For a PPP, you will still have to obtain the relevant licences from the relevant authorities for construction and operation of a plant. Furthermore, you will have to obtain licences for solar power generation and for power distribution as required by law. Such licences or approvals are deemed to be participation by the government according to the definition of “participation” under the “Act on Private Participation in State Undertaking B.E. 2535”, which defines participation as the government jointly investing with a private individual by whatever means or to entrust a private individual to invest solely by means of licensing or granting concession or granting rights in any other manner.

In the process of transmitting electricity from you to PEA, electricity has to be transmitted through transmission lines owned by PEA to a sub-station of PEA. Such transmission lines will have to pass through public lands where the PEA/Egat is granted permission for installation by the relevant authority, also known as “right of way”. Although the new regulations permit the private sector to install its own transmission lines, it is nearly impossible to do so in practice because you will have to go through complex and expensive authorisation procedures to obtain the relevant licences.

Therefore, whether you decide to sell the electricity generated by the plant to PEA or use it yourself, it makes sense to do so through a PPP. The tax considerations for investment in solar energy should be considered as well. For a Power Purchase Agreement or PPA, the tax will be straightforward as it is a normal sale and purchase of power. That is to say, you will have to include revenues received from the sale of the products for your tax calculation.

For an Engineering Procurement Construction Contract or EPC, you will have to deal with the importation of goods, meaning you need to consider the relevant tax and customs responsibilities that must be agreed in advance, including tax gross up provision (if any). In general, the contractor shall pay all duties and taxes because of his obligations under the EPC.

source: bangkokpost