BCPG Public Company Limited 2016 Annual Report BCPG Public Company Limited 2098 M Tower Building, 12th Floor, Sukhumvit Road, Bangchak, Phrakhanong, Bangkok 10260, Thailand Tel +662 335 8999 Fax +662 335 8900 2016 Annual Report www.bcpggroup.com BCPG Public Company Limited 2 Annual Report 2016 5 6 Message Policy and Business Contents from the Chairman Overview • Vision, Mission, Goal and Strategy • Milestone Developments • Relationship with Major Shareholder Nature of15 Business Shareholding30 Management33 • Solar Power Plants in Structure Structure Thailand • The Board of Directors BCPG Public • Solar Power Plants in • Sub-Committees Japan • Executive Management • Marketing and Competition and Personnel Company Limited 3 Good Corporate72 Social81 Responsibility Internal83 Control Governance • Corporate Governance Policy • Report from the Audit Committee • Report from the Nomination and Remuneration Committee • Report from the Corporate Governance Committee • Report from the Enterprise-wide Risk Management Committee • Report from the Executive and Investment Committee Risk Factors85 Connected87 Financial98 Position Transactions and Performances World’s Greenergy Iconic Creator The iconic greenergy developer who evolves the world through the greener ways. BCPG Public Company Limited is committed to collaborating, synergizing and entering into business partners in 4 every corner of the world to realize our vision “World’s Greenergy Iconic Annual Report 2016 Creator” with our mission “To invest, develop and operate green power plants globally with state-of-the-art green technology based on our common values, management and business principles in order to environmentally-friendly a sustainable and environmental-friendly business platform.” Message from the Chairman BCPG Public Company Limited (BCPG) was established on 17 July 2015 to operate clean and environment-friendly renewable power businesses. After being listed on the Stock Exchange of Thailand, BCPG made an initial public offering of newly issued shares on 28 September 2016. Primarily, the fund mobilization will finance business expansion, support sustainable growth in the international market, and establish the Company’s leading position in renewable energy businesses in the region. BCPG executes business operation in On social and environmental responsibility, development to provide more advanced compliance with corporate governance BCPG received the Roi Duangchai Ruam Chai innovations and new approaches that will BCPG Public principles and long-term environmental and Lot Lok Ron certificates (Together We Fight seamlessly and truly incorporate renewable social responsibilities. Our mission to invest Global Warming) in 2016, in recognition of energy solutions into our daily life. Against in, develop and operate power plants the Company’s achievement in reducing this greener movement landscape, BCPG globally is fueled by our firm commitment emissions of greenhouse gases or GHGS by Company Limited is putting in more efforts to introduce 5 and innovative green technologies to secure 150,984 tons of CO2 at its seven solar breakthrough products and services to a sustainable and eco-friendly business power plant projects registered with the satisfy consumers’ needs more efficiently, platform. In 2016, BCPG’s solar power plant Thailand Greenhouse Gas Management strengthen our business models, and secure projects in Thailand and Japan, had a total Organization (TGO). This was the highest our position as the iconic greenergy leader installed capacity of 400 megawatts. The reduction volume in 2016 and the second who revolutionizes the greener way we Company plans to expand its renewable highest ever recognized by TGO. In consume energy. energy power plant business in other countries December 2016, the Company was the first On behalf of the Board of Directors, by investing in various sources of renewable in Thailand to start commercial operation of the Executive Management team and all power including solar, wind, geothermal, two solar power plants under the Solar Farms employees at BCPG, I would like to take this biogas and biomass, etc. for Agricultural Cooperatives Program. Apart opportunity to reaffirm our commitment to Following the SET listing and the IPO from energy supply, the project creates jobs the Company and our stakeholders. We of 590 million capital shares, BCPG’s financial and generates revenues for cooperative will continue to maximize our collective advisors and co-underwriters received the members and the surrounding communities. experiences and expertise to drive BCPG Best IPO Award at the Asset Country Awards This is one of BCPG social enterprise initia- businesses forward, generate steady returns, 2016, organized by the Asset, Asia’s leading tives that will promote sustainable values for and strengthen operating performance for financial magazine, in Hong Kong. The award the Company, the communities where it sustainable growth. recognized excellence in BCPG’s share operates, and the society at large. allocation and price setting. Additionally, the BCPG recognizes the growing SET and global index provider FTSE Russell significance of renewable energy resources. have included BCPG stock in the composition This means our business direction must of the FTSE SET Index Series of FTSE SET cover not only continuing growth in supplying -Signed- Mid Cap Index. green energy from existing eco-friendly Mr. Pichai Chunhavajira resources, but also continuing research and Chairman Policy and Business Overview Vision, Mission, Goal and Strategy Vision “World’s Greenergy Iconic Creator” The iconic greenergy developer who evolves the world through the greener ways. Mission To invest, develop and operate green power plants globally with state-of-the-art green technology based on our common values, management and busi- ness principles in order to secure a sustainable and environmental-friendly business platform. Spirit Innovative Proactively strive for innovation excellence whilst maintaining environment-friendly stance towards change. Integrity Value integrity as the core attribute in doing business, assuring stakeholders of good gover- nance and transparency. International Build a global platform with multi-cultural adaptability and international synergy. Goal and Strategy The Group is engaged in investments in power generation business from renewable energy sources both domestically and overseas, with a target to reach the 1,000 Megawatts total capacity goal within 2020 through various sources such as solar, geothermal, wind, biogas, biomass, as well as from organic waste. Investment style ranges from acquisition of business- es to developing new projects, domestically and inter- nationally, including countries in Asia, with focus in North Asia and Asia Pacific. Milestone Developments The Company was registered on 17 July 2015, with a capital of THB 20.00 million consisting of 2.0 million common shares at a par value of THB 10.00 per share. Bangchak Petroleum Public Company Limited (“BCP”) was the majority shareholder, holding 99.9% of the shares. According to BCP Extraordinary (Prachinburi) Company Limited (“BSE-PRI”) (approximately 174 megawatts installed Shareholders’ Meeting No. 1/2015 on 9 October (“Phase 3”). capacity). 2015, the shareholders approved the restructuring On 26 April 2016, the Company was In the second quarter of 2016, the of the Group’s renewable energy business, and awarded with the rights to develop solar Group entered into an Asset Purchase an Initial Public Offering plan (IPO) in order power plants under to the Solar Power Plants Agreement with a juristic person for shares to support the Group’s business and its for Governmental Agency and Agricultural of Huang Ming Japan Company Limited business expansion in the near future. Cooperatives Program. The project has a (“HMJ”). As a result, the Group was granted Consequently, the Company purchased solar total contracted capacity of 12 megawatts (7 a license to operate 2 Solar power plant BCPG Public power plant with a contracted capacity of megawatts of which started commercial projects, located in Japan, with a contracted 38.0 megawatts, located in the Bang Kasun operation in December 2016). capacity of 30.0 megawatts (or installed Sub-district, Bang Pa In District, Phra Nakorn In addition, the Group has invested in capacity of approximately 36 megawatts). Company Limited Sri Ayutthaya (“Phase 1”) from BCP, and a solar power plant business in Japan by At present, the Group operates Solar 7 acquired of shares of BCP’s subsidiaries that entering into a Share Purchase and Sale power plant businesses domestically and operates all Solar power plants: as a result, Agreement with SunEdison International LLC. internationally, including those that are already the Company owns the Phase 1 (“SEI”) and SunEdison Energy Holding in commercial operation and those under Project and a total of 99.9% of the shares of (Singapore) Pte. Ltd. (“SEH”) (collectively development, with a total expected contracted Bangchak Solar Energy Company Limited called “SunEdison Group”) on 29 January capacity of 324.1 megawatts (or installed (“BSE”) (“Phase 2”) and, Bangchak Solar 2016. With a contracted capacity of capacity of approximately 418 megawatts). Energy (Burirum) Company Limited (“BSE- 164.1 megawatts or an installed capacity of The Company was listed in the Stock BRM”), Bangchak Solar Energy (Burirum1) approximately 200 megawatts, the projects Exchange of Thailand under the energy and Company Limited (“BSE-BRM1”), Bangchak