Whether Thailand's electricity prices rise or fall after April 2025 needs to be closely watched, following the state decision to trim the power tariff to 4.15 baht per kilowatt-hour (unit), down from 4.18 baht per unit in 2024.
The new power tariff, which is used to calculate power bills, is applicable from January to April 2025.
Energy Minister Pirapan Salirathavibhaga said he was informed of the slight cut after talks between the Energy Regulatory Commission (ERC) and state agencies.
The ERC announced in December 2024 that it would ask businesses and households in an online survey to decide whether they want the power tariff to remain unchanged at 4.18 baht per unit or increase during the first four months of 2025.
The commission eventually decided to put a cap on the 4.15-baht rate, reasoning that authorities agreed with a proposal to reduce people's financial burden.
According to the ERC, key factors that determine electricity prices include gas prices as well as a need to allocate part of power bills to reimburse the Electricity Generating Authority of Thailand (Egat) and PTT Plc, the national oil and gas conglomerate.
Egat needs money to keep its financial status healthy after posting huge losses from past electricity price subsidy schemes.
Another portion of electricity bills is to be given to Egat and PTT for their sales of natural gas at below-market prices to help cap power costs.
Gas, from domestic sources and liquefied natural gas (LNG) imports, makes up 60% of the fuels used to generate power in Thailand.
The limited domestic gas supply has led Thailand to import LNG, but because of the fluctuation of global gas prices the country may need to buy expensive LNG, which will increase electricity generation costs.
Though LNG prices in the spot market may fall in certain periods, this does not mean the power tariff will decline because the ERC is still required to pay back money to Egat and PTT.