You are on page 1of 21

THAILAND’S ENERGY POLICY delivered to the National Assembly on 30 December 2008 by Mr.

Abhisit Vejjajiva,
Prime Minister of Thailand and
ENERGY STRATEGY directed by Mr. Wannarat Channukul, Minister of Energy, on 12 January 2009

STRATEGY 1: ENERGY SECURITY

Policy Directive Strategy Target/Outcome Implementation Methodology

Intensify energy development 1.1 Promote domestic z To be able to produce z Expedite and promote greater
for greater self-reliance of the production of crude crude oil and condensate investment in exploration and
country with a view to achieving oil and condensate at more than 230,000 production (E&P) of crude oil from
sufficient and stable energy and develop related barrels/day in 2009 and domestic resources.
supply by expediting exploration infrastructure 250,000 barrels/day in z Support the development of oil depot
and development of energy systems. 2011. system and oil transportation pipelines
resources at both domestic and
so as to reduce the cost of oil
international levels; negotiating
with neighboring countries at the
distribution to various regions.
government level for joint z Encourage the PTT and PTTEP to
development of energy invest in the utilization of the deep-sea
resources; creating energy mix port in Ranong province as a supply
in power development to reduce base of petroleum E&P in the Gulf of
risks pertaining to supply, price Martaban.
volatility and production cost; z Stimulate the PTT and PTTEP to
encouraging electricity invest in overseas E&P of crude oil to
production from potential be supplied back to Thailand,
renewable energy, particularly particularly from oil resources in
from small or very small scale
strategic partner countries having
electricity generating projects,
good relationship with Thailand, such
as well as studying the
as Oman, Iran, Qatar, Bahrain,
appropriateness of other
alternative energy for electricity Algeria and Egypt.
generation.

1
Policy Directive Strategy Target/Outcome Implementation Methodology

1.2 Procure natural gas z To maintain the level of z Manage the procurement of natural
from both domestic natural gas reserve (2P) gas to be in balance with the domestic
and foreign resources that can be developed for demand.
to sufficiently meet the domestic consumption for z Speed up natural gas procurement to
demand and develop no less than 30 years. meet the domestic demand, especially
related infrastructure the development of the 2nd natural gas
systems. resource in the Thailand - Malaysia
Joint Development Area, i.e. JDA B17,
to meet the schedule.
z Follow up the progress of domestic
natural gas fields presently under
development, e.g. Plathong 2 and
South Bongkot, to be able to supply to
the system in 2011/2012.
z Speed up the signing of a Gas Sale
Agreement for the purchase of natural
gas from a new natural gas resource
in Myanmar, i.e. M9 gas field, to
enable the commencement of natural
gas supply at 240 million cubic feet
per day (MMSCFD) by 2011/2012.
z Import LNG to accommodate the
demand of natural gas, starting in
2011/2012; in this respect, the signing
of LNG sale agreements with foreign
countries must be made and the
construction of re-gasification facilities
in Rayong province must be
expedited.

2
Policy Directive Strategy Target/Outcome Implementation Methodology
z Initiate and speed up negotiation for
natural gas supply from Natuna gas
field in Indonesia.
1.3 Develop the z To have Thailand Power z Support power purchase from small-
electricity supply Development Plan (PDP) scale projects like SPPs (using
industry to correspond with economic cogeneration system and renewable
adequately meet the and social situations, with energy) and VSPPs to increase power
demand and promote a reserve margin at supply to the grid during 2009-2011,
diversification of fuel approximately 15-20%. which will also boost domestic
types. z To maintain the share of economic conditions and investment.
power generation of the z Postpone IPP projects that are not
Electricity Generating ready to be connected to the grid for
Authority of Thailand 1-3 years.
(EGAT) at more than 50% z Review the purchase of power from
of the total generating neighboring countries through re-
capacity of the country. negotiation.
z To impose a cap on z Carry out public information
dependency on natural campaigns to make people recognize
gas for power generation, the importance and necessity of fuel
not to exceed 70%. diversification.

1.4 Conduct feasibility z To provide the general z Undertake detailed feasibility study on
study on the public with better the development of nuclear power
development of other knowledge and plants, using relevant IAEA guidelines
fuel options for power understanding of new as the implementation framework.
generation, e.g. nuclear, energy options. z Carry out public information activities
clean coal and oil shale. and disseminate clear and correct
information to the general public,

3
Policy Directive Strategy Target/Outcome Implementation Methodology
giving importance to educating the
young generation about the benefits,
advantages and disadvantages of
nuclear power, coal and oil shale.
z Get prepared for presentation to the
government to make a policy decision
regarding nuclear power
development, emphasizing the
outcome of in-depth study on the
economic cost-effectiveness and
public acceptance.
1.5 Explore energy z To enhance better z Policy towards neighboring countries:
resource overseas, bargaining power of - Negotiate on the plan for power
emphasizing Thailand in negotiating on purchase from Lao PDR to suit with
cooperation between power purchase from changing situations and costs;
the public sector and neighboring countries, by
- Speed up the establishment of
private Thai operators. encouraging Thai
integrated relationship (“Energy
entrepreneurs to enter into
Diplomacy”) with Indonesia.
joint ventures on power
projects.
z Policy towards significant strategic
z To pave the way for partners relative to energy issues:
moving forward to
investment in E&P of oil - Maintain good relationship with
and natural gas resources major oil and natural gas producing
in the Middle East, Africa, countries in the world market, such
Asia Minor and the Pacific. as UAE, Oman, Iran and Qatar,
including Algeria and Egypt;
- Strengthen relationship with
strategic partner countries in the

4
Policy Directive Strategy Target/Outcome Implementation Methodology
field of alternative energy and
countries with advanced energy
technologies, e.g. Brazil, Germany,
France, Japan and South Korea;
- Expedite relationship establishment
with South Africa, Angola and
Kazakhstan – countries endowed
with various energy resources, e.g.
coal and uranium.
z Develop relationship between biofuel
producing and consuming countries in
the form of “International Dialogue on
Biofuels,” with Thailand acting as a
major lead country.

1.6 Promote and z To get prepared for z Undertake detailed study on the
strengthen the scaling up petrochemical approach to development of value-
development of development together added creation of domestic petroleum
energy industry as with biofuel development resources, including a survey for
well as downstream so as to create new potential sites for such development.
industry. industry of the country,
e.g. the development of
oleochemical industry.

1.7 Devise a plan for z To have in place a plan z Devise an energy crisis preparedness
energy emergency and readiness to address plan together with a coordination
preparedness. all forms of energy crises. system and an exercise in addressing
an oil shortage.

5
STRATEGY 2: ALTERNATIVE ENERGY

Policy Directive Strategy Target/Outcome Implementation Methodology


Set the policy on alternative 2.1 Promote the z To replace oil consumption z Establish as a “National Agenda”
energy as a national agenda production and with the use of ethanol at no the production and utilization of
by encouraging production and utilization of biofuels, less than 1.4 million ethanol and biodiesel, with a Road
use of alternative energy, e.g. ethanol and litres/day in 2009. Map to provide clear implementation
particularly bio-fuel and bio- biodiesel, to replace direction.
mass, such as gasohol (E10, oil consumption. Estimated
Quantity
(M litres/day) Service z Support the establishment of
Number of
E20 and E85), bio-diesel, solid Vehicles
Station ethanol production plants, which will
Ethanol Gasohol
waste and animal manure, to enhance Thailand to become the
enhance energy security, - E10 > 3 million 0.97 9.7 5,000
“Ethanol Hub” for ethanol production
reduce pollution, and for the and distribution in Asia.
- E20 318,000 0.25 1.05 120
benefit of the farmers by z Promote wider use of E85 fuel, via
encouraging production and - E85 1,000 0.004 0.005 30-50
supporting the set-up of E85
use of renewable energy at the automobile manufacturing line in
Motorcycles > 10 million 0.16 1.6 5,000
community level under Thailand, with an initial target to
appropriate incentive Total 1.39 12.36 have 1,000,000 E85 cars by 2018.
measures; encouraging
greater use of natural gas in z Forge ahead with the revision of
the transportation sector by z To forge ahead with the regulations pertaining to ethanol
expanding natural gas materialization of the use of export.
transportation system gasohol E85 and flexible z Initiate aggressive marketing to
nationwide; and rigorously and fuel vehicles (FFV) in induce neighboring countries as well
continuously promoting Thailand, with a promotional as China, Japan and Korea, to
research and development of target of at least 2,000 FFV. seriously consider and increase
all forms of alternative energy. ethanol use so as to expand ethanol
z The target in 2011 is as export markets in the future.
follows:
z Efficiently monitor the price
difference between biodiesel B2 and
B5 in order to properly

6
Policy Directive Strategy Target/Outcome Implementation Methodology
accommodate the demand of
Quantity (M litres/day)
Estimated biodiesel B100 to be in line with oil
Number of
Vehicles Ethanol Gasohol palm production in each period of
time.
- E10 > 3 million 1.63 16.3
z Expeditiously promote expansion of
- E20 609,823 0.57 2.85 oil palm plantations together with
development of oil palm
- E85 90,000 0.32 0.376
species/varieties and yield per rai
Motorcycles 18,522,000 0.48 4.8 [0.16 hectare].
Total 22.2 million 3.00 24.326
z Continuously promote the
“community-scale biodiesel” project,
z To produce B100 at no less emphasizing technology transfer
than 1.8 million litres/day and suitable technical management
within 2009 and promote the so as not to cause environmental
increase in domestic impact on the communities.
production capacity of B100 z Make the use of biodiesel B5
to sufficiently meet a mandatory nationwide by 2011.
demand of about 3 million
litres/day in 2011.

2.2 Promote the use of z (A table illustrating the z Forge full steam ahead and
natural gas in the target of NGV utilization continuously with the application of
transportation (NGV), and the estimated number NGV to public fleets, focusing on
industrial, commercial of NGV vehicles is being taxis, tuk-tuks (motored tricycles),
and household developed.) public and private buses, and
sectors. z To increase NGV mother trucks.
stations by a minimum of 7 z Prepare for NGV price review,
stations within 2009. taking into consideration the actual
costs and overall economic
situations of the country.

7
Policy Directive Strategy Target/Outcome Implementation Methodology
z Plan out the expansion of natural
gas transmission pipeline system to
be the backbone of NGV growth.

2.3 Promote all forms of z The target of power z Promote power generation from
renewable energy – generation by renewable renewable energy in all forms, via
wind, solar, energy type is as follows: provision of incentive measures,
hydropower, e.g. the current provision of “Adder”
biomass, biogas and At Present Target in
[an additional energy purchasing price
energy from waste. (MW) 2011 (MW) on top of the normal prices that power
producers will receive when selling
- Solar 32 55 electricity to the Power Utilities].
- Wind 1 115 z Promote the conversion of plastic
- Mini & Micro-hydropower 55 165 waste into crude oil, in a way similar
- Biomass 1,609 2,800
to the “Adder” provision, by using
the Oil Fund to provide support for
- Biogas 45 60
the cost incurred from Adder
- Electricity from Waste 5 78 provision to oil refineries that
purchase oil derived from plastic
waste to be further processed.
z Review “Adder” to better suit the
domestic situations.

2.4 Carry out research z To develop and integrate z Support R&D necessary for the
and development of the plans for R&D on development of alternative energy,
alternative energy, alternative energy of especially R&D on energy from
renewable energy concerned agencies to plants, in terms of both the 2nd
and other innovative enhance the capability to Generation Biofuels and equipment
energy technologies. respond to the approach for for generating energy from biomass
renewable energy and biogas.

8
Policy Directive Strategy Target/Outcome Implementation Methodology

development as per the z R&D on modification of old-modeled


already approved 15-year cars to be able to use gasohol E20
and E85.
REDP framework.
z R&D on car engines to be
applicable to biodiesel B10.
z Support research on advanced
technologies, e.g. hydrogen and
solar cells.
z Increase the share of domestic
technology utilization (local
contents).

2.5 Forge ahead to set z To have the National z Present the 15-year Renewable
alternative energy as Alternative Energy Master Energy Development Plan (REDP)
a national agenda Plan approved and to the NEPC/cabinet for approval to
and determine practically implemented. be used as the master plan for
incentive measures. promotion and support of alternative
energy in all forms.
z Develop an integrated Plan of
Action to forge ahead with
alternative energy development
pursuant to the targets set forth in
the 15-year REDP.

2.6 Establish and z To establish one prototype z Set up the “Community Energy
strengthen renewable of village/community-based Volunteers” by selecting community
energy networks energy source in each leaders/mentors who are interested
through encouraging province, totaling 75 in energy issues and who are willing
a participation prototypes, within 2009, to conduct campaigns promoting

9
Policy Directive Strategy Target/Outcome Implementation Methodology
process at the giving importance to the energy activities at the community
community, district application of local culture to level.
and provincial levels the fostering of economical z Devise an alternative energy
in order to create and wise usage of energy in development plan at the provincial
energy security from a community and to the level and at the provincial cluster
the foundations. increase in the economic level, using the “cluster concept” in
value of the community. order to expeditiously and practically
z To speed up the expansion convert the existing potential in each
and further development of area into energy according to the
prototype communities so 15-year REDP framework, as
as to popularize the approved.
concept, by integrating this z Accelerate the implementation of
into the community energy community-scale energy projects in
planning project with a an addition of 300 Tambon (sub-
target of “one district, one district) Administration
community energy source” Organizations nationwide – to be a
by 2011. new channel focusing on grassroots
participation in the thinking, planning,
implementing and problem solving
related to energy for the
communities, targeting to reduce the
energy cost of each community by
15-20%.
z Promote “Appropriate Technology”
that suits the way of living of people,
particularly those in rural communities,
so that the acquired technology
could be practically applied to solve
energy problems in each locality,
e.g. community-scale biodiesel,

10
Policy Directive Strategy Target/Outcome Implementation Methodology
training course on manual production
of biodiesel, 200-litre charcoal-making
stoves, high-efficiency stoves,
charcoal briquette-making machines
and household biogas digesters,
etc.
z Develop the “Green Home Concept”
for “urban communities,” by
developing technologies appropriate
for urban communities, housing
estates and condominiums.

11
STRATEGY 3: SUPERVISE ENERGY PRICES AND SAFETY

Policy Directive Strategy Target/Outcome Implementation Methodology

Supervise and maintain 3.1 Supervise energy z To attain fair/affordable z Supervise the pricing policy and
energy prices at appropriate, prices to ensure stability domestic energy prices – price structures of oil, LPG and
stable and affordable levels and fairness, while the energy cost for Thai natural gas to be in line with the
by setting an appropriate fuel reflecting actual people must not be higher world market mechanisms and to
price structure which supports production cost, through than that in neighboring reflect the actual costs; ensure
the development of energy the market mechanism. countries. fairness for the general public via
crops and which best reflects efficient use of the Oil Fund
actual production cost; mechanism; and monitor the refining
managing prices through the and marketing margins to be at
market mechanism and the Oil appropriate levels.
Fund to promote economical z As for LPG and NGV prices,
use of energy; and implementation will be in line with the
encouraging competition and resolutions of the NEPC/cabinet,
investment in energy business, which will not place a burden on
including improvement of consumers.
service quality and safety. z Regarding the calculation of ethanol
price, the Energy Policy and
Planning Office (EPPO) has been
entrusted to solicit the Ethanol
Producer Association for a more
suitable pricing formula for
monitoring domestic ethanol prices.

3.2 Promote service quality z Absolute Zero-Accident. z Accelerate capacity building of


and safety improvement of z To complete the Provincial Energy Offices (PEOs) to
energy-related business, establishment of an enhance efficiency of their duty
facilities, service stations Provincial Energy Office in execution, particularly the protection
and equipment.

12
Policy Directive Strategy Target/Outcome Implementation Methodology
each province by 2011 (to of energy consumers’ benefits.
date 36 PEOs have been z Upgrade the Regional Energy
approved) to enable their Coordination Offices of PEOs to be
practical duty execution Regional Energy Learning Centers in
and efficient protection of order to create knowledge and
energy consumers’ understanding of the government’s
benefits. energy policy.
z To establish NGV quality z Establish the quality and safety
standards to ensure safety, standards of the NGV business chain
including supervision on as a whole.
the installation cost of NGV
kits to be appropriate, fair z Regulate the safety of LPG
and in line with the utilization, by preventing misuse of
economic conditions. LPG and guarding against transfer of
z To establish an energy household LPG to be used in the
technique development transport sector while ensuring least
institute, including impact on taxis, via the mechanism
procurement of testing entrusted to five committees
equipment. appointed by the NEPC.
z To develop safety
standards of energy
business operation which
are suitable for Thailand,
and disseminate the
standards to provincial
areas and local
administration
organizations.

13
Policy Directive Strategy Target/Outcome Implementation Methodology

3.3 Encourage competition z To create good z Designate an agency in the form of


and investment in environments for an “Investor Relation Office” to be
energy business. investment in energy exclusively responsible for
business, with transparent procedures and process of
competition and investment in energy industry.
internationally accepted z Create a mechanism for enhancing a
standards. company to be a “service company”
in operation and maintenance (O&M)
in such business as electricity
industry, refineries, gas separation
plants and oil/gas rigs, both domestic
and overseas.
z Create a favorable atmosphere for
investment in energy business, with
transparent competition and
internationally accepted standards.

14
STRATEGY 4: ENERGY CONSERVATION AND EFFICIENCY

Policy Directive Strategy Target/Outcome Implementation Methodology

Encourage energy 4.1 National energy z To increase the energy z Prepare the drafting of Energy
conservation and efficiency development and conservation target Conservation Program, Phase 4
in the household, industrial, energy conservation. stipulated in the Energy (2012-2016) to be intensive to be
service and transportation Conservation Program to able to address future crises caused
sectors through campaigns 20%, focusing on by oil price volatility, climate change
fostering energy-saving increasing energy-saving and world food crisis, underlying
discipline and conscience and achievement in the participation of people and
promoting effective energy use; industrial and concerned parties at all levels.
providing incentives to induce transportation sectors.
private sector investment in
opting for energy-saving
appliances; setting incentive
measures for the household
sector to reduce electricity
consumption during the peak
4.2 Organize campaigns z To forge ahead with the z Improve the implementation
period; supporting research
to create energy- implementation of “11 approach of the “11 Energy-Saving
and development and standard
saving conscience Energy-Saving Measures Measures” by placing emphasis on
setting for electrical appliances
and provide for the People” to rapidly pilot provinces at three scales (SML,
and energy-saving buildings;
knowledge about attain practical i.e. large-scale province: Nakhorn
and supporting the
energy conservation. achievement and set an Ratchasima; medium-scale provinces:
development of mass public
energy-saving target at Phitsanulok and Krabi; small-scale
transportation and railway
100,000 million Baht/year. province: Mae Hong Sorn), and by
system to improve energy
pushing forwards energy-saving
efficiency which will help defer
measures emphasizing a
the country’s investment in
participation process, mainly through
energy procurement.
the “Community Energy Volunteers”
mechanism, prior to expansion to
other provinces in 2011.

15
Policy Directive Strategy Target/Outcome Implementation Methodology

z To enhance Local z Enforce measures on mandatory


Administration energy performance labeling within
Organizations (LAOs) to be 2009, starting with refrigerators and
focal agencies in creating air-conditioners by
and disseminating “energy- upgrading/increasing efficiency of
saving culture” via such No. 5 refrigerators and air-
target groups as children conditioners by at least 10%.
and juveniles, housewives z Expedite coordination with the Office
and senior citizens under
of the Consumer Protection Board
the “Community Energy (OCPB) and concerned agencies to
Volunteers” mechanism. enable issuance of the mandatory
z To attain participation of measure on “Standby Power 1-Watt”
100,000 households in the within early-2010 for pilot appliances
“Household Energy Credit” such as televisions and air-
project, which will conditioners, and set a target of
contribute to energy-saving electricity saving worth 4,000 million
at no less than 1,000 Baht/year.
million Baht/year. z Accelerate the replacement of light
z A target of energy credit bulbs by energy-saving lights (No. 5
provision is set to reach and T5 fluorescent tubes) in 100
60,000 million Baht/year, sample temples/mosques within
contributing to energy- 2009, and complete such
saving at no less than replacement in 500 facilities by 2011,
40,000 million Baht/year. to achieve a change to the use of
energy-saving light tubes totaling
1,000,000 units, including creation of
a sensitizing presenter in each
facility.

16
Policy Directive Strategy Target/Outcome Implementation Methodology
z Speed up the issuance of relevant
ministerial orders and announcements
pursuant to the Building Energy
Code within 2009, together with
organizing training/conferences for
architects, engineers and concerned
institutions so as to attain at least
10% energy-saving in new buildings,
accounting for electricity saving at
2,365 GWh/year.
z Speed up the enforcement of laws
and announcements related to the
regulation of energy conservation in
factories (ISO – Energy) within 2009,
aiming to attain energy saving worth
90,000 million Baht by 2011.
z Assign the Energy Mobile Units, via
the Regional Energy Coordination
Offices of all 12 Provincial Energy
Offices, to carry out their field work in
at least 576 sub-districts nationwide.
z Review the projects on “Clean Air-
conditioners Increase Money for
Households” and “Engine Tune-up to
Reduce Oil Consumption” to be
implemented continuously on an
annual basis, especially in summer.

17
Policy Directive Strategy Target/Outcome Implementation Methodology

4.3 Devise incentives and z To set a target to reduce z Promotion via 4 major measures, i.e.
provide privileges to “Energy Intensity,” or - Energy Credit and Revolving Fund
induce investment in energy consumption per to promote energy efficiency and
energy saving. production unit, in the alternative energy;
industrial sector by 20% - Tax measures and privileges on
compared with the base both cost-based and performance-
year (2006). based basis;
- Joint ventures via the use of
ESCO Fund;
- DSM Bidding.

4.4 R&D on energy-saving z To have in place an z Gather information about energy-


systems and Integrated Resources saving innovations in each locality
technologies. Planning with regard to and encourage further development.
energy conservation R&D. z Consider clearer determination of the
ratio of state budget and budget from
the Energy Conservation Promotion
Fund to be used for R&D promotion.

4.5 Set standards, rules z To announce the Minimum z Expedite the issuance of Ministerial
and regulations for Energy Performance Orders with immediate effect.
energy-saving Standards (MEPS) of 15
equipment, materials electrical appliances by
as well as energy 2009.
management. z Expedite the issuance of
Ministerial Orders, particularly
on the Building Energy
Code and ISO - Energy.

18
Policy Directive Strategy Target/Outcome Implementation Methodology

4.6 Promote the creation z To make “Thailand Energy z Intensify the implementation via the
of prototype Awards” recognized by “Thailand Energy Awards” project.
networking, e.g. SMEs general target groups.
with distinguishing
features or with
interest in energy-
saving.

19
STRATEGY 5: ENVIRONMENTAL PROTECTION

Policy Directive Strategy Target/Outcome Implementation Methodology

Encourage energy 5.1 Monitor z To set a target together z Select pilot power plants and conduct a
procurement and environmental with a plan to boost the study on the reduction of GHG
consumption which attach impact caused by management of emission from:
importance to the energy production, greenhouse gas emission 1) one natural gas-fired thermal power
environment, with public conversion and rate in the energy sector. plant;
participation, by setting utilization. 2) one coal-fired thermal power plant;
relevant standards and and
promoting greater Clean 3) one combined cycle power plant,
Development Mechanism
(CDM) projects to reduce and, devise a plan to reduce GHG
social and environmental emission in the energy industry, e.g.
impact as well as greenhouse determination of the baseline,
gas emission. together with a clear response plan.

5.2 Promote the Clean z To enable Thailand to z Promote wider use of flare gas, e.g. as
Development submit energy projects for a substitute for LPG in the production
Mechanism (CDM) certification under the process of community products or as
in the energy sector CDM, at a total of one fuel in community-scale power
to reduce million tons CO2 per year. generation.
greenhouse gas z To enhance Thailand to be z Manage to keep the level of flare gas
emission. a leading country in at the minimum, or prepare the
exporting carbon credits in announcement on “Zero Flare” policy,
Asia. particularly for on-shore petroleum sites.
z Promote study and research on the
carbon capture and storage (CCS)
technology to compress and store
carbon dioxide underground.

20
Policy Directive Strategy Target/Outcome Implementation Methodology

z Conduct a feasibility study on CCS


technology application in Thailand,
together with the development of a pilot
project for actual operation trial.

5.3 Control and monitor z To control the VOC z Expand the implementation of the
the VOC emission emission of all factories to policy on vapor recovery unit from
standards from meet the standards. currently four provinces to cover an
petrochemical and z To create low cost addition of seven provinces in areas
refining industries so “Appropriate Technology” where a large number of oil reserve
as not to create innovations, which are depots are located.
environmental environmentally friendly z Prepare for consultations with
impact. and easy for O&M, at least refineries regarding the enforcement
five innovations per year, schedule of the EURO 4 standards.
with support from the
Energy Conservation
Promotion Fund.

21

You might also like