Page 1Page 1

„Development of energy saving obligations for utilities – Energy

Efficiency Resource Standards – in Thailand“

Dr Milou BeerepootDirector GIZ Energy Efficiency

Programme Thailand

Page 2Page 2

• Thailand faces highest energy security vulnerability in ASEAN region: Thai Ministry of Energy developed strong Renewable Energy and Energy Efficiency strategies: Energy Efficiency Development Plan 2015 – 2036 (incl. EERS)

Net oil and gas import dependency in selected ASEAN countries (IEA, 2013)

Energy efficiency: energy security

Page 3Page 3

• Energy Policy and Planning Office (EPPO, Min. of Energy)

and GIZ (German International Cooperation) cooperate in

implementation of the Thai Energy Efficiency Development

Plan (EEDP):

1

7

456

EERS: Energy Saving Obligations for utilities

23

Thai-German energy efficiency cooperation

Page 4Page 4

What is EERS?

Energy Efficiency Resource Standards (EERS):

• A quantitative mandatory saving target for utilities

(electricity and/or natural gas, oil) …

• … that needs to be achieved through end-user

energy saving programs

EERS is also called Energy Saving Obligations or

White Certificate Scheme or Utility Energy Efficiency

Obligation

Page 5Page 5

Why EERS?

• Achievement of the energy savings target is relatively

certain (and can be measured with monitoring and

verification scheme)

• Relatively low burden on public budgets may lead to higher stability than other EE policies

• An EERS scheme can stimulate the development of ESCO

markets or other EE service industry

• EERS schemes are particularly well suited for standardised

EE measures in the residential sector or for SMEs

• In developing/emerging economies: reducing need for

additional power plant development

Page 6Page 6

Why utilities?

Utilities are well suited for implementing EE programs due to:

• existing customer relations

• availability of energy consumption data

• advice infrastructure & expertise in energy efficiency

Advantages for utilities (distributors):

• Avoided or postponed distribution network upgrades due to

peak load reductions

• Strengthened customer relationships, improved reputation

• Development of new markets in the field of energy services

Page 7Page 7

EERS worldwide

Page 8Page 8

Why would utilities save energy?

Who is going to pay?.

What is EERS?.

Do we need ESCO’s?.

Where should savings come from?

Baseline situation Thailand and EERS

Page 9Page 9

Baseline situation Thailand and EERS

• EERS is new in the region and new to Thailand

• Centralised energy system model, with limited number of

utilities, can have pros and cons in developing EERS

• Development of EERS is in need of process that creates

support and commitment of key stakeholders

• EERS experience worldwide are useful but needs

adjustment to local conditions

• … EERS development in Thailand therefore started with

a process of developing EERS design options as a basis

for stakeholder discussions

Page 10Page 10

Responsible Agency:• Defines saving target • Defines eligible measures and calculation methods• Certifies achieved energy savings• Monitors and evaluates the EERS

Utility 1 Utility 2Bilateral

trading of certificates?

ESCO X, Y, Z or other EE services

Certified energy savings

Certified energy savings

Certified energy savings

EERS design decisions to be taken in Thailand :1. Obligated parties

2. Basis for setting target

3. Financing the EERS pilot

4. Level of savings target

5. Options for achieving target

6. Implementation & Oversight

7. Measuring energy savings

8. Cost recovery

EERS development in Thailand: design decisions

End-users

Implementa-tion of mea-

sures

Implementa-tion of mea-

sures

Promotion CampaignsFinancial incentivesEnergy Consumption Feedback / Energy Audits

Page 11Page 11

EERS design: Obligated parties  Advantages DisadvantagesObligated parties    

Option 1:MEA and PEA (distribution and retail)

• Enables spatially differentiated saving targets

• Existing relationships with end-users and availability of data can facilitate implementation of energy efficiency measures

• Less capacity to implement energy efficiency measures at large scale

Option 2:EGAT(generation & transmission)

• Good overview regarding the spatial and temporal distribution of capacity bottlenecks and corresponding peak load reduction potentials.

• Long experience in DSM and sufficient personnel and financial resources

• No or limited direct link to the end-users

Option 3:EGAT and PEA&MEA

• Individual competences may lead to a larger portfolio of measures

• Higher competition may increase cost-effectiveness

• Increased coordination requirements between obligated parties

• Difficulty in setting individual saving targets and cost recovery rates due to different functions in the energy market

Page 12Page 12

EERS design: discussion framework for all options

Page 13Page 13

EERS development: (interim) lessons learned

• Centralized energy system model can have pro’s and cons

for EERS development

• Commitment of high levels in Ministry of Energy is essential

• Utilities support for EERS is pre-condition and can take

time: using discussion framework as part of process

• Starting with a pilot to build trust and stakeholder support

• Long term vision and changing utility futures can help to

create support for EERS

Page 14Page 14