1. Thailand’s Energy Conservation Policy : Industry Programs Prasert Sinsukprasert Ph D Department of Alternative Energy Development and Efficiency 3 rd Policy Dialogue on Green Partnership Plan (GPP) 24-25 April 2006, Bangkok

2. Thailand’s Energy Outlook Transportation 37% Agriculture 6% Industrial 36% Res & Com 21% Thailand consumes energy about 1 mill barrels of oil per day (0.75% of World energy consumption) Oil Natural Gas Coal Hydro Supply Demand

3. 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 Transport 37% Industry 36% Resident & Commercial 21% Agriculture 6%

4. Strategy Energy Efficiency Improvement Target 2. Improve EE in Industry Objective ประเทศไทยมี พลังงานใช้ อย่างต่อเนื่อง เพียงพอต่อ ความต้องการ ไปอีก 50 ปี ประชาชนมี พลังงานใช้ อย่างทั่วถึง ในราคาที่เป็น ธรรมและเพื่อ คุณภาพชีวิต ที่ดีขึ้น Energy Efficiency Improvement 1 1 2 2 ประเทศไทย เป็นศูนย์กลาง พลังงานใน ภูมิภาค 3 3 4 4 1. Improve EE in Transportation Energy Elasticity = 1:1 in 5 years Indicators Energy Elasticity = ∆ t Energy Consumption/ ∆ t GDP Ave. Energy Elasticity 1.4 : 1.0 Ratio of energy growth rate to GDP growth rate = 1.0 by 2008 3. Awareness raising campaign

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

6. 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

7. Cooperative Efforts on Energy Management  Objective: Sustainable energy management through internal cooperative efforts  Methodologies oEducate on concept & method + evaluation oHelp 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)

8. Revolving Fund for EC Projects  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) Present Status  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

9. 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

10. 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

11. 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

12. Promotion of ESCOs BOI – Tax Incentive –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

13. Holistic Approach เพิ่มมูลค่าเปลี่ยนโครงสร้างปรับกระบวนทัศน์ Paradigm Shift Enforcer / RegulatorFacilitator / Supporter