In a landmark move for Thailand’s sustainable finance landscape, BCPG Public Company Limited has partnered with Krungthai Bank to execute the country’s first interest rate swap agreement linked to International Renewable Energy Certificates (I-RECs), integrating financial risk management with climate action.
The innovative transaction supports Krungthai Bank’s carbon neutrality and net-zero targets by allowing the bank to offset its indirect greenhouse gas emissions (Scope 2) from electricity use. Under the agreement, BCPG—one of Asia-Pacific’s leading producers of renewable and clean energy—has transferred I-RECs generated from its solar and wind power plants to Krungthai Bank.
The collaboration marks a major milestone in aligning financial instruments with environmental goals. By linking interest rate hedging to renewable energy certification, the transaction advances environmentally responsible business practices and sets a precedent for similar partnerships in the region.
Rawin Boonyanusasna, Head of Global Markets Group at Krungthai Bank, highlighted the significance of the move:
“This REC-linked interest rate swap not only helps manage financial risk but also represents a new benchmark for sustainable collaboration between the financial and energy sectors. It reflects our commitment to the United Nations’ Sustainable Development Goals and our vision of ‘Growing Together for Sustainability.’”
As part of the arrangement, Krungthai Bank leverages its expertise in derivatives to help BCPG hedge against interest rate fluctuations, thereby enabling the energy firm to optimize financial performance while maintaining its commitment to decarbonization.
Saowapap Sumeksri, Senior Executive Vice President for Finance and Accounting at BCPG, said the partnership underlines the company’s dual focus on clean energy production and innovation.
“This collaboration enhances our ability to manage financial risk while affirming our leadership in driving global efforts toward a low-carbon economy,” she noted.
The I-REC mechanism provides globally recognized certification for renewable energy generation and is increasingly being adopted by companies and institutions to meet sustainability targets.
This transaction is expected to pave the way for broader integration of green finance tools in Thailand’s transition to a sustainable economy.
