Thailand's Path to Green and Clean – part 2
Thailand’s current approach to supply and demand management has been through centralized planning at the ministerial level. The current quality of electricity access in Thailand is in line with developed ASEAN countries, illustrated in the figure below. The Ministry of Energy has taken the lead in forecasting future demand. In coordination with the Ministry of Energy, the three public power utilities Electricity Generating Authority of Thailand (EGAT), Metropolitan Electricity Authority (MEA), and Provincial Electricity Authority (PEA), are looking over strategies to increase Thailand’s installed capacity to meet its anticipated needs.
Thailand’s Electricity Supply Chain
Thai electricity generation is organized in a way that state bodies are the only power buyers in the national grid, with the sector being built on an improved single buyer model. EGAT is both a producer and a buyer of power from the private sector ‘independent power producers’ (IPPs) and ‘small power producers’ (SPPs), and it also exercises a monopoly on the distribution of electricity in Thailand. In addition to EGAT, MEA and PEA have responsibilities for the distribution and purchase of electricity from “very small energy producers” (VSPPs (peer-to-peer electricity traders).
The government is actively promoting private sector investment in the generation business through bid solicitations for power purchase from large-scale IPPs and SPPs. IPPs and SPPs are regulated by the Energy Regulatory Commission (ERC).
Advances in the Energy Supply Mix
During the five years between 2013 and 2018, the ratio of electricity produced by SPPs and VSPPs increased significantly, especially after the Thai government started to follow the AEDP plan in 2015. As a result, VSPPs, which generate power from renewables, have been growing particularly strongly. This has reflected in an increasing number of buyers from this group of suppliers and affecting positively on SPPs. By 2018, the share of electricity provided by VSPP had risen to 5.0% of all electricity sold online, illustrated by the adjacent chart.
Private power producers continue to steadily grow in importance within the sector, but Thailand is still heavily reliant on its natural gas. 57% of its total consumption was from natural gas in 2018. Thailand’s current proven natural gas reserves are only sufficient for approximately another 5-6 years. Thailand will soon have to start importing gas from abroad, particularly from Myanmar. This is one of the reasons Thailand has pushed the PDP to emphasize increasing the use of renewable energy sources in power generation. As a result, the share of renewable energy in the national electricity generation ratio has been raised from 2% in 2010 to 10% by 2018, and it is expected to play a significant role in Thailand’s future power energy mix.
Thailand is well known for its great solar exposure, endowed with abundant solar energy resources across the country, with high radiance in the northeast and central parts of the country, covering approximately one-quarter of the total land area. Around 14.3% of the country has a daily solar exposure of about 19–20 MJ/m2/day, while another 50% of the country gains around 18–19 MJ/m2/day, as shown in the chart. The peak density of solar radiation in those areas is in the range of 1200-1400 kilowatt-hours (kWh) per square meter per year, with seasonal peaks in April and a low point in December.
Solar Rooftop Programme
On 16th July 2013, the National Energy Policy Commission (NEPC) approved two policy packages, increasing Thailand’s target of installed Photovoltaic (PV) capacity by 1,000 MW to a total of 3,000 MW. Since applications under the known Feed-in Tariff (FIT) Policy for solar projects were no longer accepted by the Thai Government, these policy packages reopened support for solar power in Thailand.
The first solar rooftop FiT policy for the country was set up in 2013 with a target of 200 MW, divided to commercial rooftops (10–1000 kW) and 100 MW of residential (0–10 kW) rooftop systems with a support duration of 25 years from the commercial operation date (COD). This first announced package was a policy framework to support the rooftop PV in Thailand as the Thai PV sector had so far been dominated by large free-field installations under the FiT-scheme.
Transition from FITs to Self-consumption
Last year MEA and PEA launched a household solar rooftop scheme for residential PV installations with a generation capacity set up to 10 kW. The program allows property owners to generate power themselves and sell the surplus to the state grid. The net metering tariff was set for ten years with the price of THB 1.68/kWh ($0.052), which was notably lower than the residential power price of THB 3.80/kWh. Therefore, increasing efficiency and the lower cost of solar panels makes it attractive to install solar rooftops as an independent power supply (IPS). In addition, solar system owners had to pay a grid connection fee of THB 8,500.
The household solar rooftop scheme starts at 100MW per year during 2019-27 for households and an increased solar power generation to 1,000MW per year from 2028 and onwards. It is part of the recently updated power development plan (PDP), which will run until 2037, ultimately reaching 10,000MW and the sum of renewable energy supplying 35% of Thailand’s energy consumption by that point.
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