The decision to increase the tariff by 13% instead of 20.5% was announced by the ERC on Friday (Jan 6), reports Bangkok Post. The new prices will not apply to households but will affect all other electricity users, namely businesses ranging from industrial estates to hotels and grocery stores.
The decision to raise tariffs for businesses by 13% follows a change in the ERC’s estimate of natural gas prices and the corresponding fuel tariff (Ft), the main driver of growing power bills.
As per ERC’s publication posted on Facebook on Dec 29, the price estimate for the natural gas was set at B466 per metric million British thermal units (MMBTU), down to B493. Diesel price estimate was decreased to B28.22 per litre, down from B31.90. Also factored in was the estimated foreign-exchange rate, which was reduced from B37 per US dollar to B35.68.
As the result, the Ft rate for businesses went down to B1.5492 per unit, from the previous estimate of B1.9044. The Ft rate for households was set at B0.9343.
This figures were confirmed yesterday (Jan 6) by the Thalang office of the Phuket Provincial Electricity Authority (Phuket PEA) on its Facebook page.
The new tariffs, as said above, are B4.72 per unit for households and B5.33 for other consumers effective from Jan 1 to Apr 30, as stated in the ERC notices posted on Dec 29.
As explained by Bangkok Post, higher power tariffs are being driven by a higher fuel tariff (Ft), which is reviewed every four months. Natural gas makes up 60-65% of the fuel used for electricity generation in Thailand, far more than other sources including coal and renewable energy.
The country has been importing more costly liquefied natural gas (LNG) following a decline in supplies of cheaper natural gas from the Gulf of Thailand.
The prices in the international market are currently high due to "limited production controlled by oil-producing countries and the Russia-Ukraine war which led to a tight supply of energy and finally high domestic prices of fuel, electricity and and liquefied petroleum gas," according to the Ministry of Commerce.
Proposed measures to keep a lid on power tariffs include using cheaper fuels like coal to produce electricity. The country may delay the decommissioning of its lignite-fired power plants, according to the ERC.
Deputy Prime Minister and Energy Minister Supattanapong Punmeechaow said authorities will try to better manage the fuels used by power plants for electricity generation. Cheaper fuels will receive the first priority for usage, he said.
The Ministry of Natural Resources and Environment and other relevant agencies are yet to comment on this policy shift announced less than two month after the endorseent of the the Bangkok Goals on Bio-Circular-Green (BCG) Economy at the Asia Pacific Economic Cooperation Summit in Bangkok.