy Office,
Sep 2008-Feb Deputy- Director General
Ministry of Finance
2010
2007-Aug 2008 Director, Bureau of Monetary The Treasury Department, Ministry of
Finance
Management
The National Telecommunications
2005-2007 Deputy Secretary General
Commission
11. Mr. Somboon Arayaskul

Director

Investment Committee
Member

Corporate Governance and
Social Responsibility
Committee Member
(Authorized Director)
(Vacating the office by resignation
on October 1, 2011)
58
- Master of Engineering (Mechanical
Engineering), Villanova University,
U.S.A.
- Bachelor of Engineering (Mechanical
Engineering), Mapua Institute of
Technology, Philippines
- Certificate of Directors
Certification Program, Thai
Institute of Directors Association
- Certificate of the General Manager
Program, Harvard Business School
12. Mr. Surasak Supavititpatana

Director

Investment Committee
Member
(Authorized Director)
59
-
-
-
-
-
Bachelor of Engineering (Electrical
Engineering), Kasetsart University
Certificate of Management of
Public Economy for Executive,
King Prajadhipok’s Institute
Certificate of Directors
Certification Program, Thai
Institute of Directors Association
Certificate of Finance for
Executive Decision, Continuing
Education Center, Chulalongkorn
University
Certificate of Positioning Utility
Executives for Change, University
of Idaho
Certificate of Air War College,
High Education Institute
Deputy Governor- Development
Electricity Generating Authority of
Thailand
Director
Ratchaburi Electricity Generating Holding
Public Company Limited
Vice President - Thermal Power Plant Electricity Generating Authority of
Construction
Thailand
-
-
0.000
December 2007Present
April 2008January 2009
October 2006December 2007
-
-
0.000
January 2010- Deputy Governance –Generation
Present
Assistant Governor –Power Plant 2
October 2006January 2010 Mae Moh Power Plant Production
November 2000- Division Manager
September 2006
Electricity Generating
Thailand
Electricity Generating
Thailand
Electricity Generating
Thailand
Authority of
Authority of
Authority of
13. Mr. Thawat Vadjanapornsithi

Director

Nomination and Remuneration
Committee Member
(Authorized Director)
14. Mr. Peter Albert Littlewood

Director
(Authorized Director)
(Vacating the office by resignation
on February 23, 2011)
59
60
Bachelor of Engineering (Electrical
Engineering),
Chulalongkorn
University
- Certificate of Management of
Public Economy for Executive
(Class 7), King Prajadhipok’s
Institute
- Certificate of Directors
Certification Program (Class 86),
Thai Institute of Directors Association
- Certificate of Finance for
Executive Decision, Continuing
Education Center, Chulalongkorn
University
- Certificate of Masterful Coaching
Workshop, Hay Group
- Certificate of Senior Executive
Development
Program-2,
Foundation for International
Human Resource Development
MA (1st Class Honours),
Cambridge University, UK
-
-
-
-
-
0.000
0.000
October 2010- Deputy Governance –Corporate Social
Present
Responsibility, Acting EGAT
Spokesman
January 2010- Assistant
Governor
–Human
September
Resources
2010
October 2008- Assistant Governance –Corporate
December 2009 Social Responsibility
Governance
–
December 2007- Assistant
September 2008 Administration, Development Area
Electricity Generating
Thailand
Authority of
Electricity Generating
Thailand
Authority of
Electricity Generating
Thailand
Electricity Generating
Thailand
Authority of
2009-Present Director
2003 – Present Executive Director and Chief
Operating Officer
2001-2010 Director
2000 - 2005 Director
2000 - 2005
Director
2000 - 2005
Director
1999 – 2003 Project Manager for CLP’s
generating plant projects
1998
General Manager for CLP’s
generation business group and later
Natural Energy Development Co., Ltd.
CLP Power Asia Limited, Hong Kong
Authority of
BLCP Power Limited
Rayong Electricity Generating Co., Ltd.
Khanom Electricity Generating Co., Ltd.
EGCO Engineering & Service Co., Ltd.
CLP Group
CLP Group
15. Mr. Hideaki Tomiku

Director

Chairman, Nomination and
Remuneration Committee

Investment Committee
Member
(Authorized Director)
54
16. Mr. Mark Jobling

Director

Chairman, Nomination and
Remuneration

Investment Committee
Member
(Authorized Director)
(Vacating the office by resignation
on February 23, 2011)
40
17. Mr. Shinji Tsuchiya

Director
(Authorized Director)
(Vacating the office by resignation
on February 23, 2011)
41
18. Mr. Toshiro Kudama

Director
(Authorized Director)
International Law, Tokyo University
-
-
0.00
2009-Present
May 2009Present
2006 –2011
2003 – 2006
2001 –2003
-
53
-
-
Bachelor of Economics, Monash
University
Bachelor of Laws (Honours),
Monash University
Barrister and Solicitor (Victoria)
Solicitor (Hong Kong)
-
Bachelor
of
Engineering
(Mechanical Engineering), Keio
University
-
Master of Mechanical Engineering,
Tokyo Institute of Technology
Bachelor
of
Mechanical
Engineering, Tokyo Institute of
Technology
-
0.00
2009-Present
2009-2011
2006-2009
2003-2006
-
-
-
0.00
0.00
April 2009Present
November
2005 – March
2009
November 2005
2010-Present
2006 – 2010
for CLP strategic development
Director
Chief Executive Officer
Natural Energy Development Co., Ltd.
Diamond Generating Asia, Limited
Director and Executive Vice President
Deputy General Manager, Head of
International IPP
Assistant General Manager,
Power, Generation & Marketing for
Japanese Market
Director
Managing Director-Southeast Asia
Chief Executive Officer
Senior Vice President –Business
Development
General Counsel
OneEnergy Limited
Mitsubishi Corporation
Head of Southeast Asia IPP Team
Global Power Generation and Marketing
Unit of Mitsubishi Corporation
Power Generation and Marketing
Internatinal Unit of Mitsubishi Corporation
Electricidad Aguila de Tuxpan (co.)
Electricidad Sol de Tuxpan
The Tokyo Electric Power Company, Inc.
Manager
Commercial Director
Executive Officer, Executive General
Manager, International Affairs
Department
Executive General Manager,
International Affairs Department
Mitsubishi Corporation
Natural Energy Development Co., Ltd.
CLP Holdings
OneEnergy
OneEnergy
CLP Power Asia
1997 –2006
19. Mr. Akio Matsuzaki

Director
(Authorized Director)
(Vacating the office by resignation
on January 29, 2012)
55
-
Master of Energy Science, Tokyo Institute of Technology
Bachelor of Applied Physics,
Tokyo Institute of Technology
-
0.00
2011-Present
2010-2011
2007-2010
1999-2007
20. Mr. Ryota Sakakibara

Director

Investment Committee
Member
(Authorized Director)
21. Mr. Satoshi Yajima

Director
(Authorized Director)
39
-
Bachelor of Economics, The University of Tokyo
-
0.00
2011-Present
2009-2011
Assistant General Manager
Head of Southeast Asia IPP Team
Asia & Oceania Business Unit
New Energy & Power Generation
Division
Director
2006-2009
Manager
2009-2011
44
-
Bachelor of Electrical Engineering, Waseda University, Japan
-
0.00
Manager and General Manager,
Business Development Group,
International Affairs Department
General Manager, Chiba Thermal
Power Station, East Thermal Power
Office
General Manager, Overseas Power
Business, Thermal Power Department
Executive Vice President and Chief
Operation Officer, TeaM Energy
Corporation, Philippines
General Manager, Overseas Project
Group, Thermal Power plant
Engineering Center, Thermal Power
Department
2002-Present General Manager, Overseas Business
Group 2 International Affairs
Department
The Tokyo Electric Power Company, Inc.
Mitsubishi Corporation
Diamond Generating Asia, Limited
Natural Energy Development Company
Limited
OneEnergy Limited
The Tokyo Electric Power Company, Inc.
22. Mr. Vinit Tangnoi

President and Director

Chairman, Risk Management
Committee

Chairman, Group Business
Committee

Chairman, Good Corporate
Governance Committee

Chairman, EGCO
Management Committee

Investment Committee
Member

Corporate Governance and
Social Responsibility
Committee Member
(Authorized Director)
(Mr. Vinit Tangnoi’s contract as
President expired on September 30,
2011)
60







(Vacating the office by resignation
on January 1, 2012)
Master of Science (Industrial
Engineering), University of Texas
at Arlington, U.S.A.
B.Eng. (Mechanical), Kasetsart
University
Certificate
of
Advance
Management Program, Harvard
Business School, Harvard
University, U.SA.
Certificate of Senior Executive
Program, Sasin Graduate Institute
of Business Administration of
Chulalongkorn University
Certificate of Army War College
Regular Program, Institute of
Army Academics
Certificate
of
Directors
Certification Program, Thai
Institute of Directors Association
Certificate of Leader Program,
Capital Market Academy
-
-
0.000
Mar2011Sep2011
Aug2009-Sep
2011
Jan 2009-Sep
2011
Oct2008-Sep
2011
Oct2008-Sep
2011
Oct 2008-Sep
2009
Oct 2008-Sep
2009
Dec2007Sep2008
Director
Xayaburi Hydropower Company Limited
Chairman
Natural Energy Development Co., Ltd.
Chairman
Gulf Electric Company Limited
Chairman
Khanom Electricity Generating Company
Limited
EGCO Engineering and Service Company
Limited
BLCP Power Company Limited
Chairman
Director
Chairman
Deputy Governor-Generation
Director
2006-2008
Director
March, 2006 Deputy Governor-System Control
October, 2005 Senior Executive Vice PresidentSystem Control
June, 2005 Assistant Chief Executive OfficerPlanning
October, 2004 Assistant Governor-Policy and
Planning
October, 2003 Assistant Governor-Fuel Management
Rayong Electricity Generating Company
Limited
Electricity Generating Authority of
Thailand
EGAT International Co., Ltd.
Ratchaburi Electricity Generating Holding
Public Company Limited
Electricity Generating Authority of
Thailand
Electricity Generating Authority of
Thailand
Electricity Generating Authority of
Thailand
Electricity Generating Authority of
Thailand
Electricity Generating Authority of
Thailand
23. Mr. Sahust Pratuknukul

Director
Nomination and Remuneration
Committee Member
( During April 22, 2010-September
30, 2011)

President and Director

Chairman, Risk Management
Committee

Chairman, Group Business
Committee

Chairman, Good Corporate
Governance Committee

Chairman, EGCO
Management Committee

Investment Committee
Member

Corporate Governance and
Social Responsibility
Committee Member
(Appointed to be President on
October 1, 2011)
(Authorized Director)

56
-
-
-
-
-
Bachelor of Engineering (Electrical
Engineering),
Chulalongkorn
University
Certificate of the Joint PublicPrivate Sectors Regular Course,
National Defence College
Certificate of Senior Executive
Development Program-1, GE Co.,
Ltd.
Certificate of Finance for
Executive Decision Program,
Continuing Education Center,
Chulalongkorn University
Certificate
of
Directors
Certification Program, Thai
Institute of Directors Association
-
-
0.000
Oct2011-Present Chairman
Oct2011-Present Chairman
Oct2011-Present Chairman
Oct2011-Present Director
Oct, 2010-Sep Deputy Governor-Policy and Planning
2011
Jan 2008-Dec Director
2010
Oct 1, 2006 Assistant Governor-Policy
Oct 1, 2005
Oct. 1, 2003
Gulf Electric Company Limited
Khanom Electricity Generating Company
Limited
EGCO Engineering and Service Company
Limited
BLCP Power Company Limited
Electricity Generating Authority of
Thailand
EGAT International Co., Ltd.
Electricity Generating Authority of
Thailand
Assistant Chief Executive Officer- Electricity Generating Authority of
Planning
Thailand
Director, Energy Economic Division
Electricity Generating Authority of
Thailand
The positions of the Management and the Control Persons as of December 31, 2011
Name and Position
1. Mr. John M. Palumbo

Senior Executive Vice
President -Business
Development -International

Risk Management Committee
Member

Good Corporate Governance
Committee Member

Group Business Committee
Member

EGCO Management
Committee
Age
48
Education
-
Bachelor of Science in Mechanical
Engineering (Honors), Columbia University, School of Engineering
and Applied Science, New York.
Dispute
-
Family
Relationship
between the
management
-
Amount of
Shares (%)
0.000
Working Experience
Year
Position
2011-Present
Director
2011-Present
Director
2011-Present
August 20092010
2004 –2010
30 Jan 07November 08
2005-May 2008
Director
Director
2004 – April
2007
Director
2003 – 2004
Independent Consultant to the
Managing Director and the Head
of the Southeast Asia Business
Team Leader & Infrastructure
Specialist,
Independent Consultant to Chief
2003 - 2004
2003
Director
Director
Director
Company
Khanom Electricity Generating Company
Limited
EGCO Engineering & Service Company
Limited
North pole Investment Company Limited
Natural Energy Development Company
Limited
Gulf Electric Public Company Limited
BLCP Power Company Limited
EGCO Joint Ventures & Development
Company Limited
Nam Theun 2 Power Company Limited
China Light & Power Group
(Hong Kong)
ADB Technical Assistance Program
International Power PLC.
Name and Position
2. Mr. Voravit Potisuk

Senior Executive Vice
President -Business
Development-Domestic

Risk Management Committee
Member

Good Corporate Governance
Committee Member

Group Business Committee
Member

EGCO Management
Committee
Age
54
Education
-
-
-
MBA, The University of The Thai
Chamber of Commerce
B.Eng. (Electrical &
Communication) Chulalongkorn
University
Certificate of Directors
Certification Program, Thai
Institute of Directors Association
Executive Leadership Program
(ELP-NIDA Wharton)
Dispute
-
Family
Relationship
between the
management
-
Amount of
Shares (%)
0.000
Working Experience
Year
1995 – 2003
2011-Present
2011-Present
Director
2011-Present
2011-Present
2011-Present
2010-2011
Director
Director
Director
Director
2010-2011
Director
Delta Associates (Thailand) Limited
EGCO Engineering & Service Company
Limited
Khanom Electricity Generating Company
Limited
Gulf Electric Public Company Limited
BLCP Power Company Limited
Nam Theun 2 Power Company Limited
Quezon Generating Company Ltd,
Philippines
Conal Holdings Corporation, Philippines
Executive Vice President-Business
Development
Senior Vice President - Engineering
Business Division
Acting Managing Director
Electricity Generating Public Company
Limited
Electricity Generating Public Company
Limited
Egcom Tara Company Limited
Director
Director
Director
Director
Director
Gulf Electric Public Company Limited
BLCP Power Company Limited
EGCO International (BVI) Limited
North pole Investment Company Limited
EGCO Engineering & Service Company
2004-2011
2002-2003
54
- MBA, Ramkhamhaeng University
- B.A. (Economics), Thammasat
University
-
Certificate of Directors
-
-
0.000
Company
Executive Officer
Principal and Managing Director
Director
1996-2004
3. Mr. Piya Jetasanon

Senior Executive Vice
President – Finance and
Corporate Services

Risk Management Committee
Position
2011-Present
2011-Present
2011-Present
2011-Present
2011-Present
Name and Position



Age
Member
Group Business Committee
Member
Good Corporate Governance
Committee Member
EGCO Management
Committee
4. Mr. Chumsak Desudjit
56

Senior Executive Vice President

Director-Rayong Power Plant

Risk Management Committee
Member

Group Business Committee
Member

Good Corporate Governance
Committee Member

EGCO Management
Committee
Education
Dispute
Family
Relationship
between the
management
Amount of
Shares (%)
Certification Program, Thai Institute of
Directors Association
- Certificate of TLCP Executive
Development Program, Thai Listed
Companies Association
-
-
-
B. Eng. (Mechanical Engineering),
Chulalongkorn University
Certificate of Directors
Certification Program, Thai
Institute of Directors Association
Certificate in Executive Leadership
Program, Joint Program NIDAWharton, University of
Pennsylvania
Graduate Diploma in Management
of Public Economy(MPE-7) , King
Working Experience
Year
2011-Present
Position
Director
2007 - Present Director
Director
2007
2005-Present First Senior Vice President – Finance
-
-
0.000
2003-2005
Senior Vice President – Finance
1996 – 2003
Manager – Finance Division
1994 – 1996
2011-Present
2008 – 2009
Manager- Treasury Management
Section
Director
Director and Managing Director
2009-Present
2009-Present
2007-Present
2009-Present
Chairman
Chairman
Chairman
Director
2009-Present
Director
Company
Limited
Khanom Electricity Generating Company
Limited
EGCO Cogeneration Company Limited
Thai LNG Power Corporation Ltd.
Electricity Generating Public Company
Limited
Electricity Generating Public Company
Limited
Khanom Electricity Generating Company
Limited
Electricity Generating Public Company
Limited
BLCP Power Company Limited
Rayong Electricity Generating Company
Limited
Roi-Et Green Company Limited
EGCO Green Energy Company Limited
EGCO Cogeneration Company Limited
Khanom Electricity Generating Company
Limited
EGCO Engineering & Service Company
Limited
Name and Position
Age
Education
Dispute
Family
Relationship
between the
management
Amount of
Shares (%)
Prajadhipok’s Institute
Working Experience
Year
2008-2009
Director
2006 – 2550
Director
2001 -2007
Deputy Managing Director Operation
Group
Operation Division Manager
1998 -2000
5. Mr. Chankij Jearaphunt

Senior Executive Vice
President

Managing Director –Khanom
Electricity Generating
Company Limited

Risk Management Committee
Member

Group Business Committee
Member

Good Corporate Governance
Committee Member

EGCO Management
56
- Master of Public Administration (MPA)
National Institute of Development
Administration (NIDA)
- B. Eng. (Electrical Engineering),
Chulalongkorn University
-
-
0.000
Position
2004 – Present Director and Managing Director
2004 – Present
2004-Sept 2009
April 08-Present
April 07-April 09
2002 - April 08
Company
Gulf Cogeneration Company Limited
Nongkhae Cogeneration Company Limited
Samutprakarn Cogeneration Company
Limited
EGCO Cogeneration Company Limited
Rayong Electricity Generating Company
Limited
Rayong Electricity Generating Company
Limited
Director
Khanom Electricity Generating Company
Limited
EGCO Engineering & Service Company
Limited
Director
Rayong Electricity Generating Company
Limited
Director
Gulf Energy Company Limited;
Gulf IPP Company Limited; and
Gulf Power Generation Company Limited
Chairman
Roi-Et Green Company Limited; and
EGCO Green Energy Company Limited
Name and Position
Age
Education
Dispute
Family
Relationship
between the
management
Amount of
Shares (%)
Working Experience
Year
Committee
Position
Director
2006 - April 07
58
-
-
-
-
Bachelor Degree of Mechanical
Engineering, Chulalongkorn
University
Certificate of Directors
Certification Program, Thai
Institute of Directors Association
Certificate of NIDA Executive
Leadership Program, Joint
Program NIDA-Wharton of
University of Pensylvania
Certification of The Senior
Executive Program, Sasin
Graduate Institue of Business
-
-
0.000
Gulf Cogeneration Company Limited;
Nongkhae Cogeneration Company Limited
Samutprakarn Cogeneration Company
Limited
Director
Roi-Et Green Company Limited; and
EGCO Green Energy Company Limited
Deputy Managing Director-Operation,
Khanom Electricity Generating Company
Limited
1998 – 2004
6. Mr. Wajarapong Palakawong Na
Ayudhya

Managing Director- Egco
Engineering & Service
Company Limited

Risk Management Committee
Member

Group Business Committee
Member

Good Corporate Governance
Committee Member

EGCO Management
Committee
Company
2011-Present
Director
2011-Present
Director
Mar 2011 –
Present
Mar 2011 –
Present
May 2008 –
Present
Nov 1999 –
Present
May 1997 – Feb
Director
Khanom Electricity Generating Company
Limited
Egco Engineering and Service Company
Limited
Covanta Philippines Operating Inc.
Managing Director
EGCO Engineering & Service Co.,Ltd.
Chairman
EGCOM Tara Co., Ltd.
Director
Agro Energy Co.,Ltd.
Deputy Managing Director -
EGCO Engineering & Service Co.,Ltd.
Name and Position
Age
Education
Dispute
Family
Relationship
between the
management
Amount of
Shares (%)
Working Experience
Year
2011
7. Mr. Suvapan Chomchalerm

Executive Vice President –
Finance
51
-
M.Sc. (Accounting), Thammasat
University
B.Sc. (Accounting), Chulalongkorn
University
-
-
0.000
Master of Business Administration (MBA),
Chulalongkorn Univerity
B.Sc. (CostAccounting), Chulalongkorn
University
-
-
0.000
-
8. Mr. Nattanont Meesuksabai
 Senior Vice President -Accounting and
Budget
9. Ms. Somsiri Yoosook

Senior Vice President - Finance
51
-
47
- Master of Business Administration
(Finance), Youngstown State University
U.S.A.
- Bachelor of Science (Accounting)
(2nd Class Honors), Kasetsart University
-
-
0.000
Position
Company
Operation
BLCP Power Limited
May 2010-May Deputy Managing Director & Chief
Financial Officer ( EGCO’s
2011
Representative)
2000 – April Senior Vice President - Accounting and Electricity Generating Public Company
Limited
Budget Division
2010
Manager-Accounting and Budget
1994 – 2000 Analysis Section, Accounting and
Budget Division
Electricity Generating Public Company Limited
2009 – April 2011
Senior Vice President- Accounting and Budget
Division Manager
Administration Division Manager
2005 – 2009
Internal Audit Section Manager
Electricity Generating Public Company Limited
1997 – Sept 2005
(Accounting Section Manager)
Electricity Generating Public Company Limited
2011 - Present
2003 -April
2011
2001 – 2002
1996 – 2003
1994 - 1995
Senior Vice President - Finance
Vice President–Subsidiaries Finance
Electricity Generating Public Company Limited
Electricity Generating Public Company Limited
Vice President–Project Finance
Manager - Loan Section
Manager – Disbursement Section
Electricity Generating Public Company Limited
Khanom Electricity Generating Company Limited
Electricity Generating Public Company Limited
2011 - Present
EGCO Engineering and Service Company Limited
เอกสารแนบ 2 : ข ้อมูลการดํารงตําแหน่งของผู ้บริหารและผู ้มีอํานาจควบคุม
The Positions of EGCO's Management and the Control Persons in the Subsidiaries and Other Related Companies as of December 31, 2011
Name
1
2
3
4
5
6
7
8
9
10
11
12
13
14
Mr. Pornchai Rujiprapa
Mr. Aswin Kongsiri
Dr. Chaipat Sahasakul
Pol Lt Gen Pijarn Jittirat
Mr. Somphot Kanchanaporn
Mr. Phaiboon Siripanoosatien
Mr. Thanapich Mulapruk
Mr. Kulit Sombatsiri
Mr. Surasak Supavititpatana
Mr. Toshiro Kudama
Mr. Akio Matsuzaki
Mr. Hideaki Tomiku
Mr. Ryota Sakakibara
Mr. Vinit Tangnoi
15 Mr. Sahust Pratuknukul
16
17
18
19
20
21
22
23
24
25
Mr. John Palumbo
Mr. Voravit Potisuk
Mr. Piya Jetasanon
Mr. Chumsak Desudjit
Mr. Chankij Jeraphunt
Mr. Wajarapong palakawong Na Ayudhay
Mr. Suvapan Chomchalerm
Miss. Somsiri Yoosook
Mr. Nuttanont Meesuksabai
Miss Busakorn Kakanumpornwong
EGCO
DDD, XX
DD, I, N, CC
I, AA
I, C, N
I, A
I, N, C
I, A
D,C
D, X
D
D
D, NN, X
D,X
D, N
D, President, X, C, SS, GG
SEVP-Business Development-, S,G
SEVP-Business Development- Domestic, S,G
SEVP-Finance & Corporate Services, S, G
SEVP, S, G
SEVP, S, G
SEVP, S, G
EVP
SVP-Finance
SVP-Accounting and Budget
Company Secretary, SVP-Corporate Secretary
Major Shareholders
1
2
DDD
Subsidiaries (Core Business)
3
4
5
Subsidiaries
6
7
8
9
10
11
12
13
14
15
16
Joint Ventures
17 18 19
20
21
22
23
24
25
26
D
Deputy Governor
D
Engineering Level 14
Engineering Level
14
DDD
D
D
D
DDD
D, Managing Director
DDD
D
D
DDD
D
D
D
D
D
D
D
D
D, Managing Director
D
D
DDD
D
D
D
D
D
D
DDD
D
Remark
A. DDD = Chairman DD = Vice Chairman D = Director XX = Chairman of Investment Committee X = Investment Committee Member I = Independent Director AA = Chairman of Audit Committee A = Audit Committee Member
CC = Chairman of Corporate Governance and Social Responsibility Committee C= Corporate Governance and Social Responsibility Committee Member
SS = Chairman of Group Business Committee S = Group Business Committee Member GG = Chairman of Good Corporate Governance Committee G = Good Corporate Governance Committee Member
B. 1 = Electricity Generating Authority of Thailand
9 = Roi-Et Green Co., Ltd.
17 = Quezon Generating Co., Ltd.
2 = TEPDIA Generating B.V.
10 = Nam Theun 2 Power Co., Ltd.
18 = Quezon Power Inc.
3 = Khanom Electricity Generating Co., Ltd.
11 = Gulf Electric Public Company Limited
19 = Conal Holdings Corporation
4 = EGCO Cogeneration Co., Ltd.
12 = Gulf Power Generation Co., Ltd.
20 = Northern Mindanao Power Corporation
5 = EGCO Engineering and Service Co., Ltd.
13 = Gulf Cogeneration Co., Ltd.
21 = Alsing Power Holdings, Inc.
6 = EGCO International (BVI) Ltd.
14 = Gulf Energy Co., Ltd.
22 = Southern Philippines Power Corporation
7 = EGCO Green Energy Co., Ltd.
15 = Gulf IPP Co., Ltd.
23 = Alto Power Management Corporation
8 =North Pole Investment Co., Ltd.
16 = GPI Quezon Ltd.
24 = Peral Energy Philippines Operating Inc.
D
D
D
NN = Chairman of Nomination and Remuneration Committee N = Nomination and Remuneration Committee Member
25 = BLCP Power Limited
26 = Natural Energy Development Co., Ltd.
27 = Egcom Tara Co., Ltd.
DDD
เอกสารแนบ 2 : ข ้อมูลการดํารงตําแหน่งของผู ้บริหารและผู ้มีอํานาจควบคุม
The Positions of KEGCO's Management and the Control Persons in EGCO Group Companies as of December 31, 2011
Name
KEGCO
1
1
2
3
4
5
6
8
9
10
11
12
13
14
Mr. Sahust Pratuknukul
Mr. Piya Jetasanon
Mr. John Palumbo
Mr. Voravit Potisuk
Mr. Chumsak Desudjit
Mr. Wajarapong Palakawong Na Ayudhya
Mr. Chankij Jearaphunt
Mr. Mana Vitvaskul
Mrs. Krisna Pinkaew
Mr. Tanit Kalunkul
Mr. Amnat Tippayasak
Mr. Apichai Komhint
Mr. Pairote Boonmak
Remark
A. DD = Chairman D = Director
B. 1 = EGCO Cogeneration Co., Ltd.
2 = EGCO Engineering & Service Co., Ltd.
3 = EGCO International (BVI) Ltd.
4 = EGCO Green Energy Co., Ltd.
5 = Roi-Et Green Co., Ltd.
6 = Egcom Tara Co., Ltd.
7 = Gulf Electric Public Co., Ltd.
DD
D
D
D
D
D
D, Managing Director
Deputy Managing Director - Operation
Deputy Managing Director - Finance and Administration
Maintenance Division Manager
Operation Division Manager
Account & Budget Division Manager
General Affairs Division Manager
DD
2
DD
D
D
D
D
D, Managing Director
D
8 = Gulf Power Generation Co., Ltd.
9 = Gulf Cogeneration Co., Ltd.
10 = Nongkhae Cogeneration Co., Ltd.
11 = Samutprakarn Cogeneration Co., Ltd.
12 = Gulf Energy Co., Ltd.
13 = Gulf IPP Co., Ltd.
14 = Nam Thuen 2 Power Co., Ltd.
15 = BLCP Power Limited Ltd.
3
4
5
D
Other Companies in EGCO Group
6
7
8
9
DD
D
10
11
12
13
D
DD
14
D
DD
DD
D
D
16 = Eastern Water Resources Development and Management Public Co., Ltd.
17= Natural Energy Development Co., Ltd.
18= North Pole Investment Co., Ltd.
D
D
15
D
D
D
16
17
DD
18
D
D
เอกสารแนบ 2 : ข ้อมูลการดํารงตําแหน่งของผู ้บริหารและผู ้มีอํานาจควบคุม
The Positions of EGCO Cogen's Management and the Control Persons in EGCO Group Companies as of December 31, 2011
Name
1
2
3
4
5
Mr. Chumsak Desudjit
Mrs. Wimolwan Sasanawin
Mr. Piya Jetasanon
Mr. Supoth Chantavilartkul
Mr. Yasuhiro Koide
Remark
A. DD = Chairman D = Director
B. 1 = Khanom Electricity Generating Co., Ltd.
2 = EGCO Engineering & Service Co., Ltd.
3 = EGCO Green Energy Co., Ltd.
4 = Roi-Et Green Co., Ltd.
5 = Egcom Tara Co., Ltd.
6 = Gulf Electric Public Co., Ltd.
7 = EGCO International (BVI) Ltd.
EGCO Cogen
DD
D
D
D, General Manager
D
1
D
2
D
3
DD
4
DD
5
Other Companies in EGCO Group
6
7
8
D
D
8 = North Pole Investment Co.,Ltd.
9 = Nam Theun 2 Power Co., Ltd.
10 = BLCP Power Limited
11 = Gulf Energy Co., Ltd.
12 = Conal Holdings Corporation
13 = Northern Mindanao Power Corporation
14 = Quezon Generating Co., Ltd.
D
D
9
10
D
D
11
12
13
14
Attachment # 3
AUDIT COMMITTEE’S REPORT
The Audit Committee of EGCO consists of 3 independent directors whose
qualifications, experience, and expertise are in accounting, finance, economics, law,
organization management and energy business. The Chairman of the Audit Committee is
Mr. Chaipat Sahasakul, and the other 2 members are Mr. Somphot Kanchanaporn and Mr.
Thanapich Mulapruk.
The Audit Committee has performed its duties in conformity with the mission
entrusted by the Board of Directors as prescribed in the Audit Committee Charter which is
in compliance with those specified by The Stock Exchange of Thailand (SET): the Audit
Committee’s Qualification and Scope of Duties and Responsibilities B.E. 2551. The Audit
Committee regularly reports the Committee’s Minutes of Meetings to the Board of Directors.
The Audit Committee held 17 meetings in 2011 with all committee members
attending each meeting. The Committee Meeting Attendance Report is shown in Table 2:
Board and Committee Meeting Attendance Report in Corporate Governance section.
The Audit Committee’s performance can be summarized as follows.
1. Review of financial statements
-
To review the quarterly and the annual financial statements with the external
auditors and the Management to ensure compliance with the generally accepted
accounting principles. The disclosures were complete, accurate, reliable, and in
compliance with related laws and regulations. The Committee also considered
the adoption of the new accounting standards, the new financial reporting
standards, the new interpretation and amendments to accounting standards , and
the adjusted accounting standards and accounting frameworks relating to EGCO.
-
To review the Management Discussion and Analysis (MD&A) with the
Management to ensure its accuracy, adequacy and usefulness to shareholders
and investors for making their investment decisions.
-
To hold exclusive meeting with the external auditors to ensure their
independence.
-
To consider other services performed by the audit firm’s group companies for
EGCO and its subsidiaries. It was determined that the scopes of work and fees
1
for other services were not significant and did not influence the independence of
the auditor.
2. Review of the internal control systems
The Audit Committee reviewed the sufficiency and effectiveness of the internal
control systems by considering the internal auditor’s and the external auditor’s
reports. The external auditor agreed that there was no significant shortcoming in
the year 2011. In addition, the Committee considered the results of the internal
control evaluation of EGCO and its subsidiaries together with the internal control
questionnaires which were prepared in compliance with the Committee of
Sponsoring Organizations of the Treadway Commission’s (COSO) guidelines, The
Stock Exchange of Thailand (SET), and the Securities and Exchange Commission
(SEC). The evaluation result for the year 2011 showed that EGCO and its
subsidiaries had sufficient and appropriate internal control system.
3. Oversight of internal audit
To approve scope of work and annual audit plan which included Management
Audit.
- To review internal audit report by demanding that the Internal Audit Division
directly reports to the Audit Committee.
- To review budget and manpower of the Internal Audit Division, the professional
development of internal auditors, and Chief Internal Auditor’s KPI. The Committee
also reviewed the performance of Chief Internal Auditor’s to ensure the Internal
Audit Division’s independence.
-
4. Review of compliance with laws relating to EGCO’s business
The Audit Committee reviewed with the Management to ensure that EGCO’s
activities are in compliance with the securities and exchange laws, requirements
of SET and SEC, as well as other laws relating to EGCO’s business. In addition,
the Committee acknowledged that employees at senior vice president level and
upward reviewed their compliance with related laws before signing and submitting
Annual Representation Letter to their immediate supervisors.
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5. Review of connected transactions
The Audit Committee considered the accuracy and adequacy of EGCO’s
disclosure on related-party transactions or any transactions that might cause
conflict of interest to ensure that EGCO had complied with business conditions
and requirements of SEC.
6. Review of risk management
The Audit Committee reviewed with the Management the risk management policy,
and the compliance with such policy and EGCO’s risk management guidelines. In
addition, fraud risk prevention and monitoring practice for EGCO Group was
prepared to ensure that EGCO and its subsidiaries had an appropriate risk
management system that followed the COSO Enterprise Risk Management. ,
The current and future major risks had been considered for mitigation and
management. Additional measures were set for risk management improvement
as well.
7. Review of good corporate governance
- To enhance other good corporate governance practices such as providing the
channel for employees and shareholders to direct their complaints, suspected
violation of laws and Code of Conduct and questions about the financial
statements and internal control systems by email to auditcommittee@egco.com.
Whistleblower system was also set up.
- To review and acknowledge the Code of Conduct Compliance Statement and
General Representation Letter submitted by the President to the Chairman. The
process of preparing those statements as well as their contents provided the
assurances to the Committee that EGCO’s operations were in compliance with the
Code of Conduct and the internal control systems and that the financial
information and disclosures were accurate, complete and reliable.
8. Audit Committee’s self assessment
The Audit Committee assessed the Audit Committee’s performance for the year
2011 by completing the Audit Committee’s Self-Assessment Form which complied
with SET’s regulations and international good practice. The result of this selfassessment was reported to the Board of Directors. The 2011 assessment result
was that the composition, qualifications, duties, and responsibilities of the Audit
3
Committee were still in accordance with the Audit Committee Charter, the Stock
Exchange of Thailand’s guidelines, and the international good practices.
9. Review of the Audit Committee Charter
The Audit Committee reviewed the Audit Committee Charter to ensure that the
duties entrusted to them in 2011 were achieved and complied with international
practices and those specified by the SET’s Audit Committee Best Practice
Guidelines, while also being appropriate for EGCO’s business.
10. Appointment of the external auditor
The Committee reviewed the auditors’ performance in 2011 and recommended to
the Board of Directors that PricewaterhouseCoopers ABAS Ltd., Mr.Somchai
Jinnovart Certified Public Accountant (Thailand) No. 3271, Mr. Vichien
Khingmontri Certified Public Accountant (Thailand) No. 3977, Mr. Chaisiri
Ruangritchai Certified Public Accountant (Thailand) No. 4526, and Ms. Amornrat
Pearmpoonvatanasuk Certified Public Accountant (Thailand) No. 4599, be
appointed by the shareholders as the Company’s auditors for 2012 due to their
independence, professional practices, appropriate experience, SEC approval and
discharging their duties effectively.
Based on the above practices, the Committee was of the opinion that EGCO’s 2011
financial statement was accurate, complete, and reliable. The internal control system was
adequate and appropriate. Operations were in compliance with the Securities and
Exchange Act, regulations of The Stock Exchange of Thailand and laws relating to the
business of EGCO. In addition, information disclosure in case of related-party transaction
or conflict of interest was correct and complete.
Mr. Chaipat Sahasakul
Chairman of the Audit Committee
4