1. The Joint Meeting with APG Consultative Committee (APGCC) ASEAN Power Grid Financing Options Working Group No. 6 Resources Development 26 February 2008 Indonesia The Joint Meeting with APG Consultative Committee (APGCC) ASEAN Power Grid Financing Options Working Group No. 6 Resources Development 26 February 2008 Indonesia Thana Boonyasirikul Electricity Generating Authority of Thailand

2. 2 ASEAN POWER GRID (APG) FINANCING OPTIONS  Financial Proposal for the ASEAN Interconnection Projects Cambodia, Indonesia, Malaysia, Philippines and Thailand Financing Models of the Existing Interconnection Projects - Cambodia Financing OptionProject NameBudgetScope of Work ADB Loan GMS Transmission (ADB Loan No.2052-CAM(SF) & NDF Credit No.425 - ADB = 30,941,000 SDR 44,300,000 USD - NDF = 10,000,000 EUR - Govt. = 11,070,000 USD Component 1 : Transmission Line 230 kV : 110 km Component 2 : Substation : 230 / 115 kV WB Loan GMS Power Trade (Grant No. H301- OKH) - IDA = 18.500 million USD - RGC = 3.697 million USD Component 1 : 115 kV Transmission System : Stung Treng Province to Lao PDR Border Component 2 : 115 kV Transmission System : Viet Nam Border to Kampong Cham Province

3. 3 Financing Models/Options of the Interconnection Projects – Indonesia Project DescriptionUtilities Involved StatusFinancing Models / Options Description SUMATERA (INDONESIA) – PENINSULAR (MALAYSIA) Sumatera – Peninsular Malaysia (HVDC) WEST KALIMANTAN (NDONESIA) – SARAWAK (MALAYSIA) 1). West Kalimantan – Sarawak 275 KV Interconnection PLN TNB PLN SEB Feasibility Study completed in January 2005. Study on Cross Border Issues (Financial, Tax, and Legal) and Project Structure completed by January 2007 Detail F/S and Basic Design 275 kV Transmission for Indonesia side by PLN, completed in 2003 Trans Borneo Power Grid Development and Energy Trading Study, in whole Borneo (Kalimantan) completed in 2004 Proposed: in 2011 SEB sell 100 MW to PLN in 2013 SEB sell 200 MW to PLN proposed: JV between PLN and TNB proposed: Malaysia Side by SEB Indonesia side, two options: 1. ADB 2. PLN budget Next steps: Review PDP (Power Development Program) of both countries, Detail Survey and Design for the Transmission, Funding. - Next steps: Study of common operation procedure, Review Power Development Program of both countries, Detail survey and Design for the transmission, Funding. - Interconnection between Mambong S/S (Sarawak) to Bengkayang S/S or Ngabang S/S (West Kalimantan) ASEAN POWER GRID (APG) FINANCING OPTIONS

4. 4 Financing Models/Options of the Interconnection Projects – Indonesia (cont.) Project DescriptionUtilities Involved StatusFinancing Models / Options Description WEST KALIMANTAN (INDONESIA) – SARAWAK (MALAYSIA) 2). Supply to Border Villages of West Kalimantan thru 20 kV distribution line PLN SEB Both countries agreed to proceed discussion on commercial issues under B to B basis. Discussion of common operation procedure and tariff structure are on going. It is expected to be in operation on Dec 2008 PLN’s budget. Badau and Sajingan villages in Indonesia side to be supplied by SEB through the distribution network. In Malaysia side, PLN will pay connection fee to SEB as developer and in Indonesia side, PLN develop distribution network to the country border ASEAN POWER GRID (APG) FINANCING OPTIONS

5. 5 Financing Models/Options of the Interconnection Projects - Malaysia Project DescriptionUtilities Involved StatusFinancing Models / Options Description Peninsular Malaysia - Singapore TNB SPPG Commissioned in 1985. The interconnection is between Plentong 275kV substation in Johor Malaysia and Upper Jurong 230 kV substation in Singapore. Bilateral G to G The responsible authorities/utilities of both countries will invest and financing the project (s) up to their border. Malaysia: - TNB Self- Financing Peninsular Malaysia - Sarawak TNB SESCo Detailed technical studies are currently being undertaken in view of implementing the HVDC interconnection between Sarawak and Peninsular Malaysia for transferring 1600/2000 MW power from Bakun to Pen. Malaysia. The 1st stage of the 800/1000 MW power transfer is targeted for completion in 2013/14. Financial evaluations are in progress. (SPV + TNB/SESCo) ASEAN POWER GRID (APG) FINANCING OPTIONS

6. 6 Financing Models/Options of the Interconnection Projects - Philippines Name of Project / Project DescriptionFinancing/Loan TypeTerms and Conditions 1. Leyte-Luzon International Project The project involves the installation of the following to transmit 440 MW to the Luzon Grid through a HVDC transmission network: Submarine Cable : 23 kms. Transmission Line : 468 kms. 230 KV Converter Station : 2-440 MW Monopolar Forex Portion: Co-financing between EXIMBANK & World Bank/ODA Local Portion: Internal Cash Generation EXIMBANK Loan: Interest Rate (%) 35% Commitment Charge.25 Maturity/Terms 20 years including 5 years grace period World Bank Loan: Interest Rate (%) Cost of Qualified Borrowing (CQB) Commitment Charge.25% Maturity/Terms 20 years including 5 years grace period ASEAN POWER GRID (APG) FINANCING OPTIONS

7. 7 Financing Models/Options of the Interconnection Projects – Philippines (cont.) Name of Project / Project DescriptionFinancing/Loan TypeTerms and Conditions 2. Leyte-Bohol Interconnection Project Stage I involves the installation of the following initially energized at 69 KV and capable of transmitting 40 MW: Submarine Cable : 17 kms. Transmission Line : 73 kms. (69 KV & 138 KV) Substation : 1-50 MVA Power Transformer 1-5 MVA Power Transformer 6-138 KV PCB 12-69 KV PCB 3-13.8 KV PCB 1-15 MVAR Shunt Reactor 3-10 MVAR Capacitor Bank 8-5 MVAR Capacitor Bank Forex Portion: Stage 1 – Overseas Economic and Fund Economic (OECF)/ODA Stage 2 – Japan Bank for International Cooperation (JBIC)/ODA Local Portion: Stage 1 – OECF/ODA Stage 2 – JBIC/ODA ICG Interest Rate (%) 2.7% per annum on the Principal Disbursed for equipment/materials & associated services charges and 2.3% per annum on the Principal Disbursed for consultancy & associated services charges Commitment Fee None Service Charges 0.1% of the amount of Letter of Commitment/Disbursed Amount Maturity/Terms 30 years including 10 years grace period ASEAN POWER GRID (APG) FINANCING OPTIONS

8. 8 Financing Models/Options of the Interconnection Projects – Philippines (cont.) Name of Project / Project DescriptionFinancing/Loan TypeTerms and Conditions 3. Leyte-Cebu Interconnection Project The project involves the installation of the following to transmit 200 MW from the Leyte Geothermal to augment the power demand in Cebu: Submarine Cable : 32 kms. Transmission Line : 324 kms. ( 230 KV) Substation : 2-50 MVA Power Transformer 3-100 MVA Power Transformer 1-60 MVA Power Transformer 2-50 MVA Power Transformer 24-230 KV PCB 21-138 KV PCB 1-69 KV PCB Forex Portion: World Bank/ODA Local Portion: Internal Cash Generation Interest Rate (%) Cost of Qualified Borrowing (CQB) Service Charges 0.1% of the amount of Letter of Commitment/Disbursed Amount Commitment fee.25% Maturity/Terms 20 years including 5 years grace period ASEAN POWER GRID (APG) FINANCING OPTIONS

9. 9 Financing Models/Options of the Interconnection Projects – Philippines (cont.) Name of Project / Project DescriptionFinancing/Loan TypeTerms and Conditions 4. Leyte-Cebu Interconnection Uprating Project The project involves the installation of the additional three (3) submarine cables to sustain the reliability and stability of electricity in the Cebu, Negros and Panay Grids. Submarine Cable : 32 kms. Substation : 1-150 MVA Power Transformer 6-230 KV PCB 2-138 KV PCB 3-13.8 KV PCB 3-50 MVAR Shunt Reactor 1-30 MVAR Shunt Reactor Forex Portion: JBIC Buyer’s Credit Local Portion: Development Bank of the Phils. Sydicated Term Loan JBIC Loan: Loan Amount ¥ 6,768,408,335 Interest Rate (%) 2.1% plus risk premium of 1.59% Guarantee Fee (%) 1% on the outstanding loan Commitment Fee 0.2% per annum on the daily unutilized portion of the loan Upfront Fee.3% Maturity/Terms 0 grace period, 10 years DBP: Loan Amount P 600,000 Interest Rate (%) 10.75% Guarantee Fee (%) 1.000% Arrangers Fee 0.75% Gross Receipts Tax – GRT (%) 5.00% ASEAN POWER GRID (APG) FINANCING OPTIONS

10. 10 Financing Models/Options of the Interconnection Projects – Philippines (cont.) Name of Project / Project DescriptionFinancing/Loan TypeTerms and Conditions 4. Leyte-Cebu Interconnection Uprating Project DBP: Legal Fee 500,000 Taxes & Other Incidental Expenses 303,901 Out-of-Pocket Expenses (OPE) Loan 10,000 Maturity/Terms 7 years including 1 year grace period 5. Cebu-Negros Interconnection Uprating Project The project involves the installation of the following to increase the power transfer capability generated from the Palinpinon Grothermal and for reliability and stability of the Cebu-Negros-Panay-Leyte-Samar Grid: Submarine Cable : 17.8 kms. Transmission Line : 143 kms. ( 138 KV and 69 KV) Substation : 1-50 MVA Power Transformer Forex Portion: Miyazawa Fund Local Portion: Internal Cash Generation Interest Rate (%) Tranche A – Fixed Rate of 1.60% Tranche B – Floating interest rate – LIBOR Commitment Fee 0.40% per annum of the unused Tranche B Management Fee/ JP¥420,000,000 Upfront Fee Agency Fee JP¥2,000,000 Maturity/Terms Bullet payment after 10 years ASEAN POWER GRID (APG) FINANCING OPTIONS

11. 11 Financing Models/Options of the Interconnection Projects – Philippines (cont.) Name of Project / Project DescriptionFinancing/Loan TypeTerms and Conditions 5. Cebu-Negros Interconnection Uprating Project Substation : 1-30 MVA Power Transformer 10-138 KV PCB 1-69 KV PCB 1-2 x 20 MVAR Shunt Reactor ASEAN POWER GRID (APG) FINANCING OPTIONS

12. 12  Financial Proposal for the ASEAN Interconnection Projects (as example) (cont.) Financing Models/Options of the Interconnection Projects - Thailand Project DescriptionUtilities Involved StatusFinancing Models / Options Description THAILAND – PENINSULAR MALAYSIA a) Sadao – Bukit Keteri (Short term) b) HVDC Links between Khlong Ngae-Gurun (Medium term) EGAT TNB The stage I interconnection is now used as a backup interconnection. The stage II (HVDC) interconnection project (transfer capability of 300 MW) was completed in September 2001. The HVDC system comprises a 110 km DC transmission line capable of transferring 300 MW between a 275 kV DC converter substation in Gurun, Kedah, Malaysia and a 230 kV DC converter substation in Khlong Ngae, Thailand ใ Bilateral G to G The responsible authorities/utilities of both countries will invest and financing the project (s) up to their border. ASEAN POWER GRID (APG) FINANCING OPTIONS

13. 13 Financing Models/Options of the Interconnection Projects - Thailand (cont.) Project DescriptionUtilities Involved StatusFinancing Models / Options Description THAILAND – PENINSULAR MALAYSIA a) Sadao – Bukit Keteri (Short term) b) HVDC Links between Khlong Ngae-Gurun (Medium term) EGAT TNB Joint-study to upgrade the interconnection project from 300 MW to 600 MW has been initiated. Currently members of the joint team are working on the generation expansion plan. Meetings have been held to study the upgrading of project from 300 MW to 600 MW. It was established that 600MW power transfer from TNB to EGAT is only feasible post-2012 if there is demand for power from EGAT in southern Thailand and the southern EGAT system is upgraded. Feasible from 2024 onward Bilateral G to G The responsible authorities/utilities of both countries will invest and financing the project (s) up to their border. ASEAN POWER GRID (APG) FINANCING OPTIONS

14. 14 Financing Models/Options of the Interconnection Projects - Thailand (cont.) Project DescriptionUtilities Involved StatusFinancing Models / Options Description THAILAND – LAO PDR a) Nam Theun 2 (920 MW) b) Udon Thani – Nabong - Nam Ngum 2 (597 MW) - Nam Ngum 3 (615 MW) - Nam Theun 1 (523 MW) - Nam Ngiep 1 (261 MW) EGAT EDL The Power Purchase Agreement (PPA) between EGAT and the developer of Nam Theun 2 Project was signed on November 8, 2003. The feasibility study of the transmission project on Thai side was submitted for approval from the Thai Government in February 2004. The interconnection project is expected to be completed in April 2009. COD 2009 COD 2011 Under tariff negotiation SPV + EGAT ADB + EGAT Lao PDR: - Invested by SPV (Nam Theun 2 Power Company Limited: NTPC) - Financed by WB, ADB and multilateral Commercial Banks Thailand: - EGAT Self- Financing Lao PDR: - Invested by SPV - Financed by ADB Thailand: - EGAT Self- Financing ASEAN POWER GRID (APG) FINANCING OPTIONS

15. 15  Financing Models/Options of the Interconnection Projects - Thailand (cont.) Project DescriptionUtilities Involved StatusFinancing Models / Options Description THAILAND – LAO PDR c) Mae Moh 3 – Hong Sa d) Roi Et – Savannakhet (Medium term) c) Ubol Ratchathani – Ban Sok (Long term) EGAT EDL Under tariff negotiation No Progress SPV + EGAT Bilateral G to G / ADB support Lao PDR: - Invested by SPV - Financed by WB, ADB and multilateral Commercial Banks Thailand: - EGAT Self- Financing In case Bilateral G to G invested by government authorities/utilities of both countries while financing support from ADB of EGAT Self- Financing for T/L in Thailand. In case SPV which specific project (s) to be developed and connected to grid SPV will invested in Lao PDR while EGAT Self-Financing for T/L in Thailand. ASEAN POWER GRID (APG) FINANCING OPTIONS

16. 16 Financing Models/Options of the Interconnection Projects – Thailand (cont.) Project DescriptionUtilities Involved StatusFinancing Models / Options Description THAILAND – MYANMAR a) Hutgyi (7x185 MW) b) Tasang THAILAND – CAMBODIA (Short term) EGAT EDC Feasibility Study completed mid 2007. Under negotiation for connecting lower dam (120 MW) to the northern system of Thailand. Thailand and Cambodia have reached a conclusion on the revision to tariff structure. Transmission on both sides has been completed and started energizing in 2007. SPV + EGAT Bilateral G to G SPV which specific project (s) to be developed and connected to grid SPV will invested in Myanmar while EGAT Self-Financing for T/L in Thailand. The responsible authorities/utilities of both countries will invest and financing the project (s) up to their border. Cambodia financing supported by ADB, WB. ASEAN POWER GRID (APG) FINANCING OPTIONS

17. 17 Cambodia 3 power exchange connections with Lao PDR, Thailand and Vietnam Indonesia-Malaysia 3 power exchange connections (in progress) Malaysia 1 Internal power exchange connection (in progress) Malaysia-Singapore 1 power exchange connection Philippines 5 Internal power exchange connections Thailand-Malaysia 2 power exchange connections Thailand-Lao PDR 2 power exchange connections and 3 power purchase interconnections (in progress) Thailand-Myanmar 2 power purchase interconnections (in progress) Financing Options  ADB, World Bank, EXIM Bank, JBIC  Joint Venture between interconnected utilities  Bilateral G to G, utility self-financing  SPV Investment as part of power purchase project Conclusions

18. 18 End of presentation Thank you