Industry leaders warn electricity hike will send inflation soaring
Business leaders are worried that electricity-price rises will see costs surge in Thailand’s industrial sector, according to a Federation of Thai Industries (FTI) survey.
The Energy Regulatory Commission (ERC) has announced it will hike the fuel tariff from next month until December, resulting in a record high of 4.72 baht per unit of electricity.
The FTI survey asked 215 executives how the increase in electricity costs will affect their Thai industry. Most worried that the hike was too high, said FTI vice-chairman Montri Mahaplerkpong, revealing the survey results on Tuesday.
Survey respondents said the higher electricity cost would cause the price of products to rise, driving up the cost of living even further. It would also hit Thailand’s ability to compete with Vietnam, which has kept its electricity cost to 2.8 baht per unit for 2022, they said.
Montri forecast the price of products and services in Thailand would rise by 10 per cent by the end of this year.
Most executives surveyed want the government to limit the fuel tariff hike to 5 per cent while also issuing relief measures for SMEs and people on low income.
So far, the Electricity Generating Authority of Thailand (EGAT) has shouldered increased production costs amounting to about 83 billion baht. But this burden will be shared by consumers via the tariff hike from next month.
However, Montri urged the government to review its electricity pricing structure for every sector and also open up the market for private companies to invest in power plants. He also wants authorities to reduce the time it takes for companies to get permission to use renewable energy equipment.
He explained that the private sector is preparing for the electricity hike by investing in renewable energy sources such as solar rooftops in a bid to remain competitive.
