1

The Renewable Energy Development and Related Promotion and Pricing

Mechanism in Thailand

Peeraya Siriput and Patthamaporn Poonkasem

APEC Workshop on Renewable Energy Promotion and Pricing Mechanism26-27 September 2013

San Want Hotel Taipei, Taipei, Chinese Taipei

Department of Alternative Energy  Development and Efficiency (DEDE)

Ministry of Energy ,Thailand

2

Outline

Thailand Energy situation11

Alternative Energy Development Plan2012-2021

22

Supporting Mechanism for RE promotion33

Conclusions44

Import 34%

Import 69%

Import 19%

Import 85%

Domestic 66%

Domestic 31%

Domestic 81%

Domestic 15%

Consumption OilNatural

GasCoal/Lignite

Electricity

Total

Growth (%) 4.7 9.2 5.0 3.4 6.7

Final Energy Consumption in Thailand 2012

3Source : Ministry of Energy 2013

thousand barrel oil equivalent/day

Oil

Natural Gas

Coal/Lignite

Hydropower 3%

17%

44%

36%

Preliminary

2008 2009 2010 2011 2012p

2 million BOE/day

Import value in 2012p1.44 billion baht (18%of GDP)

2012

Crude oil 77%

Petroleum product

9%

NG+LNG10%

Coal3% Electricit

y1%

Thailand’s Energy Import Value

4Source : Ministry of Energy 2013/Exchange rate 32 THB/USD

P : Preliminary

Value of Energy Imported Million baht

2008 2009 2010 2011 2012p

Elec. Coal Natural gas+LNG Petroleum Crude oil

Growth rate of energy import

16.5%

Thailand’s Renewable Energy

DevelopmentTo substitute energy imported,

increase energy security, commit low carbon society

Government Funding On R & DActivities

Encouraging Private-Led Investment

Alternative Energy Development Plan (AEDP : 2012-2021)

Solar

3,000 MW*

100 ktoe (Heat)

Small + Mini

Hydro

324 MW*

Bio Energy

Biomass

Biogas MSW

4,800 MW

600 MW 400 MW

3,000 MW*(Napier grass)

8,500 ktoe

(Heat)

1,000 ktoe (Heat)

200 ktoe (Heat)

Target 25 % of RE in Total Energy Consumption By 2021

Biofuels&CBG

• Ethanol 9 Million l/d • Biodiesel 7.2 Million l/d*• Advance biofuel replace diesel 3 Million l/d*•Compress biogas replace NGV 1,200 ton/d*

Wind

1,800 MW*

Others

• Tidal wave 2 MW• Geothermal 1 MW

*Last revised July 2013

2.Heating Process : Total Existing 3,986 ktoe 3.Biofuel: 4.83 ML/day(1,067 ktoe)

Existing 46.6 MW

Existing 214.3 MW

Existing 239.6 MW

Existing 554.4 MW

Existing 2,185 MW

Existing 98.5 MW

BiomassBiomass

WindWind

Biogas Biogas

HydroHydroSolarSolar

MSWMSW

1.Electricity Generation :Total existing 3,338 MW (928 ktoe)

Existing 3,572 ktoeBiomassBiomassExisting 6.8

ktoeSolarSolar Existing 2.2 MLPD EthanolEthanol

BiodieselBiodiesel Existing 2.6 MLPD Existing 349.0

ktoe BiogasBiogas

MSWMSW Existing 58.0 ktoe

Updated by DEDE @ June 2013

- Solar farm power plant in Northeastern part of Thailand- Rural area

- Mini Hydro & Micro Hydro in rural area

- Wind farm in Southern &Northeastern part of Thailand

-livestock farm -Industrial waste water

- Sugarcane Industry, palm ,etc.- Biomass Power plant- Community power plant

- Municipal waste

- Hot water (hospital,hotel)

- Drying

- Industrial Waste water

(starch, food, beverage, palm, rubber, paper, Bio-fuel)

- Industrial: sugarcane, palm, paper)

- community (high-eff. stove)

- Molasses, Cassava

- Palm oil, Jatropha, used cooking oil

- Municipal waste

Current status of RE Development in Thailand

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7

Final Renewable Energy Consumption

Updated by DEDE @ June 2013

Power =1.67%

Heat =6.9%

Biofuel =2.0%

Alternative&Renewable Energy

10.6%Of final energy consumption

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5 Actual mechanism :Electricity Generating

PrivateInvestor

CDM

Electricity authorities

Consumers

Promotion requesting

• Renewable energy maps• Data from demonstration

site• One-Stop Service

Renewable energy potential info• Investment Grant, i.e. biogas, solar hot water, Solar dryer (i.e. 2012 25% for SHW, 55% for Solar dryer)

• “Energy Soft Loan”Revolving funds for Renewable energy and energy conservation, Energy credit• ESCO Venture Capital

Fund

• “Adder” : Feed-in Premiums Policy , Feed-in Tariff

DEDE

DEDE & EPPO

DEDE

EPPO

DEDE

1

2

3

4

5

Promotion requesting

Banks

To raise a loan

Capital requesting

Registration for intent expression as per the time specified

Adder/ FIT(pending)

Carbon credit sale

ONEPEIA

ERC Local Admin

Offices giving licenses

Negotiation for electricity selling & buying

- Firm- Non Firm

Licenses

Technical supportSupport

from the Ministry

of Energy

BOI-Investment Incentives

Supporting Measure for RE Promotion

Thailand’s solar Map

Average solar irradiance 18 MJ/m2-d (5 kWh/m2-day)

Maximum : 20-24 MJ/m2-dSolar map developed by DEDE using

satellite images and ground station measurement ( 38 Stations)

Solar map

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Potential Area

Updated September 2010

Wind resource map of Thailand at 40 and 90 meters above the

ground

23/03/56 www.Directionplan.org

Thailand’s wind Map

Wind is not strong and not continuousA particular area of the windy +

continuous

The Project Promotion for Solar Hot Water & Solar Drying

Solar Hot Water subsidy Program

Long term Ten years RE Energy Development

Plan(AEDP)

short term

Target / (Year) 2008 2009 2010 2011 2012total08-12 2013-

2022total12-22

Target

(solar collector area (sq.m/Year)

Plan 5,000 3,000 10,000 10,000 12,000 40,000 25,000 300,000

Result 3,973 2,911 10,000 9,87911,155 36,806 N/A N/A

Target for solar hot water promotion

Giving a financial support to entrepreneurs interested in

investment on installation of the integrated solar hot water system

Subsidy 30% (2008-2012)

Subsidy 25% ,22.5% ,20 %,18.5% (2013 - 2016)

Subsidy 15% (2017-2022)

small medium

Large (with Backup Power )

Size of Greenhouse Solar Dryer

Solar Drying Subsidy Program

Greenhouse Solar Dryer in Subsidy Program

Dried Banana Dried Herbs

SubsidyInvestment

Amount Areas (m2)

2011

2012

2013

2014 2015

2016

2017

2018

2019

2020

2021

Total

60% 2000 4000 4000(55%)

- - - - - - - - 10,000

50% - - - 5000 5000 5000 5000

5000 5000 5000 5000

40,000

Total 50,000

- CDM projects enables private sectors to gain financial benefit from carbon credit

Measures for RE promotion

- The investors will receive the exemption of imported duty of equipment or machines

- Any income-corporate taxes resulting form selling RE or saving energy will be exempted for a certain periods to maximum 8 years

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- MOEN enhances private

entrepreneurs to develop alternative

energy or

energy saving projects to be CDM

projects

Project feature: set up to joint capital promote investment in energy conservation and renewable energy development projects

Technical Assistance

Credit Guarantee Facility

Carbon Credit (CDM)

ESCO Venture Capital

Equipment Leasing

Equity Investment

Investor

Investor

Investor

InvestorInvesto

r

Investment

Committee

ESCO FundESCO Fund

Consider and approve

control

Fund ManagerFund Manager

return

Financial support

return

Result 1. Stimulate investment energy conservation & renewable energy development with total value > 2,500 million baht / year2. Provide energy conservation renewable energy development with total value > 500 million baht / year

Measures for RE promotionMechanism : ESCO Venture Capital Fund

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Measures for RE promotion“Adder” : Feed-in Premiums

Fuel

Adder(Baht/kWh)VSPP

SPP

Adder-VSPP(USD Cents

/kWh)**

Special adder *

(Baht/kWh)

Supporting period(Year)

Biomass - Installed capacity <= 1 MW - Installed capacity > 1 MW

0.50 0.30

Bidding

1.540.93

1.001.00

77

Biogas (all categories of production sources)

- Installed capacity <= 1 MW - Installed capacity > 1 MW

0.500.30

Bidding

1.540.93

1.001.00

77

Waste (community waste, not hazardous industrial waste, and inorganic waste)

- AD &b LFG - Thermal Process

2.503.50

2.503.50

7.7210.81

1.001.00

77

Wind power - Installed capacity <= 50 kW - Installed capacity > 50 kW

4.503.50 3.50

13.8910.81

1.501.50

1010

Mini and micro hydropower - capacity 50-200 kW - capacity < 50 kW

0.801.50

-No- 2.474.63

1.001.00

77

Solar power 8.00/6.50

8.00/6.50

24.70/19.5

1.50 10

* Note : Special Adders for - Facilities in 3 Southern Provinces - Diesel-Gen. replacement on PEA system ** 1 USD=32.375 Baht

Government halted applications for solar energy since June 2010

New measures to support solar energy

• Solar PV Rooftop 200 MW• Solar PV Community 800 MW

Target 1000 MW

16th Jul 2013, Thailand 's National Energy Policy Commission (NEPC) promote the installation of Solar PV Rooftop and

“Solar PV community projects

The Purposes - Reduce public Investment - Reduce Peak Load - Stabilize the energy

Solar PV Rooftop projects are divided into three groups

Promotion of Solar PV Rooftop

Feed in Tariff (FiT) for Solar PV Rooftop

* 1 USD=32.00 Baht

[*21.75 cent/unit] [*20.47 cent/unit] [*19.25 cent/unit]

Solar PV Rooftop Implementation

Energy Regulatory Commission (ERC) announces Regulation to purchase of power from Solar PV Rooftop in September 3rd, 2013

Submit the application through to the Metropolitan Electricity Authority (MEA), and the Provincial Electricity Authority (PEA).

From September 23 to October 11, 2013.

For more information, please contact ERC. (www.erc.or.th/www.mea.or.th/www.pea.co.th)

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Feed in Tariff (FiT) for Solar PV Communities• NEPC (16 July 2013) approved for Solar Communities with total

installed capacity 800 MWp - owned ground mounts.• Special Scheme with Feed in Tariff (FiT) 25 years• COD within Year 2014

FIT Rates for Solar PV Communities

[* 30.47 cent/unit]

[* 20.31 cent/unit]

[*14.06 cent/unit]

* 1 USD=32.00 Baht

Project IRR= 13.6% Payback period 6 years

Communities Solar PV Implementation

Energy Policy and Planning Office (EPPO) corporate National Village and Urban Community Fund Office be

responsible about Regulations for the purchase of power from Communities Solar PV.

Encourage community enterprise for energy crop

production Contract between community enterprise & Biogas

plants Biogas utilization in 3 categories : - Electricity generation - Compress Bio Gas (CBG) production for Transport - Replace LPG Secure income for farmers All stakeholders generate income from biogas

utilization Energy security in Thailand

Subsidy investment cost 20 % Budget 300 million baht Feed-in –Tariff 14 cent/kwh (for

power production) in 20 years

Principles

Targeted area- Drought area- Irrigated area- Low rice

production area

1. Agricultural sector - Encourage energy crop growing in appropriate areas

- Generate income for farmers 2. Industrial sector - Promote investment in energy industry

- Biogas to support power generation stability - Organic Fertilizer after biogas production process

Outcome

“Pilot project on green energy for community enterprise (biogas production from Napier grass) ”

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Promotion of Biogas from Napier grass

Conclusions

Renewable energy will not solve all…

But Renewable energy can reduce dependence on natural gas and other fossil fuels.

Help strengthen the energy. Help increase energy security of the country.

Scattered areas throughout the country (Distributed

Generation) by reducing transmission congestion. Fund available from Ministry of Energy Launch 10 years master Plan for Alternative Energy “AEDP 2012-2021” Launch mechanism support for promoting renewable energy

both information & Financial

Thank you for your kind

attention

www.dede.go.thDepartment of Alternative Energy Development

and Efficiency (DEDE) Ministry of Energy17 Rama 1 Road, Patumwan Bangkok Thailand

10330

谢谢。