Thailand’s 2 billion baht electricity subsidy for 17.7 million households

The Thai Cabinet has allocated 2 billion baht to subsidise electricity costs for 17.7 million vulnerable households.

The scheme, set to be a new year’s gift, will apply to those using no more than 300 units of electricity per month, maintaining a cost of 3.99 baht per unit. Deputy Prime Minister and Energy Minister Peeraphan Salirathaviphak, stated today, December 8, that the Ministry of Energy is preparing to propose this support measure for Cabinet approval this month.

The Energy Ministry intends to maintain the rate collected from vulnerable groups, who use no more than 300 units of electricity per month, at 3.99 baht per unit from January to April next year. This measure will cover approximately 75% of the population or roughly 17.7 million households.

The funds for this subsidy will come from a central budget of 2 billion baht, aimed at alleviating the hardship caused by increasing electricity costs for those affected. For electricity users exceeding 300 units per month, the Ministry of Energy is considering various support measures under three factors that will affect the change in electricity pricing. These proposals will be put forward for consideration at the National Energy Policy Committee (NEPC) meeting on December 13.

The three factors include:

1. Requesting an extension of the debt payment period for the Electricity Generating Authority of Thailand (EGAT) by one term to address the short-term problem, along with a plan to relieve EGAT’s debt in the future.

2. Adjusting the natural gas price structure.

3. Determining the natural gas sales price of PTT Public Company Limited.

Methods to reduce costs

While these three factors would lower electricity costs from the rate announced by the Energy Regulatory Commission (ERC) for January to April 2024 at 4.68 baht per unit, all parties are still attempting to find ways to further reduce costs to cover both the public and private sectors.

Acknowledging the challenge in accomplishing this due to the involvement of multiple relevant agencies and high budget usage, every 10 satang/unit decrease in electricity costs represents an expense or burden of 1 billion baht to 10 billion baht.

Assuring that the adjustment of the natural gas price structure will be non-discriminatory and not create undue burdens for future sustainability, it is expected to become clearer within 2024. Peerapong expressed confidence that everyone is working to their utmost capacity and doing so as quickly as possible.

The energy minister also spoke about the progress in preparing cheap diesel for the agricultural group, preparing to propose a law to adjust the diesel price structure for farmers, similar to green oil sold to the fishing group, at the Parliament’s regular annual meeting for the second time, to be considered on December 12.