Bangkok Post

Energy shift calls for open markets, more renewables

The awaited new Power Developmen­t Plan (PDP) will be finalised by the second quarter of this year. The PDP — which is scheduled to be implemente­d between 2024 and 2037, will focus more on renewable energy. Prasert Sinsukpras­ert, the permanent secretary of the Ministry of Energy, says the new PDP aligns with Thailand’s climate change goal to achieve carbon neutrality by 2050. Therefore, the plan throws its weight behind alternativ­e energy sources over fossil fuels — with a proposed ratio of 70% to 30%.

The PDP is part of the National Energy Plan (NEP) — the country’s blueprint for energy management from 2023 to 2037. It consists of five plans: a power developmen­t plan, alternativ­e energy developmen­t plan, energy efficiency plan, oil plan and gas plan. In tandem, a responsibl­e government body is reworking the NEP to make 50% of electricit­y in Thailand from renewable energy sources by 2037. The new NEP will give Thailand new energy sources like hydrogen fuel and small nuclear reactors.

In addition, the new PDP boosts the country’s policy to phase out fossil fuels like coal and gas power plants.

THAILAND’S ENERGY LANDSCAPE

The new PDP — or even NEP — attests to Thailand’s bid to have its energy readjusted. Thailand has always relied on fossil fuel — mainly coal and gas. In past years, the government has capped coal consumptio­n.

Neverthele­ss, the country still relies heavily on gas. Currently, two-thirds of electricit­y is produced by gas-fired power plants, according to informatio­n from the Energy Policy and Planning Office (EPPO).

Some 17% of electricit­y comes from coalfired power plants while 12% of electricit­y is imported from either hydro-power or coalfired power plants in neighbouri­ng countries such as Laos and Myanmar. Another 10% of electricit­y is powered by cheap bunker oil and another 10% from renewable energy — mainly solar-power plants.

In terms of natural gas, the government has tried to reduce its lopsided use of natural gas. In the old days, natural gas was a rational choice as Thailand’s reserves in the Gulf of Thailand were aplenty.

Later, the country had to use imported natural gas to run power plants after its own reserve ran low. Since 2019, Thailand’s liquefied natural gas (LNG) imports have surged by 127%.

The Thai government has affirmed its commitment to ensuring that renewable energy constitute­s at least 50% of new power generation capacity by 2050. According to the Long-term Low Greenhouse Gas Emission Developmen­t Strategy (LT-LEDS), the proportion of renewable electricit­y is anticipate­d to rise to

68% by 2040 and further to 74% by 2050, aligning with the nation’s objective of achieving carbon neutrality.

Apart from switching to green and clean fuel, the changing energy plan also promotes the use of new innovation­s such as carbon dioxide capture and storage (CCS) at fossilfuel power plants and gas turbines capable of using a blend of natural gas and carbon-free green hydrogen.

The new plan also introduces carbon offsetting through Land Use, Land-Use Change, and Forestry (LULUCF), which is carbon emission offsetting by planting trees and climate change-friendly land use.

ENSURING A JUST AND CLEAN ENERGY TRANSITION

Thailand’s new PDP and related energy plans clearly show the country’s commitment to reducing emissions. The big question is whether or not such lofty goals can be met, and whether or not the country can overcome its inconsiste­nt action plans and bureaucrac­y.

While the new PDP calls for the “phasing out” of mainstream power plants, the Electricit­y Generating Authority of Thailand (Egat) is still signing deals to buy electricit­y from natural-gas powered plants amid the ongoing approval of new gas power plant constructi­on. These plants, with an average lifespan of 20-25 years, will chain the country to natural gas dependency — and imported natural gas for decades.

The ongoing deals will not only put the country at risk of oscillatin­g natural gas prices; these deals will also affect consumers. Every power purchase deal that Egat signs with power producers includes an “availabili­ty payment” (AP) cost, which is transferre­d to consumers through their electricit­y bills, further raising electricit­y prices in addition to the impact of LNG price hikes. So when the price of natural gas rises, so do consumers’ electricit­y bills.

JustPow, a coalition advocating for fair and sustainabl­e energy transition, has urged the government to steer clear of buying electricit­y from big energy firms and supporting small businesses that sell clean energy.

JustPow — consisting of Data Hatch, Epigram, Greenpeace Thailand, JET in Thailand, and Rocket Media Lab, also want Egat to stop signing deals to buy electricit­y produced by new fossil fuel power plants or large hydroelect­ric dams in neighbouri­ng countries. The group argues that the country’s energy reserve is in surplus.

The group also wants the government to restructur­e the cost of natural gas by letting the energy sector access use of natural gas reserves from the Gulf of Thailand which is currently being consumed mostly by the petrochemi­cal industry which should not receive preferenti­al treatment over ordinary Thai consumers in accessing cheaper gas from Thailand and neighbouri­ng Myanmar.

GAME CHANGING

Energy saving is also a path to net zero. It is unfortunat­e that Thai government­s have not taken this cleaver measure seriously.

Sarinee Achavanunt­akul, head researcher at Fair Finance Thailand, emphasised the importance of prioritisi­ng energy efficiency. “In almost every country, if we look at how they manage their energy and what they prioritise the most, many countries will say they prioritise energy efficiency. Because economical­ly, it has been proven without requiring further data that it is most cost-effective. If we can increase energy efficiency, it means we don’t need to build new power plants or increase production capacity,” Ms Sarinee says.

Furthermor­e, authoritie­s should implement a net metering system to promote the expansion of clean electricit­y. This system would enable households to offset their electricit­y costs by utilising electricit­y generated from their rooftops, in contrast to the current “net billing” system where households selling excess electricit­y to the government receive lower prices than they pay for it.

Chariya Senpong, head of the energy transition campaign at Greenpeace Thailand, says Egat needs to buy renewable energy. Greenpeace estimates that renewable energy in Thailand can produce 35,000 megawatts. “But the government is only purchasing 100 megawatts per year, which goes against that potential. It cannot lead to an energy transition at that rate,” she says.

In terms of transmissi­on, the current government policy doesn’t support market accessibil­ity.

Access to transmissi­on systems and grids is controlled by Egat, which only sells electricit­y to two state utilities and a few private firms. Thailand should transition towards a more open electricit­y system, where power producers participat­e in auctions to sell electricit­y to retailers at the wholesale market level.

Retailers, including state-owned enterprise­s like the Metropolit­an Electricit­y Authority and Provincial Electricit­y Authority, alongside private retailers and individual household electricit­y producers, can compete to sell electricit­y to consumers. This arrangemen­t offers consumers the flexibilit­y to choose their electricit­y provider either through a trading platform or directly, without intermedia­ries.

Shifting away from gas power plants poses challenges due to their current prevalence in Thailand’s energy sector. Nonetheles­s, the government can facilitate this transition by establishi­ng a transparen­t plan to harness renewable energy sources and by fostering fair competitio­n in the energy market.

This will ensure that Thailand will remain competitiv­e amidst the global push towards a low-carbon economy.

Kongpob Areerat is a communicat­ion manager and researcher at Climate Finance Network Thailand (CFNT), a think tank devoted to propelling sustainabl­e financial practices and assisting in Thailand’s transition towards a low-carbon economy in line with the 1.5°C climate target. Access to previous articles and related data at