DFDL Thailand | 2019 Power Development Plan: What to Expect

DFDL Thailand | Business Forecast for 2019DFDL Thailand, Bangkok | Expected in early January, Thailand’s forthcoming amended Power Development Plan (PDP) will set the course for nationwide power system development and operation over the coming years. The amended document will represent the first major update to Thailand’s PDP since 2015’s version, which in turn came three years after its predecessor.

Each version of the PDP takes into account changes in the country’s economy and infrastructure, and is one of several documents that aims to bring energy efficiency and economic security to Thailand while also advancing environmental goals. Other related planning documents include the Energy Efficiency Development Plan, the Natural Gas Supply Plan, the Petroleum Management Plan, and the Alternative Energy Development Plan. A new version of the latter document will be published in the months following the amended PDP.

The Energy Policy and Planning Office (EPPO) has been holding public hearings for the amended PDP across the country since the start of December. We expect the plan to be considered by the National Energy Policy Committee (NEPC) on 7 January 2019, with the intent of approving a final version for publication in advance of the national elections scheduled for February. Note that no official announcement has been made as to the date of publication; our conjecture is based on past precedent as well as a consideration of political priorities.

How the Amended PDP Compares to Its Predecessor

The table below lists the types of energy sources used for generating electricity, comparing the planned contribution of each source between the PDP 2015 document, and the data we expect to see in the forthcoming amended PDP:

Type of energy source	2036 Targets ( %) under 2015 PDP	2037 Targets ( %) under 2019 Amended PDP
Natural Gas	37	53
Coal	23	12
Hydropower from neighboring country	15	9
Alternative Energy	20	20
Nuclear	5	–
Others	0.1	0.06
Energy efficiency	–	6

The increase in the natural gas contribution results mainly from the recent political abandonment of the highly criticized large coal projects in the South of the country. It is also noteworthy that the contribution of alternative energy sources is expected to remain stable over time – although an increase in energy efficiency is expected.

Ultimately, the final amended PDP as approved by the NEPC will become public upon endorsement by the Cabinet. Upon NEPC approval, the Energy Regulatory Commission (ERC) will take the next step by announcing relevant draft regulations on related issues (expected within the week following the NEPC approval). A 15-day public hearing will then follow to discuss the regulations, which will be on the following topics:

Residential Solar Rooftop Program (with net metering)
Independent Solar Rooftop Program (Pilot Project).

Much later in the process, a third element will also be brought under discussion: Blockchain. Hearings will commence after business representatives are invited to brief the ERC on suggested regulatory approaches for this new technology, which is now being used by private entities to trade electricity on the open market.

Snapshot on Solar Rooftop Programs

The Residential Solar Rooftop Program has reportedly been finalized by the ERC. Based on our investigations with the ERC, the price and overall framework of this program are expected to be announced a week after the approval of the amended PDP.

No advance drafts were available for our review, but initial reports indicate that the allowance for net metering (selling the electricity back to the grid) is to be no more than 10 KVA per household, with an estimated price of 1.80 Baht/unit. The allowance cap to buy back electricity will be only 100 MW in 2019, although this number will rise steadily in subsequent years. The amended PDP will initiate plans to increase the cap allowance every year until it reaches 10,000 MW in 2037 (B.E. 2580), accounting for 4,250 MW as reliable capacity.

The Independent Solar Rooftop Program (or the Pilot Project, as to apply to the industrial sector) will be controlled by the Department of Alternative Energy Development and Efficiency (DEDE), and is not explicitly mentioned in the amended PDP. Although it was originally intended to examine the possibility of net metering, this program was reshaped instead to focus on regulating elements within the industrial sector that generate their own electricity for self-consumption.

With so many changes taking place as part of Thailand’s rush towards its 4.0 model, an up-to-date accounting of its current and future energy needs will help businesses as well as the government plan for the road ahead. DFDL Thailand will cover these and other developments when they are officially announced in 2019, providing context and analysis for responsible strategic decision-making.

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