Fuel tariff to go up starting September

The fuel tariff, which is used to calculate electricity bills, may rise above an initial estimate of 0.40 baht per unit from September-December, according to the Energy Regulatory Commission (ERC).

Khomgrich Tantravanich, secretary-general of the ERC, said it is likely the fuel tariff (Ft) hike will occur in the last four months of the year due to the depreciation of baht and increased use of gas in the production of electricity.

The ERC said in March that the Ft would increase to 0.6483 baht per unit between September and December. The current rate from May to August is 0.2477 baht per unit and is adjusted every four months, based on foreign exchange rates, power consumption and fuel costs.

Mr Khomgrich said the cost of electricity generation has risen this year because natural gas accounts for 60% of the fuel used. Of this, 10% is imported liquefied natural gas (LNG) which has become more expensive.

However the ERC will have to wait for more data to determine the Ft rate for September and December, he said.

As a short-term measure to tackle high production costs, he said the ERC has increased output at the coal-fired Mae Moh 8 and Mae Moh 9-11 plants to 2025 to reduce dependence on imported LNG.

He said the ERC has also decided to buy additional electricity produced by biomass power operators with a combined capacity of 100MW.

According to Mr Khomgrich, the ERC has proposed a restructuring of electricity prices to address volatile fuel costs and this should allow a switch of fuels used in the production of electricity to those with lower costs.