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John Daly

John Daly

Dr. John C.K. Daly is the chief analyst for Oilprice.com, Dr. Daly received his Ph.D. in 1986 from the School of Slavonic and East European…

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Thailand’s Energy Shortages Raise Political Temperature

Thailand’s Energy Shortages Raise Political Temperature

Thailand has not had an easy time over the past several years. The government was reshuffled in 2011, the country was hit with massive flooding in October of the same year, and since January 2004 the central government has been battling Muslim separatists after violence erupted in the country’s southern Muslim majority provinces of Narathiwat, Pattani and Yala.

Now, electricity shortages are adding to Bangkok’s problems.

The U.S. government’s Energy Information Agency notes, “Thailand's rapidly expanding economy over the past two decades has spurred the need for building more generation capacity to keep pace with higher electricity demand. So far, Thailand's installed capacity growth has exceeded its rate of power consumption growth which averaged about 5 percent a year over the past decade. Thailand now has one of the highest electrification rates in Southeast Asia and delivers electricity to nearly all of its population. Concern for electricity supply security and grid reliability has prompted the Thai government to create policies that promote planned capacity expansion, diversification of fuel sources and increase of alternative fuel use, demand-side management, and management of electricity import dependence.”

Related article: Myanmar Attracting Major Energy Investors

On 22 May a massive power blackout hit more than 8 million people in Thailand's 14 southern provinces, including popular tourist areas such as Koh Samui and Phuket, in one of the country's biggest recent blackouts. The darkness also affected Thailand's three restive southern provinces, battling a smouldering Muslim insurgency, after a transmission failure on a high-voltage cable from Ratchaburi to Bang Saphan district in Prachuap Khiri Khan, the main power transmission line from the Central region to southern Prachuap Khiri Khan province, cut off supply from the central region. Key installations such as airports and hospitals switched to emergency back-up electricity supplies. The Thai PBS news team reported that lightning was involved.

The government scrambled to attribute the power loss to technical causes, with Secretary to the Prime Minister Wim Rungwattanajinda announcing on television that the blackout was caused by a problem with the transmission line and was not linked to the southern unrest.

But problems remain unresolved, primarily that regional power plants cannot keep up with surging demand. South Thailand now requires 2,500 megawatts of electricity supply per day while local power plants can only generate 2,000 megawatts. The other 500 megawatts are supplied from central Thailand via such power transmission lines as the high-voltage cable from Ratchaburi to Bang Saphan.

The future?

Well, the bad news for Thai consumers is that on 28 June Thailand's largest energy conglomerate, PTT Plc detected a leak on its subsea 36-inch natural gas pipeline 200 miles from the eastern province of Rayong in the Gulf of Thailand and halted gas supplies, raising the prospect of higher electricity bills. After the leak was discovered PTT Plc executive vice-president of natural gas operations Wichai Pornkeratiwat told reporters that the company immediately shut down gas transmission through the pipeline, cutting off about 600 million cubic feet per day of gas to the Electricity Generating Authority of Thailand and PTT Plc's gas separation plants.

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In such a shambolic environment, other Thai energy producers are looking for overseas profits before resolving local power problems.

Thailand’s top private power producer, Ratchaburi Electricity Generating Holding Pcl, is interested in buying into in Australia's New South Wales Macquarie Generation and two more power firms as part of a drive to expand into overseas markets. The New South Wales government is interested in privatizing Macquarie Gen. Ratchaburi bought into the Australian power market two years ago when acquired 80 percent of Transfield Services Infrastructure Fund, later renamed RATCH-Australia Corp. Aside from Australia, Ratchaburihas also been looking for energy market acquisitions in Laos and other Asian countries.

Closer to home, Thai officials are to be pressured over the latest blackouts. Thai Chamber of Commerce vice chairman Pornsilp Patcha-rintanakul has called on the government to provide a prompt and clear explanation to the public of the southern blackouts, as they were a “sensitive” issue, given the regional politics, while Federation of Thailand Industries secretary-general Thanit Sorat called for the government to ensure that similar events would not recur and said it had to find out which party would take responsibility in this case.

By. John C.K. Daly of Oilprice.com

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  • Maha Bodhi on April 17 2015 said:
    it is indeed really a good news to learn that Thailand has one of the highest rates of electrification in SE Asia altogether.

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