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Power development in Thailand needs 'serious planning'

Publication Date : 29-06-2012

 

Thailand must take its power development plan seriously in order to secure sustainable energy in the future, and needs to balance the energy sources, an expert suggested yesterday.

"The government will have to prioritise what it should do ... it needs to rethink energy subsidy for household cooking, public cars, private cars or luxury cars," said Prasert Bunsumpun, chairman of Sustainable Energy Foundation.

Given the current situation where Thailand is a net importer of energy, about 60-70 per cent of natural gas is being used for electricity generation. Meanwhile, the government's unclear policy regarding support for energy would make investors reluctant to invest, which will result in a reduction in energy production in the future. This would compel the country to import more energy at higher prices.

Speaking at a seminar on survival of Thai electricity, held by Krungthep Turakij newspaper yesterday in Bangkok, Prasert said the country's research-to-production ratio showed a low level among other Asian countries, while its energy intensity ratio is relatively high.

Power generated by coal and nuclear with cheap production have been unacceptable in the country, so it will move forward to alternative and renewable, but more expensive, energy. The question is how will it achieve a balance, said Prasert.

He said the country would inevitably spend more on energy as its natural-gas reserves are being depleted.

"We have to balance our energy resources so as not to rely on only one resource."

Prasert noted that the key is the structure of energy prices, without any distortion by governmental subsidies. The right structure of energy prices would be the key to a country's appropriate energy development plan.

"Now, it's a golden period when the government should take advantage of a reduction in global oil prices to revive excise taxes [about Bt5 per litre is exempted right now] for diesel consumption," he said.

He added: "The country has lost income in terms of excise taxes collected for diesel of more than Bt100 billion a year."

This amount, if used for education, mass-transit and high-speed-rail projects would help increase the productivity of the economy.

According to research conducted by World Bank on subsidies, 30 per cent of subsidies by Thailand went to the right projects while the balance 70 per cent were wasted.

Other governments in Asia such as Malaysia, Indonesia and China have gradually reduced subsidies on energy use. This will result in more efficient use of energy, adjustment of enterprises and use of subsidy amounts for other projects.

Kurujit Nakornthap, deputy permanent secretary at the Ministry of Energy, said the main challenge for the country to survive from blackouts is how to price the electricity grid. "If we rely on the electricity grid too much, it's conceded that there would be a blackout in Bangkok and other provinces in the Central region if a half of natural gas output disappears."

He proposed that coal, though it is said to emit more carbon dioxide than natural gas, could be a choice.

Thongchai Panswad, honorary adviser to the Environmental Engineering Association of Thailand, said investors should bear the burden for harm to the environment and community where a power plant is located. They should not pass on these costs to the community.

 

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