Power tariffs are likely to stay in the range of 4.20 to 4.25 baht per kilowatt-hour until the end of this year, according to the Energy Regulatory Commission (ERC).
ERC secretary-general Khomgrich Tantravanich said on Tuesday that the range was based on the cost of fuels available for electricity generation, including domestic gas expected from the Erawan field in the Gulf of Thailand.
Gas accounts for 60% of the fuel used for electricity generation in the country. It comes from three main sources: domestic fields, imports from offshore Myanmar, and imported liquefied natural gas.
PTT Exploration and Production Plc (PTTEP), which now operates the Erawan block in the Gulf, increased production by 50% to 600 million cubic feet per day in September last year, and aims to raise it to 800 million in April this year.
Mr Khomgrich said he did not think the power tariff could be lower than 4 baht per unit because domestic fuel availability over the longer term would decline as Gulf fields near the end of their lifespan, which increases the need for more costly imported fuel.
The ERC earlier this month agreed to cap the power tariff at 4.18 baht per kilowatt-hour (unit) until the end of April. Those who use less than 300 units per month will pay 3.99 baht.
Tariffs are reviewed every four months, with the fuel tariff (FT) component of power bills adjusted based on prevailing fuel prices and currency exchange rates.
One other factor keeping power bills high by regional standards is long-term purchase contracts with generating companies that oblige the state-run Electricity Generating Authority of Thailand (Egat) to pay for power even if it is not used.
Consequently, the country for the past several years has had an electricity surplus of 35-40% of consumption, whereas 15-20% is considered an adequate reserve in most countries.
The ERC had earlier planned to raise the power tariff to 4.68 baht for the January-April period because of a projected increase in fuel costs and the need to repay Egat.
Egat shouldered huge losses after it subsidised electricity bills between September 2021 and May 2023 under a government programme to ease the impact of higher fuel prices on households and businesses.
The regulator subsequently found a way to bring down the rate by reducing the FT charge.
Egat has complained that the lower rate means it will face a liquidity problem, meaning it would take longer to pay down its debt.
The government has yet to outline how it intends to help Egat resolve its problems.