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Thailand: Officials mull new power tariff rate

Energy officials may keep the power tariff, which determines electricity bills, unchanged or trim the rate at its next adjustment as gas prices have become less aggressive.

The new rate will be enforced between May and August.

Early this week, prices of liquefied natural gas (LNG) in the spot market fell to UScopy5-16 per metric million British thermal units (MMBTU), down from $35-40 per MMBTU during the fourth quarter of last year, said Kulit Sombatsiri, permanent secretary for energy.

The winter, during which high demand for gas drives up prices, is also coming to an end.

Thailand has depended more on expensive imported LNG, as cheaper domestic gas supply declined.

The country uses gas as the main fuel for electricity generation.

Energy officials are working on the new power tariff rates and will ask the government to choose one that is most appropriate.

Calculation of the new tariff will be partly based on the need to help the state-run Electricity Generating Authority of Thailand deal with a loss of 170 billion baht from its electricity price subsidy.

The current power tariff, driven by a higher fuel tariff, or Ft, stands at 4.72 baht per kilowatt-hour (unit) for households and 5.33 baht per unit for businesses.

The two rates are applicable between January and April.

Energy officials said earlier that if LNG prices exceeded $50 per MMBTU, Thailand would need to use cheaper fuels for power generation, such as diesel and fuel oil.

In another development, the National Energy Policy Council (NEPC) yesterday approved the revision of the national power development plan (PDP), which is applicable between 2018 and 2037.

The 20-year PDP, which had been revised since 2020, was supposed to get the green light in December last year, but approval was delayed after the Constitutional Court was petitioned to consider whether the proportion of electricity produced by the government can be lower than 51% as stated in the PDP.

The judges ruled it does not violate the charter but recommended the NEPC ensure power supply from private power producers and the country’s power generation capacity in reserve must be set appropriately.

To allay concerns over the surplus of power generation capacity in reserve, the PDP promotes use of the loss of load expectation method to better manage power supplies. This will estimate how many hours electricity supply cannot meet actual demand in a year.

Source: https://www.bangkokpost.com/business/2505689/officials-mull-new-power-tariff-rate