NGV subsidy to be shifted to ministry

NGV subsidy to be shifted to ministry

PTT will no longer take on burden

The Energy Ministry plans to shift the financial burden of the natural gas for vehicles (NGV) subsidy under the state welfare smartcard scheme, roughly 1.7-1.9 billion baht per year, from PTT Plc to the Finance Ministry.

Under the scheme, PTT has been ordered to subsidise three baht per kilogramme of NGV for public taxis drivers who register for the smartcard.

The smartcard allows taxi drivers to refill NGV at PTT gas stations, with 223 of the 434 NGV stations located in Bangkok and surrounding provinces.

As of yesterday, the retail price of NGV stood at 16.44 baht per kg.

This move was approved in May 2018 by the National Energy Policy Council chaired by the prime minister, with the expiry of PTT's subsidy from July 2019.

Kulit Sombatsiri, permanent energy secretary, said all relevant energy policymakers are studying the impact of shifting this financial burden.

"We have yet to make a final decision on whether the plan will be effective from July onward," said Mr Kulit.

Consumption of NGV started increasing in 2007 when global oil prices were high, at around US$140 per barrel.

The government also pegged the retail price at 8.5 baht per kg.

PTT was told to subsidise the marginal price with an accumulated loss of 100 billion baht before the NGV price was floated in 2015, coinciding with the global oil price collapse.

NGV consumption has declined since then because local motorists have shifted to petrol.

In a related development, PTT plans to allocate an area at its NGV stations to serve as a small marketplace for local farmers to sell their produce.

Items from the marketplace will also be available on an e-commerce site.

Roughly 1,000 farmers will participate in this campaign.

Chansin Treenuchagron, president and chief executive, said PTT's gas station in Ban Bueng district of Chon Buri will be the pilot location for this campaign.

"Our intention is to develop distribution channels for agricultural products at the NGV stations and promote a digital economy to improve the lives of farmers," said Mr Chansin.

Anan Suwannarat, permanent agriculture secretary, said this project is expected to accelerate the standard of living in agriculture communities.

The Agriculture and Cooperatives Ministry wants to speed up its smart agricultural policy, called the Phra Phirun Strategy, among farmers nationwide, he said.

"Buyers can be persuaded to choose quality and safe agricultural products at the marketplace, whether at filling stations or via e-commerce websites," said Mr Anan.

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