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Thailand’s Renewable Energy Policy & Investment Opportunity. Prasert Sinsukprasert Ministry of Energy Thailand. 19, March 2013 . Content. 1. 2. 3. 1. Energy policy and Power Development Plan. Thailand’s Energy situation in 2012. Total Energy Consumption in 2012 = 73,316 ktoe.
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Thailand’s Renewable Energy Policy & Investment Opportunity PrasertSinsukprasert Ministry of Energy Thailand 19, March 2013
Content 1. 2. 3.
1. Energy policy and Power Development Plan
Thailand’s Energy situation in 2012 Total Energy Consumption in 2012 = 73,316 ktoe Total Energy Use 2.0 million barrels (oil equivalent) per day = 2.1 trillion baht Energy import value in 2012 = 1.12 trillion baht
Thailand’s Energy Situation in 2012 Thailand’s Energy Supply by source Total Energy Use 1.98 million barrels (oil equivalent) per day NG Hydro Coal Source : Energy Policy and Planning Office
Thailand’s Energy Situation in 2012 Proportion of Import and Domestic Production Import Value (billion baht) Total Energy Import Value of 1,125 billion baht Import 85% of oil consumption Import 56% of overall energy demand
1. Thailand’s Energy Situation in 2012 Thai Energy Challenges • Increased and fluctuated world oil price • Limited petroleum reserved needs to import 85 % of supply • 70% of electricity supply depends on Natural Gas • Lacking of public agreement on Energy projects • affects long term energy security
Renewable energy Plan & Policy 11th National Economic and Social Development Plan Sustainable Management of Natural Resources & Environment Balance of Food and Energy Security • Develop Natural Resource to Strengthen Agricultural Base • Enhance Agricultural Productivity & Value creation • Enhance Food & Bio-energy security & Biomass -- at Household & community Level • Develop Bio-Energy Security • Improve Agricultural Management to Food & Energy Balance • Shifting Development paradigm towards • Low-Carbon Society
Renewable energy Plan & Policy Thailand’s Energy Policies • Enhance Energy-related Industries • & Business to be next generation value creator • Secure Thailand Energy supply • Fair Energy Pricing • Target Energy Intensity reduction by 25% within 20 years (based on 2010 level) • Up-scaling RE mix to 25% in 10 years Prime Minister YingluckShinawatra
Renewable energy potential • Natural • Solar • Hydro • Wind RE Potential wind Solar • Crop • Sugar cane (Molasses) • Cassava • Palm Biomass & biogas Ethanol & biodiesel • Waste • Agricultural • Industrial • Municipal solid • waste (MSW) Khong river = 10,000 MW Salween river = 15,000 MW *Total realisable potentials for RE in ASEAN-6 countries , by technology to 2030 ; IEA 2010
Alternative Energy Development Plan (AEDP) Committed to the development of low-carbon society Government Funding On R & D & D Activities Private-Led Investment 10 years Alternative Eergy-Development Plan (AEDP-Master Plan 2012-2021) Target 25 % of RE in Total Energy Consumption By 2021 Current RE Share of 9.9% (March 2013)
Trend and Opportunities 10 yrs AEDP Target Proposed Capacity Over-Subscribed Solar 2,000 MW 3,194.899 MW 160% Approved and Waiting for PPA Under consideration Signed PPA Already sell to the grid Potential Area 875.97 MW 4.22 MW 1,232.974 MW 336.451MW Within 4 yr. Solar community 400 MW In the Future Solar Rooftop+ comminity 1,000 MW within10 yr • Promote Small system project at household level ex. solar PV rooftop , • Feed-in Tariff system (FIT) - is not yet approved by the NEPC. • PV Recycle & Building code supporting 13
Trend and Opportunities Wind 10 yrs AEDP Target Present Generating Capacity 1,200 MW 111.73 MW SW Wind 4 months/yr • Trend & Opportunities • Promoting community collaboration • Database management ex. Micro-scale • wind map • Request on Land Utilization by regulations of Ministry of Natural Resource & Environment • Asking for exempt of 1-B area for Private sector project NE Wind 8 months/yr 14
Trend and Opportunities 10 yrs AEDP Target Hydro Power Present Generating Capacity 1,608 MW 101.75 MW Generate hydro power at Village level Very small power plant 48 projects 1,807 KW Non-electrified household (Off-Grid) Solving barriers in sensitive / conserved area (1-B) Support construction at community level • Small hydro power plant • 22 projects 43.3 MW • Local Admin Organization/people collaboration project owner DEDE & EGAT develop small hydro power system of downstream irrigation dam
Trend and Opportunities AEDP Target Current Capacity Bioenergy 1,959.95 MW 3,630 MW Biomass • Promote “Distributed Green Generation” • Promote Planting Fast Growing Trees • Extending transmission & distribution lines AEDP Target Current Capacity 193.40 MW 600 MW Biogas • Promote biogas production in household level • Promote “CBG” Compress Bio-Methane Gas • Biogas Safety Campaign AEDP Target Current Capacity 42.72 MW 160 MW Municipal solid waste • Promote MSW in medium/small size Local Admin Organization • Speed up private sector for co-working or implementing government WTE projects • Promote “RDF” Refuse-Derived Fuel 16
Trend and Opportunities Biofuel status : Ethanol AEDP Target 2021 Current level 62.8% Market share …. And Counting Gasoline blended (Gasohol) • Interesting facts • Plenty of energy plants, cassava and sugarcane : for ethanol production system • Promote plan of action to increase the usage of ethanol in transportation sector • Amending the laws and regulations to support ethanol free trade in AEC 2015
Trend and Opportunities Ethanol Demand policies • Phase out ULG 91 (Jan.2013) • Promote E10 uses in Motorcycle E20 cars since 2008 ~1 million cars • Promote E20 awareness • E20 gas stations coverage • E20 price competitiveness E20 gas stations and counting 1,234 • Vehicles • Flex fuel vehicles (FFV) incentives • Evaluate FFV conversion kits • Evaluate E85 uses in motorcycles • Promote E85 awareness • Fuel access and price • E85 gas stations coverage • E85 price competitiveness There are 64 E85 gas stations There are 52,113 FFV cars Source : Department of Energy Business, Ministry of Energy
Trend and Opportunities Biodiesel AEDP Target 2021 Current level Current level Average B100 daily production • Interesting facts • Thailand is the only country that mandate biodiesel mixed in every liter of diesel sold, normally at 5% since 2012 • Registered capacity = 5.21 ML/day
“Adder” : Feed-in Premiums • Technology based premiums • More incentives for smaller projects Now EPPO is studying to adjust the Adder to be “Feed-in-Tariff system”
Tax Incentives by Board of Investment : BOI Import duty exemption 8-year income tax holidays Another 5 years (9th-13thyr) Provide capital cost grants Adder and soft loans A provision for a 50% tax reduction • Advantages for investors • Thailand leads strong policy support for RE comparing to other • countries in the region • Successful implementation of VSPP+SPP • Offered the highest financial and non-financial support to RE projects • Economy growth estimated to have grown at 5-6% per year • China has emerged as the fifth largest overseas investor in the ASEAN
Co-Investing Scheme : ESCO Fund ESCO FUND • Co-Investing & • Investment Promotion Scheme Energy Conservation Promotion Fund ESCO Venture Capital Investors Equity Investment Equipment Leasing Investment Committee Carbon Market Technical Assistant Credit Guarantee Facility Fund Manager • 500 + 500 mil.B allocated from Gov’s ENCON FUND • 2 Fund Managers assigned & given 3 years window of investment • Equity Investment 10-50% equity holding, Max. 50 mill. B./project , Investment period 5-7 years • Equipment Leasing 100% of total cost with max. 10 mill. B. Maximum leasing period 5 years • As of now, 54 projects invested with total investment of 6.1 billion Bt.(510 mill. B. from ESCO Fund) • Total Energy saving of 1.06 billion B.
Technical Assistances Tech. Catalogues 1-Stop Service Maps Solar Map Wind Map
Thailand’s RE Private Power Producers SPP : Small power producer VSPP : Very small power producer • ≤10 MW sold to MEA or PEA • can be - renewable energy • - Cogeneration • Incentive in the past : Net metering (Fuel saving • , Renewable energy promotion , Adder) • Aims to promote local resource consumption/ waste to • energy • 10-90 MW sold to EGAT with any installed • capacity • can be - renewable energy • - Cogeneration • Connection point : any EGAT, MEA or PEA • system. • Needs Environmental Impact Assessment (EIA) Firm Non-firm • ≥ 5 years contract (20–25 yrs.) • can be - Combustible fuels form • - Residue Energy • Price structure = capacity payment + energy payment • + fuel saving + renewable promotion • + Adder • less than 5 years contract • can be - Combustible fuels form • - Residue Energy • - non-conventional energy • ex. Wind turbine , Solar , Mini hydro • Price structure = Wholesale Tariff @11-33 kV • + Ft + Adder
Electricity purchasing process Step 1 Preparing all documents and permission before starting the project (120-180 days) Feasibility study Licensing for Juristic person / Company limited Licensing for energy production and grid connection Power plant design Licensing for industry operation Signing contact with the authorities Granting of permission under land use and building control law Step 2 Constructing the power plant (60-90 days) To construct the power plant and install equipment Step 3 Checking the system (15 days) Licensing for regulated energy production Licensing for the energy industry operation License submission Step 4 Guarantee by the authorities and COD (60 days) System checking and quality control report by the authorities Commercial operation date (COD) Step 5 Starting the system and connecting to the grid (90 days) Max. total = 435 days Issuing receipt Payment by the authorities
AEDP targets and Current Situations Now 9.9% of RE in Total Energy Consumption
PDP2010 Rev#3 (2010-2030) Renewable energy power plants - power purchase from domestic (9,481) - power purchase from neighboring countries (5,099) Cogeneration Combined cycle power plants Thermal power plants - coal-fired power plant (4,400) - Nuclear power plant (2,000) - Gas turbine power plant (750) - Power purchase from neighboring countries (1,473) 14,580 6,476 25,451 8,623 Classification of added capacity during 2012-2030 of 55,130 MW Unit : MW PDP2010 Rev3 Comprising total capacity (Dec.2011) Total added capacity Deduction of the retired capacity Grand total capacity • 32,395 • 55,130 • 16,839 • 70,686
Power Generation by Plant Type เมกะวัตต์ PDP2010 :Rev#3 (2010-2030) Renewable Energy 29% 29% 29% 29% 29% 30% Cogeneration 29% 30% 29% 30% 30% 10% 28% 10% 27% 10% 25% 10% 10% 24% 11% 23% 11% 23% 12% 12% 13% 23% 13% 13% 21% 12% 13% 11% Combined cycle 10% 44% 10% 10% 44% 7% 42% 42% 43% 43% 41% 39% 39% 38% 37% 39% 41% 43% 46% 48% 44% 47% 49% Thermal 17% 18% 17% 18% 17% 18% 17% 19% 19% 19% 20% 19% 19% 19% 19% 18% 19% 24% 23% MW
Power Generation by Fuel Type 18% 18% 18% 18% 18% 18% 18% 18% 18% 18% 18% 16% 15% 14% 58% 14% 56% 14% 55% 57% 14% 59% 15% 60% 15% 60% 59% 59% 60% 59% 62% 61% 65% 66% 68% 67% 64% 63% 12% 13% 13% 12% 12% 12% 12% 11% 12% 12% 11% 11% 9% 10% 10% 7% 8% 9% 8% 9% 9% 9% 9% 9% 10% 5% 4% 5% 5% 9% 10% 10% 11% 9% 13% 11% 12% 9% 11% 12% 13% 12% 2% Million Unit PDP2010 :Rev#3 (2010-2030) RE Natural Gas Imported Coal Lignite Nuclear
Thailand Power Development Plan 2010-2030 (PDP2010 Rev#3) Major Assumptions • Load Forecast • - By Thailand Load Forecast formulated by Ministry of Energy • System Security • - Reserve Margin : 20% • Future electricity acquiring • - Fuel diversification to reduce dependence on natural gas • Electricity acquiring from Renewable Energy • - 10-year Alternative Energy Development Plan 2012-2021 • Electricity acquiring from nuclear power plant • - SCOD of the first unit project from 2020-2023 • Electricity acquiring from coal power plant • - development in appropriate proportion , focus on clean coal technology • Foreign power purchase • - 15% of total generating capacity • Efficient power generation by Cogeneration system • Target of CO2 Emission from power sector
Trend and Opportunities 1 MW AEDP Target New RE Geo-Thermal • Geo-thermal in Northern part of Thailand (Chiang Mai) 2 MW AEDP Target Tidal • Phuket island • Samui island • Promote Material Research • Researches on Vanadium Redox Flow & Lithium-ion Battery R & D 34