Published on  06/06/2012
Solar firms plead for sourcing sweeteners Thailand should follow Malaysia's example and introduce incentives for solar project developers to use local materials, say Thai operators. The Thai solar industry currently relies heavily on imported components, mainly from China, with no import tariffs, said Wuthipong Suponthana, the managing director of Leonics and a representative of the Solar Club in Thailand. Most solar farm installations use imported modules and other supportive components. The value of these imported modules and parts is high, estimated at 70-80% of total investment cost. "Of the total cost of 70 million baht for each megawatt of solar energy, up to 50 million baht goes to import components with minimal job creation locally," said Dr Wuthipong. Malaysia, the only Southeast Asian nation whose solar usage is on par with Thailand's, offers enticements for foreign solar investors to use local materials. Solar operators generally get one Malaysian cent (10 satang) per gigawatt-hour of electricity produced, while firms using local materials get two cents per GwH. Germany, the world's largest photovoltaic market, has created 300,000 local jobs from 20 years of experience in the industry, said Dr Wuthipong. Leonics is at the stage of setting up an assembly plant in Malaysia to pursue projects there.
The Solar Club, with six local solar companies as members, has held talks with energy regulators and the Board of Investment (BoI) about possible incentives for solar in Thailand, but no concrete action has been taken to date. "The import duty on solar panels was waived several years ago to promote renewable energy development in Thailand," Dr Wuthipong told a solar workshop hosted by the German Society for International Cooperation (GIZ). "What we suggested the BoI do is offer a longer tax-holiday period for companies using local contents. So far they see no need to do that." Under a 10-year development plan through 2021, Thailand aims to have 2,000 megawatts of solar energy installed. Thus far, more than 3,000 MW worth of solar projects including solar thermal schemes, have been approved or are in the submission stage. The Northeast is a prime area for capitalising on the solar market given the highest rate of solar radiation, said Wandee Khunchornyakong, the chief executive of SPCG Plc, which runs solar plants there. Also, there is ample supply of land at a reasonable price and the high terrain buffers the region from environmental hazards like flooding. Raymond Schonfeld, the managing director of Single Market Ventures, said Thailand would be best off by developing a local market and focusing on Asean opportunities. "In two years, Thailand has quadrupled its growth target," said Mr Schonfeld. "And this would serve the Thai industry well by developing optimal technological solutions that can be exploited throughout Asean." Â