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BOI promotes Thailand’s development of alternative energy

Currently, the country still relies heavily on imported oil, even though Thailand itself has 78 petroleum felds. And the threat always exists that oil prices could go skyward

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An inventive spirit, not only among private entrepreneurs but also in the halls of government, is pushing Thailand’s development of alternative energy. But “alternative” might not be the best word. With fossil fuels depleting and tomorrow’s generation certain to have a robust appetite for energy, perhaps “necessary” is more appropriate.

Necessary energy sources in coming years include biofuel, solar, wind, waste and water, among possible others as yet unimagined. Industry experts are confident that Thailand’s investment in alternative energy will increase steadily with the government, industry and private citizens all showing greater concern over pollution caused by petroleum products. From a standpoint of economic survivability, it makes good sense for Thailand to cultivate renewable energy sources.

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Thailands economic development has resulted in growing electricity consumption by the commercial and residential sectors driven by higher income levels of consumers

Currently, the country still relies heavily on imported oil, even though Thailand itself has 78 petroleum felds. And the threat always exists that oil prices could go skyward. Petroleum products account for about 57% of commercial energy consumption in Thailand. Diesel and gasoline power 72% of transport. This draws attention to the fact that Thailand also possesses a large agricultural sector, representing ample raw material for development of the ethanol and biodiesel sectors.

In addition, Thailands economic development has resulted in growing electricity consumption by the commercial and residential sectors driven by higher income levels of consumers whose consumption characteristics have shifted towards greater convenience and modernization.  A greater number of electrical appliances are thus widely used, for example, refrigerators, electric fans, rice cookers, televisions, light bulbs, including air-conditioners, computers, and so on.

These appliances have become necessities in Thai households.  As electricity becomes a major factor in the countrys economic development and peoples living, energy development plans have so far focused on expansion of electrification to ensure adequate and extensive service coverage.Consequently, the government has to work out the power development plan of the country to increase the generating capacity of the system so as to adequately meet the rising demand. In 1979, the peak demand of power was 2,964 megawatts MW while that in 2009 amounted to 22,596 MW.

This agri- advantage is being tapped, as output of biofuels has shot up since oil prices soared in 2004. High petroleum costs have made biofuel development one of the most active sectors of Thailand’s alternative energy industry. Progress is being achieved with ethanol made from cassava and sugar, biodiesel from vegetable oil, gasohol, biogas, and other forms. According to the Offce of Agricultural Economics, the planted area of cassava totals nearly 4 million rai and covers 19 northeastern provinces. The country also has 11 ethanol plants that rely on sugar molasses as raw material. Thailand my be the world’s No. 1 exporter of cassava products and No. 2 for sugar, but there is still plenty of opportunity for using these crops as a renewable energy source locally.

Out of the total annual harvest of nearly 30 million tons of cassava, an estimated 3.7 million tons is available as stock for ethanol production. However, one challenge that authorities and change advocates must monitor is whether the increasing use of farmland for energy crops is having a negative effect on the national supply and price of food. Currently, five ethanol plants approved by the Thailand Board of Investment (BOI) are being established at a combined cost of 16.5 billion baht (USD 550 million).

These projects are located in Nakhon Ratchasima, Ubon Ratchathani, Chaiyaphum, and Kalasin. Ethanol consumption in the country is approaching 2 million liters per day, according to the Ministry of Energy. Projections are for that to climb steadily to 9 million liters/day by 2022. Proponents of biodiesel, which is running at about 1.35 million liters/day in 2010, see that segment rising to 4.5 million liters/day over the same period.

Diesel B2 was enforced nationwide in February 2008, and B5 will follow suit in 2011 as palm-oil cultivation expands to 2.5 million rais. Consumption of gasohol, a blend of mostly ethanol with some petrol, is expected to top 12 million liters a day in coming years. The Swine Raisers Association of Thailand is leading the way in efforts to use biogas from livestock manure fermentation as a fuel source. Biomass is yet another part of the complex formula for success in overcoming reliance on fossil fuels. Biomass is material derived from residue such as dead trees, yard clippings, rice husks and garbage that can be burned to produce heat and generate electricity.

Although this promising sector is still in its infancy, biomass will see increased attention in coming years because it is a completely renewable source of energy. More trees can be grown and waste is a constant in society. However, further breakthroughs are required in conversion technologies to make this a feasible energy source on a large scale. Even though natural gas has been on the energy scene in Thailand since the early 1980s, it is actually a very attractive area for new development. Today only about 6% of the energy used in the nation’s vibrant commerce sector comes from natural gas. Vast potential exists, however.

Of Thailand’s 50 natural gas felds, nearly 30 are not in production. As the al ternat ive energy movement picks up speed, the reverse effect will be seen with pol lution problems as vehicle emissions and waste water from factories subside. Thailand has signed several environmental conventions and joined “green” organizations. In addition, the government’s strategic long-term plan on climate change emphasizes R&D, institutional capacity, clean technologies and public awareness.

According to figures from PTT Public Co. Ltd., Thailand’s national energy provider, as of October 2009 the country had 351 NGV (natural gas vehicle) stations and 165,800 low-polluting NGVs, including taxis, tuk-tuks, personal and corporate cars and vans, trucks, and buses. The number of servicing stations is expected to increase to 595 in 2012. The enthusiasm to constantly look to new horizons is vital for growth in the alternative energy industry. Clean and efficient, nuclear power looms as a possibility. The Ministry of Energy is already conducting a feasibility study on what would be Thailand’s first 2,000-megawatt nuclear power plant, with three possible sites under consideration. Public awareness programs on nuclear power are also being carried out.

BOI: http://www.boi.go.th

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