3 days ago
Fresh hope for clean energy targets
The new deadline for implementation of the much-delayed power development plan (PDP) offers a blueprint for Thailand to align with its clean energy goals.
Prasert Sinsukprasert, energy permanent secretary, expects the PDP to take effect from 2025 to 2037, with enforcement starting by the end of this year following a major revision required by energy analysts.
Thailand expected to start using the new PDP last year, but maintained the 2018 version, which stalled plans to raise renewable energy development.
Under the new PDP, the country aims to have renewable energy comprise 51% of total fuel use by 2037, up from the 22% target in the preceding PDP.
At the end of 2023, Thailand's renewable energy proportion tallied 20%.
The renewable energy target and a reasonable projection of electricity demand over the next 12 years were among the issues discussed during the PDP revision.
The Explainer looks into the debate and the impact for Thailand if changes to the PDP are not quickly finalised and forwarded to the National Energy Policy Council for approval.
Is a 51% contribution from renewable energy adequate?
Energy analysts want the government to increase the proportion of renewable energy to support plans to cut carbon dioxide emissions.
The PDP does promote greater use of renewable power, but the proportion is too low, raising doubts over whether it will help Thailand achieve its net-zero target, said Naruechon Dhumrongpiyawut, chief executive of Gunkul Engineering, an integrated clean energy developer.
Former premier Prayut Chan-o-cha announced in 2021 at the 26th UN Climate Change Conference that Thailand would be more aggressive in addressing climate change, striving to reach carbon neutrality, a balance between carbon dioxide emissions and absorption, by 2050 and a net-zero target, which is a balance between greenhouse gas emissions and absorption, by 2065.
Some other nations in Southeast Asia set 2050 as their target for net-zero, meaning Thailand could be slower to curb greenhouse gases in the region.
Areeporn Asawinpongphan, a research fellow at Thailand Development Research Institute, suggested the government increase renewable energy development by using more solar power.
Authorities are not prioritising solar energy and battery technology, though their prices have begun to decline, she said.
"We would like the government to specify clearly in the PDP an electricity generation target from solar energy," said Ms Areeporn.
Rooftop solar panels can help businesses and households save on electricity bills, which can become expensive if oil and gas prices fluctuate in the global market.
Thailand increasingly depends on costly imported liquefied natural gas for power generation as the cheaper domestic gas supply is dwindling.
As solar power generation costs are not expensive, the government should take this opportunity to invest more in the development of this type of renewable energy, as well as an energy storage system to ensure a steady supply of electricity, she said.
Natural gas comprises 60% of the fuels used for Thailand's power generation and will likely continue to be a crucial fuel for electricity supply, said Kurujit Nakornthap, executive director of the Petroleum and Energy Institute of Thailand.
"We want to go green, but efforts must be done at a measured pace," he said.
Natural gas is expected to be a key fuel for the world over the next 30-40 years as countries transition to clean energy, said Mr Kurujit.
The government is aware of calls by energy analysts for more renewable energy promotion and is considering an appropriate target for carbon dioxide emission reductions, said Mr Prasert, the energy permanent secretary.
Should Thailand's power demand projection be changed?
The estimation of power demand in the 2024 PDP follows the same miscalculation of the nation's long-term electricity consumption that has been made over the past 28 years, said Ms Areeporn.
The PDP expects power demand in Thailand to increase to 112,391 megawatts by 2037, up from 51,000MW in 2024.
"If the projection is not changed, electricity users will shoulder unnecessary costs caused by the construction of new power plants," she said.
The additional costs, widely known as an availability payment (AP), commits the government to pay for electricity throughout an entire period under power purchase agreements made with companies, though the actual usage may be less during that time frame.
The AP benefits electricity suppliers but increases the power tariff, which is used to calculate electricity bills.
Are there negative impacts if Thailand does not finalise the PDP?
Delays in implementing the PDP can affect the country's attempts to draw foreign investment, said Ms Naruechon.
If the PDP is not approved, Thailand cannot enforce the National Energy Plan, designated to take effect between 2024 and 2037 and serve as a roadmap for a low-carbon society.
The PDP is among five long-term energy management plans in the National Energy Plan. The others are the oil plan, the gas plan, the alternative energy plan and the energy efficiency plan.
The postponement of the National Energy Plan is an obstacle for Thailand, which needs to attract foreign investors who demand clean energy to operate their businesses, said Ms Naruechon.
Though Thailand may develop attractive investment incentives for foreign companies, they are unlikely to quickly expand their businesses here if the promotion of renewable energy supply is unclear, she said.
