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towards an economic, socially and environmentally caring

SustainabilityReport2013

and responsible organization

2013

Sust

aina

bilit

y Re

port

SUSTAINABLE GROWTH

Contents

About this report

1. About RATCH •Vision •Mission •Policy •CommonValue •OurBusiness

3.OrganizationalManagement 3.1 CorporateGovernance 3.2 RiskandCrisis Management 3.3 Stakeholders’ Engagement

4.TargetandAchievement in 2013

MessagefromtheChiefExecutiveOfficer

2.MaterialityAssessment

Economic4.1 SustainableGrowth4.2 SupplyChain Management

3

8

20

47

85 91

106

72

36 38

16

6

Environmental4.3 ClimateChange Strategy4.4 ProjectManagement4.5Operational Excellence

Social4.6 OurPeople4.7 CommunityandSocial Responsibility

AwardandRecognition

5.PerformanceData •Economics •Labor •Environmental

6.GRIContentIndex

3Ratchaburi Electricity Generating Holding Public Company Limited

Reporting Approach This sustainability report is developed in line with

the Company’s annual report and provides information and data from 1 January 2013 to 31 December 2013. Its objectives are to express the Company’s commitment on sustainability development and report reliable quality information by presenting the Company’s policy, operation procedures, and performances in aspects of economics, environment and society.

This sustainability report is the first issue of Ratchaburi Electricity Generating Holding Public Company Limited. It is developed in accordance with Sustainability Reporting Guidelines version 3.1 of Global Reporting Initiative (GRI 3.1). The Company has committed to continuously conduct the sustainability development report every year covering substantial issues concerning the Company’s sustainable business operation including stakeholder expectation. The information boundary according to GRI’s guideline is shown in page 91-105.

The Company has followed the guideline in scoping the report’s information and added elaboration about materiality assessment.

This report presents environmental and social information of Thailand operation. Information about joint venture companies and other subsidiaries can be found in the Company’s annual report.

Quality Control Under report development process, there is an

internal process in validating information consistency and completeness by the responsible unit of the report.

About this report

For more information, please contact:Ratchaburi Electricity Generating Holding Public Company Limited8/8 Moo 2, Ngam Wong Wan Road, Bang Khen Sub-district, Muang District, Nonthaburi Province, Thailand 11000

In addition, the information accuracy is reviewed by units providing information.

The reporting boundary This report covers only the principal subsidiary, the

main source of electricity generation in Thailand, which the Company mandates management and holds 99.99% of equity stake. By investment classifying, it includes:

• Ratchaburi Electricity Generating Holding Public Company Limited

• Ratchaburi Electricity Generating Company Limited, a 99.99% owned subsidiary and operates 3,645 megawatts Ratchaburi Power Plant in Ratchaburi province

As it is the first year for reporting in accordance with GRI standard, limitation of information collecting in some topics has been appeared. It is because the power plant’s information collecting pattern and performance indicators on economic, environmental and social are different from GRI standard. This may cause deviation of the information. The Company is currently in process of developing and streamlining its reporting method in compliance with the GRI standard.

To cope with challenges and to enhance business management standard regarding sustainability in accordance with GRI’s standards, the Company will review its sustainable matters by studying and assessing in comparison with power business trend and the Company’s ability in responding stakeholders’ expectations. In the next step, the relevant units of the Company will specify activities, projects and action plans both in medium and long term in order to enable the 2014 report presenting targets of each sustainable matter in aspects of economics, environmental, and social completely. The Company also considers reporting more information covering other business operations under its management.

contributing power generating to economic and social development

adhering to good corporate governance and operates corruption-free business

conservingthe environment to minimize Global Warming impact, and builds a happy society

achieving operational and project management excellence

enhancing employee's competency to drive business growth

commiting to serve stakeholders' expectation

sustainable growth towards an economic, social and environmental caring and responsible organization

4SustainabilityReport

2013

contributing power generating to economic and social development

adhering to good corporate governance and operates corruption-free business

conservingthe environment to minimize Global Warming impact, and builds a happy society

achieving operational and project management excellence

enhancing employee's competency to drive business growth

commiting to serve stakeholders' expectation

sustainable growth towards an economic, social and environmental caring and responsible organization



2013

Message from the Chief Executive OfficerTo all shareholders and stakeholders,

Throughout 2013, Ratchaburi Electricity Generating Holding Public Company Limited has operated its business with commitment to economic, social and environmental responsibility in carrying out our operations, geared towards the organizational sustainability.

To achieve the goal, all stakeholders play a significant role in pushing for growth, to ensure good returns which could support stakeholders’ advance in tandem. In the meantime, the Company is bound to operate with minimum negative impacts.

The Company draws up a 5-year sustainability strategy focusing on two dimensions - the Company and stakeholders. In the first dimension, the Company must grow with concerns on environmental and social impacts. The assurance is required to ensure that the environmental and social impact of investment projects and power plant management is within legal boundary and up to international standards. Importantly, the investment and plant operation must win supports from the community and stakeholders.

In the stakeholder dimension, the Company must respond their expectations with clearly-defined procedures. The Company pays more attention to employees particularly in matters of environment and occupational safety, fair and competitive remuneration system, the capacity-building program, and equal opportunity for career advancement. A reasonable return is guaranteed for shareholders, while trade and business partners are assured of fair treatment and transparent process. Power plants are maintained in a standardized way to meet customers’ generating demands and support the Electricity Generating Authority of Thailand (EGAT), the major customer, in crisis situation. Community and society is assured of measures to safeguard and strengthen the environmental quality and quality of life, as well as appropriate benefits.

The Company seeks cooperation with the EGAT which is a major shareholder (with a 45% stake) and a customer, in jointly developing projects in neighboring countries. This creates mutual benefits: business expansion for the Company and assurance to the EGAT’s mission and goal

in maintaining the security of the electricity reliability system – crucial infrastructure for economic and social development, as well as in maintaining the electricity prices at a reasonable level.

In the past year, the Company assisted EGAT in sustaining the national power security. The Company’s three power plants in Ratchaburi province, namely Ratchaburi power plant, Ratchaburi-Power power plant and Tri-Energy power plant, with combined capacity of 5,745 megawatts stood ready to tackle the crisis when natural gas fields in the Union of Myanmar stopped operations unexpectedly. Sufficient fuel supplies were stocked, for the shift of generating source from natural gas to fuel. The annual maintenance plans were rescheduled, to ensure that the national generating capacity could sufficiently meet demand. Consequently, the crisis did no impact on the economy and society.

Under the sustainability strategy, the Company sets the goal to invest more for increasing returns. In the past year, new investment is focused more on renewable energy, in respond to the changing environmental condition as a result of the climate change as well as the trend in many countries which strive for more renewable energy and set clear targets for renewable energy generation. The Company thus raised the renewable energy target to 500 megawatts from 200 megawatts. In 2013, the Company took on a study to develop two more projects in Australia – a 165 megawatts wind farm in New South Wales and a 23 megawatts solar farm at the Collinsville Power Plant in Queensland. Under the development process, these two projects, if successful, are expected to commence the 25-year operations in 2016. The Company also embarked on more studies and negotiations for equity participation in several renewable energy projects in Thailand, Australia and Japan.

The successful investment in renewable energy will not only benefit the Company’s financial performance but also the environment. Renewable energy not only can reduce the carbon dioxide emission – a main cause of the global warming, but also significantly reduce fossil fuel consumption and ensure longer availability of the limited supply.


Environmental issues pose a big challenge to the Company’s sustainability. The operations are thus emphasized towards the prevention of environmental impacts and assurance to community and society. At Ratchaburi power plant, our principal assets, an energy-saving program was initiated in 2005 and has reduced power consumption by 67 million kilowatt-hours. This is on top of the measures to control and handle the in-process combustion pollutant through advanced technology.

The Company has also launched a campaign to raise energy conservation awareness among the public, by supporting community energy planning by communities around Ratchaburi power plant. The plans are aimed at reducing combustion which emits carbon dioxide. This scheme has been in place in Tambon Tharap, Muang district; and Baan Sing, Photharam district, Ratchaburi province since 2011. A number of 172 households takes a lead in changing their consumption behavior and adopting the energy community technology. For example, energy-saving light bulbs replace conventional light bulbs. Biogas replaces cooking gas. Solar dryers are created to preserve food.

Forest conservation and green area enhancement is another key off-line approach to expand the carbon sink, under the Company’s commitment to address environmental challenges. The “Love the Forests and the Community” was launched in 2007 to encourage the community role in preserving and restoring forests. This

has been carried out through activities like a contest of sustainable community forests, reforestation in community forests, and the support to the Royal Forest Department’s establishment of community forests.

The Company is committed to pursue sustainability. The more power demand grows in line with population and economic development, the more the Company needs to invest in power generating projects to meet the increasing demand. Meanwhile, it is necessary to invest in highly-efficient technology for efficient generating process, efficient use of fuels, and environmental-friendly operations. The projects on renewable energy will proceed along with community energy projects and forest conservation programs, to ease the global warming which influences the climate change.

The Company wishes to thank all stakeholders for the supports towards sustainable growth. We are convinced that the operations with economic, social and environmental concerns will lead the organization towards success and recognition from all parties as well as a sustainable future.

Sincerely yours,

Mr. Pongdith Potchana Chief Executive Officer


2013

1. About RATCH

To be a leading value-oriented integrated energy company in Asia-Pacific

Vision

Ratchaburi Electricity Generating Holding Public Company Limited is a leading private-owned electricity generating company in Thailand. Its power generation represents 14% of total generating capacity of the country. It was established on 7 March 2000 and the Electricity Generating Authority of Thailand is a major shareholder, owning 45%

equity. The Company as a public company has registered paid-up capital of 14.5 billion Baht. It is listed on the Stock Exchange of Thailand under the trading symbol of “RATCH”. The headquarters is located at 8/8 Moo 2, Ngam Wong Wan Road, Bang Khen Sub-district, Muang District, Nonthaburi Province.


Seeking and joining partnership to expand investment in Asia region

Creating additional value from investment in businesses related to power generation

Enhancing readiness and developing competency of human resources

To ensure shareholders’ value creation by continuously generating superior financial returns

To achieve world-class operational excellence and project development

To be socially and environmentally responsible, conducting businesses in a fair manner

To provide an enjoyable, secure, and motivating work environment

To support long-term national energy security and comply with all local regulations

Enhancing efficiency of the existing assets for maximum value

Taking leadership in power project development in existing investment base

Reliability : commitment to operational excellence to secure the country’s electric power stability in conjunction with social responsibility in business operationAccountability : working with high expertise and professional standard to maintain better corporate performanceTrust : adhering to good corporate governance principle, fairness and ethics in business operation

Mission

Policy

Common Value

R A T HC

Reliabili

ty

Account

ability

Trust

Happine

ss

Challen

ge

Challenge : focusing on maximizing value of the assets and extending business towards the targets to maintain leadership in Thailand electricity generating business, and become a leading power generating company in Asia-PacificHappiness : implanting value of cooperation, unity and teamwork among employees, and promoting friendly working environment to motivate efficiency for driving utmost goal of “Employer of Choice”


2013

Our Business

The Company considers investment and projects development by partnering with local and international business partners. To date, the Company has three investment bases namely Thailand, Lao PDR, and Australia that are high potential markets for future investment in power projects. The Company’s nature of business is a holding company which invests in equity of core companies, subsidiaries, and joint venture.The investments have been made in three core businesses namely electricity generating, renewable energy and other related businesses.

ElectricityGenerationBusiness

Renewable Energy Business

RATCH

RelatedBusiness


The Company’s investment is focused on primary fuel power plant project, which is a main source of electricity generating for securing the national power grid. It aims to increase capacity to 9,700 megawatts in 2023 by considering diversification of fuel in order to reduce fuel shortage risk. Concerning to environmental impacts from emission of fuel burning, the Company considers natural gas, oil, coal and hydro power as preferable fuel alternatives. At present, the Company operates gas-fired power plants, hydro-electric plants and coal-fired power plants with combined capacity of 6,146 megawatts. The operations in Thailand and Lao PDR distribute most electricity to Electricity Generating Authority of Thailand (EGAT). The power plant operating in Australia supplies electricity to power pool or local off-takers directly. Further information about the investment structure of electricity generation is provided in Annual Report 2013.

Electricity Generation Business


2013

Remark: As of January 2014, the Company accounted 6,543 megawatts total installed capacity resulting from acquisition of additional 50% equity of Tri Energy Co., Ltd, a gas-fired Tri Energy power plant’s operator, increasing another 350 megawatts to 700 megawatts in total, and liquidation investment of a Nam Ngum 3 hydro power project holding 25% equity with 110 megawatts capacity accounted.

Renewable Energy BusinessTo respond to climate change issue, the

Company has seriously considered renewable energy investment in 2010 with an aim to utilize unlimited natural energy for generating electricity which will help reduce fossil fuel consumption and carbon dioxide emission for better environment. The Company targets renewable power capacity expansion to 500 megawatts in 2016. Its priority is

focused on wind energy project, solar and biomass in Thailand and overseas because the said energy is of high potential for commercial and technology efficiency is advanced to reach commercial purpose. Until 2013, the Company has invested in 18 projects in Thailand and Australia with combined capacity of 156.45 megawatts. Please find investment structure of Renewable Energy Business in Annual Report 2013.

Natural gas4,933.32 MW

Coal751.20 MW

Hydro455.30 MW

Renewable156.45 MW Associated gas

6.25 MW

Thailand4,586.5 MW(73%)

Lao PDR1,206.5 MW

(19%)

Australia509.52 MW(8%)

Capacity classified by fuel Capacity classified by investment base

wind128.51 MW

Solar23.98 MW

Biomass 3.96 MW

Capacity classified by energy source


Related Business

It leads the Company to integrated business with compliment to its steady and stable cash flow. To date, the Company has joined in 7 joint ventures including operation and maintenance business, coal mining supply for power plant, gas turbine refurbishment and biomass raw material providers. The total investment values 174 million Baht. The investment structure of related business can be found in the Company’s Annual Report 2013.

Thailand 102.45 MW(65%)

Australia54 MW(35%)

Capacity classified by investment base


2013

In operation

Under construction

Under Development

In operation

Under construction

Under Development

Location of power plants

Thailand

Lao PDR


In operation

Australia


2013

Report

Review

Topics, Categories, Aspects, Disclosures on Management Approach and Performance Indicators

Stakeholder Inclusiveness

Identification Prioritization Validation

Sustainability Context

Materiality Completeness

2. Materiality Assessment

The report assessed critical aspects towards the company’s sustainability by applied information scoping guideline of the sustainability report according to GRI G3.1 shown below:


High significant aspects

Moderate significant aspects

• Local hiring• Impact of water source• Stakeholder engagement

• Economic performance• Recycle and use of resources• Energy use and energy efficiency• Emission• Effluents and waste management• Environmental protection and respond plan• Employee health, benefit, and training• Human rights• Community involvement• Corporate governance (i.e. Anti-corruption)• System reliability and availability

• Risk and opportunity from climate change• Environmental compliance• Supplier assessment

Moderate significant aspects

Critical to RATCH’s business (score 1 - 4)

Criti

cal t

o RA

TCH’

s sh

areh

olde

r (sc

ore

1 - 4

)

Step 1 Identification• Identifying aspects which are important to

the Company’s sustainability considering from the Company’s business nature, aspect of stakeholders’ expectation and aspects of sustainability of electricity generating industry.

Step 2 Prioritization• Prioritizing the aspects by their impacts on

sustainability in two areas: the area that is critical to business operations and the area that critical to the stakeholders according to criteria of risk assessment in four areas of business operations: economics, health and hygiene, environment, and corporate image, and frequency of questioning on these issues from the stakeholders.

• Proposing the critical aspects towards sustainability to the relevant functions- owners of the information.

Step 3 Validation• Reviewing the information by the responsible unit

of the report development to ensure that it is conformed to principles of the report’s quality identification.

Step 4 Review• Reviewing with external stakeholders to bring

their views for improving content of the next report more appropriate and relevant.

Materiality Assessment on the company’ sustainability in 2013

Topic Significant aspectsChapter

Organizational Governance

Economic Dimension

Social Dimension

Environment Dimension

3.1 Corporate Governance3.2 Risk and Crisis Management3.3 Stakeholder Engagement

4.1 Sustainable Growth 4.2 Supply Chain Management

4.6 Our People4.7 Corporate Citizenship

4.3 Climate Change Strategy 4.4 Project Management 4.5 Operational Excellence

• Corporate Governance (i.e. Anti-corruption)• Human rights• Stakeholder engagement

• Economic performance• Supplier assessment

• Employee health, benefit, and training• Community involvement• Local hiring

• Recycle and use of resources• Energy use and energy efficiency• Emission• Effluents and waste management• Environmental protection and respond plan• System reliability and availability• Risk and opportunity from climate change • Environmental compliance• Impact of water source

Summary of significant aspects towards the company’s sustainability


2013


Report on:

1.1

2.1 - 2.10

3.1 - 3.8, 3.10 - 3.12

4.1 - 4.4, 4.14 - 4.15

Not Required

Report fully on a

minimum of any 10

Performance

Indicators, including

at least one from

each of : social,

economic, and

environment.**

* Sector supplement in final version

** Performance Indicators may be selected from any finalized Sector Supplement, but 7 of the 10 must be from the original GRI Guidelines

*** Performance Indicators may be selected from any finalized Sector Supplement, but 14 of the 20 must be from the original GRI Guidelines

Report fully on a

minimum of any 20

Performance Indicators,

at least one from each of :

economic, environment,

human rights, labor

society, product

responsibility.***

Respond on each

core and sector

supplement* indicator

with due regard to

the Materiality Principle

by either: a) reporting on

the indicator or b)

explaining the reason

for its omission

Management Approach

Disclosures for each

Indicator Catagory

Repo

rt Ex

tern

ally

Ass

ured

Report on all criteria listed

for Level C plus:

1.2

3.9, 3.13

4.5 - 4.13, 4.16 - 4.17

Report

Application Level C C+ B B+ A A+

Management Approach

disclosed for each

Indicator Catagory

Repo

rt Ex

tern

ally

Ass

ured

Repo

rt Ex

tern

ally

Ass

ured

Same as requirement

for Level B

Stan

dard

Disc

losu

res

ProfileDisclosures

OUT

PUT

Disclosures onManagementApproach O

UTPU

T

PerformanceIndicator & Sector SupplementPerformanceIndicators

OUT

PUT

Report level reference

This sustainability report is the first issue of Ratchaburi Electricity Generating Holding Public Company Limited. It is made to conform to Sustainability Reporting Guidelines version 3.1 of Global Reporting Initiative (GRI 3.1). The Company has committed to continue conducting the sustainability report every year, covering key issues regarding the company’s sustainability in doing businesses and the aspect of stakeholders’ expectation. The scope of information reported under GRI’s guidelines is shown in page 91-105.

Ratchaburi Electricity Generating Holding Public Company Limited conducts this report according to Global Reporting Initiative’s standard (GRI G3.1) which also covers the guidelines of disclosing additional information for electricity generating sector according to Electric Utilities Sector Supplement (EUSS). The report application level is set to B level according to GRI’s Reporting Assessment criteria as shown below.

3. Organizational Management

The Company has applied the good corporate governance principle for listed companies of the Stock Exchange of Thailand (SET) and requirements of the Securities and Exchange Commission (SEC) to be the guidelines for governing organization. The Company’s policy on corporate governance was announced in 2003 to be a standard of practice for the group of companies. It implies the Company’s commitment in doing business with responsible manner and adheres to integrity, equality, and transparency in all activities. The policy has annually been reviewed to ensure that it is updated to current circumstances.

3.1 Good Corporate Governance


2013

In addition, the Company announced relevant policies concerning all stakeholders to be a guideline assuring all stakeholders be treated fairly and equally. It includes the Corporate Code of Conduct, the Director and Executives Code of Conduct, the Employee Code of Conduct, the Risk Management Policy, the Shareholder Policy, the Employee Policy, the Social and Environment Policy, the Policy on Networking System and Computer Utilization, the Security Policy, the Occupational Health,

Safety and Environmental Policy, and 5S Policy. These policies enhanced operational system up to international standards. To be prepared for ASEAN Economic Community (AEC) in 2015, the Company has studied and reviewed its rules and regulations ensuring they align with ASEAN Corporate Governance Scorecard, a common standard for listed companies in ASEAN country. The mentioned policies are published on the Company’s website at www.ratch.co.th.

Board of Directors

Planning and Business

DevelopmentFinance

Portfolio Management

CoporateAdministration

AuditCommittee

Risk Management Commitee

Investment Committee

Human Resources andRemuneration Committee

Management structure

Internal Audit Division.

Chief Executive

Officer


1) Board of Directors and CommitteeThe Board of Directors has an authorization,

duty, and responsibility to monitor and supervise the Company’s business operation on behalf of a representative of shareholders. They have to ensure the Company’s activities comply with laws, rules and regulations, the resolution of the shareholder’s meeting, the Company’s goals and good corporate governance principle. Also, shareholder’s value creation, conflict of interest avoidance and the Company’s interest protection must be directed by them.

As of December 31, 2013, there are 15 directors who are expertise and experienced in many areas. Out of 15 directors, seven directors are representatives of a major shareholder (one of them is an executive of the Company’s Management) and eight are independent directors. It also has four Committees; Risk Management Committee, Human Resources and Remuneration Committee, Investment Committee and Audit Committee. Their roles and responsibilities can be found in the Company’s Annual Report 2013.

In 2013, the Board of Directors worked together with the Management to revise and develop the Company’s business strategy plan. It also conducted performance evaluation of Committees for the first time other than the annual performance evaluation of the Board which was conducted in overall and individual basis. Regarding to the result, the overall Board of directors and individual directors, the Risk Management Committee, the Human Resources and Remuneration Committee, and the Investment Committee were rated in the “Very Good” level. The Audit Committee was in the “Excellent” level.

For the Corporate Governance Report of Thai Listed Companies 2013, the Company was rated in the “Good” level for 6 consecutive years. It was also ranked in the Top Quartile among the listed companies with over 10 billion Baht market capitalization. The Thai Investors Association scored “Excellent” level for the Company’s

shareholder’s meeting in 2013. The Company was granted the award for five consecutive years reflecting its operational effectiveness and efficiency complied with principles of good corporate governance seriously and continuously.

2) Code of ConductSince the establishment in 2000, the Company

announced and enforced the Corporate Code of Conduct, the Director and Executives Code of Conduct, the Employee Code of Conduct across the organization. The new hired employees and directors will receive the code of conduct manuals in the orientation session at the first effective day of duty. The manuals will encourage employees and directors being aware of complying with the code of conduct. Importantly, stakeholder treatment guideline is identified in the code of conduct covering shareholders, employees, business partners, competitors, lenders, borrowers, and society and environment. Details can be found in the Company’s Annual Report 2013.

3) Compliance to Laws, Rules and RegulationsThe Company is committed to growing business

and investment expansion for mutual benefits of all stakeholders, together with maintaining operational standard based upon integrity, honesty, fairness and good corporate governance principle in order to gain credibility and acceptance from concerned parties. Since its commencement, the Company seriously and strictly complies with relevant laws, rules, and regulations.

4) Disclosure of Information and TransparencyThe Company pays more attention in providing

concerned parties sufficient information bases on equal and timely manner. The given information is in Thai and English languages and the responsible units in charge of disclosure are clearly identified. The disclosure always makes through various media and communication channels.

The Company establishes the practices framework for good corporate governance as follows;


2013

5) Communication, Whistle-blowing, and Complaint Management

The Company provides channels for stakeholders to inform and report misconduct or complaints about the functional units or employees that violate or fail to follow the laws, policies, rules, and regulations, good corporate governance principle and the code of conduct, possibly causing damages to the Company. The Company has protection measures for honest claimants and provides various channels for receiving complaints including telephone, facsimile, e-mail, postal, the Company’s website, which is accessible to the Company’s Secretary Office, Internal Audit Division, Corporate Relations Division, and Investor Relations Department.

6) Internal Control and Auditing The auditing process is a key mechanism of the

good corporate governance principle. It enhances confidence of stakeholders ensuring that the Company adopts the internal control and risk management system appropriately and sufficiently. The Internal Audit Division directly reporting to the Audit Committee is responsible unit for monitoring and auditing worthiness and effectiveness of the Company’s operational processes including usage of the Company’s resources, finance and accounting system, financial management, and asset and resources management.

7) Anti-CorruptionThe Corporate Code of Conduct, the Director

and Executives Code of Conduct and the Employee Code of Conduct are a basic guideline in deterring and preventing corruption in doing business such as respecting and following laws and regulations, prohibiting conflict of interest, disallowing gift taking and giving, forming the internal audit system to ensure law and code of conduct compliance in all activities, and setting penalties for any fraudulence and corruption.

The Company has promoted integrity in the Group and embedded in its corporate value of “Trust” aiming

to foster all levels of employees to behave and perform their duties with integrity. According to the Company’s charter, it is not allowed employees to directly and indirectly offer and/or give money or any objects, and/or give or take in any forms of bribes, and offer political support. Failure to comply with the provision is subject to the disciplinary action, up to termination of employment.

8) Respect for Human RightsIn 2013, the Company is aware of human rights

issue and applied in its operational process engaged with three stakeholders; employee, community, and suppliers. The Company adheres to the principles of labour law aligned with the convention and charter of International Labour Organization (ILO) as a basis for treating those stakeholders.

The Company applies this guideline to protect employees and employment covering employment of indigenous people. Regarding to the community, the Company respects their rights of acknowledging information as well as safety protection. As a result, communication between the Company and community consistently and continuously occurred. For suppliers, the Company pays more attention to human rights issue in their business operation. Initially, the Company considers aspects of fair treatment of their labour.

In 2014, the Company embeds human rights issue in the corporate value of “Happiness” and also plans to enhance employees’ understanding about human rights principle, leading to their awareness of its importance towards the sustainability of the Company. Also, employees are able to interact with relevant party with respect of their basic rights. In the procurement process, the human rights aspect is considered to required qualifications of suppliers in dealing business with the Company. This issue is one of the terms set forth in the procurement contract. Moreover, the Company plans to provide training on human rights for its employees or supplier’s staff working in the Company’s office to ensure that suppliers operate the business with responsibility and respect for human rights.


3.2 Risk and Crisis Management

The company has required risk factor identification and assessment , as well as regular risk-related information communication within the organization. The Risk Management Working Group consisting of high-ranking executives of each function is responsible for considering and determining processes, guidelines, and measures of risk management. The risk limit is set to control possible damages within acceptable level. The Risk Management Working Group has also identified events or risk levels which are the warning signs for operators to perform their duties according to the procedure required. All functions need to form their risk management plan and report execution’s results in quarterly basis. It regularly monitors and evaluates effectiveness in controlling and preventing risks of the functions.


2013

Planning and Business

Development

PortfolioManagement

Finance Corporate

Administration

Board of Directors

Risk Management Committee

Risk Management Working GroupConsists of top executives of every discipline

Identifying business-level risk factors which relates to functions’ operation, developing risk management plan and

reporting execution’s result in quarterly basis

•Analyzebusiness-level risks and then indentify corperate-level risks•Reviewriskmanagement plan •Monitorandfollowup implementation of the plan

Sending back to revisit/correct in case of disapproval

Structure and Process of Managing Risk

Process of Managing Risk

Business Level

- Analyzing business-level risk issues and developing risk management plan of functions - Reporting risk management performances

Corporate Planning Division

- Collecting data and analyzing corporate– level risk issues and developing the corporate risk management plan - Summarizing risk management performance of the functions and reporting

Board of Directors- Approving the corporate risk management plan and performances of risk management

Risk Management Committee - Reviewing and approving the corporate risk management plan- Considering and approving performances of risk management

Feedback / Suggestions

Risk Management Working Group - Reviewing risk factors and risk management plan - Considering and evaluating performances of risk management

Corporate Planning Division acts as the secretary of the Committee


Major Issues Risk Management Approach

Impact from competition and limitation of domestic market

Climate change

Liberalization of power sector in Thailand leads to increase of players both local and multinational companies in the market resulting to gradually intensified competition. In the meantime, the market is limited because new power plant bidding is uncertain and subject to electricity demand forecast according to the Power Development Plan.

The climate change leads to substantial changes of energy policy in Thailand and international. Concerns of renewable energy and carbon dioxide emission are increasingly considered. Tax measures are likely applied to reduce such issues which inevitably affect the company’s investment in fossil fuel power plant project.

Reviewing and adjusting business strategy to enhance opportunities for driving growth of the company The strategic plan is defined focus

more on international investment in both Greenfields & Brownfields and Merger & Acquis it ion, as well as diversifies to business adjacent to power generation Focusing on investment in neighboring

nations to support the power reliability system of Thailand and seeking for investment opportunities in Small Power Producer projects, renewable energy projects, and business related to power generation Seeking for strategic business partner to

strengthen the company’s capability and enhance competitive advantage

Increasing renewable power capacity target to 500 megawatts in 2016 from 200 megawatts Seeking for domestic and international

investment opportunities in renewable power projects Setting carbon dioxide reduction target of

400,000 tons in 2016 from renewable power projects development Learning more about clean development

mechanism and carbon markets to apply as a tool for easing condition about carbon dioxide emission volume

The Corporate Planning Division is responsible unit for risk management of the Company. The division works closely with the Risk Management Working Group in order to assess and analyse risky issues, possibilities, and degree of impact against the organization. It also sets risk management measures for controlling negative impact against the Company’s business growth, and then presenting such measures to the Risk Management Committee and the Board of Directors for consideration and approval, respectively.

Substantial risk factors in brief possibly affecting the company can be grouped into four issues as follows;

Under risk management process of the Company, each function identifies risk factors in its operation and develops its risk management plan. The function-level risk factors are determined to be business-level risks. After assessing possibility and degree of negative impact, the corporate risk factors are specified and the risk management measures or approaches of risk prevention and control needs to be set.


2013

Major Issues Risk Management Approach

Financial market fluctuation

Acceptance of Community and Society

Power generation business requires intensive capitals which some of them derives from onshore and offshore lending. The fluctuation of foreign exchange and interest rate is considered risks affecting to financial cost, liquidity and financial position of the Company.

Acceptance and trust of communities surrounding the operating area is considered critical factor for growing business in long term.

Studying and identifying sources of fund alternatives Considering terms of debt repayment to

match with the company’s cash flow Requiring fixed or floating interest rate Restructuring debt based on financial

market circumstance to manage cost of fund at lowest level Applying financial instruments for offshore

debts to prevent risks arising out of fluctuation of foreign exchange and interest rate

Doing business fairly based on principles of good corporate governance, and respecting and strictly complying with laws and regulations Caring and protecting environment, and

establishing the social and community responsibility policy to deal with them as a “good neighbor” Opening communication channels for

communities to acknowledge their concerns and let them monitor the company’s operation Providing the complaint handling process

based upon step by step and fastest


Crisis Management

The Company establishes the crisis management and crisis communication plans for solving unexpected events leading severe impact to business interruption. It consequently reduces the company’s damages and losses as well as possible risks affecting stakeholders during crisis.

In addition, the crisis management and crisis communication plans are the efficient tool to help the Company quickly resumes business as usual. Under the plans, there are three crisis handling teams, which are;

The crisis management and crisis communication plans are regularly reviewed and updated for catching up with current situations of the Company appropriately and timely. They were also aligned with the emergency response plan of the Company’s subsidiaries. To enhance understanding among employees, the Company provides training on crisis management to relevant staff and all employees. Last year, no any crisis event affecting the Company’s business and operation was occurred.

1. Crisis Management Team (CMT), fully authorised to manage crisis and communication during the crisis situation,

2. Crisis Response Team (CRT), being responsible for executing and solving crisis regarding to CMT’s command,

3. Crisis Communications Team (CCT), being responsible for communicating with internal and external stakeholders.


2013

3.3 Stakeholder Engagement

All stakeholders involving to the business are significant to the sustainable growth of the Company. As a result, the Company conducts its activities with full caution and avoid negative impacts and treat to all parties equally and fairly. The Company emphasizes on building good relationship with all stakeholders, supporting participation and connecting them to the Company for understanding their expectations which are responded in the Company’s operation.

It categorizes internal and external stakeholders

by considering relevant to the Company’s mission, business strategy and corporate values. The affects

from the Company’s operation in both positive and negative and a group interested in the Company are also considered.

Currently, the Company classified 11 stakeholders

that relevant functions are responsible for creating and maintaining good relationship with them and act as the communication and feedback channel to learn their views and expectations. The significant aspects related to stakeholders were specified in the Company’s business strategy, stakeholder engagement action plan and operational processes.


Stakeholder ExpectationEngagement

Method

Responding

Measures

Electricity GeneratingAuthority of Thailand (EGAT), as a major shareholder andcustomer

Good dividend Business operation

aligned with EGAT’s strategy and integrate strengths of each to enhance competitive advantage Generating electricity

in agreed volume and quality

EGAT’s Business Committee Meeting Board of Directors

Meeting Joint meeting with

EGAT’s Portfolio Management function Formal and informal

meeting and activities

Dividend is paid no less than 40% of net profit after reserves according to the dividend payout policy Protect customer’s business

confidentiality and other information Specify its business strategy

aligned with EGAT’s objective Regular dialogues about

business cooperation in various levels; Board of Directors, Management and operational functions Cooperate with EGAT’s

Portfolio Management function to manage joint-activities for exchanging information and tightening relationship of both

Shareholders and Investors, including Thai and foreign institutional and individual shareholders and investors, and securities analysts

Generate reasonable return in terms of dividends and capital gains Adhere good

corporate governance and transparency in management Create growth for

adding corporate value Disclose sufficient

information in equally and timely basis

Company’s code of conduct Annual shareholder’s

meeting and regular analysts’ meeting Company’s site visit The Company’s

Secretary Office and Investor Relations Department Meeting with foreign

institutional investor aboard (Road show) Annual report,

Sustainability report and 56-1 Form Company’s website Media/ Journalists Disclose information

via various channels Two-way communication

provided

Identify guidelines for shareholder treatment in the company’s codes of conduct Dividend payout is not less

than 40% of net profit after reserves according to the dividend policy Provide opportunity for

proposing a meeting agenda in a shareholders’s meeting Fully open for their comment,

feedback and suggestions in the shareholders’s meeting Frequently communicate

with shareholders in forms of company’s site visit, road shows and analysts meeting Annually report operating

performance and corporate social responsibility performance to the shareholders Provide communication

channels and information access; website and mass media


2013

Track record and financialstrength Businessknowledge

andexpertiseof personnel Fairandtransparent

businessoperation Reputationand

credibilityofthe company Strongfinancial

position Trustineachother Leveragingstrength

andexpertiseofeach

Seekingforastrategic partnertodrivethe company’sgrowthaccording thecompany’sbusiness strategy. Determiningtheinvestment

portionandmanagingrisks possiblyaffectinginvestment returns Regularbusinessmeetingin

levelsofBoardofDirectors, Managementandoperational teammeeting Theprojectjoint-working

teamarededicatedand professional Arrangingthecompany’svisit

tobuildconfidenceandtrust Publishingthecompany’s

informationandachievement throughvariouschannels suchas,thecompany’s website,massmedia

Businessstrategy Policyofrisk

management Formalandinformal

meetinganddialogue Company’ssitevisit Informationdisclosure Providingspecialized

teamjoiningin eachstageofproject development Negotiatingjoint

venturebasedon mutualbenefitsor win-winsolution


Method

Responding

Measures

Lenders,includingfinancialinstitutions,tradecreditors,anddebentureholders

Financialdiscipline Abilityofdebt

repaymentandlowest defaultrisk Revenue-generating

capability Thecompany’s

credibilityproven stablefinancial position Complyingwith

relevantlaws Applygoodcorporate

governanceand transparencyin management

Planningdebt repaymentandfinancial management Regularmeetingfor

sharinginformation Annualfinancialand

operatingperformance reports Creditratingagency EnvironmentalImpact

AssessmentReport

Committingprincipal andinterestrepaymenton schedule Specifyingdebt-to-equity

ratioat70:30forinvestment Ratingthecompany’scredit

bydomesticandinternational creditratingagenciessuchas TRISRatings,S&PRatings, andMoody’s,toaffirm financialstrengthand repaymentability Regularmeetingtoshare

information Financefunctionisresponsible

forstrengtheningrelationship withlenders

Strategic partner/ business partner


Regulators, Permission authority and the Stock Exchange of Thailand (SET)

Suppliers /contractors

Complying with relevant laws, and regulations Environmental quality

management and community care Business operation

based on good corporate governance and transparency Sufficient information

disclosure equally and timely

Dealing business as a strategic partner and keeping long-term relationship Fair and transparent

competition Strong financial

position Reputation and

credibility

Formal and informal meeting and dialogue Company visit Annual Report and

Sustainability Report Environmental

quality management performance report Emergency response

plan and crisis management plan Complaint handling

channels and remedy measures

Defining the procurement policy based on transparency, fairness and equality The Corporate code

of conduct, and Articles of Association Occupational

health, safety, and environment policy Supplier registration Requirements of

supplier qualifications

Strictly comply with laws and regulations in doing business Monitoring and studying

changes related laws and regulations to ensure its completed and precise compliance Submitting complete required

information/ reports on schedule Drilling emergency response

plan and reviewing the plan annually Providing communication

channels; the company’s website and relevant responsible units Regular meeting, dialogue and

participation in activities of related agencies

Establishing the procurement system and methods in line with international standard Prohibiting conflict of interest

specified in the corporate code of conduct and setting punishment measures in severe disciplinary actions in case of corruption Providing desired and

backlisted suppliers registration by considering track records, quality of work and services and their management Caring occupational health

and safety for contractors/ suppliers working in the Company’s premise


Method

Responding

Measures


2013

Employee Attractive compensations Competitive welfare and

benefits compared to industry standard Career advancement

and succession Enhancing

competencies of employees Involving in business

planning regarding ranking and responsibility Good environmental

workplace and work safety Job security The company’s growth

and reputation

Employee code of conduct, corporate code of conduct, Employee policy and Articles of Association Performance appraisal

system Review of compensation

structure, welfare and benefits Employees development

and succession plans Appointment,

promotion, demotion, dismissal and reshuffle based upon merit and individual capability Occupational health,

safety, and environment policy Internal communication Channels for comments

and complaints, as well as complaint protection measure Recreational activity

and opened forum for employee’s participation

Specifying employee treatment guideline and required working practices for employees in the corporate code of conduct and Articles of Association Conducting performance

appraisal based upon merit system Regular review the

compensation rate, welfare and benefits structure to be competitive to the industry standard Establishing measures of

occupational health and safety, and environmental management in the workplace Providing employee training

plan for improving their competency, skill, and capability, and mental health enhancement, as well as developing their potential for career advancement Providing succession plan for

employees career progress equally Communicating the Company’s

information to employees through various channels, such as intranet, e-mail, conference, website, bulletin board Initiating relationship building

activity consistently to create better understanding of each and opening for their participation


Method

Responding

Measures



Method

Communities surrounding the operation

Customers/ Consumers, Including power buyer and end-users

Operating business with responsibility and minimizing impact to communities and environment Caring and supporting

community’s quality of life development Engaging in communities

and opening for comments and feedbacks

Generating and delivering electricity completely as per the agreement and orders Environmental-friendly

electricity generating process Operating without

impacts to environment and society Selling electricity with

reasonable price Credibility and trust

Power development fund Power plant visit Environmental

inspectors Community

development activities Emergency response

plan and crisis management plan Corporate Relations

Division Disclosure on the

power plant’s operational performance Community

participation and community visit

Planning annual outage of the power plants Meeting for sharing

information and views Cost efficiency

management and energy consumption plans Emergency response

plan and crisis management plan

Community participation in managing Power Development Fund to maximize community’s benefits Power plant visit providing for

community Introducing the Environmental

Inspectors of Ratchaburi Power Plant for community participating in inspecting the plant’s environmental management process Reviewing and exercising the

emergency response and crisis management plans annually, and notifying and engaging the community in the drill Initiating community development

plan by involving community Disclosing information and

consistently communicate with communities via various channels; newsletter, notification, visit, meeting and the Corporate Relations Division Always participating in

community activity Supporting the community’s

philanthropic programs

Implementing power plants’ maintenance according to the outage plan to maintain availability efficiency Meeting and visit customers

for sharing information and comments and strengthening good relationship Reviewing emergency response

and crisis management plans and drills annually Managing operational efficiency

for controlling lowest production cost

Responding

Measures


2013


Method

Mass Media Accurate and adequate information disclosure Providing information

timely, extensively and equally Two-way

communication with high-level executives

Press conference News release Interview Company’s website Company visit Regular/ occasional

meeting Relationship building

activity

Planning communication and publicising the Company’s information and managing media employed as a channel Providing content development

process and system to validate information accuracy Providing regular two-way

and one-way communications, for example, press conference, interview, company visit, website, news release Assigning responsible unit/

person for disclosure

Society and Environmentincluding non-profit organizations, communities located out of the business area, and general public

Protecting environment for reducing the global warming Social contribution Environmental - friendly

generating for serving economic and social development

Business strategy plan Social activities Energy conservation

Setting Carbon Dioxide reduction indicator in the business strategy plan Developing and promoting

renewable power generation in respond to the Company’s policy on global warming Initiating social activities

concerning on national forest conservation and increasing green area for social and environmental benefits Campaigning energy saving and

developing community energy program to reduce the energy consumption in communities Readily supporting power

generation for securing the country’s electricity system in crisis situation and controlling pollution at the lowest level

Responding

Measures


4.Target and Achievement in 2013

Capacity GrowthThe Company targets to increase generating capacity to 9,700 megawatts by 2023. The capacity

according to the Company’s shareholding in domestic and international projects as of 31 December 2013 was 6,303 megawatts.

For renewable power generation capacity, the Company has successfully invested in wind power projects, solar power projects and biomass power plants in domestically and overseas. As of 31 December 2013, the renewable capacity has reached 156.45 megawatts while the Company’s goal of 500 megawatts is expected to be accomplished in 2016.

10,000

9,000

8,000

7,000

6,000

5000

4,000

3,000

2,000

1,000

02010

5,212

2011

5,586

2012

6,282

2013

6,303

2023

Megawatts

Year

Growth of Capacity from 2010-2013

Goal9,700

2012 2013

500

450

400

350

300

250

200

150

100

50

0

98.68

156.45

2016

Goal500

Megawatts

Year

Growth of Renewable Energy Capacity Year 2012-2013


2013

CO2 Reduction Target from Renewable Energy Project To respond to climate change issue, the Company targets to reduce 400,000 tons carbon dioxide emission

in 2016 by more focusing on renewable power project development. As of 31 January 2014, the Company has invested in renewable power projects in Thailand and Australia with total installed capacity of 156.45 megawatts. The mentioned capacity is able to reduce 230,855.41 tons carbon dioxide emission per year.

Forest Conservation for CO2 Capture StorageThe Company promotes forest conservation in order to conserve forest as carbon sink for lessening

global warming impact. It has initiated “Love the Forest and Community” program to campaign community forest development which community participates in preserving and protecting the forest. In 2013, the Company aimed to support communities demonstrating their strong will and commitment to develop and manage the forest for sustainability and benefits for community and environment at large. The 2013 target of community forest promotion set at 100,000 rai enabling to capture about 200,000 tons carbon dioxide per Rai per year.

Under the project performance through two activities- Model Community Forest Contest and Strengthening Ratchaburi Community Forest, forest areas have been conserved 109,792 Rai in total.

2013 Target 100,000 Rai

• Model Community Forest Contest

• Strengthening Ratchaburi Community Forest

93,621 Rai

Achievement 109,792 Rai

16,171 Rai


4.1 Sustainable Growth

Throughout 14 years of doing business, the Company has committed to building sustainable and stable growth by dedicating all efforts in adding value to the businesses along with putting emphasis on social and environmental responsibility. This is in respond to the expectations of the stakeholders who are looking for reasonable returns and mutual benefits in aspects of society and environment.

The Company is fully aware that the business to grow steadily and sustainably, the stakeholders must have trust and confidence on the Company. For this reason, the Company has always operated businesses with transparency by disclosing up-to-date information on issues relevant to all stakeholders for their acknowledgement as well as giving emphasis on building good relations with the local communities; promote the community engagement continuously in every step from the project development stage until the project fully operated. Furthermore, the Company also discloses information on the investment activities and the progress of each project through various channels so that the stakeholders would keep

Economic

abreast of the movements. In the previous year, the Company’s investment, development and operation focus on power generation business and related businesses. For renewable energy project, it plans to achieve 500 megawatts investment in 2016.

The Company has defined its investment into two forms: by developing new projects and by acquiring equity in the existing operations. This allows the Company’s cash flow to become more stable and steady. Aside from Investment expansion, the assets management is also essential to strengthen the Company’s revenue. In this regard, the Company focuses on operational excellence of power plants by leveraging employees’ experience and expertise in the operation and maintenance of power plants to manage the efficiency of power plants’ availability to produce electricity in due time specified in the power purchase agreement. So far, the Company is able to well maintain the availability of the power plant enabling the revenue growth that meets the targeted goals.


2013

For the investment’s destination targets, the Company put emphasis on Thailand, Australia and Japan. In 2013, the Company studied the feasibility of wind power projects and solar power in Australia, and solar energy projects in Japan. There are now two projects under the study and development, which are the 165 megawatts wind power project and the 23 megawatts Solar PV project in Australia.

At present, the Company has invested in 18 renewable energy projects with total capacity of 156.45 megawatts in accordance to its equity holding in the projects. It divided into wind power projects of 128.51 megawatts, solar power project of 23.98 megawatts and biomass projects of 3.96 megawatts. All of these projects can reduce carbon dioxide by 230,855.41 tons per year.

However, if the Company’s investment in 165 megawatts wind power projects and 23 megawatts Solar PV projects in Australia are decided, it will increase the renewable energy capacity to 306.85 megawatts and can reduce carbon dioxide by 698,937.81 tons per year.

Employing of renewable energy to generate electricity tend to increase continuously both in the country and overseas, as a result of global climate changes. The electricity generating sector has significantly released the greenhouse gases into the atmosphere. Coupled with the decline of fossil fuel reserves, therefore, many countries have turned to generate the energy that exists in nature as an alternative to generate electricity and then set the policies and goals to develop alternative energy sources for power generation.

From these situations, the Company sees the potential for renewable energy businesses and investment opportunities both in domestic and overseas. Therefore, it has adjusted the investment target for renewable energy project from 200 megawatts to 500 megawatts with main focus of investments in wind, solar and biomass energy.

Investment in Renewable Energy


Asset Management to Maximize Value

The Company has clearly identified the investment structure covering three key businesses which are: electricity generation, renewable energy and business related to power generation. These approaches are attributed to the growth of the Company both in terms of returns and quality assets that can generate revenue to the Company.

Power generation business is the key to the Company’s revenue, so the investment will focus on fossil fuel power plants as it is a source of electricity that will secure the electricity system of the country. The renewable energy business aims to respond to the regulatory changes that arise as a result of global climate change and generate additional revenue to the Company by paying attention to wind, solar and biomass energy projects. The business related to power generation is supplemented its business integrated that helps underpin growth in revenue to be even more stable. Emphasis is put on the investment in power plant’s operations and maintenance, gas turbine refurbishment and coal mines.

The Company has invested in 32 power plants, of which are diversified in variety of fuel sources ranging from natural gas, coal, hydro, wind, solar to biomass, and planed to further investment to generate more revenue. Previously, it focused only on domestic market, now it has expanded the investment to Lao PDR and Australia and also studied and sought investment potentials and opportunities in other countries, including in Indonesia, Philippines, Vietnam, Cambodia, Myanmar and Japan.

In aspects of asset management, the Company focuses on the effective management of existing assets in order that they can create maximum value for the Company. In case of holding the minority shares, the asset management will be performed through a representative of the Company acting as the Board of Directors or management level of that company.

2013 Operating Performance

Targets in 2013:

Targets in 2014

Financial Performance:

Profit of the year 6.187 billion Baht Market capitalization 71.05 billion Baht (as of 27 December 2013) Shareholder’s equity 55.539 billion Baht Investment funding 2.81 billion Baht The Company’s credit ratings - TRIS Ratings: affirmed at AA+; Outlook: Stable - S&P Ratings : affirmed at BBB+; Outlook: Stable - Moody’s : affirmed at Baa1; Outlook: Stable

Maintain the power plant’s availability and dispatch electricity in due time as required by the power purchase agreement. Maintain the revenue growth and reasonable returns to shareholders Maintain the company’s credit ratings at the level reflecting stable and strong position of the company

Total revenue 53.494 billion Baht Total assets 88.903 billion Baht Dividend 2.27 baht per share Dividend yield 4.63%


2013

Project Owner : RATCH– Australia Corporation Limited

The study of wind power project development in Australia

The large-scale wind power project with 165 megawatts capacity

RATCH-Australia Corporation Limited (RAC), 80% equity-owned subsidiary, is a joint venture with Transfield Infrastructure Service Limited holding 20% stake. The investment is made through RH International (Singapore) Corporation Limited, its wholly owned subsidiary. RAC operates in Australia focusing on investing, developing and operating in power plants. Currently, RAC owns equity in seven power plants, with total installed capacity of 509.52 megawatts consisting of three gas-fired power plants, three wind power plants and a decommissioned coal-fired power plant.

This will be the 4th wind energy project with largest installed capacity of RAC if the investment is made. It will also drive RAC’s growth in terms of revenues and installed capacity, which willh increase to 642 megawatts.

Key Performance Indicators - The total installed capacity: 165 megawatts.- Electricity production: approximately 650 gigawatt- hours per year. - The project value: approximately at 11.4 billion baht (equivalent to AUD 380 million). - The development licence approval: December 2013. - The commercial operation schedule: 2016

Profit of the year 6.187 billion Baht Market capitalization 71.05 billion Baht (as of 27 December 2013) Shareholder’s equity 55.539 billion Baht Investment funding 2.81 billion Baht The Company’s credit ratings - TRIS Ratings: affirmed at AA+; Outlook: Stable - S&P Ratings : affirmed at BBB+; Outlook: Stable - Moody’s : affirmed at Baa1; Outlook: Stable

Toora Wind farm operated by RAC



2013

The Company recognizes the importance of supply chain management for its benefits in terms of cost management and work efficiency, in particular for maintaining efficiency of power plant’s readiness in generating electricity, in order to deliver our product to customers as needed. In this regard, the Company determines 3 approaches for supply chain management in our business procedures as follows :

1. Procurement Rules and RegulationsFor controlling the arrangement of goods

and services related to the Company’s business operation transparently and fairly. Such procurement procedure must consist of expert or senior committee in the areas of supply and procurement to consider on such procurement and must assign an executive starting from division director level as a person in charge of procurement approval by limiting approval amount for each level. In addition, goods/products purchasing and hiring procedure must be considered on the basis of purchasing or hiring value.

Purchasing and hiring of any kind conducted by

the Company is inspected by the Internal Audit Division reporting directly to the Company’s audit committee. It needs to ensure that the procurement procedures of the Company properly complied with the determined procurement rules and regulations, as well as opens for suppliers on the basis of fair competition. The consideration for supplier selection must be based on reasonable and non-discriminatory criteria, as well as fair price negotiation.

4.2 Supply Chain Management


Criteria for Supplier Selection The Company determines basic qualification criteria

for supplier which is a guidance to assess risk of each supplier by considering based on;

• Ability in delivering assignment within the determined timeline, expertise related to such business and industry, continuous innovation or technological development or products

• Track records, accountability, and stability of financial status, as well as no background of job abundant or being listed in public and private restricted list in the areas of works concerning occupational health, safety, and environment

Furthermore, the Company also added human rights issue as one of partner qualification criteria. All suppliers shall not employ or support the use of child labor based on relevant labor laws, shall have no case related to the violation of employee’s basic rights, and shall have no background concerning offering or receiving bribery.

Significant Milestones in 2013

In 2013, the Company added provisions concerning Green procurement by determinedly selecting standardized products in order to help minimize the exploitation of resources affecting to environment. Such provisions concern the determined selection of suppliers listed in Green Product list receiving Green Label Certification, Carbon Reduction Label from Thailand Environment Institute, and TIS Certification from Thai Industrial Standards Institute. In this connection, each partner must provide green product or service certificate(s) or have environmental-related label or green label as a tool in sorting products as well.

For the performance regarding Green Procurement in 2013, the total value of Green Procurement was 8,038,742 Baht, or accounting for 6.42 percent of the total 125,141,021.85 Baht. Last year was the first year that the Company seriously performed this initiative and the Company targets to have more extensive Green Product range for its further business.

%

Ordinary Procurement

Green Procurement

0

100

90

80

70

60

50

40

30

20

10

Purchasing

97.89

2.11

Hiring

96.35

3.65

Renting

15.68

84.32

Proportion of Green Procurement in 2013


2013

• In case of office automation equipment, the Company considered renting arrangement rather than purchasing and also selected eco-friendly type products. In last year, it rented photocopiers using printing ink with NOHSC (National Occupation Health Safety Committee) standard.

For 2014, the Company shall arrange to have inspection procedure on each retail partner in terms of Green Product manufacturing procedures, such partner’s treatments to its labors, and environmental concerns in manufacturing procedures. In addition, under Company’s procurement agreement, the provisions related to human rights, anti-corruption, and political neutrality are also added.

The increase of Green Procurement in 2013 resulted from the switching of using ordinary materials, equipment, and office supply to Green Products which is reflected in purchasing, hiring, and renting procedures as follows

• In 2013, the Company purchased eco-friendly office supplies including electric appliances with No. 5 Energy-saving Label, toilet paper made from 30 percent recycling wood pulp without bleaching powder or halogen

• For hiring, the Company procured service providers employing eco-friendly equipment in the production process or services, for instance, hiring printing service provider using soy ink for the Company’s printings of several kinds


2. Guidelines for Products and Services Arrangement for Power Plant Operation

Arranging a contractor for Engineering, Procurement and Construction of the power plant project (EPC)

Arranging spare parts and equipment of power plant

Key Issue Managing Method OutcomePartner Consideration

Criteria

Experience and expertise in developing and constructing power plant which are accepted in the industry Stable financial status

and conducting business on the basis of good governance Price quoting must

cover the determined scope and must be based on project budget amount Construction must be

completed within the determined timeline

Experience and expertise in electrical-related business which are accepted internationally

Stable financial status and conducting business on the basis of good governance

Ability to provide spare parts and specific equipment matched with technical information or checked and certified its workable capability by other users

Offering reasonable warranty period

Offering after-sale service and providing consultation quickly and free of charge

Providing technical knowledge or educational training on spare parts and the provided equipment

Hiring procedure must be by quotation request Partner must

strictly abide by relevant laws by determining in hiring agreement Post-construction

warranty must be arranged by determining in hiring agreement Owner engineers must

be designated to follow up and inspect partner’s work to ensure work quality and progress as planned

Must be arranged under long-term contract by determining advance purchasing price and that partner must arrange required products within the determined timeline in accordance to the purchasing agreement Having post-installation

warranty period by mentioning in the purchasing agreement Product delivery must

be made within the determined timeline by mentioning in the purchasing agreement. Checking requirements,

specification and completeness of the delivered equipment before using Coordinate with trade

partner when requires additional technical information

Budget Management for project development can be controlled within the determined amount Project development

and construction can be achieved as planned, power generation can be performed in consistent with the determined timeline Quality and endurance

of power plant can meet internationally accepted standard

expenses lower as a result of decrease in spare parts inventory Being able to control

product price fluctuation in the future Stability of power

plant operations and effective maintaining of its power generation readiness Power plant

maintenance can be performed as planned


2013

Arranging power plant’s fuels

Arranging operations and maintenance services

Experience and expertise in fuel business

Stable financial status and conducting business on the basis of good governance.

Ability to provide specific fuel matching with technical specification of the power plant

Ability to provide secondary fuel in crisis

situation or urgent needs

Experience and expertise in operations and maintenance which are accepted in the industry

Stable financial status Personnel and team possess sufficient ability and expertise

Provide supports on working system, equipment and technical team

Must be arranged under long-term contract covering the entire term of power purchasing contract

Product delivery must be made within the determined timeline by mentioning in hiring agreement

In case of natural gas, a maintenance plan of gas fields must be notified in advance by determining in hiring contract

Customers must be informed of a plan to suspend the production in advance in case that natural gas cannot be delivered

Determine fuel specification needed for delivery

Must be arranged under long-term contract based on the term of power purchasing contract

Determining required target and work performance in hiring contract

Determining the partner’s compliance to relevant laws and the power plant’s regulations in safety, occupational health, and environment related to working in the power plant in the hiring contract.

Monitoring, coordinating, determining key success factors of operation for performance check against target

Power plant can maintain its power generation readiness effectively

Risks from fuel scarcity are under control

Expenses and costs can be managed more efficiently

Power plant can maintain its power generation availability effectively

Expenses and costs can be managed more efficiently

3. Contractual Work ManagementFor contractual work, the contractor must abide

by regulations concerning the control of safety and environment, orders and practices concerning power plant’s safety as well as preventive preparation in case of emergency. Prior to starting work, the contractor shall participate in the training in order to gain understanding on risk factors resulted from working and the Company’s regulations on safety, occupational health, and working environment.

For the power plant, practices concerning danger indication and risk assessment are determined as standard to assess risks of work performed by the contractor. In addition, some kinds of work require legal documents, the contractor must provide the power plant with such documents in order to enter into work. This is to ensure that working in the power plant provides safety for individuals, properties, operating procedures, and environment, as well as to be deemed as measures for the contractor to treat its labors fairly and on the safety-concerned basis.

Key Issue Managing Method OutcomePartner Consideration

Criteria

Environmental


Climate change strategy for sustainable development

4.3 Climate change strategy

The Company has formulated the strategies to prevent, remedy and reduce the impacts of climate change and plunged into practice to alleviate the impacts through the maximum efficiency of electricity generating process and management of the greenhouse gases from the process. The Company has defined the guideline for operation control and

activities which can significantly contribute to the reduction of the impacts; both in terms of lessening the greenhouse gas from the source, increasing in the storage sources for greenhouse gas and adapting to meet and respond to climate change which may occur to the business in the future.

Increase the source of greenhouse gases storage

Climate change strategy

Adapt to accommodate the climate change

Reduce of the source of

greenhouse gases


2013

The Company attempts to reduce the greenhouse gas emission into the environment in every process and to enhance biodiversity starting from increasing in investment in alternative energies from wind power, solar and biomass; enhancing and maintaining efficiency of fossil fuel generation; the reduction of energy consumption as well as creating awareness of energy conservation and the environment among the operators and ramification into communities in the areas surrounding the project.

Management of Investment

Mitigation of Greenhouse Gas Emissions

• Study and create understanding of policies, terms and conditions in terms of the management of greenhouse gas and the climate change in the countries into which the Company has an investment, for instance, carbon tax in Australia as well as risk factors arising from the value of emission of carbon to be used as data to seek for guidelines and to create investment opportunities in alternative energies.

• Investments in projects for generating alternative energy or energy that generate lower level of greenhouse gas such as:

- Giving priority to invest in gas-fired power plants as well as hydro-electric plants considering being a mega-project that can stabilize production capacity and have less impact on climate than fossil fuel projects based on coal and oil.

- Increasing the proportion of power generation from alternative energy such as wind power, solar, and biomass continuously. This is responsible for the shareholding proportion of 156.45 megawatts in total. All these alternative energy projects are capable of reducing the emission of greenhouse gas up to 230,855.41 tons per year.


The location of the alternative energy projects

Equity Capacity

Equity Capacity

Thailand: Total installed capacity: 102.45 megawatts

Australia: Total installed capacity: 54 megawatts

Wind Farm

Solar Farm

Biomass power Project

Solar Farm Khorat 3, 4, 7 Projects,Nakhon Ratchasima province,

Production capacity: 7.2 megawatts

Windy Hill Project

Queensland


Toora Project

New South Wales


Starfish Hill Project

South Australia


Biomass Power ProjectSongkhla province


Saitong, Sai Prapha, Sai Yoi and Sai Yai Solar Farms Projects, Nakhon Pathom province


Sai Sena Solar Farm Project,

Phra Nakhon Sri Ayutthaya province


Sai Saphan Solar Farm 1, 2 and Sai Tatong ProjectsSuphanburi province


Khao Kor Wind Power Projects,Phetchabun province.


Huay Bong 2 and 3 Wind Power Projects,Nakhon Ratchasima province



2013

Greenhouse Gas Reduction Activity

Increase Efficiency of Production Process• Improvement of lighting system project by utilizing

high-efficiency light bulbs in Ratchaburi Thermal Power Plant, the Water and Wastewater Treatment Plant, the Cooling Water Reuse Plant and Petchakasem Fuel Oil Receiving Station, will help reduce the consumption of energy to as much as 887 megawatt-hour or reduce the greenhouse gas to about 454 tons per year.

• Energy-saving project through the discontinued usage of the Heater in the Regeneration Anion Resin by using Reverse Osmosis processed water with less dissolved Silica in the Regeneration Anion Resin instead of using service water, helps to reduce usage of the heater to increase the water temperature in Regeneration Anion Resin process while maintaining the efficiency of the resin throughout its useful life. Thus, it furthers to reduce the energy use to 129 megawatt-hour or reduce the glasshouse gas to 66 tons per year.

Mitigation of Greenhouse Gas from the Business Partners and Customers

The Company has the policy and defines the terms and conditions in the procurement by focusing on doing business with eco-friendly business partners, which have certificates of environmentally-friendly products and services or labels of the environment as a tool to separate the environmentally-friendly products from the general products in the market; or there is the availability of the environment management system or the certified international standard as to reduce indirect impact on climate change from the Company’s business as well.

• Energy-saving project by discontinued use of Agitator Mill Overflow Tank to regulate the concentration of lime during the Standby Mode of the Flue Gas Desulfurization system, helping to decrease Agitator operation in preventing sedimentation of lime, can reduce the consumption of energy of about 45 megawatt-hour or reduction of greenhouse gas to about 23 tons per year. Mitigation of Indirect Gereenhouse Gas Emission Reduction The improvement on the equipment of the air-conditioning system and the lighting system within various buildings as well as the change in the behavior to focus on creating the awareness of the energy conservation among staffs can reduce the energy consumption to a total of 1,483 megawatt-hour per year, which accounts for the reduced volume of greenhouse gas to 759 tons per year.

ProjectElectrical energy saving achieved

(megawatt-hour per year)Reduced volume of

greenhouse gas (tons per year)

Improvement on the air-conditioning system

Reduced consumption of electrical energy at Headquarters Building

62

1,421

32

727


Creating Awareness in the Reduction of Energy Consumption

Aside from the greenhouse gas management in various projects, the Company also responds to the creation of sustainability in terms of reducing the impact from the climate change with also extending into stakeholders in communities situated around the power plants.

The extended community energy project implemented in collaboration with Ratchaburi Energy Office continually in second year in the area of Tambon Tharab, Muang District and in Tambon Baan Sing in Photharam district, in Ratchaburi province, which is a community area within the radius of 5 kilometers around the power plant in Ratchaburi province. The project is to implement the community energy plan in the sub-districts with a budget of 200,000 Baht with combination 8 technologies from 589 items, i.e., economical light bulbs, solar dryers, high efficent charcoal stove or brazier, bio-mass fermentation pits, horizontal and vertical charcoal furnaces, biomass stove and high efficiency chicken barbecue. There are a total of 172 households joining the pilot scheme for transforming the behavior of using the energy and introducing the community energy technology to use in their way of life.

Based on the application of the community energy of the project, it can mitigate the greenhouse gas emission up to 18.5 tons and helps economize the expense for a total of 172 pilot households amounting to 109,519 Baht as well as imparting knowledge and awareness of energy conservation to the pilot households and also diversifying into households in the neighborhood according to the objectives of the community energy project.

Pilot households in the Extended Community Energy Project

Mrs. Anchalee Thongbaiyai, Chairman of the community energy volunteers of Tambon Tharab, residing at the house No 58 Moo 4 in Tambon Tharab, said: “I joined the community energy project from the beginning to the formulation of the Tambon Energy Plan. I received support a 200-liter of charcoal kiln of horizontal type to use on a trial basis. As I managed to produce the charcoal for selling, I then ordered additional two charcoal kilns to make more charcoal for sale. I used firewood as available in the community. I managed to earn about 6,000 Baht per month from selling charcoal together with a high efficient stove for use in place of the original stove, thus saving about 30 % in charcoal for cooking. Moreover, for replacing all the light bulbs in the house, I could save about 300 Baht per month. This draws interest from the neighbors to see it as an example.


2013

Increase the Greenhouse Gas Storage

To alleviate the problem of climate change resulting from the emission of greenhouse gases in the power generation, the Company is also committed to increase the carbon sink to store greenhouse gases, in various forms as well as carrying out activities in the project areas and the activities in the community areas.

Planting Trees and Preservation of Forest Areas

• IncreaseGreenAreaswithintheProject After the completion of Ratchaburi Power

Plant, it further made development on the remaining project areas and turn it entirely into the green area. This was possible by making improvement upon and increasing the green area throughout 13 years of operation to the extent that total green area has accumulated to 472 Rai, which accounts for 23.4% of the project area (more than the measure defined in EIA at 5% of the project area.)

• PreservationofForestAreas The Company is yet determined to implement

the project entitled “Love the Forest and Community” in collaboration with the Royal Forest Department continually as to preserve the forest areas of the country to 40%. The project increases the number of trees and the community forest area at total 873 sites to be the carbon sink. The community forest areas accounted for 791,391.78 Rai. In 2013, the Company supported activities about community forest registration and community forest management for 159 communities, totaling 109,792 Rai in acreage. The area has potential to store carbon dioxide gas to as much as 219,584 tons per year and it is convinced that the area of this community forest will sustainably remain in abundant and rich of bio-diversity, which well serves communities contributing to forest protection as the source of food and water.

• Thestudypotentialofcommunityforestforcarbonstorageandthebio-diversityofthecommunityforest.

Under the “Love the Forest and Community”, phase 2 (2013-2017), implemented in collaboration with the Royal Forest Department, They have initiated the study project of “The community forest‘s potential for carbon storage and bio-diversity” as to assess the volume of stored carbon of the community forest and to follow up on the change in the accumulation of carbon as well as

the study of the bio-diversity in the participating community. The study result will be used as guidelines to rehabilitation of the forest ecological system by community participation as to increase the carbon sink to help reduce the climate change problem.

The 50 community forests participating in the study selected from those granted awards from the community forest contest under the project “Love the Forest and Community”. The 5- year project (from 2013 to 2017) provides the training of villagers of the community forests and the forestry officials to create knowledge and widen understandings of the project, laying out of the sampling plots, collecting data, monitoring and analyzing the information to learn of the accumulated stored carbon and the bio-diversity from the community forest areas and the use of information to define the integrated forest management guideline for adapting and accommodating climate change. In 2013, the training was organized on method of laying out the sampling plots, and the technique of checking accuracy to the officials and leaders of 12 community forests. They are ready for laying out the sample plots and for collecting the data in 2014 onwards.

TheuseofgreenhousegastocultureSpirulinaalgae

Ratchaburi Power Plant has made a study project to bring wasted carbon dioxide from the combustion of the Combined Thermal Power Plant for use in culturing Spirulina algae which can store carbon dioxide 9 times higher than the trees can. In 2013, the production of dried Spirulina algae grossed dry weight of 1,497 kilograms, which accounted for volume of carbon dioxide used by Spirulina algae for growth of 2.74 tons. Moreover, Ratchaburi Power Plant is in the process of developing a project for the culture of algae to produce bio-diesel oil, which uses the wasted carbon dioxide from the plant. The project was conducted in collaboration with the Department of Alternative Energy Development and Efficiency, Ministry of Energy; as well as with Bangchak Petroleum PLC and Loxley PLC. At the present the project is constructing the culture pond and selecting the species of algae to be further used in the project.


Adaptation to Climate Change

Water managementAs the power plant may be impacted by climate

change further resulting in drought which may cause the decline in the source of raw water (in Mae Klong River) and the conflict over water between the community, power plant and the agricultural area in the Mae Klong river basin may take place. Although Ratchaburi Power Plant uses the water by average about 1% of the volume of water drained from Mae Klong Dam, the power plant has prepared for the impact by introducing the mitigation measures to accommodate the shortage of water by means of using the circulation water for heat exchange of the cooling system to extend the turbidity of the water at a certain level before draining into the treatment system. This is to reduce the consumption of water in the production process and to build reservoir as to store rain water in the power plant area for use in watering trees and plants. In addition, it introduced a project to improve quality of discharged water for re-use and to reduce the use of the raw water and maximize management of water resource.

Accommodation of flood disasterDue to major flood disaster in 2011, the Company

has over-weighted risk on flood. The project under development conducted additional study on flood impacts together with measures to improve on the design of the power plant structure, the power plant’s foundation construction, the lay-out of the level of key power plant equipment placement and additional design of the water drainage and flood prevention system within the power plant. For example, the precautionary actions having been already taken are at Ratchaburi Power Plant and Ratchaburi-Power Power Plant by conducting a study on flood risk as to formulate additional preventive measure. As the study result, it was found that the two plants have the least flood risk probability thanks to the availability of the power plant’s efficient internal water management and the embankment around the plant is at high level and strong enough to prevent flooding. For this purpose, the two power plants have increasing strengthened the earth embankment in the area around the power plant, and Ratchaburi Power Plant has developed the contingency plan to accommodate the emergency flooding.


2013

Ratchaburi Power Plant has formulated procedure of the flood emergency plan to accommodate the flooding incident. The plan as a guideline manual defined the step by step practical procedure in solving the situation within the area of the Ratchaburi Power Plant with promptness, effectiveness and efficiency. It helps prevent and reduce losses of personnel, property, the production process and impact on the environment. Additionally, the preparedness for personnel concerned as to enhance their expertise on duty through regular drill is made a yearly basis. The power plant classifies the level of severity of the circumstance for preparedness to respond as follows:

• Level 1 severity means flooding incident that is controllable by the operators of the responsible organizations within such area.• Level 2 severity means the flooding incident that is controllable by the use of all available resources in Ratchaburi Power Plant to control the situation. • Level 3 severity means the flooding incident that is uncontrollable through the use of all available resources within the Power Plant. External assistance may be sought to join in solving the problem in collaboration with the Power Plant units.

Moreover, in 2012, Ratchaburi Power Plant and Ratchaburi-Power have yet been conducting a study and assess the risk of flooding in the area which may occur in the future. A summary is made of flood risk assessment, measures to prevent and reduce impact which may happen from the said incident for further action to ensure the ability to meet the flooding disaster at various levels efficiently.

Elevation of the height of the new office building Based on the flood disaster of 2011 which wreaked

havoc in many provinces of the country including Bangkok Metropolis and the outlying provinces, the new buildings of the Group in Nonthaburi province, which was under construction of its foundation at that time, was also impacted.

Thanks to that incident, it prompted the Company to readjust its concept for the construction of this new building by using the data on the water level to apply to the engineering design and reconditioning the construction area as to accommodate the repeat of the incident in the future with the use of the budget of 7.7 million Baht to elevate the height of the foundation, to construct the solid wall partition to serve as the embankment to prevent flooding and two additional reservoirs to store the water before it reaches the ground floor of the building.


4.4 Project Management

For the development of each power plant, it entails high amount of capital investment and requires a project period of between 5 to 7 years before power generation can be produced. The feasibility study of the project and the risk analysis as well as the cost-efficiency is therefore the steps of considerable importance for a decision to invest by the Company.

The process of feasibility study and due diligence of the project will cover every dimension as to analyze the risk, the project’s cost effectiveness and returns on investment of the project. The process and stages of the specific disciplines clearly defined and the internal and external expert work team must be followed the guidelines in detail, carefully and concisely.

Most importantly, after the investment is made, the Company focuses on the project-cost control, the period of project development and the construction to ensure timely completion as scheduled in the power purchase agreement, and the risk management, in particular, the acceptance of the community around the project site and the environmental impact.


2013


Management of project’s risks

The assessment and the analysis of the project are important stage in the project development. There will be the process of paticipation of the community located within the radius of the impact as part of analyzing the impact and formulation of impact prevention and mitigation measures to ensure that the project development responds to the community concerns. For technical issue, the result of the study is used for project designing and selecting technology to reduce the impact from production process and to define the preventive measures and mitigation.

The impact assessment on the power plant development will focus on 2 main issues, namely, the environmental impact and health impact. The result of the assessment and analysis of the impact will lead to the formulation of the preventive measures and mitigation, and formulation of the environmental management-implementation plan. The prevention and mitigation measures will be put in practice from the construction period until the operation period through the working life of the power plant.

Important measures to be used for reduction of the impact on Ratchaburi Power Plant will be, e.g., the installation of the continuous pollutant substance mornitoring equipment at the top of the stack, the installation of the air quality monitoring stations in the community, installation of the noise absorbent equipment within the power plant and the tree planting around the power plant for being a noise barrier, etc.

The Company analyzes and assesses the risks based on the internal and external factors of the project which will impact on the project.

The significant risks arise from the internal factors, i.e., the capability and efficiency of the availability for power generating, the shortage of fuel and water. In relation to that, the Company has formulated the commissioning plan for power distribution to customers to be clearly specified in the power purchase agreement together with the outage plan; the selection of technology to accommodate the switch to using 2 types of fuel and enter into the fuel purchase contract with commitment to procure and supply the fuel to the power plant throughout the life of power purchase contract as well as the construction of the reservoir for storage of raw water within the power plant to ensure water adequacy for power production and installation of the water recycled system for re-use within the power plant, etc.

External risk factor is the amendment of the law, rules and regulations to accommodate the issue of global climate change. In this connection, the Company has considered using the carbon trading market mechanism as to reduce the impact arisen from the said issue. Moreover, the right of the community to take part in the inspection of the project is one of the risk factors to which the Company attaches importance and operates by opening the communications channels with the community continually in various formats.

Assessment of the impact on the project

Exemplary CasePreventive Measure against impacts from flood

disaster of Nava Nakorn Cogeneration project.


2013

1. Guidelines for risks management due to natural disaster in Nava Nakorn Cogeneration Project

Nava Nakorn Cogeneration Project is located in the Nava Nakorn Industrial Zone, Pathumthani province. The plant is due for commissioning commercially in 2016.

The development of the said project has started since 2010 until 2011 in which severe flood disaster occurred in Thailand. Consequently, the Company considered incorporating flood disaster as a risk having material importance to the operation of the project and formulated the measures to deal with the said risk.

Goal - To prevent and reduce the damage of the power plant - The power generation can proceed continuously and is least impacted by flood disaster (if there is any).

Method of management - To prepare a report on the study of the highest level of flood during 100 years to be the data for use in planning the level of landfill of the project and in upgrading the base level of the key equipment of the project to be at the level higher than the maximum level of flood assessed from the study - To conduct a repeated inspection of the height level of the project area and inspection of the characteristics of the soil in the project site area. The data obtained will be used to analyze the method of landfill in the project site area and the proper design of the foundation of the power plant capable of accommodating the flood condition actually occurred - To study flood protection measures and method of water drainage in the project area. The measures are used for designing flood prevention system and the water drainage within the project area constructed as a supplement to the flood prevention system of Nava Nakorn Industrial Zone

SUCCESS - The implementation of the said plan has passed the consideration and inspection in detail from experts in water, flood prevention system and insurance. - The said implementation was incorporated in the Report on Environmental Impact Assessment of the Project which has already passed the review and approval from the Office of the Natural Resources and Environmental Policy and Planning.

PROCESS SAFETY

KEY OPERATIONS IN 2013

The Company takes into account the operational process safety intensely and it is deemed to be a key risk that not only has impact on the property, but also has the impact on the living of the operators. For the management of the operational safety, it is therefore in the format of work plan and will be seriously and strictly enforced on the personnel and outsiders who enter to work in the project area.

The management of safety in the operation of the power plant focuses on key issues such as the working environment, accident related to work and the prevention of fire outbreak. The measures defined by the Power Plant in the preventive measures and reduction of safety impact will be applied both during the construction and operational periods.

Exemplary Case The enhancement of the operational safety efficiency with

application of the OHSAS 18001 system in Ratchaburi Power Plant.


2. Operational Safety of Ratchaburi Power Plant

Ratchaburi Power Plant has developed the safety operational plan continually and in 2010, it introduced the occupational health and safety management system OHSAS 18001 to upgrade the efficiency and effectiveness of the safety and occupational health management.

In 2013, Ratchaburi Power Plant has formulated the Environment Management Master Plant. In relation to safety, the Power Plant is resolved to control and prevent danger which may befall the operators and related persons in terms of personnel, property and production as well as improvement on safe working environment and safety aspects enhancement.

Goal - To prevent personal accident ( to the extent requiring work stoppage) to nil

Key Operation - Formulated the control measures of safety and the environment of the contracted work, applied to all contractors of every organization which enter into the work performance in the area of Ratchaburi Electricity Generating Co, Ltd., to ensure that persons who come in to work in the area of Ratchaburi Power Plant is safety protected under the provisions of the law as well as to ensure safety of property and the production process - Formulated the safety plan for the plant maintenance to ensure that the safety measures are strictly complied with for every stage of work performance - Launched the project “STOP WORK AUTHORITY” to support and promote every operator in the safety control or sub-standard working environment which may lead to occurrence of accident

INDICATOR 1) To bring personal accident (to the extent requiring work stoppage) to nil by defining the measuring criterion at Disabling Index: DI equal to or less than 0.05 2) The operating results in 2013 of Ratchaburi Power Plant show that it is capable of preventing personal accident successfully. There appears no occurrence of accident to the extent of work stoppage, accounting for Disabling Index: DI equal to zero.

4.5 Operational Excellence


2013

Reliability and Availability

Regarding to the requirement of Electricity Generating Authority of Thailand (EGAT), the Company has to generate electricity up to the quality and power system standard and deliver electricity at ordered amount and schedule ensuring reliable and adequate electricity supply for power grid. The Ratchaburi Power Plant, a principal facility of the company, satisfactorily maintains higher Availability Factor than requirements of Power Purchase Agreement and its annual target.

To maintain the availability of distribution, proactive maintenance to raise the readiness, which may be disrupted by equipment damage and work operation, is necessary. The Ratchaburi Power Plant thus keeps control production cease rate of Thermal Power Plant and Combined Cycle Power Plant at lower than the

standard of NERC (North American Electric Reliability Corporation) when compared to power plant at the same capacity. The measures include:

1) Ratchaburi Power Plant has entered Operation & Maintenance Agreement (O&M) to protect availability risk. Monitoring and assessment of O&M performance specified in the service agreement is regularly done.

2) Ratchaburi Combined Cycle Power Plant has a long-term Contractual Service Agreement on spare parts with its partner since 2005. The contract will be expired in 2027 when gas turbines end their operation according to the power purchase agreement. The agreement also helps raise availability and reliability, reduce outage period in planned maintenance. So, it can estimate maintenance expenses and control them efficiently.


According to the policy on fuel efficiency management by implementing regular maintenance of the power plant, Ratchaburi Power Plant Equivalent Availability Factor and Reliability Factor are better than 2013 target. It is proven that the power plant can efficiently manage continuous increase of its Reliability Factor.

Environmental Management

As a major power producer, the Company pays high attention to protect environment by putting the best effort in preventing the environmental impacts starting from a pre-construction stage, particularly in plant designing. Installation of highly efficient pollution preventive and control system were set up during construction period, to ensure that the environment quality will be best cared from the start of the operation.

The Company has mitigated measures to reduce operational risks in two ways. To prevent

social, environmental and economics impact, the Company has established the power plant’s environmental management measures aligned with required environmental laws, and created awareness among everyone concerned leading to operational excellence with regard to accepted standard and attitude change towards environmental concern. For climate and environmental changes, it is a driving force for the Company to continue improving its operational procedures for efficiency maintained, and reduce resources consumption and pollution to cope with the climate changes appropriately.

Thermal Unit 1

Thermal Unit 2

Combined Cycle Block 1



82.23

82.23

90.09

80.01

92.43

84.10

79.63

91.32

80.46

93.00

97.50

97.50

96.07

80.13

98.57

25.00

25.00

70.00

70.00

70.00

28.62

28.46

71.09

74.55

66.89

100.00

94.09

97.01

93.97

98.69

Ratchaburi

Power PlantTarget Target TargetAchievement Achievement Achievement

(Equivalent Availability

Factor: EAF)

(Reliability Factor: RF) (Dispatch Factor: DF)

RATCH

Reduction

• Social

• Environment

• Economic

Environmental Management

•Emission

•Water

•Noise

•Waste

•Biodiversity

•Safety

•Compliance

•AwarenessAdaptation

Environmental Risk ManagementforSustainability


2013

1) Study and assess the environmental impacts prior to the project development, as well as seek community participation and encourage them to raise their environment concerns.

2) Comply by the relevant laws and regulations identified in the Environmental Impact Assessment Report.

3) Maintain operational efficiency 4) Employ 3R principle (Reduce/ Reuse/ Recycle)

in production process. 5) Apply ISO 14001: 2004 and OHSAS 18001: 2007,

environmental, occupational and safety management standards to control systematic operation of the power plant and standardize procedures of emergency response and complaint handling from concerned parties at international accepted level. The performance review and auditing are conducted every six month.

6) Join the Corporate Social Responsibility scheme, organised by Department of Industrial Works: CSR-DIW, for moving towards the green industry.

7) Develop renewable energy projects.8) Educate and create awareness regarding energy

and natural resources conservation among staffs and other stakeholders.

Environmental Management Approach

Risk

Assessment


Air Quality Management Air Quality Monitoring Results

Ratchaburi Power Plant equips pollution control and monitoring systems to watch air quality impact through measure as followed.

• Install the Flue Gas Desulfurization System or FGD in construction period of Thermal Power Plant with 97.2% effective for desulfurization.

• Design the combustion system for Thermal Power Plant with Low NOx Burner and Flue Gases Re-circulation techniques to reduce oxide of nitrogen. The gas-fired Combined Cycle Power Plant, is equipped with the Dry Low NOx Burner. When diesel is in use, it will be injected with demineralized water to keep the temperature below the oxide of nitrogen formation point.

• Equip the Continuous Emission Monitoring Systems: CEMs to monitor stack emission from fuel combustion

• Install the Ambient Air Quality Monitoring System (AAQMs) at four stations in community area nearby the plant.

Air quality monitoring from power plants’ stacks throughout the year 2013 found that stack emission were in standard, from Sulphur dioxide, Oxide of Nitrogen, and Opacity from natural gas and/or oil combustion. None of substances that deplete the ozone layer is used in power generation procedure.

Besides checking air quality at power plant chimneys, where are the origins of pollution, and found all power plants stayed in standard without causing environmental effects, Ratchaburi Power Plant also monitors air quality in communities surrounding by installing. Ambient Air Quality monitoring stations work around the clock to check Sulphur dioxide, Nitrogen dioxide and ozone, Total Suspended Particulate (TSP) and Particulate Matter less than 10 micron (PM10). It was found that pollution parameters are efficiently controlled in Standard Air Quality parameters.


2013

Noise Management

Waste Management

The power plant initiates a campaign to reduce noise pollution by growing plants to serve as noise barrier around the area. It meanwhile spares a large space as Buffer Zone next to community. Moreover, there are noise control measures as following:

• Stop all activities that cause annoying noise to the community during night time. Measures are applied to control noise at origin source to stay lower than 85 dB(A) in one–metre range from the origin.

• Staff working in power plant must wear noise protection equipment such as earmuffs when work in area with noise over 90 dB (A) and must work less than eight hours per day.

• Noise level checking must be carried out every three months.

General Waste Management• Recycle garbage: Recycle garbage bank is

established for buying recycle garbage from the power plant’s internal units . • Wet garbage: The power plant hires Ban Rai Municipality to collect and transport leftover food and non-recyclable waste. Reusable material will be sorted out at the landfill site.

Management of Waste from Production ProcessTo cope with 163.59 tons of waste from

production process, which are both toxic and non-toxic, the power plant hires waste management service provider to treat and disposal waste. Oily

waste, such as oil water, will go through process and reused. Qualified oil waste management will be selected to recycle or reuse it as fuel in steam generation, instead of burying it. The reused fuel reduces green house gas emission and contamination to the environment.

Moreover, 4,600 tons of gypsum from Thermal Power Plant’s desulfurization is buried in the power plant’s landfill area, waiting to be used or sold to cement factory as raw material. Underground water quality monitoring is done for watching out the contamination.

Noise Level Monitoring ResultsAccording to noise level monitoring

implemented 4 times in 2013, it was found that the average and maximum noise level was according to the regulations.


BiodiversityConservation

The power plant conserves and improves the existing ecosystem for wildlife biodiversity around the site, both local and migratory animals. Wildlife study is conducted on diversity, population and distribution to monitor and watch out impact from the power plant, particularly over bird. Bird is a main indicator of environmental quality around the power plant. Totally, 74 bird species are found (64 local birds and 10 migratory birds) in 2013. Survey has been conducted continually since 1997 when power plant construction just started.

Water Management

In 2013 Ratchaburi Power Plant used 23.8 million cubic metres of water from Mae Klong River. The water used here represented 0.95 per cent of water from the river. It was used for generating 14.6 million megawatt-hour. Then 3.6 million cubic metres of treated water was drained into Bang Pa Canal.

Water Quality Measuring Water quality measured since the operation

started shows that all water records could meet official waste water standard. A project to enhance water efficiency is initiated to maximise reuse of treated water, reduce additional raw water usage, and waste water drained into natural waterway.

Water usage of Ratchaburi Power Plant varies to electricity supplied into the grid. It can maintain maximum efficiency of water usage when compared with quantity of electricity generated. Water quality in cooling system is well maintained and can be used three to four times before drained. High water usage ratio occurs when the power plant restarted operation after maintenance stop.


2013

As Ratchaburi Power Plant uses around one per cent of water released from Mae Klong Dam Reservior while amount of water released from the reservoir tends to drop compared to the same season of earlier year, so, it has a measure to cope with the risk of water shortage and confrontation with communities and agricultural-related bodies in Mae Klong River Basin. Rain Water pond is built to store water for the garden. Reuse water project is initiated to reduce raw water usage and maximize water efficiency, as well as coping with climate changes.

Improving quality of reused water by Reserve Osmosis and Ultra Filter

The project is initiated for maximum water efficiency. The power plant has built a Cooling Water Reuse Plant and utilising Ultra Filter (UF) and Reverse Osmosis (RO) system. Water from holding pond goes through many filters, as tiny as cell, and being reused in the operation system. In 2013 treated water through RO and UF was 806,746 cubic metres. This amount of water could produce 381,795 cubic metres of RO water, representing 2.7% of raw water in operation system.

Treated water is reused in 350 rai area, once was a swamp at western side of the plant and now turned into plantation. The water is used for watering plants in biological agriculture plantation, which is cooperation between the power plant and the Military Engineer Department, Ratchaburi Province. The plantation comprises a 23 rai rice paddy which can produce two crops a year. In 2013 season, it produces 16 tons of rice to the Military Engineer Department. Moreover, it serves as nature study centre for youth and interested people. Garden watering system in the power plant was set by using treated water from production process to help reduce waste water and raw water usage as well.

Biological Project to Reduce Waste Water Drainage


Safety

Comparative Statistics for Overall Accidents at Ratchaburi Power Plant in 2012-2013

Accidents Concerning Generating ProceduresAccidents Concerning Generating Procedures mean unexpected incident resulting in the loss of power

generation availability and distribution within the generating and supplying procedures.

NoteSeverity Level A: Loss of Equivalent Availability Factor more than 80% per unitSeverity Level B: Loss of Equivalent Availability Factor between 50-80% per unitSeverity Level C: Loss of Equivalent Availability Factor less than 50% per unit

Number of Times

Level of Severity

0

20

15

10

52012

2013

0

20

15

10

5

A

2

6

12

15

B

4

9

C

Statistics on Accidents Concerning Generating Procedure


2013

NoteSeverity Level A: Death, disabilities, loss of body organ – taking leave for over 7 daysSeverity Level B: Starting from first aid in a clinic to getting injuries to take leave up to 7 daysSeverity Level C: Minor injuries, i.e. irritation from dusts or bruise

Preventive measures for Decreasing Loss of Accidents Concerning Generating Procedure and Properties are as follows:

1. Conduct major overhaul of Block1 and Block2 of Combined Cycle Power Plant in 2013, as well as the Block3 of it in 2014 in order to repair and replace any expired equipment and maintain the machines to be able to perform operations efficiently.

2. Assign Electricity Generating Authority of Thailand, as an operation and maintenance service provider, to prepare re-work management plan to reduce loss of generating hours.

Accidents Concerning Individuals

3. Set reliability value for operational system as KPI to assess the EGAT’s performance of Operations and Maintenance for the Power Plant, owned by Ratchaburi Electricity Generating Co., Ltd. (RG), which EGAT’s employees perform the power plant’s maintenance under the contract with Ratchaburi Power Plant.

0

20

15

10

5

A

0

B

7

9

0

20

15

10

5

A

0 0

C

3

Number of Times

Level of Severity

2012

2013

Statistics on Accidents Concerning Individuals


Accidents Concerning PropertiesAccidents Concerning Properties mean unexpected incident in which its occurrence may impact on the

damage of the Company’s properties whether such properties are used in power generation procedure or not.

NoteSeverity Level A: Loss of properties valued over 500,000 BahtSeverity Level B: Loss of properties valued between 50,000-500,000 BahtSeverity Level C: Loss of properties valued less than 50,000 Baht

The reason why value of loss concerning properties and generating procedure in 2013 is more than that of 2012 was the deterioration of power plant equipment caused by normal using condition which resulted in the increase of maintenance costs. In addition, based on Power Purchasing Agreement (PPA), as in 2013 the second block of combined cycle power plant had fundamental availability payment rate higher than that of 2012,

fines for distribution availability loss also increased accordingly. Furthermore, National Control Center (NCC) instructed Ratchaburi Power Plant to operate with fuel oil more than in 2012. The reliability rate in the case of fuel oil operations was lower than that of fuel gas operations. When National Control Center instructed the power plant to operate with fuel oil more and longer than in 2012, the operation hours or availability payment had decreased as a result.

0

20

15

10

5

0

2

C

5

8

0

20

15

5

BA

1

6

Number of Times

Level of Severity

2012

2013

Statistics on Accidents Concerning Properties


2013

Value of loss from accidents concerning individuals was calculated from actual incurred medical costs. No severe case caused leaving from work occurred in 2013. The occurrence of accidents concerning individuals was caused by the work performer’s negligence to work safety, i.e. refusal to wear personal hazardous preventive equipment as already provided. The Company, therefore, set out guidelines to solve any possible problems by having all workers trained on knowledge regarding safety and realized on risks in implementing such work prior to each work performing. In addition, all working safety staff (SS) were required to inspect working spaces and all workers to ensure their readiness and in-safety conditions prior to each working performance. The “STOP WORK AUTHORITY” system is implemented as a tool to control working performance, by assigning policies and authorities from the management to practitioners in order to have authorities and duties in instructing to cease any risky work or any below-standard action or condition.

1. Ratchaburi Electricity Generating Holding Public Company Limited (RATCH)

In 2013, the Company notified policies regarding safety, occupational health, and working environment, as well as organized the election of the committee on safety, occupational health, and working environment which involves representatives from all areas of work in order to collaboratively take responsibility on the welfare of employees and every person entering into the office building, as well as any company-related persons.

Such committee raised a campaign to create awareness and understanding among practitioners regarding safety during working hours and non-working hours. A manual on safety, occupational health, and working environment was arranged and regular communication with practitioners was made through several channels.

5S activities conducted by a working group involving members from all relevant bodies was another tool used to support the implementation concerning safety and occupational health, as it concerns office improvement to be in order, as well as helps strengthen employees’ disciplines. E-Document system was also developed so that the employees could systematically file documents in electronic system in order to save spaces for document

collection and to prevent the loss of information and document, as well as to support document searching and copying through computer system more conveniently and faster.

The Committee on Safety, Occupational Health, and Working Environment also organized an exhibition on Safety Day (Safety in All We Do) in order to encourage employees to be alerted and recognize the importance of safety during working and non-working hours, as well as to apply such knowledge to their daily life. There was also Best Suggestion Award 2013 Project targeting employees at all levels to recognize any possible dangers which could be caused by any surrounding factors in the workplace, as well as to collaborate in seeking for concrete and practicable preventive measures and solutions on this matter.

ImplementationConcerningSafety,OccupationalHealth,andWorkingEnvironmentin2013

Stop Work Authority ActivityThe Stop Work Authority (SWA) was an assignment of authority from the Managing Director to practitioners at

all levels to be able to instruct work to be ceased if it was found that there is any unsafe event to practitioners or unconditional environment for working with safety and which might cause accidents. This represented the involvement of all employees in the issue concerning safety.


2. Ratchaburi Electricity Generating Co., Ltd. (RATCHGEN) Safety Measures

Ratchaburi Power Plant managed all risks systematically by conducting risk assessment for all activities and having proper control measures based on legal provisions and relevant regulations in order to mitigate risks into the acceptable level. It also ensures that the power plant performance could be implemented effectively and had no adverse effect to practitioners, communities, and environment.

Ratchaburi Power Plant was assessed twice a year by an external auditor in order to audit the system of Occupational Health and Safety Assessment Series (OHSAS 18001). It was also validated twice a year by the internal auditor. According to the outcomes of the reviews previously conducted, no faults were found.


2013

4.6 Our People

Human Resources Management

The Company has determined to consistently improve the human resources management process to be flexible. Besides compliance with the provisions of laws, the Company puts emphasis on no discrimination, supporting unity through activities, appropriate compensation and welfare, and good and safe occupational environment and surroundings enabling employees to work efficiently. Moreover, the Company also fosters the awareness of public mind, morality, and ethics to all employees.

Personnel Recruitment and Selection The Company plans rational and fair procedures and

methods of personnel recruitment by considering skills, abilities, experiences, and suitable qualifications through the job interview, specific aptitude test, psychological test, and analytical thinking ability test in order to select personnel who are utmost suitable for tasks and the organization.

Compensation and WelfareThe Company has the fair policy of compensation

and welfare for all employees. It is able to compete with other companies in the industry. The increases of the annual wage is based on performances appraisal applying the Key Performance Indicator (KPI), both in the individual level and functional level. In addition, the Company assigns the Welfare Committee in the workplace in order to improve the welfare system and life quality of employees in accordance with laws and international standards.

Regarding to welfares, the Company offers supports to employees in various aspects, for example, social security fund, provident fund, medical welfare of employees and their families, annual check-up, contributions for disaster victims, contributions for child’s birth, accommodation welfare, etc.

Social


Development of Personnel Competency

The Company pays attention to all employees to make progress together with the Company. Therefore, the Company develops and enhances the functional competencies for employees in all levels consistently in accordance with the Company’s business direction.

In the previous year, the Company provided the human resources development plan, both in-house training and external training, which costs exceeding 5 million baht. The plan consisted of training, seminar,

Employee Turnover RateThe Company is committed to create work

motivation and reduce the turnover rate of the employees. In 2014, the Company plans to improve the salary structure by assigning an external agency to study, analyze, and evaluate the structure so that the Company will be able to compete in the labor market.

In the meantime, the Company provides the action plan which focuses on creating employee engagement in the organization and reducing the gap between managerial executives and operational employees through any activities, such as, project of Work-Life Balance, Health Promotion, Life Happiness, Satisfaction, and Personnel Motivation in Working for Improving Life Quality, etc.

Average Hours of Training Attendance Classified by Position Level Year 2012-2013

studying tour, group session, job rotation for practical learning and on-the-job training coached by supervisors, skill development based on field of work, and promotion of life quality.

In addition, since the strategy of the Company is planned to increase the overseas investment, the Company prepares the readiness of personnel by providing them the foreign language training, handbook for introduction of living abroad, and knowledge relating to local cultures and traditions.

High-Level Management

Mid--Level Management

First Level Management

Operational Employee

Position Level

2012 20122013 2013

Total Means (Hours/Person)

69.25 51

18.37 24

21.77 12.86

22.79 22.54

73.81 12

28.30 16

26.83 51.23

33.68 17.56

RATCH RATCHGEN


2013

Performance Appraisal

1. Performance appraisal of high-level management The performance of high-level management

including Chief Executive Officer, Chief Operating Officer, Chief Finance Officer, Deputy Chief Executive Officer and Executive Vice President, is evaluated by the Board of Directors, against the Corporate Key Performance Indicator specified at the beginning of the year.

2. Performance Appraisal of Employee

Performance of every employees will be evaluated. The employees’ Performance is evaluated in two forms; by assessing their achievement against the Key Performance Indicator (KPI) of function level and the individual level, and assessing their competency performance. The competency assessment is a process to learn about employees’ skills, knowledge, abilities, and behaviors compared with expected competency in each position required by the Company. Such assessment is divided into 2 parts, which are Core Competency and Functional Competency. Core Competency refers to the core value of the organization which is the desired behaviors that employees required to act and perform. Functional Competency is the specific qualification of each profession. The results of these assessments are analyzed and used for planning the human resources development in order to enhance capability of each individual appropriately.

Average Hours of Training Attendance Classified by Gender Year 2012-2013

Male

Female

Gender

Year RATCH RATCHGEN

2012 20122013 2013

18.74 Hours/Year

28.12 Hours/Year

32.03 Hours/Year

34.95 Hours/Year

11.25 Hours/Year

14.50 Hours/Year

17.45 Hours/Year

9.6 Hours/Year


Development of Succession Plan

In 2014, the Company plans to formulate the Succession Plan for key positions in order to prepare skilled personnel readiness for succeeding management level in the future. After analysis of business strategy, the Company will determine key positions, then select talented personnel and assess their readiness for further development. The Individual Development Plan (IDP) is established to enhance skill and competency of selected personnel for being ready to take more responsibility in the higher positions. This succession plan ensures that the Company will have successors to continue its business operation consecutively. Furthermore, it is the tool for retaining talented personnel in the organization.

Treatment for Employee Working Aboard

According to the Company’s business strategy plan focusing on overseas investment, workforce preparedness for operations in aboard is very significant. In operation to that, the Company prepares and provides an overseas travel handbook, training of English and local languages, local culture and tradition, and work procedure guidelines so that they are able to adapt themselves quickly when working in foreign countries. In addition, the Company assures employees by offering attractive compensation and allowances, accident insurance, life insurance, and travelling insurance. In 2014, the Company establishes a new unit in Human Resources function for taking care of employees working aboard especially.

Employee Activity

The Company pays attention to the employees’ activities in order to create good relationship between employees and executives, and also promote health concerned among employees. As a result, the Company provides a fully equipped fitness area in the office to executives and employees encourage to spare time for exercise. Additionally, they can use the place for getting together after work that helps tighten relations among them. The Company also allows employees interested in same activity to establish an activity club. This is to promote employee to learn more about management and teamwork that helps strengthen the harmony in the organization, but also develop competencies in other aspects based on their skills.


2013

4.7 Community and Social Responsibility

Responsibility to Community and Society

Ratchaburi Electricity Generating Holding Public Company Limited is fully aware that the Company has responsibility to the community and society. So the Company has set in its mission to seriously work on this matter with the aim to achieve tangible results with the target groups, both direct and indirect stakeholders.

The process of community and social responsibility

Vision

Mission

Strategic Goals

Strategy Execution

Indigenous Plants, Community Food Bank

Plant Genetic Conservation project

Power Development Fund for communities nearby

the power plants

Community Development Projects

Complaints Handling

Baan Rao Journal

Environmental inspectors

Local curriculum

Environment (reduction of CO2 sources/ increase

greenhouse gases storage)

Edcucational & Youth

Development

Developing community’s quality of life

Communication between community and power

plants

Body of Knowledge

Development

Community Engagement

The Extended Community Energy project

Love the Forest and Community project

Scholarships scheme

Education for CareerEmpowerment project

To be a leading value-oriented integrated energy company in Asia-Pacific

To be socially and envirommentally responsible, conducting businesses in a fair manner

Being accepted and trusted from community and society at large

Implementations on the

community and social

responsibility.

Live together happily as a

“good neighbor” by building

friendly relationship

with the community around the power plant



2013

Performance of Community and Social Responsibility in 2013

The community and social responsibility is generally implemented in 2 aspects as follow:

Responsibility to the community and society Based on the Company’s strategic goals that want to get the recognition and trust from society at large, so the Company has defined the implementation strategy in 3 main areas which are: 1. Environment

There are two key projects supporting this area which are: the ‘Love the Forest and Community’ Project with the objective to increase carbon sink for capturing greenhouse gases; and ‘The Extended Community Energy’ Project to reduce the sources of carbon dioxide.

‘Love the Forest and the Community’ Project

The project is a partnership between the Company and the Royal Forest Department as to work on the community forest promotion in all regions in Thailand. The Company has provided supports to the communities tomanage their community forests, help maintain and increase forest areas as carbon sink of the country; as well as increase the abundance of community forests to achieve biodiversity. The Company has assigned the Faculty of Forestry, Kasetsart University to follow up and evaluate theresults of implementation every year. The activities under this project are as follow;

Model Community Forest Competition The goal is to honor the communities

that help conserve forests, have effective forestry management system and can effectively extend the network to other communities. Since the inception of the project until the year 2013, the Company has awarded the financial support to the communities winning the Model Community Forest Competition, totaling 846 awards, worth the total of 18.77 million Baht. The objective is to encourage the winning communities to utilize the fund in improving and managing their own community forest sustainably.

‘Klayim’ Youth Camp The target group is young people from

community forests throughout the country. ‘Klayim’ youth camps are conducted approximately 2 times a year. Since the beginning of the project until 2013, there are 13 generations of youths in the ‘Klayim’ camps, with a total number of 1,073 young people. In 2013, the activities were held twice and attended by 161 youths.


Community Forest Leader Network Seminar The purposes of the seminar are to encourage the community forest leaders to share and learn experiences in forestry management of each other, and to establish the collaborative networks among them. Since the beginning of the project until 2013, there were 10 seminars and 802 community forest leaders participating in the activities. In 2013, the seminars were held twice and attended by 142 community forest leaders.

One Million Seedlings in honor of the Queen Mother Project

The Company has supported the ‘One Million Seedlings in honour of Queen Mother’ Project of the Royal Forest Department, under the ‘Civil Volunteer to Plant 80 Millions Seedlings Project’ on the occasion of celebrating H.M. the Queen Sirikit’s 80th Anniversary in 12 August 2012, by providing financial support planting one million seedlings and give them to more than 200 villages to plant in the empty or degraded areas of the communities or in the community forest areas.

Activity to strengthen community forests in Ratchaburi province

This activity began operation since 2012 with the aim to establish relations with the neighboring areas and communities around the power plant in Ratchaburi province. They include the communities in Muang district, Photaram district, Chom Bueng district, and Pak Tho district, totaling 27 villages. The aim is to strengthen the management competency of the community forest leaders and enhance the capabilities of people working in community forests to manage the community forests in sustainable manners.

In 2012 and 2013, the Company partnering with the Royal Forest Department conducted a survey and registered 22 community

forests, with a total areas of 11,617 rais, 65 square wa and contributed a total budget of 2,110,000 baht for the communities. The Company also encouraged them to develop community forest management plans, provided better understandings on energy and environment, developed manual on ‘Planning and Management of Contributed fund for Community Forests’ in order that they can manage the community forests effectively and efficiently. It also helps them foster the community network in the learning process of community energy so they can exchange knowledge among each other. The Company still keeps on joining the activities, monitoring and providing consultation to them continuously.

The Extended Community Energy Project The Company puts emphasis on the concept of

sustainability of energy usage and management. We have tried to create awareness among various target groups in communities around the power plant and neighboring communities to learn of the importance of energy as well as to find ways to conserve and use appropriate energy-saving technologies, without compromising the way of life. The Company has joined with the Ratchaburi Energy Office to run community energy projects in two pilot areas nearby the power plants which are Ban Sing sub-district, Photaram district and Tha Rab sub-district, Muang district of Ratchaburi province. The projects commenced in 2011 and continued until 2013.


2013

Outcome of the Extended Community Energy Projects Following the implementations of the Extended Community Energy projects phase 1 and 2 (2011 – 2013),

and the continuous monitoring at sites, it could see the changes in both of the two pilot areas which have applied energy-saving technology in their households as the data shown in Table

The data shown was randomized from households in the two pilot sub-districts which have been encouraged to use energy-saving technologies, it has proven to really help reduce energy consumption and lower the expenses.

2. Development of Education and Youths The goals are to provide educational opportunities

for youth development, help improve the educational personnel to have a higher capacity and reduce household expenses for parents of students. The Company initiates a program to support the educational development for youths as follow:

Scholarship programs for the communities around the power plant

We have implemented the scholarship schemes for 3 communities around the power plant which include Pradu Tao and Sao Thian Power Plant in Sukhothai province, and another area in Pathum Thani province which is conducting the feasibility study to develop the new project. Over the past six years, the Company has granted scholarships to kindergarten to high school students from 30 schools, with 557 students and total amount of 912,300 Baht.

1. Use of charcoal with high-efficient stove compared to traditional stove

2. Biomass-fired stove compared to LPG Gas

• Household that use cooking gas for commercial purpose• Household that use gas for household consumption

3. Biomass from Gasifier compared to LPG Gas

63

6

3

16

2

2

25.39

33.33

66.66

39.44

20.57

135

14.40

28.07

28.57

50

24.24

788.70

411.43

2,700

288

Comparison of

TechnologiesPilot

HouseholdsNo. of

SamplingKg./

House-hold/Year

Bath/House-

holdค/Year%%

Randomized data of

pilot households

Energy & Expenses

Reduction


Due to long-term investment in Lao PDR, the Company demonstrates its social responsibility commitment that corresponding to the educational policy of Lao PDR’s government. The Company has implemented the educational project aiming to enhance professional skills to vocational students as to equip them with skills and knowledge that meet the growing needs of the labour market, especially skills for working in power generation business such as electric power, machinery, welding and so on. The project is the collaboration between the Company

and the Ministry of Education and Sports of Lao PDR with implementation period to last from 2011-2016. There are various activities under this project including granting continued-education scholarships, training programs for technical skill development, renovating of workshops as well as other supporting activities. In 2013, the Company has undertaken activities to various target groups including vocational students,educational personnel, and educational institutions. The results are detailed in the table below.

1. Scholarships

3. Training schorlarship of technical skill development

2. Renovating Workshop

Activities

Target Groups No. of Grants

Beneficiaries

Teachers to further education

Vocational students attended practical training on electrical power, welding and machinery

Vocational colleges

10

61 students

11

3 technical colleges

Technical college teachers to further study in Bachelor’s Degree

Education for Career Empowerment Project in Lao PDR


2013

3. Body of Knowledge Development The Company has provided support in collecting

and disseminating of knowledge, both folk wisdom and modern education, and distribute it to interested public. In 2013, the Company has supported the collecting of knowledge on the following topics:

Book on ‘Indigenous Plants, Community Food Bank’ in honor of H.M. the Queen Sirikit on the occasion of celebrating her 80th Anniversary, 12 August 2012

The Company joined hands with the Royal Forest Department to collect knowledge on indigenous plants and herbs found in community forest nationwide and put them in the book titled ‘Indigenous Plants, Community Food Bank’ which is aimed to disseminate the knowledge to community people who joined ‘The Love Forest and Community” project, as well as to students and general public nationwide. In 2013, it published 10,000 copies of the book.

60 Community Forests to Conserve Plant Genetic under the Royal initiative of Her Royal Highness Princess Maha Chakri Sirindhorn to celebrate her 60th Anniversary on 2 April 2015

The collaboration between the Company and the Royal Forest Department in implementing the project to study genetic plants in 60 community forests, then collect and conserve them by growing seedling for planting further. The conserved genetic plants are regarded its tremendous value for ecological system, economics and community. The 3-year project (2013-2015) is implemented in 60 community forests nationwide fully involved with their participation.

Live happily as ‘good neighbor’ with communities around the power plant

Based on the Company’s strategic goals that need to get recognition and trust from communities around the power plant, so the Company has laid out 3 key strategies (this report only refers to Ratchaburi Power Plant) which include:

1. Quality of Life Development

The Company has participated in quality of life development in two ways as follow:

Power Development Fund for communities surrounding the power plant

The Energy Regulatory Commission has set up the Power Development Fund with the aim to sourcing the fund for life enhancement of community people living around the power plants who might have been affected from the operation of the power plant. The fund committee consisting of a representative from relevant parties including communities is formed to manage the fund for use of life quality enhancement and conservation of the environment in the community. The project supported by the fund includes career development and educational

support.


In 2013, Ratchaburi Power Plant subsidized the Fund worth totaling 140.94 million baht.

Community Development Projects In 2013, the Company carried out development

activities for communities around the power plant in 4 areas which include

Educational Activities The Company granted 985 scholarships, worth

totaling 2,005,000 baht, for students in school network around the power plants. Throughout eight years of scholarship scheme, there are 7,855 grants have been provided, with the total amount of more than 16 million baht.

• “Youth conserves Energy and Environment to Foster Awareness on Energy-saving and Environmental Conservation”; a seminar to enhance energy-saving concerns of teachers in communities around the power plants. There were teachers from the 27 schools under the ‘For Our Hometown” project participating the seminar.

• Organized training for school’s management and teachers in the education network on the topic ‘Join Together to reduce energy, conserve natural resources for sustainable future’

Sports Promotion Activities Ratchaburi Power Plant Mini Football Academy

is implemented for 6 consecutive years. The 150 students aged 13 years old in Ratchaburi province and neighboring provinces have been selected to join the project. The Company also organized “Ratchaburi Electricity Generating Mini Football Cup” and also contributed 1.5 million baht to promote sport for 3 consecutive years. It also helps tighten good relations between the plant, communities and public agencies in the province.

Healthcare Promotion Activities “Holistic Health Care” and “Holistic Health

Care Camp “ are established to support medical staff and general public to learn more about health knowledge and then change their behaviors on caring health. There were 76 staffs from Sub-district Health Promotion hospital, Village Health Volunteers and general people attended the two projects. Last year, the Company also organized 24 mobile medical units to serve communities around the power plants, covering 11 sub-districts.


2013

2. Communication with the Communities around the Power Plant

The Company’s approach to communication between the power plant and communities is intended to provide awareness and understanding of the power plant operating, and also to enable the power plant to acknowledge their views and impacts that the community may have concerned from the power plant, both directly and indirectly. The communication is made into two ways as follows

Complaints Handling The company received complaints via

telephone, complaint boxes or they can report directly to the staffs of the power plant. The most common complaints in 2013 is that the lighting at the north of the power plant fall upononthepaddyfieldsofvillagersresiding at Moo 11, Ban Don Pho, Ban Sing sub-district, Potharam district. It assumed that the light caused to rice to produce little grains and resulted in lower productivity. The power plantthusdiscussedtofindsolutionsforthe problem by adjusting the lighting direction sothatitwillnotaffectthericefields.The community people finally accepted the solutions.

‘Baan Rao’ JournalCommunicating about the operation progress and updating the movements would be done through ‘Baan Rao’ quarterly journal. Therearealsonotificationlettersdeliveredto the community people to inform them of the current issues and movement such as to inform them of switching of fuel from natural gas to oil, warn them about the possible loud noise caused by machine-testing so they are well aware in advance. This is a measure to prevent them from any possible anxiety.

3. Community Engagement The Ratchaburi power plant provided opportunities

for community engagement in key activities as follow:

The Environmental Inspectors The power plant incorporated with Ratchaburi

ProvincialOfficetosetuptheEnvironmental Inspectors, who are selected representatives from government agencies, local agencies and relevant communities from all sectors. Their roles are to monitor the power plant’s operation and act as the coordinator between the communities and the power plant.TheEnvironmental Inspectorswould have the tenure of two years.

In2013,theCompanyorganizedafieldtrip for environmental inspectors of Ratchaburi power plant, taking them to meet with EnvironmentalInspectorsofKhanompower plantandBaanKiriwongModelCommunity of Nakhon Si Thammarat as to learn and exchange experiences among each other.

Development of Local Curriculum The Company has collaborated with the network of 27 schools around the power plant to jointly develop local curriculum on ‘Alternative Energy and Environment’as to improve knowledge on energy and environment to local students. The curriculum began in 2011 and has been revised and improved continually.


Required Data Amount (Million Baht)

2012 2013

Sale Revenues 55,365.40 50,612.43

Operating costs 47,269.50 43,327.25

Employee wages and benefits 660.59 558.96

Dividend payments for the performance 3,291.50 3,291.50

Payments to government 887.24 1,293.73

Community investments 139.37 114.12

Spent on local suppliers[1]

• RATCH 361.38 125.14

• RATCHGEN 240.57 511.83[1] Local suppliers mean suppliers in Thailand.

Economics

Performance data in this report is for below entities.RATCH : Ratchaburi Electricity Generating Holding Public Company LimitedRATCHGEN : Ratchaburi Electricity Generating Company Limited

Performance Data Economic

Labor

Total employee person 177 180 56 58

- Male employee person 94 94 32 33

- Female employee person 83 86 24 25

Employee by employment contract:

- Employee with permanent contract person 175 176 43 45

• Full-time male employee person 93 91 27 27

• Full-time female employee person 82 85 16 18

• Part-time male employee person 0 0 0 0

• Part-time female employee person 0 0 0 0

- Employee with temporary contract person 2 4 13 13

• Temporary male employee person 1 3 6 6

• Temporary female employee person 1 1 7 7

5. Performance data

Required Data Unit RATCH RATCHGEN

2012 2013 2012 2013


2013

Labor

Employee turnover

Total number of employee turnover person 12 15 2 2

Employee turnover rate % 6.8% 8.3% 3.6% 3.4%

Employee turnover by gender

- Male employee - number of turnover person 7 8 1 2

- Male employee - turnover rate % 7.4% 8.5% 3.1% 6.1%

- Female employee - number of turnover person 5 7 1 0

- Female employee - turnover rate % 6.0% 8.1% 4.2% -

Employee turnover by age group

- Employee turnover below 30 years old person 6 7 1 0

• Male employee - number of turnover person 4 4 0 0

• Male employee - turnover rate % 66.7% 57.1% - -

• Female employee - number of turnover person 2 3 1 0

• Female employee - turnover rate % 33.3% 42.9% 100.0% -

- Employee turnover 30-50 years old person 5 8 0 2


• Male employee - turnover rate % 40.0% 50.0% - 100.0%


• Female employee - turnover rate % 60.0% 50.0% - -

- Employee turnover over 50 years old person 1 0 1 0


• Male employee - turnover rate % 100.0% - 100.0% -


• Female employee - turnover rate % - - 0 0

New employee hires

Total number of new employee hires person 23 19 2 2

Employee New hires rate % 13.0% 10.6% 3.6% 3.4%

Employee New hires by gender

- Male employee - number of New hires person 10 11 1 1

- Male employee - New hires rate % 43.5% 57.9% 50.0% 50.0%

- Female employee - number of New hires person 13 8 1 1

- Female employee - New hires rate % 56.5% 42.1% 50.0% 50.0%

Employee New hires by age group

- Employee New hires below 30 years old person 11 10 2 1

• Male employee - number of New hires person 3 5 1 0

• Male employee - New hires rate % 13.0% 26.3% 50.0% -

• Female employee - number of New hires person 8 5 1 1

• Female employee - New hires rate % 34.8% 26.3% 50.0% 50.0%


2012 2013 2012 2013


Labor

- Employee New hires 30-50 years old person 9 8 0 1


• Male employee - New hires rate % 17.4% 26.3% - 50.00%


• Female employee - New hires rate % 21.7% 15.8% - -

- Employee New hires over 50 years old person 3 1 0 0


• Male employee - New hires rate % 8.7% 5.3% - -


• Female employee - New hires rate % 4.3% - - -


2012 2013 2012 2013


2013

Injury - excluded first aid

• employees Person 0 0 1 0

• contractors Person 0 0 9 9

Occupational disease case



Lost day case



Absentee case



Fatality



Injury rate (IR)

• employees number of injuries per 0 0 1.654 0

200,000 hours worked

• contractors number of injuries per 0 0 1.213 0.7575


Occupational disease rate (ODR)

• employees number of injuries per 0 0 0 0


• contractors number of injuries per 0 0 0 0


Lost day rate (LDR)



• contractors number of injuries per 0 0 0.135 0


Absentee rate (AR)



• contractors number of injuries per 0 0 0.135 0


Education training risk and safety health

• Risk and safety health Times / Number of hours 7 times 11 times 7 times 6 times

training (62 hours) (87 hours) (42 hours) (36 hours)


2012 2013 2012 2013

Environmental

Material used

Natural Gas Million scf 134,725.6 123,705.9

Bunker Oil Million liter 190.47 51.98

Diesel Oil Million liter 8.51 19.88

Energy Consumption

Total Direct Energy Consumption GJ 145,304,929 128,971,340

- Natural Gas GJ 137,420,081 126,180,006

- Bunker Oil GJ 7,574,927 2,067,392

- Diesel Oil GJ 309,920 723,942

Direct Energy Intensity GJ/MWh 9.15 8.81

Total Indirect Energy Consumption MWh 38,045 43,403

(electricity purchased)

Water

Total water withdrawal Million m3 29.29 23.78

Recycled & Reused Water % 2.5 2.7

Biodiversity

Number of IUCN Red List species Species 1 (The Asian 1 (The Asian

and national conservation list species Golden Weaver) Golden Weaver)

• Training_Employees Person 176 182 30 55

• Training_Contractor Person - 120 15 117

Employee Trainning

• Average hours of training Hours /year 23.06 33.40 21.21 25.96

per employee

Average hours of training by gender

• male employee Hours /year 18.74 32.03 11.25 17.45

• female employee Hours /year 28.12 34.95 14.50 9.6

Average hours of training by employee category

• employee level Hours /year 22.79 33.68 22.54 17.56

• senior level Hours /year 21.77 26.83 12.86 51.23

• middle management level Hours /year 18.37 28.30 24 16

• executive level Hours /year 69.25 73.81 51 12


Required Data Unit RATCHGEN

2012 2013


2012 2013 2012 2013

Environmental

Emissions, Effluents, and Waste

Total GHG emissions Ton of CO2 8,337,983 7,314,551

equivalent

- Direct GHG emissions [2] Ton of CO2 8,318,531 7,292,359

equivalent

- Indirect GHG emissions Ton of CO2 19,452 22,192

equivalent

Total GHG emissions reductions Ton of CO2 6,280 6,503

equivalent

NOx emissions Tons 23,930 21,292

SOx emissions Tons 12 5

Opacity Percentage 1.97 3.03

Total water discharge Million m3 4.41 3.56

COD Tons 158.11 144.67

BOD Tons 18.30 13.70

Total hazardous waste disposal Tons 117.66 163.59

- Reuse Tons 24.8 24.7

- Recycling Tons 0.3 1.35

- Recovery (including energy recovery) Tons 92.56 137.54[2] Emissions are calculated based on CO

2 emission factors from IPCC Volume 2 Energy

For Natural Gas, CO2 emission factor = 56,100 kg CO

2/TJ on Net Calorific Basis

For Fuel Oil, CO2 emission factor = 77,400 kg CO


For Diesel Oil, CO2 emission factor = 74,100 kg CO



2013

Required Data Unit RATCHGEN

2012 2013


Level of Reporting: Fully Reported = , Partially Reported = , or Not Reported =

1. Strategy and Analysis

Profile Disclosure Level of Location of RemarksDisclosure Reporting disclosure

1.1 Statement from the most senior 6 decision-maker of the organization.

1.2 Description of key impacts, risks, 6-7, 26-27 and opportunities.

2. Organizational Profile

2.1 Name of the organization. 1, 3

2.2 Primary brands, products, and/or 8 services.

2.3 Operational structure of the organization, 10-13, Annual Report including main divisions, operating companies, subsidiaries, and joint ventures.

2.4 Location of organization’s headquarters. 8

2.5 Number of countries where the 10 organization operates, and names of countries with either major operations or thatarespecificallyrelevanttothe sustainability issues covered in the report.

2.6 Nature of ownership and legal form. 8

2.7 Markets served (including geographic 10-15 breakdown, sectors served, and types ofcustomers/beneficiaries).

2.8 Scale of the reporting organization. 3, 8 12-13 2.9 Significantchangesduringthereporting Thisisthefirst

period regarding size, structure, or sustainability report ownership. in accordance with GRI guideline.

2.10 Awards received in the reporting period. Back Cover EU1 Installed capacity, broken down by primary 11, 14-15 energy source and by regulatory regime.

6. GRI Content Index


2013

2. Organizational Profile


EU2 Net energy output broken down by primary 14-15 energy source and by regulatory regime.

EU3 Number of residential, industrial, institutional 10, Annual Report and commercial customer accounts.

EU4 Lengthofaboveandunderground Theoperationin transmission and distribution lines by transmission and regulatory regime. distribution lines is notunderRATCH operation.

EU5 Allocation of CO2emissionsallowancesor RATCHhasnot

equivalent, broken down by carbon trading allocated any CO2

emissions allowances.

3. Report Parameters

3.1 Reportingperiod(e.g.,fiscal/calendaryear) 3 for information provided.

3.2 Dateofmostrecentpreviousreport(ifany). Thisisthefirst sustainability report

in accordance with GRI guideline.

3.3 Reportingcycle(annual,biennial,etc.) 3

3.4 Contact point for questions regarding the 3 report or its contents.

3.5 Processfordefiningreportcontent. 3,16-19

3.6 Boundary of the report (e.g., countries, 3 divisions, subsidiaries, leased facilities, joint ventures,suppliers).SeeGRIBoundary Protocol for further guidance.

3.7 Stateanyspecificlimitationsonthescope 3 or boundary of the report (see completeness principleforexplanationofscope).

3.8 Basis for reporting on joint ventures, 3, Annual Report subsidiaries, leased facilities, outsourced operations, and other entities that can significantlyaffectcomparabilityfromperiod to period and/or between organizations.


3.9 Data measurement techniques and the 3 bases of calculations, including assumptions and techniques underlying estimations applied to the compilation of the Indicators and other information in the report. Explain any decisions not to apply, or to substantially diverge from, the GRI Indicator Protocols.

3.10 Explanationoftheeffectofanyre-statements Thisisthefirst of information provided in earlier reports, sustainability report and the reasons for such re-statement in accordance with

(e.g. mergers/acquisitions, change of base GRI guideline. years/periods, nature of business, measurementmethods).

3.11 Significantchangesfrompreviousreporting Thisisthefirst periods in the scope, boundary, or sustainability report measurement methods applied in the report. in accordance with

GRI guideline.

3.12 Tableidentifyingthelocationofthe 91-105 Standard Disclosures in the report.

3.13 Policy and current practice with regard At the time of this toseekingexternalassuranceforthereport. publication,RATCH

is seeking external assurance for this

report.

4. Governance, Commitments, and Engagement

4.1 Governance structure of the organization, 21 including committees under the highest governancebodyresponsibleforspecific tasks, such as setting strategy or organizational oversight.

4.2 Indicate whether the Chair of the highest 22 governancebodyisalsoanexecutiveofficer.

4.3 For organizations that have a unitary board Annual report structure, state the number and gender of members of the highest governance body that are independent and/or non-executive members.

4.4 Mechanisms for shareholders and 22 employees to provide recommendations or direction to the highest governance body.

3. Report Parameters



2013

4.5 Linkage between compensation for members Annual report of the highest governance body, senior managers, and executives (including departurearrangements),andthe organization’s performance (including socialandenvironmentalperformance).

4.6 Processes in place for the highest governance 21, 23 bodytoensureconflictsofinterestareavoided.

4.7 Process for determining the composition, 20-23 qualifications,andexpertiseofthemembers of the highest governance body and its committees, including any consideration of gender and other indicators of diversity.

4.8 Internally developed statements of 9, 21 mission or values, codes of conduct, and principles relevant to economic, environmental, and social performance and the status of their implementation.

4.9 Procedures of the highest governance body 21 for overseeing the organization’s identificationandmanagementofeconomic, environmental, and social performance, including relevant risks and opportunities, and adherence or compliance with internationally agreed standards, codes of conduct, and principles.

4.10 Processes for evaluating the highest 22 governance body’s own performance, particularly with respect to economic, environmental, and social performance.

4.11 Explanation of whether and how the 24, 26-27 precautionary approach or principle is addressed by the organization.

4.12 Externally developed economic, 21, 23, 62, 71 environmental, and social charters, principles, or other initiatives to which the organization subscribes or endorses.






4.13 Memberships in associations (such as 20, 23 industryassociations)and/ornational/ international advocacy organizations in whichtheorganization:*Haspositionsin governance bodies; * Participates in projects or committees; * Provides substantive funding beyond routine membership dues; or * Views membership as strategic.

4.14 List of stakeholder groups engaged by 30-35 the organization.

4.15 Basisforidentificationandselectionof 29 stakeholders with whom to engage.

4.16 Approaches to stakeholder engagement, 30-35 including frequency of engagement by type and by stakeholder group.

4.17 Key topics and concerns that have been 30-35 raised through stakeholder engagement, and how the organization has responded to those key topics and concerns, including through its reporting.

DMA Disclosure on Management Approach EC. 38-39

EC1 Direct economic value generated and 40, Performance data distributed, including revenues, operating costs, employee compensation, donations and other community investments, retained earnings, and payments to capital providers and governments.

EC2 Financial implications and other risks and 47-48 opportunities for the organization’s activities due to climate change.

EC3 Coverageoftheorganization’sdefined 72 benefitplanobligations.

EC4 Significantfinancialassistancereceived from government.

Economic

Indicator Disclosure Level of Location of Further comments Reporting disclosure


2013

Economic


EC5 Range of ratios of standard entry level wage by gender compared to local minimumwageatsignificantlocationsof operation.

EC6 Policy, practices, and proportion of spending on locally-based suppliers at significantlocationsofoperation.

EC7 Procedures for local hiring and proportion of senior management hired from the localcommunityatsignificantlocations of operation.

EC8 Development and impact of infrastructure 77, 80 investments and services provided primarily forpublicbenefitthroughcommercial, in-kind, or pro bono engagement.

EC9 Understandinganddescribingsignificant 26-27,77,80,81 indirect economic impacts, including the extent of impacts.

EU6 Management approach to ensure short and 6, 60-61 long-term electricity availability and reliability.

EU7 Demand-sidemanagementprograms RATCHonly including residential, commercial, sells electricity to institutionalandindustrialprograms. EGAT.Thereisno other demand-side

programs.

EU8 Research and development activity and 45-46, 50-52 expenditure aimed at providing reliable electricity and promoting sustainable development.

EU9 Provisionsfordecommissioningofnuclear RATCHdoesn’town power sites. any nuclear power plant.

EU10 Planned capacity against projected RATCHhasnodirect electricity demand over the long term, responsibility for long- broken down by energy source and term planning processes regulatory regime. for the corresponding electricitysystems.EGAT conducts the studies to anticipate the long-term needs of the respective electricity system.


Economic


EU11 Averagegenerationefficiencyofthermal 61 plants by energy source and regulatory regime.

EU12 Transmissionanddistributionlossesas Transmissionand a percentage of total energy. distribution is not relatedtoRATCH operation.

Environmental

DMA Disclosure on Management Approach EN 48, 53, 60-66

EN1 Materials used by weight or volume. Performance data

EN2 Percentage of materials used that are Materials used for recycled input materials. electricity productions cannot be recycled. EN3 Direct energy consumption by primary Performance data energy source.

EN4 Indirectenergyconsumptionbyprimary Insignificantamount source. of indirect energy

consumption.

EN5 Energy saved due to conservation and 50-51 efficiencyimprovements.

EN6 Initiativestoprovideenergy-efficientor 50-51 renewable energy based products and services, and reductions in energy requirements as a result of these initiatives.

EN7 Initiatives to reduce indirect energy 50-51 consumption and reductions achieved.

EN8 Totalwaterwithdrawalbysource. 65,Performancedata

EN9 Watersourcessignificantlyaffectedby 65 withdrawal of water.

EN10 Percentage and total volume of water Performance data recycled and reused.

EN11 Location and size of land owned, leased, 65 managed in, or adjacent to, protected areas and areas of high biodiversity value outside protected areas.

SustainabilityReport

201398รายงาน

ความยั่งยืน ปี 2556

Environmental


EN12 Descriptionofsignificantimpactsofactivities, 52,65,78-79 products, and services on biodiversity in protected areas and areas of high biodiversity value outside protected areas. EN13 Habitatsprotectedorrestored. 65

EU13 Biodiversity of offset habitats compared to the biodiversity of the affected areas

EN14 Strategies, current actions, and future plans 65 for managing impacts on biodiversity.

EN15 Number of IUCN Red List species and Performance data national conservation list species with habitats in areas affected by operations, by level of extinction risk.

EN16 Totaldirectandindirectgreenhousegas Performancedata emissions by weight.

EN17 Other relevant indirect greenhouse gas emissions by weight.

EN18 Initiatives to reduce greenhouse gas 50-52 emissions and reductions achieved. Change Strategy

EN19 Emissions of ozone-depleting substances 63 by weight.

EN20 NOx, SO

x,andothersignificantair 63,Performancedata

emissions by type and weight.

EN21 Totalwaterdischargebyqualityand 65,Performancedata destination.

EN22 Totalweightofwastebytypeand 64,Performancedata disposal method.

EN23 Totalnumberandvolumeofsignificant Therewasnoincidentof spills. significantspillduring2013. EN24 Weight of transported, imported, exported, or treated waste deemed hazardous under the terms of the Basel Convention Annex I, II, III, and VIII, and percentage of transported waste shipped internationally.

Ratchaburi Electricity Generating Holding Public Company Limited 99บริษัท ผลิตไฟฟ้าราชบุรีโฮลดิ้ง จำากัด (มหาชน)

Environmental


EN25 Identity, size, protected status, and biodiversity value of water bodies and relatedhabitatssignificantlyaffectedby the reporting organization’s discharges of water and runoff.

EN26 Initiatives to mitigate environmental 39, 51 impacts of products and services, and extent of impact mitigation. EN27 Percentageofproductssoldandtheir Thisisnotrelevantto packaging materials that are reclaimed by electricity generating category. business.

EN28 Monetaryvalueofsignificantfinesand RATCHhasalwayscomplied total number of non-monetary sanctions with environmental laws for non-compliance with environmental and regulations. laws and regulations.

EN29 Significantenvironmentalimpactsof Theimpactsof transporting products and other goods and transporting materialsusedfortheorganization’s products(electricity) operations,andtransportingmembersof areinsignificant. the workforce.

EN30 Totalenvironmentalprotection expenditures and investments by type.

Social: Labor Practices and Decent Work

DMA Disclosure on Management Approach LA 70

EU14 Programs and processes to ensure the 72-73 availability of a skilled workforce.

EU15 Percentage of employees eligible to retire in the next 5 and 10 years broken down by job category and by region.

EU16 Policies and requirements regarding 70-71 health and safety of employees and employees of contractors and subcontractors.

EU17 Days worked by contractor and subcontractor employees involved in construction, operation and maintenance activities.

EU18 Percentage of contractor and subcontractor 70, Performance data employees that have undergone relevant health and safety training.


2013



LA1 Totalworkforcebyemploymenttype, Performancedata employment contract, and region, broken down by gender.

LA2 Totalnumberandrateofnewemployee Performancedata hires and employee turnover by age group, gender, and region.

LA3 Benefitsprovidedtofull-timeemployees 72 that are not provided to temporary or part-time employees, by major operations.

LA4 Percentage of employees covered by collective bargaining agreements.

LA5 Minimumnoticeperiod(s)regarding significantoperationalchanges,including whetheritisspecifiedincollective agreements.

LA6 Percentage of total workforce represented Performance data in formal joint management-worker health and safety committees that help monitor and advise on occupational health and safety programs.

LA7 Rates of injury, occupational diseases, 69, Performance data lost days, and absenteeism, and number of work-related fatalities by region and by gender.

LA8 Education, training, counseling, prevention, Performance data and risk-control programs in place to assist workforce members, their families, or community members regarding serious diseases.

LA9 Healthandsafetytopicscoveredinformal 70-71 agreements with trade unions.

LA10 Average hours of training per year per 73, Performance data employee by gender, and by employee category.

LA11 Programs for skills management and 73 lifelong learning that support the continued employability of employees and assist them in managing career endings.




LA12 Percentage of employees receiving regular 74 performance and career development reviews, by gender.

LA13 Composition of governance bodies and Performance data breakdown of employees per employee category according to gender, age group, minority group membership, and other indicators of diversity.

LA14 Ratio of basic salary and remuneration of women to men by employee category, by significantlocationsofoperation.

LA15 Return to work and retention rates after parental leave, by gender.

Social: Human Rights

DMA DisclosureonManagementApproachHR 23,42-43,72-74

HR1 Percentageandtotalnumberofsignificant investment agreements and contracts that include clauses incorporating human rights concerns, or that have undergone human rights screening.

HR2 Percentageofsignificantsuppliers, 43-44 contractors and other business partners that have undergone human rights screening, and actions taken.

HR3 Totalhoursofemployeetrainingon policies and procedures concerning aspects of human rights that are relevant to operations, including the percentage of employees trained.

HR4 Totalnumberofincidentsofdiscrimination and actions taken.

HR5 Operationsandsignificantsuppliers 22-23,43-44,72 identifiedinwhichtherighttoexercise freedom of association and collective bargainingmaybeviolatedoratsignificant risk, and actions taken to support these rights.


2013

Social: Human Rights


HR6 Operationsandsignificantsuppliers 22-23,43-44,72 identifiedashavingsignificantriskfor incidents of child labor, and measures taken to contribute to the effective abolition of child labor.

HR7 Operationsandsignificantsuppliers 22-23,43-44,72 identifiedashavingsignificantriskfor incidents of forced or compulsory labor, and measures to contribute to the elimination of all forms of forced or compulsory labor.

HR8 Percentageofsecuritypersonneltrained in the organization’s policies or procedures concerning aspects of human rights that are relevant to operations.

HR9 Totalnumberofincidentsofviolations involving rights of indigenous people and actions taken.

HR10 Percentageandtotalnumberofoperations that have been subject to human rights reviews and/or impact assessments.

HR11 Numberofgrievancesrelatedtohuman 23 Weprovidegrievance rightsfiled,addressedandresolved channelandprocess

through formal grievance mechanisms. in written to receive issues related to human right including other relevant social issues and general concerns for employee and stakeholder.

Social: Society

DMA Disclosure on Management Approach SO 57, 84

EU19 Stakeholder participation in the decision 57 making process related to energy planning and infrastructure development.

EU20 Approachtomanagingtheimpacts Therewerenoimpacts of displacement. that cause displacement in 2013.


Social: Society


EU21 Contingency planning measures, disaster 28 /emergency management plan and training programs, and recovery/restoration plans. EU22 Number of people physically or economically displaced and compensation, broken down by type of project.

SO1 Percentageofoperationswithimplemented 55-57 Thecommunity localcommunityengagement,impact isoneofRATCH’s assessments, and development programs. stakeholders. When new project is implemented, the community engagement and impact assessment will be conducted as part of the project development process. SO2 Percentage and total number of business Only procurement

units analyzed for risks related to corruption. department analyzed this risk in accordance with Procurement Procedure Policy. SO3 Percentage of employees trained in 22-23 All new employee organization’s anti-corruption policies and receive Code of procedures. Conduct and are trained about anti- corruption as part of the Code of Conduct.

SO4 Actionstakeninresponsetoincidentsof Therewerenoincident corruption. of corruption reported in 2013.

SO5 Public policy positions and participation 22-23 in public policy development and lobbying. SO6 Totalvalueoffinancialandin-kind RATCH’sCodeof contributions to political parties, politicians, Conduct indicated and related institutions by country. clearly about anti-bribery and no-gift taking or

giving policy.


2013

SO7 Totalnumberoflegalactionsfor anti-competitive behavior, anti-trust, and monopoly practices and their outcomes.

SO8 Monetaryvalueofsignificantfinesandtotal Therewerenoincident number of non-monetary sanctions for ofsignificantfinesornon- non-compliance with laws and regulations. monetary sanctions for non-compliance with laws and regulations in 2013.

SO9 Operationswithsignificantpotentialor 55-57 actual negative impacts on local communities.

SO10 Prevention and mitigation measures 55-57 RATCHconductedrisk implementedinoperationswithsignificant assessment for every plant potential or actual negative impacts on weoperate.The local communities. prevention and mitigation measures are implemented. Social: Product Responsibility

PR1 Life cycle stages in which health and safety impacts of products and services are assessed for improvement, and percentage ofsignificantproductsandservices categories subject to such procedures.

PR2 Totalnumberofincidentsof non-compliance with regulations and voluntary codes concerning health and safety impacts of products and services during their life cycle, by type of outcomes.

PR3 Typeofproductandserviceinformation required by procedures, and percentage ofsignificantproductsandservicessubject to such information requirements.

PR4 Totalnumberofincidentsof non-compliance with regulations and voluntary codes concerning product and service information and labeling, by type of outcomes.

PR5 Practices related to customer satisfaction, including results of surveys measuring customer satisfaction.

Social: Society



Social: Product Responsibility


PR6 Programs for adherence to laws, standards,

and voluntary codes related to marketing

communications, including advertising,

promotion, and sponsorship.

PR7 Totalnumberofincidentsof Thereisnoincidentofnon- non-compliance with regulations and compliance with regulations

voluntary codes concerning marketing and voluntary codes communications, including advertising, concerning marketing

promotion, and sponsorship by type of communications. outcomes.

PR8 Totalnumberofsubstantiatedcomplaints. Thereisnocomplaintregarding

regarding breaches of customer privacy breaches of customer privacy and losses of customer data. and losses of customer data. PR9 Monetaryvalueofsignificantfinesfor RATCHhascompliedwith non-compliance with laws and regulations laws and regulations con-

concerning the provision and use of cerning the provision and products and services. use of products and services.

EU23 Programs, including those in partnership with 79-84 government, to improve or maintain access to electricity and customer support services.

EU24 Practices to address language, cultural, RATCHisapowerproduceranddoesnot

low literacy and disability related barriers own any transmission or distribution

to accessing and safely using electricity infrastructure.Therefore,we do not have

and customer support services. access to the end users. It is responsibility

ofMetropolitanElectricityAuthority(MEA)and

ProvincialElectricityAuthority(PEA).

EU25 Number of injuries and fatalities to the Therewasnoincidentthat public involving company assets, including cause injuries and fatalities legal judgments, settlements and pending to the public involving legal cases of diseases. company assets in 2013.

EU26 Percentage of population unserved in licensed distribution or service areas. EU27 Number of residential disconnections for non-payment, broken down by duration of disconnection and by regulatory regime.

EU28 Power outage frequency.

EU29 Average power outage duration.

EU30 Average plant availability factor by energy 61 source and by regulatory regime.


2013

Award and Recognition

• “Outstanding Award” in Sustainability Report Award 2013 was co-organized by the Securities and Exchange Commission (SEC), Thai Listed Companies Association, CSR Club and Thaipat Institute.

• The “Best Investors Award” 2013 in the category of listed company with market capitalization exceeding 50 billion Baht with score of 92.26%, ranked by the Stock Exchange of Thailand.

• Scored 93% of the Corporate GovernanceReport of Thai Listed Companies organized by the Thai Institute of Directors, higher than 78% averagescoresof526companiesparticipatedin the program.

Ratchaburi Electricity Holding Public Company Limited • TRISRatingupgradestheCompanyratingfrom

“AA” to“AA+” with “stable” outlook. The upgrade reflects the Company’s success indiversificationandthestart-upofthepowerproject investment. The Company plans todevelopandinvestinpowerandpower-relatedprojects in Thailand and other countries in order to strengthen its businesses and its leadingpositionasthelargestprivatepowerproducer group in Thailand.

• Standard&PoorsRatings(S&PRatings)affirmedtheCompany’screditratingof“BBB+” and the outlook of “Stable”

• Moody’sInvestorsService(Moody’s)affirmedtheCompany’screditratingof“Baa1” with the outlookof“Stable”

• “Excellence” rating of the Company’s annual shareholders’ meeting in 2013 with 100 scores for fiveconsecutiveyearsratedbytheThaiInvestorsAssociation.`

• “MEA Energy Saving Building” certified bythe Metropolitan Electricity Authority (MEA) to recognize the Company’s effort in managing energyefficiencyintheofficebuildingsprovenbyenergysavingmeasurerespondingtoMEAIndex.

Ratchaburi Electricity Generating Co., Ltd. (subsidiaries) • TRIS Rating upgrades theCompany and issue

ratingofRatchaburiElectricityGeneratingCo.,Ltd.from“AA”to“AA+”with“Stable”outlook.TheupgradeisbasedontheCompany’sdemonstratedabilitytoprovidebetter-than-expectedoperatingperformance,stablecashflows,well-structuredand state-of-the-art Ratchaburi PowerPlant, aswellastheCompany’sprovenrecordofpowerplant management.

• CSR–DIWContinuousAward2013andCSR-DIWAdvanceAwardLevel42013wasgrantedbytheDepartmentof IndustrialWorks, reflecting theCompany’scommitmenttosocialresponsibilityand green culture organization.

• CertificateofOccupationalHealth andSafetyAdvisoryServices(OHSAS18001:2007)auditedandcertifiedbyDetNorskeVeritas(Thailand)Co.,Ltd.

• TheOutstandingWorkplaceAward for LabourRelationsandLabourWelfare2013,grantedbytheLabourMinistryfor6consecutiveyears.

• TaxpayerRecognitionAward for2 consecutiveyears,grantedforappreciationtotheCompany’sresponsibilityintaxpaymentasagoodcorporatecitizenthatbenefitstonationaldevelopmentandencouragesawarenessoftaxpaymentpracticeaccordingtotheprincipleofgoodgovernance.

With commitment to environmentalprotection, Ratchaburi ElectricityGenerating Holding Public CompanyLimited uses environmentally-friendlypaper made from trees grown incontrolled farm under SustainableForest Management principleand state-of-the-art process thatreduces pulp by 50%. The paper islight thus energy used in transportand delivery is less. We use inkmade from soybean, meaning lesscarbon dioxide emission, beingchemical free and safe to readers.

Sustainability Report 2013 Ratchaburi Electricity Generating Holding PCL

Ratchaburi Electricity Generating Holding PCL8/8 Moo 2, Ngam Wong Wan Road, Bangkhen, Muang, Nonthaburi 11000 Thailand.Tel. : +66 2794 9999 Fax. : +66 2794 9998Website : www.ratch.co.thEmail : [email protected]

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