Commission banking on renewables
text size

Commission banking on renewables

'Last-ditch' bid to cut cost of power bills

Listen to this article
Play
Pause
Buying additional renewable power represents the ERC's latest attempt to help the government curb expensive power bills.
Buying additional renewable power represents the ERC's latest attempt to help the government curb expensive power bills.

A greater number of short-term purchases of renewable power will represent a "last-ditch effort" the Energy Regulatory Commission (ERC) can make to help the government reduce electricity bills to support its policy to curb the power tariff that remains as high as 4.15 baht per kilowatt-hour (unit).

Prices of renewables vary depending on the type, but on average renewable power is priced at 2.2 baht per unit, 0.4 baht cheaper than electricity from gas-fired power plants, which is sold at 2.6 baht a unit, said a source at the Energy Ministry who requested anonymity.

Fuel prices are part of the Ft, or a fuel adjustment charge at a given time, which is determined by various factors including certain expenses under government policies.

The power tariff comprises Ft and the base tariff, which indicates the costs of power plants and distribution systems.

The government aims to keep the power tariff below 4 baht a unit.

Thailand's power tariff is high because of a surge in gas prices. Gas accounts for 60% of fuels used for electricity generation.

"Additional purchases of renewable power are a measure the ERC can push ahead as the state energy regulator," the source said, adding that other options, such as the adjustment of the availability payment (AP) requires discussions with power firms while the proposal to adopt nuclear power technology for long-term electricity generation would require careful, thorough study.

AP commits the government to paying for electricity throughout the 25-year power purchase agreements (PPAs) made with power firms, though actual usage may be less during that time frame.

The ERC's push for additional purchases of renewable power came after the National Energy Policy Council resolved last month to have the government purchase more electricity from renewable power plants under non-firm PPAs between this year and the end of 2026 in order to deal with the decrease in domestic gas supply and liquefied natural gas (LNG) price fluctuations.

Non-firm PPAs refer to the buying of electricity generated by the sun, wind and biomass, which are intermittent sources of power because their production depends on weather conditions and seasons.

The ERC on Jan 17 posted an announcement offering to buy additional renewable power for a period of two years from companies with PPAs made with the state grid.

A survey found additional renewable power can come from 35 power operators -- 26 of them to supply 126 megawatts, derived from biomass, and the remaining nine operators to supply 2MW from biogas, 2MW from waste-to-energy projects, 0.5MW from wind energy and 0.4MW from solar energy.

More purchases of renewable power over a two-year period would help reduce LNG imports by 60,000 tonnes.

Do you like the content of this article?
COMMENT (2)