Energy policymakers plan to promote wood pellets as an alternative source of energy by encouraging factories to switch from fossil fuels and gas to generate power in a bid to increase consumption of wood at home rather than exports.
Deputy energy permanent secretary Twarath Sutabutr said the government would give financial help to those factories willing to change their power generating machines that use bunker oil and liquefied petroleum gas to wood pellets.
The government will help to absorb 30-50% of the costs of changing the machinery, with the rest paid by the factories themselves.
Mr Twarath said many good-quality wood pellet producers exist in Thailand, but most of their products are exported to East Asia.
This move will help to increase domestic consumption of wood pellets, he said.
Thailand is one of several countries with high potential to use alternative power sources from fast-growing plants such as napier grass, horse tamarind, corncobs, eucalyptus and acacia.
The heat value created by wood pellets is 4,000 to 4,500 kilocalories per kilogramme, with 8-15% of the content moisture and 3-5% ash.
"These new renewable energy sources offer another option that reduces greenhouse gases and agricultural product waste at the same time," Mr Twarath said.
Several countries in Asia, Europe and North America are expanding renewable energy in their electricity portfolio to reduce the use of fossil fuels.
The wood pellet market is booming in Europe, as EU 2020 policy prioritises renewable energy sources and greenhouse gas emissions reduction.