Surveying the energy scene around the world gives the impression that renewable energy — once considered as the “little league” by many experts — is on the verge of breaking from an awkward stroll into a sprint.
Everywhere you turn these days, some nation is trying to stay ahead of the others in terms of installing renewable energy systems — from the US to Europe, India and China. And, yes, even Thailand.
In Scotland, renewable energy overtook nuclear as the country’s top power source during the first half of this year, providing about 40% of total energy demand.
Even more amazing, wind turbines produced 982,842 megawatts per hour of electricity in October, enough to service more than 3 million homes in the UK, or 126% of Scotland’s entire residential demand.
The country’s former first minister, Alex Salmond, claimed that renewables could provide 100% of Scotland’s energy by 2025.
According to the Renewables 2014 Global Status Report, 22.1% of the world’s electricity was generated from renewable sources last year.
China, believe it or not, with its publicised air pollution problem, is leading the world in renewable energy investment, spending US$56.3 billion (1.9 trillion baht) on wind, solar and other renewable projects last year, more than all of Europe.
While slow to catch up with the renewables bandwagon, the US at least ranks second after China for annual investment in renewable energy. However, its share of energy from renewables is only 13%, lower than the world average of 22.1%.
In OECD countries, 80% of new electricity generation between now and 2020 is expected to be renewable.
Like Scotland, Spain produced 42% of its power from renewables in the first half of last year, while wind produced 41% of total electricity consumption in Denmark.
One of the reasons for the rise of renewable energy is cost. According to the International Renewable Energy Agency, the price of onshore wind electricity has fallen 18% since 2009, with turbine costs falling nearly 30% since 2008. In some places, the cost of onshore wind power is on par with, or lower than, electricity from fossil fuels.
For solar power, the speed of decline in costs has been even more dramatic. Solar photovoltaic prices have fallen by 80% since 2008 and are expected to keep dropping.
As for Thailand, renewable energy is fast becoming a darling for energy investors with an eye on the next big thing in business.
The power company EGCO, in partnership with two foreign companies, has installed 545,000 solar panels on a 1,200-rai plot of land in Lop Buri with an initial capacity of 73MW, later increased to 84MW, making it the largest solar farm in Asean.
Thai Solar Energy, a new venture from the Maleenont family, is reported to have invested 14 billion baht in 15 solar farms with a combined capacity of 135MW.
Other companies have also invested heavily, including Bangchak Petroleum, Mitr Phol, Loxley and Solar Power, to name a few.
By all accounts, Thailand has emerged as the solar power leader of Southeast Asia. At the end of 2013, it had an installed capacity of 823.5MW. Under the 10-year Alternative Energy Development Plan, it is seeking to increase capacity by more than 260% to a whopping 3,000MW by 2022.
While this is an encouraging trend for renewable energy in Thailand, there remains much room for improvement.
When the country decided to promote renewable energy in a substantial way in 2006, it chose to entice businesses with a huge subsidy programme. For solar power, the government offered 6.5-8 baht for each kilowatt per hour. This is called an adder, which means the subsidy is added to the cost of producing a unit of electricity.
With the cost of solar technology dropping by the day, businesses saw huge profits to be made from the subsidy programme and jumped in to invest in large solar farms.
There is nothing wrong with businesses taking advantage of an opportunity to make profit. However, what we’ve got as a result is another centralised energy system in the form of huge solar farms taking up large swaths of precious land.
One of the advantages of solar power is that installation is relatively simple, making it ideal for a decentralised, distributed energy system, so that power-users need not necessarily rely on a monopolistic system.
While the government has initiated a programme to promote rooftop solar power for households and small systems for communities, there are hurdles that make this difficult to turn into a reality.
One of the hurdles is official regulations, particularly the limited time-frame for applications. But a bigger hurdle is the high initial installation cost. Even if the subsidy is generous, it takes several years to recover investment cost. Not many people, particularly in remote areas, can afford that.
Now that energy reform will be discussed at the national level, it would be wise to focus attention on a means to make the system beneficial to as much of the public as possible.
A priority should be given to decentralising the power system, and to making it possible for households and communities to enjoy the capacity to produce power for their own use or for re-sale to the national grid.
Wasant Techawongtham is former News Editor, Bangkok Post.