Mitsubishi Corporation signed a US$692 million financing package for a massive Laos wind farm in conjunction with the Asian Development Bank, Japan International Cooperation Agency, Sumitomo Mitsui Banking Corporation and other lenders. Construction on the Monsoon Wind Power Project is scheduled to start this year.
This is a cross-border wind power project with energy to be distributed to Laos and Vietnam. According to the Japan-based company, a 25-year agreement to sell electricity to Vietnam’s state-owned electric power company has already been reached. It will begin as soon as the facility is operational in 2025. That was seen as a key factor in Mitsubishi signing the finance agreement for the Laos wind farm.
The Monsoon Wind Power Project will have the largest installed capacity of any wind farm in Southeast Asia. Reports say the facility will be capable of producing up to 600 megawatts annually. It is located near the Mekong River across from Ubon Ratchathani in southern Laos.
The Laos wind farm will be built by Thailand’s Bangchak Corporation with assistance from PowerChina with contracts signed last year. Financing was the final obstacle for the project and Mitsubishi’s backing will ensure it can go ahead.
Monsoon Wind Power Project is seen as a win for all parties involved. The Laos government is able to create jobs through foreign investment. Vietnam can source more renewable energy which is a vital part of its power development plan. And, importantly, cross-border energy infrastructure is developed.
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Interesting Analysis
Wind energy is in and the Laos wind farm is another in a long line of renewable projects in the pipeline. Financing is always key to getting these facilities from the drawing board to reality and Mitsubishi stepping up is essential in this instance. It’s also important not to overlook the cross-border elements of this development. Better connected electricity grids are going to benefit Southeast Asia as a whole.
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