A group of renewable energy producers in Thailand has reason to panic following Energy Minister Siri Jirapongphan's announcement last week that the government will not buy more renewable power over the next five years.

This policy will affect potential renewable energy developers. In Thailand, renewable power businesses are classified as either "small" or "very small" producers due to the size of their generated capacity -- between 10MW and 90MW each for the former or less than 10MW for the latter.

Since 2007, Thailand has used a form of subsidy to incentivise investment in solar power for which state utilities buy electricity from producers at a subsidy rate of 8.5 baht per kilowatt-hour. This is higher than the rate of 2.4 baht per kilowatt-hour that the state-run Electricity Generating Authority of Thailand (Egat) pays to conventional producers.