The call to action resonates through Thailand’s corridors of power as demands surge for the nation to lead the clean energy revolution across the region, igniting economic growth. Contact online >>
The call to action resonates through Thailand’s corridors of power as demands surge for the nation to lead the clean energy revolution across the region, igniting economic growth.
Burin Adulwattana, the managing director and chief economist at Kasikorn Research Centre (K-Research), underscores the urgency of this endeavour, stressing its pivotal role in ensuring competitive pricing for clean energy within Thailand.
Burin issues a stark warning: failure to address this issue could lead to future trade obstacles for Thai products, arising from their greenhouse gas emissions. He points to the recent implementation of the Carbon Border Adjustment Mechanism by the EU and the US’s Clean Competition measures as potential stumbling blocks for goods with high carbon footprints.
Highlighting the economic ramifications, Burin reveals that last year alone, these measures incurred an approximate loss of 18 billion baht, equivalent to 0.1% of GDP. Projections indicate this figure could skyrocket to 167 billion by 2026. If stringent measures are adopted universally by developed nations, Thailand may be staring at a staggering impact of up to 32% of GDP, said Burin.
“Decarbonisation, digitisation, and deglobalisation are the key global trends. Capitalising on these trends could yield neutral outcomes, but neglecting them could spell doom for the Thai economy.”
With generative artificial intelligence poised to drive demand for data centres, Thailand finds itself in a promising position, ranking third in Southeast Asia in terms of data centre size, trailing only behind Singapore and Malaysia. Forecasts suggest a substantial investment surge in Thai data centres, reaching up to US$7.8 billion (approximately 279 billion baht) between 2024 and 2027, dwarfing Malaysia’s anticipated investment of US$23.4 billion.
This surge in data centre investment is anticipated to inject approximately 540 billion baht, equivalent to 2.3% of GDP, into the Thai economy by 2027. Burin advocates for Thailand to seize the opportunity and champion clean energy, leveraging potential advantages over regional counterparts and accelerating development timelines.
Economic growth obstacles
However, Burin flags educational barriers and ageing demographics as persistent hurdles to Thailand’s long-term economic prosperity, necessitating sustained efforts for resolution. He underscores the critical role of energy costs in business operations, emphasising the ripple effect of transitioning to clean energy across various sectors.
“The Thai government’s inclination towards clean energy initiatives, such as green electricity development, is commendable.”
Thailand’s target of sourcing 30% of its electricity from renewable sources by 2030 aligns it with regional peers, albeit falling short of Vietnam’s more ambitious goal of 50%.
Despite the potential to meet domestic electricity demand sustainably, Thailand grapples with comparatively higher electricity prices vis-à-vis regional counterparts like Malaysia, Vietnam, and Indonesia. Nonetheless, the plummeting cost of solar energy, now 76% cheaper than a decade ago, positions it as a compelling alternative to fossil fuels.
The chief economist points out structural economic challenges that have plagued Thailand in recent years, exacerbating the need for a new growth engine. With Vietnam’s GDP poised to overtake Thailand’s within five years at the current growth trajectory, and with lacklustre investment performance over the past decade, urgent action is imperative.
The agricultural sector, employing nearly a third of Thailand’s workforce, faces productivity and income disparities compared to regional competitors like Vietnam. Additionally, Thailand’s education system trails behind regional peers, as evidenced by lower scores on international assessments like the Programme for International Student Assessment (PISA), reported Bangkok Post.
In light of K-Research’s downward revision of Thailand’s GDP growth forecast for this year to 2.8%, attributed to sluggish domestic demand, manufacturing sector contractions, and soaring household debt, the imperative for strategic economic revitalisation becomes ever more pressing.
Bangkok has taken a significant step towards becoming a smart city, with the signing of a memorandum of understanding (MOU) between Bangkok Governor Chadchart Sittipunt and Metropolitan Electricity Authority (MEA) Governor Wilas Chaloeysat.
The agreement, formalised yesterday, aims to advance smart city development and renewable energy projects in Thailand’s bustling capital.
Chadchart stressed the importance of sustainable energy and efficiency, particularly through the use of solar power systems. He pointed out the Bangkok Energy Action Plan, which is part of the broader Bangkok Master Plan on Climate Change 2021 to 2030. This plan aims to address climate change and enhance the city’s resilience through various clean energy initiatives.
The Bangkok Energy Action Plan includes the implementation of solar power systems, Wi-Fi-enabled smart light bulbs, and other Internet of Things (IoT) devices. These technologies are crucial for transforming Bangkok into a smart city that leverages modern advancements to improve urban living.
According to Wilas, the MEA is committed to supporting Bangkok’s smart city aspirations. The authority, known internationally for its expertise in electricity distribution technology, aims to leverage renewable energy systems to meet sustainable development goals. This initiative is also part of broader efforts to combat climate change and promote energy conservation, ultimately contributing to a low-carbon society, reported Pattaya News.
“The MEA is dedicated to supporting Bangkok''s smart city ambitions by leveraging renewable energy systems. We aim to meet sustainable development goals, combat climate change, and promote energy conservation for a low-carbon society.”
In related news, Bangkok City Hall is set to implement stringent measures aimed at regulating street vendors, targeting their income, enforcing tax compliance, and ultimately eliminating hawking on pavements. Governor Chadchart announced these measures following a meeting focused on enhancing the orderliness of the city''s surroundings.
Thailand''s revised power development plan (PDP) is set to be submitted for approval after a week-long public hearing concluded yesterday, the implementation of the plan by year’s end, will steer the country towards cleaner energy.
Central to Thailand’s commitment to reducing carbon dioxide emissions, the PDP is expected to provide a clearer path for the nation. Thailand announced its commitment to achieving carbon neutrality by 2050 at the 26th UN Climate Change Conference in Glasgow in 2021, demonstrating its commitment to balancing carbon dioxide emissions and absorption.
The new PDP, covering the period from 2024 to 2037, highlights increased renewable energy use, improved power supply management, and an initiative to adopt nuclear energy. This plan is part of the national energy plan, which includes the alternative energy development plan, energy efficiency plan, oil plan, and gas plan.
Businesses and households will be invited to share their views on the national energy plan before it is sent for approval this year to the National Energy Policy Council, chaired by Prime Minister Srettha Thavisin.
The revised PDP aims to increase the proportion of renewable energy to 51% by 2037, up from 20% last year. Gas will make up 41%, a slight decrease from 57% in 2023. Coal is projected to account for 7% by 2037, a substantial decrease from 20% last year, while nuclear energy and new solutions will contribute the remaining 1%.
Most of the additional renewable power is expected from solar energy, supplemented by wind, biomass, biogas, floating solar panels, waste-to-energy projects, mini-hydropower plants, geothermal power, and renewable electricity imported from neighbouring countries.
Director-General of the Energy Policy and Planning Office (EPPO) Veerapat Kiatfuengfoo stated that roughly 5% of gas fuel will be replaced by hydrogen, with this proportion set to increase to 20% between 2035 and 2037.
Thailand has yet to decide whether to use blue hydrogen, a natural gas-based with carbon capture and storage, or green hydrogen, produced using electricity generated from renewable energy to split water into oxygen and hydrogen.
Thailand’s total electricity supply is expected to reach 112,400 megawatts (MW) in 13 years, up from 53,868MW last year, mostly generated from fossil fuels. The PDP employs the loss of load expectation (LOLE) method to manage the power supply more effectively, estimating the number of hours electricity supply cannot meet actual demand annually.
Using more clean energy is beneficial but raises concerns about intermittent output from solar and wind power, which are weather-dependent. The LOLE method is suitable for higher use of renewable resources, as their power supply is monitored hourly, according to EPPO.
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