Thursday, June 28, 2007

What’s the solution for Thailand’s predicted power dilemma?


Thailand, Southeast Asia's second- biggest economy, plans to buy electricity from China for the first time starting in 2017 because the country isn't building its own plants fast enough to meet an expected surge in demand.

The Thai government has signed an initial agreement to buy about 3,000 megawatts of electricity from hydropower plants in southern China starting in 2017, Energy Minister Piyasvasti Amranand, said in an interview. Thailand needs to add more than 30,000 megawatts of generating capacity by 2021 to avoid shortages, according to the ministry's forecasts. The accord will bolster Thailand's own efforts to more than double its power-generating capacity by building coal, nuclear and hydropower plants. The government wants to pare the country's reliance on natural gas, which provides about 70 percent of Thailand's electricity.

“We continue to look for other sources of energy and the biggest source around here is probably hydropower,” Piyasvasti said. “Hydropower potential is enormous around here in Laos, Myanmar and southern China.” Thailand has about 26,000 megawatts of power-generating capacity and needs an additional 31,791 megawatts by 2021, the energy ministry said in a statement.

“If there is an export of electricity to Thailand, it should be from a combination of hydro and coal-fired plants,” said Bai Jianhua, a research director at the State Power Economic Research Center, who helped study the feasibility of the plan to transmit electricity from Yunnan to Thailand. “It is not only a matter of prices. China, in general, is a country of energy shortages, and we need to ensure stable supplies to the southern provinces, particularly Guangdong.”

Thailand’s neighbours seem to come in handy. For instance, Thailand imports about a third of its natural gas from neighboring Myanmar, he said. It is also tapping neighboring Laos for power, and plans to buy about 5,000 megawatts of hydropower from the country by the end of 2015, Piyasvasti said. Electricite de France, Europe's biggest power producer, Kansai Electric Power Co., Japan's second-biggest utility, and Thai companies are building a hydropower plant on the Nam Theun river in Laos. Piyasvasti reiterated the Thai government's plan to build the nation's first nuclear power plants, and said his ministry has sought advice on the project from countries including the U.S. and France.

Coal-fired plants are not the preferred solution. Thailand's military-backed government faced protests earlier this year over plans to build coal-fired plants that would have accounted for as much as 40 percent of the country's new capacity. Public outcry over environmental and health problems associated with older coal-fired plants forced the government to scrap plans for three plants and seek alternatives.

Bangkok prefers nuclear capabilities in the long term due to such issues. “We aim to diversify the mix of nuclear, natural gas, coal and hydropower,” Piyasvasti said. Thailand lags behind countries in the region including Indonesia and Vietnam that have decided to build nuclear power capacity, he said. “If the world wants to see an eventual reduction in the global emission of greenhouse gases, the world will really have to go back more seriously to nuclear power,” said Piyasvasti. Electricity Generating Authority of Thailand, the state-owned power utility, plans to spend about $6 billion to build its first nuclear power plants, Kraisi Karnasuta, the governor, said. Each plant will generate 2,000 megawatts of electricity. The government in May said it will complete the plants by 2021, and appointed six groups to draft construction plans. The groups will study international nuclear power regulations and formulate a strategy for winning public support for the project. Power companies in countries including Japan have struggled to win acceptance for new nuclear facilities because of growing public concerns about safety.

However, the Thai government's plan to push ahead with construction of nuclear power plants may be reviewed after the general election, scheduled for as early as November. “There is no guarantee that the elected government will agree with the nuclear plan, but we have now put nuclear power in the long-term power development plan,” Piyasvasti said.

On the bright side, Bangkok managed to spot the looming power shortage. However, solving is a more complicated task. For now, the state has bigger problems with unrest in the South and incoming elections that may be destabilizing. Will the next government have the same priorities in mind? Can China, with its power shortages, honour it’s agreement in ten years time?