ERC Approves Power Rate Hike Starting September

The average electricity rate in Thailand will increase by 18% or 4.72THB per kilowatt hour (KWh) starting September to December 2022, according to the Energy Regulatory Commission (ERC) on Monday.

The ERC made the announcement through its Facebook page, explaining the increase was caused by the surge in fuel tariff from 0.6866THB per KWh to 0.9343THB per KWh, as the price of imported liquefied natural gas (LNG) rose as well.

Moreover, the decrease in production of low-cost domestic gas supplied by the offshore Erawan gas block in the Gulf of Thailand prompted the increase in LNG imports. The price of imported LNG from the Spot market ranges from US$25- US$50 per metric million standard cubic feet per day (MMSCFD) versus US$6- US$7 per MMSCFD from the Gulf of Thailand.

With the global economic recovery in the last quarter of 2021, there was a sharp uptick in the demand for LNG and other energy sources. Due to the Ukraine-Russia war, Russia decided to reduce the amount of natural gas it exports to Europe which has an indirect effect on the price increase of LNG in the Asian market, the announcement read.

Prime Minister Prayut Chan-o-cha postponed the official announcement that was supposed to take place on Aug.1 to further discuss ways on how to mitigate the effects of the price hike to the underprivileged, according to a report from Bangkok Post on Aug. 15.