Review of SPP programme needed, says energy minister
Energy Minister Narongchai Akrasanee says the Small Power Producer programme should be reviewed because of its higher electricity tariffs and discrepancies in conditions given to different SPP plants that sell electricity to the national grid.
Speaking at the Institute of Electrical and Electronics Engineers on Wednesday night, Narongchai said his energy policy would focus on the three key pillars – supply security, economy of prices and resources, and ecological impact.
He said the government would make sure the Independent Power Producer and SPP schemes were “rational”.
“Co-generation power plants [under the SPP programme], in particular, have been altered to sell electricity as the main product and steam has become the secondary product,” he said. “This has resulted in us buying electricity at higher prices than IPPs’. Their contract extensions have to be reviewed.”
Narongchai said the Energy Regulatory Commission would review SPP contracts with a combined generating capacity of about 4,000 megawatts and which had not yet commenced commercial operations. He said the ERC was wunlikely to extend the power-purchase agreements of SPPs with a capacity of more than 1,000MW, as requested by the Association of Private Power Producers.
He was told that the former ERC board had messed up things because of the “influence of politicians”. That board was replaced by members hand-picked by the current military-led regime.
In response to the Office of the Auditor-General’s opinion that PTT has failed to transfer all of its onshore and offshore gas-pipeline assets to the state despite a court order, Narongchai said any impact would be minimal to PTT because it ould be able to lease back the pipelines from the state. Those assets are valued at almost Bt33 billion.
“PTT has the property right over the pipelines that it has invested in and operated,” he said.
He said that while the ERC was authorised to govern the power sector, the Energy Ministry would serve as the regulator for the fuels sector, including combating smuggling.
The ministry was considering a plan to install radio frequency identification (RFID) chips on tanker trucks to monitor the inflow and outflow of oil and gas products to make sure nothing was smuggled out of petrol stations.
The Royal Thai Police had offered a Bt1-million reward for anyone who provided information on the whereabouts of Pattani businessman Sahachai Chiamsermsi.
Sahachai was allegedly involved in a fuel-smuggling ring in the South and allegedly made more than Bt100 million in payments to corrupt senior police officers.
Narongchai confirmed that the government would not extend the petroleum exploration and production concessions awarded to Chevron Thailand Exploration and Production and PTT Exploration and Production, and would take back the concessions to the state after they expired in 2022 and 2023.
The government is studying ways to ensure the continuity of petroleum production after the concessions expired, including through subcontracting the production.
Narongchai said the government could be able to commence its energy-conservation work soon after getting rid of legal hurdles that prevent the functioning of the National Energy Conservation Board.
He said Star Petroleum Refinery was expected to commence its initial public offering in the first half of next year as part of the government’s plan to dilute PTT’s stake in oil refinery that is majority-owned by Chevron.
