Liquefied natural gas (LNG) prices are likely to stay unchanged in early 2025, putting less pressure on the authorities preparing to calculate a new power tariff for electricity bills between January and April next year, says the Electricity Generating Authority of Thailand (Egat).
The Energy Regulatory Commission (ERC) has yet to announce when it will work on the new tariff rate, which is adjusted every four months. The current rate of 4.18 baht per kilowatt-hour is applicable until Dec 31, 2024.
"We estimate LNG prices in early 2025 should not be different from US$13-14 per million British thermal unit [BTU] in the LNG spot market at present," said Egat governor Thepparat Theppitak.
Egat is monitoring the price of LNG, which plays a key role in determining electricity prices.
Part of a power bill is required to be used to reimburse Egat, which is shouldering a huge financial burden after it spent several billion baht subsidising domestic electricity prices, especially during a period when there was a surge in LNG prices.
In 2022, LNG prices skyrocketed to $80 per million BTU, following the Russian invasion of Ukraine.
Egat has posted losses of 80 billion baht, with up to 70 billion baht of the total being money it owes creditors, said Mr Thepparat.
Poonpat Leesombatpiboon, secretary-general of the ERC, said earlier that LNG prices are likely to fall as seasonal global demand for the gas tends to decrease at the beginning of a year.
Gas, from domestic sources and LNG imports, makes up 60% of the fuels used to generate power in Thailand.
Mr Thepparat said greater use of renewable energy will enable Thailand to depend less on LNG, but wind and solar power cannot generate electricity around the clock. The sun and wind also tend to offer an intermittent supply of power, with volume determined by weather patterns.
Batteries can be used to store renewable power for later use, but this will drive up electricity costs, he said.
This led Egat to conduct a study on the use of small modular reactors (SMRs), a type of nuclear power technology, as the cost of power generation via SMRs is competitive and they don't emit carbon dioxide.