Enserv Power Co, a local developer and operator of solar farms, has joined with China-based Empower Corporation to make lithium manganese oxide batteries in Thailand. The investment is valued at 2 billion baht.
The two firms have set up a new company, Ensen Power Co, to develop and operate a plant which is expected to be located in the eastern region of Thailand, said Tanachat Pochana, chairman of Enserv Power Co.
He said the two firms will commemorate the official launch of the joint venture on March 18, when construction of the plant is set to start. The import and installation of the necessary machinery will begin in August.
The joint venture is 51% owned by the Thai partner, while the remaining 46% is owned by the Chinese partner, Empower Corporation.
Mr Tanachat said the new plant in Thailand is intended to be a production hub for Asia and Asia-Pacific, excluding China, were Empower Corporation will continue overseeing the market.
The lithium manganese oxide battery, or "Power Qube", is designed to store power generated by renewable sources, particularly solar, wind, biogas and biomass.
Mr Tanachat said the first phase of the plant will have production capacity of 100 megawatt hours per year (MWhr/y), while the second phase will double capacity to 200 MWhr/y. The company is expected to start commercial operations by the fourth quarter of this year or the first quarter of 2018.
The only imported raw material will be lithium manganese oxide from China, while all other components will be sourced locally.
The joint venture also plans to develop a second battery plant in China. Enserve is expected to hold 6.6% stake in that plant if the deal is finalised.
Regarding the Thai plant, the two firms are waiting for a development license and investment privileges from the Board of Investment.
"We are close to reaching a deal with a Korean client who is a solar farm operator. The client requires power storage units for this year of 150 MWhr/y," said Mr Tanachat, adding that the company will have plenty of time to conduct marketing campaigns in Thailand this year.
He said the two companies had conducted work and research on new innovations since 2006 before achieving the new Power Qube product, which has recently undergone test trials.
Production costs for the Power Qube are around 6 baht per kilowatt-hour, which are relatively high. The company, however, is expected to cut production costs down substantially over the next several years.
The technology is intended to complement future lifestyle trends, when household residents want to harness power from their own solar panels, with such batteries helping them store and sell any surplus capacity. That would require legal changes, as the current law only allows private power producers to sell power to the state utilities, said Mr Tanachat.
Phuwadon Suntornwipart, chief executive of Enserv Power Co, said the company plans to launch a pilot project to demonstrate how Power Qube can be used at charging stations for Electric Vehicles.
Meanwhile, the first group of clients will be renewable energy developers, which are expected to need new, more efficient technology capable of producing a constant supply of power for state utilities. To that end, the Energy Policy and Planning Office has recently changed power purchasing agreements (PPA) for renewable energy from non-firm to firm contracts for new licences.
A firm PPA is a contract under which operators supply an exact amount of power as required by the Electricity Generating Authority of Thailand.