The new power tariff of 3.99 baht per kilowatt-hour (unit), which reduces electricity bills for the last four months of this year, has taken effect, following approval from the Energy Regulatory Commission (ERC), which was instructed to enact the government's energy price policies.
The approval allows the new calculation of power bills for households and businesses from September to December.
The cabinet initially agreed to cut the power tariff from 4.45 baht to 4.10 baht a unit during its first meeting on Sept 13, then resolved to cut the rate further to 3.99 baht a unit at the Sept 18 meeting.
The 3.99-baht rate was suggested by Energy Minister Pirapan Salirathavibhaga following talks with the ERC, said government spokesman Chai Watcharong.
The reduction also adjusts the fuel tariff (Ft), a key component of the power tariff, by decreasing it from 0.66 baht per unit to 0.2048 baht per unit, said Khomgrich Tantravanich, secretary-general of the ERC.
Ft originally stood for float time, a fuel adjustment charge at a given time. Ft is determined by various factors, including fuel prices, electricity purchases and other expenses under the government's policy.
State-run Electricity Generating Authority of Thailand (Egat) buys electricity from local power companies and imports some from Laos to ensure adequate power supply in Thailand.
Mr Khomgrich did not provide details regarding the deduction of money from the new power tariff to reimburse Egat.
Part of the power tariff is required to be paid to Egat to help it settle its huge loss after it subsidised electricity bills between September 2021 and May 2023, easing the impact of higher fuel prices for households and businesses.
Egat's loss was projected earlier to decrease to 135 billion baht at the end of August.
Under a tariff rate of 4.45 baht per unit, the authority was forecast to clear its loss by April 2025.
The ERC met with Egat and PTT Plc on Sept 20 and discussed ways to finalise the energy price reduction policy.
Egat was instructed to come up with a plan to adjust its debt management, while PTT was told to decrease its gas sales price to 304.79 baht per million British thermal units (BTU) or less, down from 323.37 baht per million BTU, according to the ERC.
Gas makes up around 60% of the fuel used for power generation in Thailand.