1. Thailand’s Energy Conservation Policy : Industry Programs
Prasert Sinsukprasert Ph D
Department of Alternative Energy Development and Efficiency
Tel
Fax

2. Thailand’s Energy Outlook
Thailand consumes energy about 1 mill barrels of oil per day
(0.75% of World energy consumption)
Hydro
Coal
Agriculture 6%
Transportation
37%
Industrial
36%
ประเทศไทยใช้พลังงานวันละ 1 ล้านกว่าๆ บาเรล/วัน
ส่วนใหญ่ใช้ในภาคขนส่ง และอุตสาหกรรม
และน้ำมัน นำเข้ายังเชื้อเพลิงหลัก โดยมีก๊าซธรรมชาติที่ผลิตได้ในประเทศเป็นส่วนเสริมถึงเกือบ 40%
Natural Gas
Oil
Res & Com 21%
Supply
Demand

3. Energy Intensity Thailand USA UK Japan Germany
(Compare with Developed Countries)
Thailand
USA UK
Germany
Japan

4. Energy Intensity
(Compare with Developing Countries)

5. Thailand’s Energy Situations
Energy is basic factor of economic development
In 2005, energy costs accounted to about 15% of GDP
Oil imports accounted to 12% of total import values
60% of commercial energy was imported or about 700 billion baht
Still rooms for energy efficiency improvement
Agriculture 6%
Resident & Commercial 21%
Industry 36%
Transport 37%

6. Energy Efficiency Improvement Target
Strategy
Indicators
Objective 1
Energy Efficiency Improvement
1. Improve EE in Transportation
Energy Elasticity
= 1:1 in 5 years
2. Improve EE in Industry 2
ประเทศไทยมีพลังงานใช้อย่างต่อเนื่อง เพียงพอต่อความต้องการไปอีก 50 ปี
3. Awareness raising campaign
Energy Elasticity = ∆t Energy Consumption/ ∆t GDP 3
ประชาชนมีพลังงานใช้อย่างทั่วถึง ในราคาที่เป็นธรรมและเพื่อคุณภาพชีวิตที่ดีขึ้น
Ave. Energy Elasticity
1.4 : 1.0
Ratio of energy growth rate to GDP growth rate = 1.0 by 2008 4
ประเทศไทยเป็นศูนย์กลางพลังงานในภูมิภาค

7. Create Conducive Environment for EE Investment
Customer Service
Low Interest
Source of Fund
Access to Funds
Workshop & Training
Technical Assistance
Free Energy Audit and consulting
Tax Incentives
Incentives & Subsidies
Regulations
Energy Codes
Promotion Campaign
Raise up Confidence
Perfect Information
List
Of Experts
Demonstration Project
Promotion of ESCOs
Directory of Technology Providers

8. Compulsory Program
Over 1 MW peak demand or consume more than 20 TJ annually
More than 4000 large buildings and factories (so called Designated Facilities)
Mandatory Tasks
Assign Energy Manager
Report Monthly Energy Use
Develop EE Target and Plan
Compile all energy codes

9. Cooperative Efforts on Energy Management
Objective: Sustainable energy management through internal cooperative efforts
Methodologies
Educate on concept & method + evaluation
Help create and implement EC measures
Achievement
Implemented 500 facilities
Introduced house-keeping measures
Energy saving of 5-10% for each facility
( simple payback of 2.5 yrs)
Cooperation Efforts on Energy Management :
This program is concentrated on the participation of all related key persons in buildings and factories to proceed for energy conservation activities by themselves as well as to maintain the sustainability of the process. The program will start with the a team of experts which has been sent to educate the concept and method for key persons in the factories and buildings in order to encourage them to create their own measures to reduce energy consumption or to use improve the efficiency of the equipment. The experts will also have to give a recommendation for the energy teamwork as well as evaluate the result of the program. Up to the present time, 95 factories have already been implemented this program. Most of the measures proposed by the teamwork are house-keeping measures which can be easy to implement and require little investment cost but can be achieved a certain level of energy reduction. The average energy saving of those who have implemented this program is about 5-10% of the total consumption with a average payback period of 2.5 years.
Presently, this program has leveraged over 20 million USD of EC investment for 26 approved projects. An average size of project investment is around 0.8 mill USD with a wide range of measures such as – Co-generation, Boiler efficiency, Biogas, Chiller, Control system, Lighting, Fuel Switching, etc. An average payback period of all measures is 2.4 years. The potential savings is more than 91 mill kWh per year and 8.6 mill liters of fuel oil per year.

10. Revolving Fund for EC Projects
Phase I Results
82 approved and under
construction projects
with leverage 80 million
USD of EC Investment
Average investment
1 mill USD / a project &
average payback 2.3 yrs
Annual savings > 250 GWh
and 91 mill. liter of fuel oil
Budgets allocation from ECP Fund
Loan approval by Bank
Technical assistance by DEDE
Key conditions
Loan size < 1.2 mill USD/project
Interest rate less than 4% (fixed rate)
Repayment in the defined time frame (7yr)
Revolving Fund for EC Projects
For financial incentive program, there is a program so-called revolving fund for energy conservation projects. The objective for this program is to stimulate an investment in EC projects as well as raise up the interest of commercial lending for EC projects among banking community. The budget for the soft loan was allocated from ENCON Fund with an initial of 50 mill USD and distribute to the participating banks. ( 7 banks is now participating ). The approval and loan process is done by banks while DEDE provides technical assistance in project assessment. The max. loan size is 1.2 mill USD/facility while banks can collect a max. of 4% interest rate from the loan. and they have to repay the loam to ENCON Fund through DEDE within 7 years.
Phase II Status – 6 months
11 commercial banks joined
Loan for EE projects over 300 million USD (mostly from banks)

11. Cost Based Tax Incentive
25% Tax Break for the Investment in EE Projects Result in Efficiency Improvement
Applicable for the First 50 mill baht Investment ( 1.25 mill USD )
Incentive Spread Over 5 Years

12. Performance Based Tax Incentive
100% of achieved energy saving will become tax deduction
Max Incentive of 2 mill baht (50,000 USD) / Facility
Pre and Post Audit will be required

13. Incentive through Board of Investment
( BOI )
Import duties and Cooperate tax exemption on new investment in
Energy conservation business
High efficiency machine or equipment and renewable energy equipment manufacturing
Solar PV manufacturing
Energy Service Company – ESCO
Renewable energy production business
Alcohol or fuels from agricultural products
Electricity or steam generation
Incentive last for the max period of 8 years

14. Promotion of ESCOs BOI – Tax Incentive Access to Revolving Fund
Maximum 8 years tax exemption for ESCO projects – Cooperate Income tax
Access to Revolving Fund
Eligible to borrow the low-interest loan from RF program on project-by-project basis
ESCO promotion activities
Website
Seminars, workshop
Publications
Lists of ESCOs and successful cases

15. Organizational Restructure
Holistic Approach
Mission Adjustment
Organizational Restructure
Value Creation
Paradigm Shift
Enforcer / Regulator
Facilitator / Supporter