Jul. 14--The World Bank and its subsidiary, the International Finance Corporation, will offer Thailand $700 million in financial support to help develop renewable energy, said a senior official.

The two organisations will finance development projects through the World Bank's Clean Technology Fund and the IFC, said Jitendra Shah, country sector coordinator at the World Bank.

Terms and conditions for accessing the funds will be released to loan applicants later this month.

The average interest rate will be from 0.25 percent to nearly 2.0 percent with 20 to 40-year repayment period.

"Thailand is one of the first 10 countries where we have launched the support programme. Other countries are Turkey, Egypt, Indonesia, the Philippines and Vietnam," he said.

"Thailand was selected to be one of World Bank's preferred countries since the kingdom has a clear policy on renewable and alternative energy and has the potential to become a demonstration country in this field," said Energy Minister Wannarat Channukul.

The World Bank and the IFC will provide technology and support for loan applicants. They will also coordinate the market's clean development mechanism or carbon credit trading.

The World Bank and IFC forecast the value of developing Thailand's renewable energy at about 156.49 billion baht from now until 2011.

Private-sector investment will account for about 85 percent of the total investment, or 134.17 billion baht.

The agencies said the development of projects could cut total annual oil imports by 3.255 million tonnes, and cut green-house gas emissions by 10 million tonnes a year.

Thailand drafted its renewable energy development plan last year for the next 15 years.

The plan forecast Thailand would cut its oil import bill by 363.24 billion baht a year and reduce green-house gas emissions by 29 million tonnes per year. The development of alternative fuels such as ethanol and biogas would lead to the reductions.

In related developments, the Energy Policy and Planning Office is encouraging motorcyclists to switch to gasohol despite fears the fuel damages engines.

"We want motorcycle assemblers and major oil traders to guarantee gasohol is appropriate for motorcycles," said Mr Wannarat.

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