Asahi Glass Co (AGC) will invest around $400 million to construct a power plant at its Indonesian subsidiary PT Asahimas Chemical (ASC).
According to a AGC press release, the power plant will enhance the competitiveness of its chlor-alkali business in Southeast Asia by significantly reducing power rates, a major cost item of that business.
“The caustic soda and polyvinyl chloride (PVC) market in Southeast Asia is projected to grow at over 5 per cent per year,” AGC said.
Of the total demand in the market, Indonesia, Thailand and Vietnam, where AGC has bases for the chlor-alkali business, account for 70 per cent of the demand.
In order to steadily meet increasing demand in these growth markets, AGC has been working to grow business, by looking at Southeast Asia as a whole and leveraging group synergies in the region.
It has enhanced production capacity at ASC, which is scheduled to be completed at the end of 2015, purchased a Vietnamese PVC manufacturing company and increased its production capacity.
This investment will realise cost reduction of electricity, one of the main cost components, and will help AGC to build dominant competitiveness not only in Indonesia but also in the entire Southeast Asia.
To cope with increasing demand for electric power, Indonesia plans to reinforce thermal power stations fueled by coal that is produced in the country.
To make the plan successful, Japan has proposed high efficiency power generation using circulation fluidised bed boilers (CFB method) or ultra-supercritical power plant, etc., aimed at reducing CO2 emissions.
The power plant to be constructed by AGC will be a coal-fired power plant with a power generation capacity of around 250 MW and will use low-grade coal, whose reserves are large in Indonesia.
ASC will adopt the highly efficient, environmentally-friendly CFB method, which is capable of co-generation and mixed fuel burning of biomass fuel.
