Published on 11/07/2014
Analyst urges energy rethink The energy industry's reforms should focus not only on transparency and removing market dominance, but also improving energy efficiency and usage to reduce risks of a fuel shortage in the future, says an energy analyst. Manoon Siriwan, an energy analyst and former executive of Bangchak Petroleum Plc, said energy security is a serious matter for the development of the country. "The only strategy to strengthen our energy security has to be focused on efficiency. It doesn’t matter what was presented. If we ignore efficiency of usage, then it is all wrong," said Mr Manoon at an energy seminar. Lack of efficiency is largely attributed to a long-time government subsidy for diesel and liquid petroleum gas (LPG). "Our wish for the country is to use more alternative energy, as sustainability will never happen if fossil fuels continue to be subsidised," said Mr Manoon. Subsidies encourage consumers to use fossil fuels without realising their actual costs and discourage distributors from using alternative fuels. Banyong Pongpanich, CEO of Kiatnakin Phatra Financial Group, reiterated that energy reform must be based on transparency to ensure limited monopolies and good governance. However, the problems have been accumulating for over 10 years so reforms have to be done carefully, said Mr Banyong, also a member of 17-member superboard set up by the junta. "Now is the right time for reform because an elected government will return to populist policies and subsidies," said Mr Manoon. The International Energy Agency (IEA) conducted a study in Thailand and found the country has the highest energy security risk in Asean. The report projected by 2035 energy demand would grow by 80% from now, leading to higher oil imports. Thailand’s power generation is heavily dependent on natural gas, at 68%, and Singapore faces the same dilemma, with 70% of its electricity from natural gas.
The price of gas from the Gulf of Thailand is US$10 for 1 million BTU, but this supply is dwindling and imports from Australia or Qatar would cost $16-17, he said. The trend is the price of electricity in 10 years will increase 30%. Part of Thailand's problem is nobody wants a new power plant constructed near their home, said Mr Manoon. Thailand has not found new petroleum in seven years because no concession bids were held. "Thailand had 40 years of concessions. If there was a large reserve, wouldn’t we have found it by now?" he said. Concessions would be for the same areas already explored, said Mr Manoon. Thailand is a net importer of energy.