The rationale for the Project is derived from the following partly interrelated elements: (i) the Government's strategy to reduce regional disparities in growth and income, particularly between Bangkok and the rest of the country and to eradicate poverty; (ii) the Bank's Country Operational Strategy for Thailand that supports the Government's efforts in this regard; (iii) the emphasis on rural energy development in the Bank policy for the energy sector in Asia; (iv) external debt management of Thailand in general and PEA in particular; (v) PEA's major investment program and limited access to capital markets; and (vi) developmental role for the Bank in PEA's commercialization, corporatization, and privatization.