Thailand’s power sector is heavily dependent on fossil fuels with 81% share in the generation mix, meeting the country’s growing power demand. With countries across the world setting timelines for completely shoving coal out of the generation mix, Thailand’s latest Power Development Plan (PDP) has set the expansion plan of gas-based power generation and renewables with a slow phase-out of coal generation to meet the low carbon transition target. The share of non-hydro renewables in the generation mix is set to grow from 15% in 2019 to 22% in 2030 while the gas-based generation is set to expand from 62% to 76% during the same period.
Thailand is an oil and gas producer and has been predominantly dependant on gas for its power generation. The low natural gas prices, declining renewable capital cost, and a low carbon economy vision are likely to shrink the share of coal in the generation mix to approximately 10% in 2030.
By 2030, the non-hydro renewable capacity is set to double, crossing 18GW in 2030 from the present 9GW. The share of coal in the capacity mix is anticipated to halve to approximately 5% in 2030 while the gas-based generation capacity accounts for nearly 59%. The new capacity that is likely to be installed by 2030 will have 4.7GW of solar PV, 5.2GW of gas projects, 2.6GW biopower, and 1.4GW of wind.
As part of the low carbon transition plan, Thailand has set a target of achieving 30% of its power generation from renewables by 2036. The renewable growth will be led by biopower followed by solar PV and then wind. Rice, sugar, palm oil, and wood-related industries are the major potential biomass energy sources in Thailand. As the share of solar PV and wind keeps growing, Thailand will aim to remain on-track for achieving the renewables target. By 2030, more than 22% of the generation is anticipated to come from non-hydro renewable sources.
The upswing in renewables is likely to push coal out of the business as the government expects to capitalise on the cheap renewables by providing ample opportunities, revitalising the sector with improved risk-free investment access, favourable regulatory environment, attractive feed-in tariffs, tax incentives, and favourable expansion roadmap that will lead to the decarbonisation of the power sector.