Pioneering renewable energy options: Thailand takes up the challenge

Case Summary: 

The Thai people and government have long been supportive of renewable energy and have been some of the earliest adopters of renewable technologies in Asia. Thailand currently imports about 50% of its bulk energy, often in the form of fossil fuels. Thailand is devoted to more sustainable and independent energy production and since 1992 has enacted programs to encourage renewable energies. Thailand’s current goal is to reach 20% renewables for electricity production by 2022. This could save $19 billion in energy imports annually, encourage $15 billion in private investment, avoid 76 million tons of CO2 released, create an estimated 40,000 jobs, and encourage economic development in rural regions.

The Thai government has used a variety of policy tools to increase renewable energy generation. In 1992 incentives began for small power providers (under 60 MW and later expanded to under 90 MW) that gave incentives to combined heat and power generators usually fulfilled with biofuels such as rice husks. Programs grew to include very small power producers (VSPP) with outputs under 10 MW, power purchase agreements, and feed-in-tariffs referred to by the Thai government as “adders” that required the purchase of renewably generated electricity at avoided-cost rates by utilities.

There are many challenges that have been overcome in the expansion of renewable energy in Thailand. Many challenges still remain as have been identified by the Thai government. But several aspects of Thai policy were deemed necessary for success in the past and future which include:

  • Starting small. By initially limiting the program size it was more manageable for the government, was filled by private producers, and grid integration was more easily handled by utilities reducing their resistance.
  • Aligning multiple political coalitions. While having a positive environmental impact, Thai energy policy also maintained reasonable costs to electricity ratepayers and built energy independence. This helped to unite public opinion in favor of the renewable policies.
  • Building tangible benefits for groups of recipients. Special interest was payed to rural populations ensuring they received the maximum benefits from self-generation, especially in economically down-turned rural regions.

Thailand’s progress can be seen in its adoption rates. By 2013 it had developed 2.2 GW of renewable generation capacity and in 2010 received 2 GW worth of application which is four-times larger than was expected (500 MW). Thailand remains committed to renewable energy while protecting customer’s electricity prices and ensuring a balanced renewable energy portfolio for a more sustainable Thailand energy sector.

East Asia and Pacific
Action Area 
Planning and Implementation Activity 
Developing Strategies and Plans, Analysis and Data Collection, Developing and Implementing Policies and Measures, Governance and Stakeholder Engagement, Financing Implementation, Long-Term Strategies
Climate and Development Knowledge Network (CDKN)
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