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Thailand Energy Security on Demand Side: Energy Conservation and Renewable Energy Promotion by Mr. Viraphol Jirapraditkul Deputy Director-General Energy Policy and Planning Office (EPPO) Ministry of Energy 8 June 2004 Siam City Hotel, Bangkok. Primary Energy Consumption

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Thailand energy security on demand side energy conservation and renewable energy promotion by

Thailand Energy Security on Demand Side:

Energy Conservation and Renewable Energy Promotion

by

Mr. Viraphol Jirapraditkul

Deputy Director-General

Energy Policy and Planning Office (EPPO)

Ministry of Energy

8 June 2004

Siam City Hotel, Bangkok


Thailand energy security on demand side energy conservation and renewable energy promotion by

Primary Energy Consumption

by Energy Source

Hydro & Others

5%

Lignite & Coal

3%

Natural Gas

2%

Renewable

8%

11%

2%

27%

10%

15%

Oil

15%

25%

45%

48%

2


Final energy use by sector

Final Energy Use by Sector

6%

Residence and Commercial

2%

9%

Transportation

38%

26%

36%

Industrial

35%

36%

29%

Year

3


Fuel consumption for electricity generation

Fuel Consumption for Electricity Generation

unit: million

5%

5%

5%

15%

13%

7%

6%

16%

15%

14%

6%

16%

13%

10%

5%

6%

7%

7%

6%

8%

10%

8%

8%

9%

7%

10%

6%

7%

10%

6%

11%

7%

11%

9%

12%

13%

14%

13%

15%

8%

69%

66%

60%

75%

73%

70%

63%

77%

77%

72%

70%

67%

6%

74%

4


Energy use versus gdp by country

log(Energy Use)

3.5

USA

3.0

China

Russia

Japan

Canada

Germany

2.5

India

France

Mexico

Italy

United Kingdom

Thailand 2001

Thailand 2000

2.0

Australia

South Korea

Thailand 1999

Malaysia

China Teipei

Indonesia

Philipine

1.5

Singapore

Vietnam

Newzealand

Chili

Hongkong

1.0

Peru

0.5

Brunei

0.0

log(GDP)

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

Energy Use versus GDP by Country

5

5


Thailand energy security on demand side energy conservation and renewable energy promotion by

Renewable Energy Sources in Thailand

Biomass 7,000 MW

TE 16.5%

Solar >5,000 MW

2002

NRE 0.5%

Commercial Energy 83%

TE = Traditional Energy

NRE = New & Renewable Energy

Wind 1,600 MW

Small Hydro 700 MW

High Potential

Low Development

6


Strategic plan for energy conservation during 2004 2011

Strategic Plan for Energy Conservation during 2004-2011

  • Energy Efficiency

  • New and Renewable Energy Technology Development

To reduce the ratio of energy consumption growth rate to GDP growth, or energy elasticity, from 1.4:1to 1:1 within five years’period, that is, by 2007.

Focus on promotion of :

7


Thailand energy security on demand side energy conservation and renewable energy promotion by

Strategic Plan for Energy Efficiency

Emphasis is placed on 2 major energy-intensive sectors :

  • Transportation Sector

  • Industrial Sector

8


Situation in 2002 and target in 2011

Strategic Plan Promoting New & Renewable Energy Technology Development

Situation in 2002 and Target in 2011

  • 1,060 ktoe from power producers using renewable energy;

  • 3,910 ktoe from traditional biomass, agricultural waste and industrial waste;

  • 1,570 ktoe from the increase of ethanol blending with gasoline and substitution of the use of diesel oil by biodiesel

2002

52,939 ktoe

2011

81,753 ktoe

TE 11%

TE 16.5%

NRE 0.5%

NRE 8%

Commercial Energy 83%

Commercial Energy 81%

TE = Traditional Energy

NRE = New & Renewable Energy

accounts for 6,540 ktoe

9


Thailand energy security on demand side energy conservation and renewable energy promotion by

Energy Conservation Promotion Fund(ENCON Fund) - The Government Tool

  • Established in 1995

  • Unique resource for supporting RE and ENCON projects in Thailand

  • Revenue - from the premium rates imposed on petroleum products at 0.04 Baht/litre.

  • Currently, ~ Baht 13,000 million (US$ 300 million) in the ENCON Fund

  • Annual revenue is ~ Baht 1,000 million (US$ 23 million).

10


Thailand energy security on demand side energy conservation and renewable energy promotion by

  • The ENCON Fund supports projects on:

  • improvement of energy efficiency;

  • demonstration and dissemination of RE technologies;

  • R&D

  • enhancing a market of RE technology equipment;

  • training and public relations.

11


Factor s of success and barriers

Factors of Success and Barriers

  • Cost Competitiveness

  • Viable Market/Economy of Scale

  • National Renewable Energy Strategy

  • Supportive Infrastructure and Measures

12


Thailand energy security on demand side energy conservation and renewable energy promotion by

Investment for the Future

Development

Renewable Energy

  • Energy Security

  • Environment

  • Knowledge-based

  • New Business

  • Opportunities

Conventional Energy

Time

New Energy Development

and Business Challenges

New Policies and Measures

13


Thailand energy security on demand side energy conservation and renewable energy promotion by

Policy Initiatives

To increase the share of renewable energy to 8% by 2011

Market Driven

R&D Supports on high potential

renewable energy

RPS and Specific programs

  • Innovation and Demonstration

  • Technology Transfer

New Regulations and Policy

Fiscal and Financial Incentives to encourage private sector participation and partnership of the local communities in renewable energy business

14


Thailand energy security on demand side energy conservation and renewable energy promotion by

Energy Conservation Policy Implementation

- Achievement

-Unjustifiable Outcome

15


Thailand energy security on demand side energy conservation and renewable energy promotion by

Achievement

Energy Conservation in the Tobacco Curing Industry

Subsidy Mechanism

(for replacement of major equipment using energy-efficient technology)

16


Thailand energy security on demand side energy conservation and renewable energy promotion by

Old Style Tobacco Curing

  • Pollution (SO2, Co2,. etc.,)

  • consume fuel (coal)

  • bad quality product (mix- colored dry tobacco)

17


Thailand energy security on demand side energy conservation and renewable energy promotion by

Energy Efficient Tobacco Curing

Subsidy 40% (10,000 US$/System)

  • Saving fuel 60-70%

  • easy operation and maintenance

  • good quality product (smooth color of dry tobacco)

  • Saving lignite 55,554 ton/yr. and reduce SO2 2,200 ton/yr.

18


Thailand energy security on demand side energy conservation and renewable energy promotion by

Unjustifiable outcome

Implementation of Energy Conservation Measures in Designated Facilities

19


Thailand energy security on demand side energy conservation and renewable energy promotion by

Designated Facility

A “designated facility” is a factory or building with energy consumption greater than 1 MW or those authorized to install one or more transformers with a total capacity of 1,175 kilovolt-ampere (kVA).

20


Thailand energy security on demand side energy conservation and renewable energy promotion by

Facility Owners’ Duties Stipulated by Law

  • 1) Assign staff to take full responsibility concerning energy programs.

  • 2) Submit information on energy production, consumption and conservation to the Department of Alternative Energy Development and Efficiency (DEDE).

  • 3) Keep records of all information on energy of machinery or equipment that affects energy consumption and conservation.

  • 4) Set energy conservation targets and plans.

  • 5) Conserve energy, audit and analyze the energy consumption.

21


Thailand energy security on demand side energy conservation and renewable energy promotion by

Problems

  • The appointments of the facilities’ energy managers were delayed.

  • Lack of capable resources of DEDE and problem on “Registered Consultant” (RC).

  • The delivery of required data was delayed

  • The economic downturn, leading to short of investment capital in energy conservation.

  • Financial assistance not attractive enough

22


Thailand energy security on demand side energy conservation and renewable energy promotion by

Way Forwards

  • Impose surcharges stipulated by law

  • Tax incentives are being devised

  • Promotion of the Energy Service Company, or ESCO.

23


Thailand energy security on demand side energy conservation and renewable energy promotion by

Renewable Energy Policy Implementation

  • - Achievement

  • -Unjustifiable Outcome

24


Thailand energy security on demand side energy conservation and renewable energy promotion by

Achievement

Promotion of Small Power Producers Using Renewable Energy

Subsidy Mechanism

(to stimulate participation of potential investors)

25


Subsidized spp program

Subsidized SPP Program

  • Objective

    To create incentives for more investors to participate in renewable energy-fueled power generation and distribution

26


Renewable energy sources

Solar

Wind

Water (hydro)

Waste

Biogas

Agricultural Waste

rice-husk, bagasse, tapioca rhizome, woodchip

Waste from Agricultural Industrial Process

Renewable Energy Sources

27


Support process

Support Process

  • Total funding budget: 3,060 Mbt.(US$ 76.5 million)

  • Subsidy will be in the form of an addition to EGAT’s power purchasing rates from SPPs using renewable energy

  • Invite investors to propose required subsidy rates via bidding process (maximum cost .01 US$/kW-hr.)

  • Funding period: 5 years.

  • Target 300 MW.

28


Thailand energy security on demand side energy conservation and renewable energy promotion by

Summary of the Subsidized SPP Program Outcome

(as of May 2004)

No. of ProjectsMW

SPPs approved for subsidy20243.3

SPPs pending final approval for subsidy 120.0

Total Potential Supply to the Grid21263.3

SPPs withdrawn from the Program10228

Grand Total31491.3

29


Thailand energy security on demand side energy conservation and renewable energy promotion by

Unjustifiable Outcome

Solar Water Heaters for Households

Subsidy Mechanism

(to support the investment cost)

30


Thailand energy security on demand side energy conservation and renewable energy promotion by

Solar Water Heaters for Households

  • Size 2 sq. m.

  • Cost 25,000 Baht/System (625 US$/System)

  • Govt. support (32%) 200 US$/System

31


Thailand energy security on demand side energy conservation and renewable energy promotion by

Problems

  • Lack of continuity of project monitoring & expansion

  • Cost very high (10 times compare with electric heaters)

  • System maintenance services are limited

  • No further R&D to make it competitive in the market

32


Thailand energy security on demand side energy conservation and renewable energy promotion by

Way Forwards

  • Re-orient funding method towards creating sustainable markets

  • Intensify R&D to reduce production costs

33


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