With great power comes a huge electricity bill so the saying goes but not for much longer according to the Thailand energy minister. Energy Minister Supattanapong Punmeechaow yesterday announced Thailand’s utility bills were coming down.
Supattanapong disclosed that electricity bills are expected to fall from May to August as the fuel tariff (Ft) dips following a decrease in the price of liquefied natural gas (LNG).
The Ft has been identified as a crucial element of the power tariff that has experienced a significant surge since last year, causing a rise in electricity bills and leading to financial strain for households and businesses alike, Bangkok Post reported.
At a seminar entitled The NEXT Thailand’s Future, the 63 year old energy minister told the audience that…
“The new power tariff should not exceed 4.72 baht per kilowatt-hour [unit] for households and 5.33 baht per unit for businesses because LNG prices have eased.”
The Energy Regulatory Commission (ERC) increased the power tariff last year, driven by a higher Ft, by 13% to 5.33 baht per unit for businesses and maintained the tariff at 4.72 baht per unit for households. However, the commission is scheduled to propose new power tariff rates for the upcoming four-month period starting in May. The ERC plans to gather public opinions on its proposals before making a final decision.
Energy Minister Supattanapong Punmeechaow.
The Thai government is well aware that the current power tariff rates are high, and it is burdening both homeowners and entrepreneurs.
The Federation of Thai Industries (FTI) raised concerns about expensive electricity bills dampening the country’s competitiveness in terms of attracting foreign investment. High energy costs will discourage foreigners from investing in Thailand, according to the federation.
To address this issue, the government earlier subsidized both electricity and diesel prices to slow down their rates of increase. The country relies on LNG imports as gas is a primary fuel for electricity generation, while diesel is used in both the transport and industrial sectors. Domestic diesel prices fell to 33.94 baht per litre last month, down from 34.94 per litre, as global crude oil prices decreased.
Supattanapong noted that if global crude oil prices continue to fall, officials will continue to cut retail prices of diesel in the country. However, global crude oil prices can fluctuate, rising based on a range of economic uncertainties, including the impact of the Russia-Ukraine war and preparations for the Thai general election.
Speaking at the same seminar, Kriengkrai Thiennukul, chairman of the FTI, expressed his hope that a new government would do a better job of managing electricity prices, which are currently higher than those in neighbouring countries.
The ERC’s proposed power tariff rates for May to August will likely be scrutinized by both businesses and households to assess the impact on their budgets.
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