April 12, 2018 / 5:04 AM / 15 days ago

Thailand plans to increase coal use in power generation - minister

* To find new coal-fired power plant locations end-2018

* Increase coal’s share in power generation to ensure security

* Electricity from renewable to be priced at grid parity

By Florence Tan and Chayut Setboonsarng

NEW DELHI/BANGKOK, April 12 (Reuters) - Thailand is expected to increase the share of electricity generated by coal to diversify its fuel mix for power generation, the country’s energy minister said.

“The share of coal in our power generation mix is very low at slightly less than 20 percent,” Energy Minister Siri Jirapongphan said on the sidelines of the International Energy Forum late on Wednesday.

“We need to diversify the sources of fuel for our power generation. Having a reasonable percentage of coal to be used for power generation would be a necessity in considering the security of fuel supply to our generation system.”

Thailand relies mainly on natural gas to generate power, but domestic demand is falling behind consumption, requiring the country to import more piped gas from Myanmar and more liquefied natural gas (LNG).

A plan by the Electricity Generating Authority of Thailand (EGAT) to build coal-fired power plants in the southern Thailand tourist destinations of Krabi and Songkhla has been delayed for years due to opposition from villagers and environmentalists.

“We need to conduct a more global strategic environmental assessment to identify a more suitable location to build a coal-fired power plant that Thailand needs,” Siri said, adding that a decision on the plants’ locations could be made towards the end of this year.

“In terms of contribution to carbon dioxide generation, Thailand can be considered as one of the lowest in the world,” Siri said.

Thailand has promoted the use of renewable energy aggressively over the past 10 years, he said, adding that the share of electricity generation from renewables has reached around 12 percent, which is the highest rate among the countries that make up the Association of Southeast Asian Nations.

“But that achievement came at an expense as we’re paying a high rate for generation of electricity from renewable resources,” he said.

Authorities increased retail electricity prices by 3.5 percent last year for the first time since 2014, citing rising oil and gas prices.

Falling costs for solar panels has made the renewable resource competitive against fossil fuels.

“We have proven in several pilot projects that we can expand on our success to promote more electricity generation from renewable resources at a price which we call grid parity at 8 cents (per kilowatt hour) on a wholesale basis.”

Going forward, Siri said Thailand will only be accepting grid-parity prices of electricity generated from renewable sources.

Reporting by Florence Tan in NEW DELHI and Chayut Setboonsarng in BANGKOK; Additional reporting by Promit Mukherjee in NEW DELHI; Editing by Christian Schmollinger

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