Thailand invests in rooftop solar to protect against LNG price shocks

Akanat PROMPHAN, Thailand's Energy Minister, said that the country will assist 1 million households in installing 5 gigawatts of rooftop solar panels by year-end to protect citizens from soaring energy prices caused by the Iran War.

This move is financed through a 200 billion Baht ($6.01billion) emergency energy transition fund. It's the third major Asian importer of liquefied gas to use rooftop solar as a hedge against rising prices after the Philippines, and Bangladesh.

Government data from the six months to June shows that renewables, including solar, account for about 10% of Thailand’s electricity generation. Gas, on the other hand, accounts for over 60%.

According to the energy?think tank IEEFA, over a quarter is imported for electricity production. Kpler data show that Thailand purchases half of its LNG on spot markets, which makes it vulnerable to shocks like the surge in LNG prices following the U.S.-Israeli war against Iran six months ago.

Akanat said, "It's about energy transition (using emergency funds) because otherwise we will be forever subjected to the Middle East's turmoil."

GOVERNMENT INCENTIVES TO AMBITIOUS SOLAR TAGORES

Akanat stated that the 5 GW goal will be part of Thailand's long term power development plan. This is a roadmap to electricity generation in Thailand for the next 25-years. It will be published next month.

TransitionZero, an energy modelling firm, estimates that Thailand's small scale solar capacity will double if the target is met. Residential rooftop solar represents 1.4 GW of that capacity.

Thailand was Southeast Asia’s largest solar user until 2018. However, installations slowed after incentives faded. Vietnam then overtook Thailand late last decade.

Ekniti Nitithanprapas, the Finance Minister, said last month that the government will provide a financial assistance of 50,000 Baht ($1,500), along with loans to install rooftop solar panels.

Akanat stated that the government was also looking for new domestic gas sources in offshore fields, and new long-term LNG purchase agreements to diversify their import mix.

He said that PTTEP (the exploration and production arm of state-owned energy giant PTT) has allocated a budget to explore new gas fields on the Andaman sea and in Myanmar.

(source: Reuters)