Recent Middle East conflict and oil price volatility have highlighted Thailand’s dependence on imported fossil fuels, prompting calls to accelerate its clean energy transition. A seminar involving energy experts, policymakers, and industry representatives concluded that reducing fossil fuel dependence is now an economic and security necessity, not just an environmental goal, with ASEAN neighbors facing similar pressures.
Research presented showed growing industrial demand for green electricity, though supply and infrastructure remain insufficient, while another study emphasized protecting jobs tied to natural gas industries during the transition. Experts recommend modernizing the electricity grid, expanding battery storage, and shifting from the Enhanced Single Buyer model toward market liberalization, including broader Direct Power Purchase Agreements. The upcoming Power Development Plan 2026-2050 is seen as a key opportunity to implement these reforms, balancing renewable energy expansion with affordability and economic competitiveness.
The latest conflict in the Middle East did more than send oil prices soaring. It exposed, once again, a weakness Thailand has lived with for decades; its heavy dependence on imported fossil fuels.
However, a crisis can turn into an opportunity.
For Thailand, this is the time to accelerate a shift towards clean energy, to reduce fossil fuel dependence, strengthen energy security, and achieve its net-zero emissions by 2050.
Therefore, the challenge for Thailand’s energy system is not only to manage short-term crises, but also to become more reliable and flexible in the long term, while keeping electricity affordable for the people.
This topic was raised at the recent seminar “Energy in a Boiling World: Thailand’s Unavoidable Choice” organised by the Clean, Affordable, and Sustainable Energy (CASE) for Southeast Asia project, in collaboration with the German Agency for International Cooperation (GIZ), the Energy Research Institute of Chulalongkorn University, and the Thailand Development Research Institute (TDRI).
From this seminar, energy experts, policymakers, academics, and the private sector reached a consensus that “Reducing dependence on imported fuels and expanding clean energy is no longer just an environmental goal. It has become an economic necessity, a matter of national security, and an essential safeguard against future global disruptions.”
ASEAN’s Voice – Lessons from the Neighbours
Thailand is far from alone in this challenge. Other ASEAN countries under the CASE project; Indonesia, Vietnam, and the Philippines, have also been hit by the recent energy crisis. Apart from short-term measures to cushion the immediate impact, some governments have established central committees to coordinate responses across ministries. For the long term, all countries are moving in the same direction, accelerating domestic clean energy development. Apart from ambitious targets, the ASEAN representatives underlined the need for consistent government policies and a careful balancing of the interests of all stakeholders to achieve a successful transition.
“Thailand is moving in the same direction”, said Ms. Patcharaporn Phasukavanich, a director of the Strategy and Planning Division at the Energy Policy and Planning Office (EPPO).
The government, she said, is giving greater priority to renewable and alternative energy while modernising the national electricity grid to support a changing energy landscape.
Exploring Energy Transition Opportunities Through a Research Lens
Industry trends suggest that the transition is already under way.
A study titled Green Electricity Demand in Thailand’s Industrial Economy, conducted by GIZ senior energy adviser Mr. Suchart Klaikaew, surveyed 69% of companies in the country’s industrial sector.
The study found that while 91% of the surveyed companies still use green electricity for less than 25% of their total electricity usage, more than half plan to increase that share to over 50% by 2030, driven by environmental targets and global trade requirements.
The demand for green electricity is obviously there; however, supply is still insufficient. The study also shows that industrial demand for renewable electricity is expected to increase sevenfold by 2040. Without faster investment in transmission networks and other supporting infrastructure, Thailand risks losing its appeal as a regional manufacturing base.
The energy transition is also about people and their livelihoods.
Another study, Gas Under Pressure: Managing Energy Security, Economic Resilience and Livelihoods, by Ms. Hanna Fekete from the NewClimate Institute, found that the energy transition is not only about replacing fossil fuels, but also about protecting people’s employment and livelihoods.
Using economic modelling and interviews with communities in Rayong’s Eastern Economic Corridor (EEC), the study found that natural gas-fired electricity generation currently supports more than 100,000 jobs. This means that transition process must consider creating new jobs for workers who depend on it.
Skills training, local hiring policies, and stronger support for small businesses are all needed if the transition is to be fair rather than disruptive.
The upcoming Power Development Plan for 2026-2050 (PDP 2026) offers an important opportunity to embed those principles into Thailand’s long-term energy strategy.
However, planning alone will not be enough.
If the transition to clean energy is inevitable, the next question is, where should Thailand begin?
During the panel discussion “How Should Thailand’s Energy Sector Adapt in a Changing World?”, energy experts and academics likewise underlined that reform must begin with new rules and a new electricity market structure.
To make the transition possible, Thailand must accelerate the modernisation to accommodate the growing share of renewable energy in the electricity mix. At the same time, the system’s flexibility must be enhanced by expanding the use of Battery Energy Storage Systems (BESS), helping maintain the stability and reliability of the country’s power system.
However, the major challenge for Thailand lies in transforming its electricity market structure, form the “Enhanced Single Buyer (ESB)” model, originally designed for energy security but failing to meet the needs of prosumers, to a “Market Liberalisation” model.
The ESB model may have worked in the past, but not now as businesses and households begin generating electricity by themselves. The system should therefore move towards a more liberalised electricity market.
The government has taken a first step by adopting a pilot Direct Power Purchase Agreement (Direct PPA) scheme, allowing private electricity producers and users to trade electricity directly through the Third Party Access (TPA) mechanism, which enables producers to use existing transmission lines to connect with buyers without having to go through the traditional state-controlled purchasing system. For now, however, the scheme is only officially available to data centres that are being promoted by the Board of Investment (BOI).
This has resulted in a consensus among the private sector, calling for Direct PPA and TPA to be expanded to the entire industrial sector, especially as manufacturers’ need for renewable energy grows more urgent under pressure from the European Union’s Carbon Border Adjustment Mechanism (CBAM) and the RE100commitments adopted by multinational companies across global supply chains.
Therefore, reliable access to renewable electricity is becoming a competitive requirement rather than a corporate choice..
The private sector is also calling for a broader reform of the electricity industry based on the “4D1E” framework: Digitalisation (Use digital technology to manage the electricity system), Decarbonisation (Reduce carbon emissions), Decentralisation (Distribute electricity generation), De-regulation (Promote competitiveness and reform regulations to unlock regulatory barriers for fair competition), and Electrification (expand the use of electricity to replace fossil fuels).
Ultimately, The PDP 2026, which is currently under revision, could become the blueprint for these changes. So far, the target for renewable energy in power generation has been raised to more than 50%, and the plan has been adjusted to prepare for growing electricity demand from electric vehicles and data centres, without shifting excessive costs onto consumers.
After all, Thailand does not have to choose between economic growth and a cleaner environment, nor is this just about keeping up with global trends. It is all about whether Thailand will keep relying on an energy system that grows more vulnerable with energy crisis, or transits one that is cleaner, more secure, and more competitive.
The choice will shape not only the country’s economic future but also the quality of life for the people in this increasingly uncertain world – and the longer Thailand delays the transition, the higher the price it is likely to pay.
Pasinee Rerkpiboon is a Researcher at the Thailand Development and Research Institute (TDRI). Policy analyses from the TDRI appeared in the Bangkok Post on 8 September 2026.
