SESEA 2014: Thai electricity regulator holds public hearing to discuss solar market future

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The Energy Regulatory Commission (ERC) of Thailand is holding a public hearing to discuss the country's solar energy future.

Currently ongoing the hearing began 13 November, and will end Thursday this week, 27 November.

Thidarat Sawai, solar energy officer at the Bureau of Solar Energy in the Department of Alternative Energy Development and Efficiency (DEDE, revealed details of the hearing at the Solar Energy Southeast Asia (SESEA 2014) conference being held in Bangkok today and tomorrow. The event is organised by PV Tech's publisher, Solar Media.

The hearing is to discuss regulations on government power purchasing from solar PV generation, the creation of an agricultural cooperation programme and to negotiate a new solar PV ground-mount committee. Possible changes to the feed-in tariff (FiT) are also on the table, Sawai said.

The current FiT for solar farms is THB5.66 per (US$0.17) kilowatt hour for 25 years.

One consequence of the discussions could be that solar project proposals that are bunched in one area may be asked to relocate to spread the FiT across the country, Sawai said.

There is currently a stall in approving new solar programmes and new announcements due to a delay caused by “several companies that made more installations than they declared on paper, the ERC is trying to regulate them so the FiT price is spread out over Thailand, or it is not fair to the end user,” said Sawai.

There are 177 projects proposed in the current pipeline, with a further 15 that have signed power purchase agreements already and one project approved and waiting to sign a PPA.

PPAs are to be signed by December 2015 for projects currently proposed, she said

Jack Kneeland, managing director for financial advisor, AWR Lloyd, told at SESEA 2014 that the current regulation bottleneck and slow admissions in Thailand mean, for the present market, “it’s the end of utility scale; something needs to happen to get projects done”.

Kneeland added that with help to fast-track applications, there was the possibility for publicly listed, yield co-type models in Thailand. But most opportunities lie in partnering up with entities that have already gained PPA approvals. “This provides more opportunities for economic gains in the future,” Kneeland said.

“Yield cos could work, but it would require a sizable project; projects don’t meet the size required now, and debt package constraints need to be addressed. Hopefully we will have yield cos in the future,” said Kneeland. There are “aims for public markets to be playing a much larger role in Thai renewable energy”, he added.

Kneeland also said that constraints on selling power back to the grid in Thailand are a limiting factor on the size and profitability of utility-scale solar plants in the country.

However the “capability of the government and the strong regulatory framework are a solid platform for the next round [of solar projects]” in Thailand, with a best-case scenario of 8GW installed by 2021, Kneeland predicted.

Solar is also cheaper than liquid natural gas (LNG) on a levelised cost of energy (LCOE) basis in many cases in Thailand, depending on the reduction of fuel costs and caps to the cost of new infrastructure fund programmes, said Kneeland.

Thailand has 1.087GW installed capacity for 2014, an increase from 785MW in 2013 and 220MW in 2012.

Follow Lucy Woods live from Bangkok via Twitter using the hashtag #sea2014.

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