Thailand proposes to achieve carbon neutrality by 2065-2070 under a new energy plan that could see renewable energy account for a 50% share of its new power generation, displacing natural gas which is currently the mainstay of its power generation sector.
Receive daily email alerts, subscriber notes & personalize your experience.Register Now
The Southeast Asian country's carbon neutrality target is significantly staggered from the 2050 goal being pushed by the United Nations, and even lags the net zero 2060 goal set by China, but is still ambitious for country that lacks access to modern energy infrastructure.
"The updated energy policy, the so-called National Energy Plan 2022 has been recently approved by the Energy Committee chaired by the Prime Minister of Thailand," Ministry of Energy's Permanent Secretary, Kulit Sombatsiri, said at the FEA 2021 conference on Aug. 25.
"The NEP 2022 will support Thailand to move towards green and clean energy with an aggressive plan and measures to reduce carbon emission towards the goal of carbon neutrality within the period of 2065-2070," Sombatsiri said.
He said the policy will require the country's energy sector to lower carbon emission, and boost the proportion of clean and renewable energy aggressively in new power generation to not less than 50%, considering the cost of long-term energy storage systems.
Thailand is one of the few Asian countries with a relatively low penetration of coal in the power mix due to historical aversion to the fossil fuel, but where natural gas accounts for around 57.5% of the power mix, according to official data from the Energy Policy and Planning Office, or EPPO.
This is followed by coal-fired power with a share of around 17%, 12% of electricity is imported from Laos, Myanmar and China which is largely hydro and coal-fired, around 10% from renewables, 3% from hydro and the remaining from oil, official data showed.
A 50% share of renewables in new power generation will mean a significant reduction in natural gas and coal fired generation. This is detrimental for the LNG sector in the long run as Thailand is one of the key growth markets for Asia's LNG demand.
Additionally, just over 40% of Thailand's primary energy demand comes from oil.
"We will transform the full use of transport to green electricity through the promotion of EVs by the 30:30 policy, which means we will build 30% of domestic EV production by 2030," Sombatsiri said, adding that decarbonization will involve retiring inefficient coal-fired power plants, digitalization of power plants, decentralization of power supply and deregulation to support third party access in gas and electricity markets
"We will continue to liberalize the gas market to secure competitive business and support Thailand's energy transition," he added.
CCUS for overseas, domestic gas projects
With natural gas caught in the energy transition crossfire, Thailand's state-owned oil company PTT Exploration and Production is looking to implement carbon capture utilization and storage at one of the largest discoveries being developed off Malaysia and at producing assets back home to bolster green credentials of natural gas, its incoming president and chief executive said Montri Rawanchaikul at the same conference.
"Carbon capture and storage will always come at a cost but it is inevitable because at the end of the day, we want greener gas," Montri Rawanchaikul, who will head up PTTEP from October, said.
PTTEP has invested heavily in acquiring and developing upstream assets to secure natural gas supplies to make up for declining domestic production levels due to depleting reserves and few new discoveries.
Rawanchaikul maintained that natural gas still has a place as the bridging fuel for the country's low carbon transition though he acknowledged the need to deploy CCS.
He identified the proposed development of the giant Lang Lebah discovery off East Malaysia's state of Sarawak as one prospect for PTTEP's first CCUS application overseas, and suggested that the NOC will also look at sequestering CO2 emitted from gas production in Thailand.
"We will work with our host, Petronas, to implement CCUS at Lang Lebah," he said, adding that the Malaysian NOC also aims to achieve net zero carbon emission by 2050.
Lang Lebah, located in Block SK410B, contains 13% CO2, according to Rawanchaikul's estimate, and is rated as PTTEP's biggest exploration success in Southeast Asia. It is also one of Malaysia's biggest gas discoveries and its proposed field development will secure feed gas for Petronas' nine-train Malaysia LNG complex at Bintulu, Sarawak.
"We expect to reach a final investment decision on this project in 2023," executive vice president for strategy and business development, Natruedee Khositaphai said at a panel discussion, but didn't elaborate on the deferral from PTTEP's previously guided date in 2022.