11

Energy Efficiency and Conservation Energy Efficiency and Conservation

in Thailandin Thailand

Department of Alternative Energy Department of Alternative Energy

Development and Efficiency (DEDE)Development and Efficiency (DEDE)

Ministry of EnergyMinistry of Energy March 2005

22

Presentation OutlinesPresentation Outlines

• Thailand Energy Policy and Strategies

• Energy Situation in Thailand

• Energy Conservation Promotion Act

• Energy Conservation Scheme

• Renewable Energy Strategic Plan

33

Thailand Energy Policy and VisionThailand Energy Policy and Vision

To conserve, develop and promote the efficient consumptionof energy, while balancing the development with indigenousNatural resources and the environment, with ultimate goal toReduce the degree of reliance on energy imports

HE. Dr. Thaksin Shinawatra, Feb 26, 2001

National Policy

Strategic objectives

Enhancecompetitivenessof the real sector

Supply the kingdomwith clean and

continuous energy

Energy forbetter

living for all

Thailand asSE ASIA

Energy Hub

1 2 3 4

44

Thailand Energy Strategies Thailand Energy Strategies for Economic Development and Regional Integrationfor Economic Development and Regional Integration

• Strategy for Energy Security Ensure sufficient and reliable energy supply for at least 30 yrs

• Strategy for Efficient Use of Energy Reduce Energy Elasticity from 1.4:1 to 1:1 by 2007

• Strategy for Renewable Energy Development Increase share of RE from 0.5% to 8% of total final energy by 2011

• Strategy for Thailand as a Regional Energy Center Develop Strategic Energy Land Bridge and Energy Hub

55

Energy Consumption Energy Consumption in Transportationin Transportation

Air Transport

16%

Land Transport

79%Water Transport

5%

Total Consumption of 20,927 ktoe in year2003

Source: Thailand Energy Situation Report 2003 , DEDE

66

Energy Consumption Energy Consumption in Industryin Industry

Metal5.3%

other6.5%

Chemical12.8%

Non-Metallic 28.3%

Metal Fabrication

6.6%

Textile5.7%

Paper3.5%

Food & Beverage

30.5%

Wood & Furniture

0.8%

Total Consumption of 19,988 ktoe in year2003

Source: Thailand Energy Situation Report 2003 , DEDE

77

Energy Consumption in ResidentialEnergy Consumption in Residential

Rural Area 79%

Bangkok Metropolitan

13%

Municipal Area 8%

Total consumption of 8,173 ktoe in year 2003

Source: Thailand Energy Situation Report 2003 , DEDE

88

0

10,000

20,000

30,000

40,000

50,000

60,000

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003

ktoe

Transportation 37%

Industry 36%

Residential & Commercial 21%

Agriculture 6%

Industry=Manufacturing+Mining+Construction

Final EnergyConsumptionby Economic Sectors 5Total Consumption of 6,28 2229 200 3

Source: Thailand Energy Situation Report 2003 , DEDE

Energy Situation in ThailandEnergy Situation in Thailand

99

Energy IntensityEnergy Intensity

6http:/ / www.eia.doe.gov/ pub/ international/ iealf/ tablee1g.xls

Energy Intensity [Total Primary Energy Consumption Per Dollar of Gross Domestic Product]

02,0004,0006,0008,00010,00012,00014,00016,00018,000

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002Btu pe

r 1995

US D

ollars

Using

Mark

et Ex

chang

es Ra

tes

World Primary Energy Consumption Per Dollar of Gross Domestic Product, 1991-2002

Thailand

USA

UKGermanyJapan

(Compare with Developed Countries)

1010

Energy IntensityEnergy Intensity

6http:/ / www.eia.doe.gov/ pub/ international/ iealf/ tablee1g.xls

Energy Intensity [Total Primary Energy Consumption Per Dollar of Gross Domestic Product]

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002Btu pe

r 199

5 US

Dollar

s Usin

g Mark

et Ex

chan

ges R

ates

Malaysia

China

India

Thailand

Vietnam

World Primary Energy Consumption Per Dollar of Gross Domestic Product, 1991-2002

(Compare with Developing Countries)

1111

Regulation for Designated Facilities

Established ENCON Fund

Thailand’sThailand’s

Energy Conservation Act 1992Energy Conservation Act 1992

1212

ENCON FundENCON Fundapproximately 450 million USDapproximately 450 million USD

• Sources– Initial from Oil Fund ~ 40 million USD– Small taxes from the use of benzine, diesel, fuel oil,

kerosene ~ 60 million USD annually– Interests

• Uses– Grants for R&D, Pilot projects, Training, Studies– Low Interest Loan for Investment - Revolving Fund

1313

Customer Service

Customer Service

Workshop &

Training

Workshop &

Training

Low InterestSource of Fund

Low InterestSource of Fund

ListOf

Experts

ListOf

ExpertsDirectory

of Technolo

gy Provider

s

Directory of

Technology

Providers

Promotion of

ESCOs

Promotion of

ESCOs

Promotion

Campaign

Promotion

CampaignDemonstration Project

Demonstration Project

Access to Funds

Technical Assistance

Raise up Confidence Perfect Information

Regulations

Value engineering and

EM Standard

s

Value engineering and

EM Standard

s

Tax Incentive

s

Tax Incentive

s Incentives & SubsidiesEnergy Codes

Energy Codes

Create Conducive Environment for EE Create Conducive Environment for EE InvestmentInvestment

1414

Highlighted ProgramsHighlighted Programs

1515

Compulsory ProgramCompulsory Program

• Over 1 MW peak demand or consume more than 20 TJ annually

• More than 4000 large buildings and factories (so called Designated Facilities)

• Mandatory Tasks– Assign Energy Manager– Report Monthly Energy Use– Develop EE Target and Plan– Compile all energy codes

1616

Cooperative Efforts on Energy Cooperative Efforts on Energy ManagementManagement

Objective: Sustainable energy management through internal cooperative efforts

Methodologieso Educate on concept & method + evaluationo Help create and implement EC measures

AchievementImplemented factory 95 plantsIntroduced house-keeping measuresEnergy saving of 5-10% for each facility

( simple payback of 2.5 yrs)

1717

Revolving Fund for EC ProjectsRevolving Fund for EC Projects

Budgets allocation from ECP Fund

Loan approval by Bank Technical assistance by

DEDE Key conditions

Loan size < 1.2 mill USD/project

Interest rate less than 4% (fixed rate)

Repayment in the defined time frame (7yr)

Present Status 79 approved and under construction projects with leverage 80 million USD of EC Investment

Average investment 1 mill USD / a project & average payback 2.3 yrs

Annual savings > 250 GWh and 91 mill. liter of fuel oil

1818

Cost Based Tax IncentiveCost Based Tax Incentive

• 25% Tax Break for the Investment in EE Projects Result in Efficiency Improvement

• Applicable for the First 50 mill baht Investment ( 1.25 mill USD )

• Incentive Spread Over 5 Years

1919

Performance Based Tax IncentivePerformance Based Tax Incentive

• 100% of achieved energy saving will become tax deduction

• Max Incentive of 2 mill baht (50,000 USD) / Facility

• Pre and Post Audit will be required

2020

Incentive through Board of Investment ( BOI )

Import duties and Cooperate tax exemption on new investment in• Energy conservation business

• High efficiency machine or equipment and renewable energy equipment manufacturing

• Solar PV manufacturing

• Energy Service Company – ESCO

– Renewable energy production business

• Alcohol or fuels from agricultural products

• Electricity or steam generation

Incentive last for the max period of 8 years

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www.dede.go.thwww.dede.go.th

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