The National Energy Policy Council chaired by the prime minister wants PTT Group to contribute 6 billion baht from its gas separation revenue to help freeze electricity fees for small users from January to April next year, according to the energy minister.
Energy Minister Supattanapong Punmeechaow said that the NEPC resolved on Friday to ask PTT to spend 1.5 billion baht per month from January to April next year to cut the price of gas it supplies to the Electricity Generating Authority of Thailand. This would allow Egat to freeze its electricity charges for people who use no more than 500 units per month.
"The measure is aimed at freezing electricity fees for vulnerable groups of power users who consume no more than 500 units per month. Their electricity fees will be the same as the rates in the present period, between September and December 2022," Mr Supattanapong said.
The Electricity Regulatory Commission (ERC) would work out the implementation of the policy to freeze costs for small consumers.
The present charge is 3.70 baht per unit for up to 300 units per month and 4.72 baht per unit for those using more. The 4.72 baht rate is the country's highest ever and is caused by the rising price of natural gas used for electricity generation.
Mr Supattanapong said the government was using 7 billion baht from its central fund to subsidise electricity fees in the September-December period. The fund would also contribute alongside the proposed PTT contribution to freeze charges from January to April, he said.
"This measure is necessary to provide short-term assistance for the people," Mr Supattanapong said.
Prime Minister Prayut Chan-o-cha said the energy price crisis was likely to continue for a long time and the government needed to take appropriate action.
Amid the prolonged conflict between Russia and Ukraine, the price of liquefied natural gas (LNG) rose from US$10 per metric million British thermal units (MMBTU) in early 2021 to $30/MMBTU last month.
The government expected the LNG price to range between $25-33 per MMBTU from 2023 to 2024. The country must import a large amount of expensive LNG for power generation because natural gas production in the Gulf of Thailand is declining. This was forcing up the cost.
Gas fuels more than 50% of local power generation. The ERC earlier predicted electricity costs would rise by about 14% to a minimum 5.37 baht per unit between January and April next year if there was no subsidy. Egat is also partially subsidising the cost on the government's instructions and consequently is 126 billion baht in deficit.