Laws in Thailand Promoting
Renewable Energy:
the REcent Developments*
Chacrit
Sitdhiwej†
A recent observation argues that the Thai
energy laws, varying from the making of national energy policies and plans to the
conservation of energy use, can be used to promote renewable energy in three
aspects. Firstly, the 1992 National Energy Policy Act empowers
the National Energy Policy Council and the Office of Energy Policy and Planning
to be responsible for the making and regulating Thailand’s energy policies and
plans, including those of renewable energy. However, it is suggested that the
incomplete modification of the component of the National Energy Policy Council
under the 2002 public administration reform may create a difficult division of
responsibility between the Minister of Energy and the top ranks in the Council
of Ministers. As a result, the relevant provision of the Act needs an
appropriate amendment.
Secondly, the 1992 Promotion of Energy
Conservation Act, which aims at the efficient and economical production and use
of energy by providing incentives to those who put efforts into energy
conservation measures and providing disincentives to those who fail to comply
with such measures, can be used to promote renewable energy, especially by
substituting non-renewable energy with renewable energy measures.
Thirdly, the Department of Alternative
Energy Development and Efficiency, which is the key state agency in relation to
technical aspects and regulation of energy production, transmission and
distribution under the 1992 Energy Development and Promotion Act, can play a
significant role in renewable energy promotion. In addition, the measures
related to ‘regulated energy,’ if wisely used, can be useful in renewable
energy promotion.
This paper discusses the latest
developments of the Thai government’s initiatives over the above three aspects
since last observation.
II
Laws in Thailand Promoting Renewable Energy
Thailand is a country rich in renewable
energy sources. The potential renewable energy sources are biomass, biogas,
solar electric energy, solar thermal energy and wind energy.
Biomass and biogas sources in Thailand
are abundant. As a result, Thailand has high potential for bioenergy use. Wood, agricultural residues and
wastes are used for heating in rural areas. Animal wastes are used to produce
biogas.
Because of its geographical location and
landscape, Thailand has a high potential for solar energy use in terms of
concentration and amount of utilisation areas. Approximately 50 per cent of
Thailand’s terrain is exposed to concentrated sunlight all year round.
In addition, the eastern and western coasts of southern Thailand have a high
potential for wind energy use.
Despite the abundant and potential sources,
renewable energy use in Thailand is only 0.5 per cent of commercial energy use.
Before 1992, energy matters in Thailand
were administered under the National
Energy Act, BE 2496 (1953). In 1992, under an initiative of the coup d’état
government, the then National Legislative Assembly passed a series of new
energy laws to replace the 1953 Act, comprising the laws on national energy
policy and planning, promotion of energy conservation and energy development
and promotion.
A National Energy Policy and Planning Law
The national energy policy and planning
law of Thailand are administered under the National
Energy Policy Council Act, BE 2535 (1992). This Act established the
National Energy Policy Council to be responsible for the making of Thailand’s
energy policies and plans. It also established the Office of Energy Policy and
Planning as its secretariat.
The Act defines the term ‘renewable
energy’ for the first time in Thai legal history.
1
Official
Definition of Renewable Energy
Simultaneously and identically with
section 3 of the Promotion of Energy
Conservation Act, BE 2535 (1992) and
section 5 of the Energy Development and
Promotion Act, BE 2535 (1992), section 4 of this Act defines the term ‘renewable energy’ to include ‘energy obtained
from wood, firewood, paddy husk, bagasse, biomass, hydropower, solar power,
geothermal power, wind power, waves and tides.’ All these Acts also define
another term that involves renewable energy sources, ie ‘fuel,’ to include
non-renewable, the above renewable energy sources, garbage and synthetic fuel.
In addition, the term ‘energy’ is defined to include renewable energy. As a
result, all provisions of the said three Acts apply to renewable energy
matters.
Section 5 established the National Energy
Policy Council (NEPC), while section 6 provides that NEPC is responsible for
the submission of national energy policies and national energy plans to the
Council of Ministers, and is also responsible for the monitoring, supervision,
coordination, support and expedition of operations of all bodies whose powers
or duties are related to energy, including renewable energy, both in public and
private sectors, in order that their operations are in accordance with the said
national energy policies and plans.
In August 2003, Prime Minister Thaksin
Shinnawatra and the Ministry of Energy launched the Energy Strategy for Competitiveness at the Workshop on Energy
Strategy for Competitiveness to set out Thailand’s strategic plans for energy
efficiency, renewable energy development, energy security enhancement and
Thailand to be the regional energy centre.
Under section 5, the Prime Minister
chairs NEPC. Other members include those of high ranks in the administrative
branch, ie a Deputy Prime Minister designated by the Prime Minister as
Vice-Chairperson, all other Deputies Prime Minister, a Minister Attached to the
Office of the Prime Minister designated by the Prime Minister, Minister of
Defence, Minister of Finance, Minister of Foreign Affairs, Minister of
Agriculture and Cooperatives, Minister of Transport and Communications,
Minister of Commerce, Minister of Interior, Minister of Energy, Minister of Industry,
Permanent Secretary of the Ministry of Industry, Secretary-General of the Council of
State, Secretary-General of the National Economic and Social Development Board,
Director of the Bureau of the Budget and Director-General of the Department of
Alternative Energy Development and Efficiency.
The Council-of-Ministers-like component
of NEPC clearly indicates the importance of energy and NEPC to Thailand.
Besides the result of the definition of the term ‘energy,’ the powers and
duties provided to NEPC are broad themselves. As a result, NEPC may include the
promotion of renewable energy into the national energy policies and plans, and
may make efforts to monitor, supervise, coordinate, support and expedite the
operations of all renewable energy related bodies to ensure the harmonisation
of their operations and the said national energy policies and plans.
NEPC meetings are often conducted
alongside Council of Ministers meetings. On many occasions, the Council of
Ministers directly brings into its consideration a number of energy-related
policies, plans or projects proposed by competent Ministries or state agencies,
rather than waiting until such policies, plans or projects come through the
regular bureaucratic lines of command. For example, on 18 May 2004, the Council
of Ministers approved the gasohol and bio-diesel development projects jointly
proposed by the Ministry of Energy and Ministry of Agriculture and Cooperatives
as part of the promotion of alternative energy use to counter the recent oil
price crisis in Thailand.
It should be noted, however, that as part
of the recent public administration reform in October 2002, there was an
attempt to enact a royal decree to amend section 5 to modify
the composition of NEPC and to transfer the powers and duties of the Prime
Minister in NEPC to the newly established Ministry of Energy, by removing the Prime
Minister, all Deputies Prime Minister and the Minister Attached to the Office
of Prime Minister, and replacing them with the Minister of Energy as
Chairperson of NEPC. However, owing to a concern as to the constitutionality of
the delegation of powers in the enactment of the Royal Decree Amending Provisions to be Consistent with the State Agency
Organisation Act, BE 2545, BE 2545 (2002), ie the extent to which the Royal
Decree could affect the provisions of the Act, the attempt to transfer powers
was suspended. As a result, the Prime Minister,
Deputies Prime Minister and the Minister Attached to the Office of Prime
Minister are still lawful members of NEPC.
Thus, oddly, the Prime Minister and Deputies Prime Ministers still hold most
powers and duties under this Act whereas the Minister of Energy, who was
attempted to exercise such powers and duties, plays no significant role under
this Act. Undoubtedly, section 5 needs proper amendment by way of legislation
to eliminate such an incomplete and awkward transfer of the aforesaid powers
and duties by removing the Prime Minister, all Deputies Prime Ministers and the
Minister Attached to the Office of Prime Minister from NEPC, then replacing
them with the Minister of Energy as Chairperson of NEPC.
Section 9 established the Office of the
National Energy Policy Council (ONEP) as the secretariat of NEPC. ONEP’s powers
and duties include the preparation of the national energy policies mentioned
above and plans for NEPC. The Secretary-General of NEPC was also established
under section 5 generally to supervise the performance of the official affairs
of ONEP, whereas section 10 requires the Secretary-General to be responsible
directly to the Prime Minister and to be a member and secretary of NEPC. As a result
of the 2002 public administration reform, however, ONEP and its
Secretary-General have been converted to the Office of Energy Policy and
Planning (OEPP) and the Director-General of the Office of Energy Policy and
Planning, respectively. In addition to this Act,
OEPP is administered under the Ministerial
Regulation Organising the Office of Energy Policy and Planning, Ministry of
Energy, BE 2545 (2002). Clause 1 provides missions, powers and duties to
OEPP similar to those given to NEPC.
In March 2004, OEPP published a report
entitled Thailand Energy Policy and
Measures, 2546 (2003). This report presents Thailand’s energy situation in
2003 and projects the 2004 energy trend. Part 4, ‘Energy Strategies: Energy for
Thailand’s Competitiveness,’ includes the ‘Alternative Energy Development
Strategy: A New Opportunity for Thailand.’ This particular strategy recognises
the importance of decreasing Thailand’s dependency on imported fossil fuel and
its adverse impacts on the environment. As a result, and to be inline with the Energy Strategy for Competitiveness,
OEPP has established a goal to increase the use of alternative energy from 0.5 per cent of commercial
energy use in Thailand in 2002 to eight per cent by the year 2011. To achieve
this goal, OEPP proposes that the following measures should be implemented:
(1)
legislation
requiring the renewable portfolio standard (RPS) should be enacted to require
all newly built power plants to generate at least four per cent of their
electricity from solar or wind energy or biomass;
(2)
incentives
promoting power purchase from alternative energy sources, including renewable
energy sources;
(3)
research and
development of high potential renewable energy sources in Thailand; and
(4)
promotion to the community
of share ownership of renewable energy power plants.
In addition, Part 5 of the report,
entitled ‘Energy Policies and Measures for 2546 (2003),’ includes the ‘Very
Small Power Producers Purchase Project’ and ‘Small Power Producers from
Renewable Energy Project.’ Both projects promote small-scale generation and the
purchase of electricity from domestic renewable energy sources, such as solar
cells, agricultural residues and biogas.
There is also a law on the promotion of
energy conservation, the Promotion of
Energy Conservation Act, BE 2535 (1992), which can apply to
the promotion of renewable energy in Thailand.
B Promotion of Energy Conservation Law
Energy conservation promotion in Thailand
is administered under the 1992 Promotion of Energy Conservation Act. Section 4
empowers NEPC to promote energy conservation. Its powers include the submission
of policies, goals or measures related to energy conservation to the Council of
Ministers, and the prescription of guidelines, rules and conditions for the
promotion and assistance to factories, buildings, producers or distributors of
highly energy efficient machineries, equipments or materials used for energy
conservation. By virtue of section 3, which defines the term ‘energy’ to
include renewable energy, certain provisions of this Act apply to renewable
energy where they are applicable.
As its title denotes, the Act aims to
promote energy conservation. Only the regulated factories, regulated buildings,
and prescribed machineries, equipments and energy efficient materials are
required to implement the given measures. The Act provides incentives in terms
of support and assistance to those who comply with the designated energy
conservation measures. On the other hand, it provides disincentives to those
who fail to comply with the designated energy conservation measures.
Although most of the provisions of the
Act are dedicated to energy conservation, particularly the conservation of
conventional energy, some provisions are worth exploring in detail as they can
be used to promote renewable energy use in Thailand.
Part 1 of the Act provides energy
conservation measures for regulated factories. Section 8 provides that
regulated factories shall be prescribed, by royal decree, by either types or
sizes of factories, or by quantities or methods of energy use.
The Royal
Decree Prescribing the Regulated Factories, BE 2540 (1997) prescribes the
factories by quantities of energy use. Section 3 of the Royal Decree provides that,
after 120 days of its entry into force, the following organisations were
defined as regulated factories:
(1)
a factory or
group of factories with an electricity installation of at least 10,000 kW or
11,750 KVA; and
(2)
a factory or
group of factories whose electricity, steam heat or any other non-renewable
energy consumption is at least two million mega Jules (MJ) of electricity
equivalent.
Section 4 of the Royal Decree prescribes
additional regulated factories, ie one year after its entry into force, factories
in category (1) above whose electricity installation is from 3,000 kW to 10,000
kW or from 3,530 KVA to 11,750 KVA; and factories in category (2) above whose
energy consumption is from 60 million to 200 million MJ of electricity
equivalent were defined as regulated factories. Sections 5 and 6 prescribe
further additional regulated factories two and three years after the entry into
force of the Royal Decree, respectively.
As from July 2000, as a result of section
6, the followings are regulated factories:
(1)
a factory or
group of factories whose electricity installation is at least 1,000 kW or 1,175
KVA; and
(2)
a factory or
group of factories whose electricity, steam heat or any other non-renewable
energy consumption is 20 million MJ of electricity equivalent.
Section 3 of the Act defines the term
‘energy conservation’ as ‘the production and use of energy efficiently and
economically,’ and also defines the term ‘energy’ as ‘an ability to perform
work inherent in the sources capable of generating powers, which are renewable
and non-renewable energy, and shall include the sources which may generate
powers, such as fuel, heat and electricity.’
Section 7 of the Act provides energy
conservation measures for the regulated factories. Interestingly, one of the
energy conservation measures provided under section 7(4) is the substitution of
one type of energy by another type. According to the above definitions of the
terms ‘energy conservation’ and ‘fuel,’ the substitution of power generated
from non-renewable energy by another power generated from renewable energy can
be a renewable energy conservation measure. For example, a regulated factory
may substitute electricity purchased from diesel power plants, which is a
non-renewable energy source, with electricity purchased from hydropower or
solar power plants, which are renewable energy sources. As a result, the owners
of regulated factories that employ such substitutions of energy benefit from
the promotion or assistance provided in Part 5 of the Act, ie an exemption from
paying surcharges, grants or subsidies from the Fund for Promotion of Energy
Conservation under section 25. Under this section, any successful applicant
will be funded grants or subsidies for investment in operation of his/her
energy conservation programme, for solving environmental problems resulting
from energy conservation programme, for research and development on energy
development or environmental protection, or for education, training or
conferences with respect to energy.
2
Energy
Conservation in Regulated Buildings
Part 2 of the Act provides energy
conservation measures for regulated buildings prescribed by royal decree
enacted under section 18. Section 18 provides that the royal decree will
prescribe regulated buildings by types or sizes of buildings or quantities or
methods of energy use.
The Royal
Decree Prescribing the Regulated Buildings, BE 2538 (1995) prescribes
regulated buildings by quantities of energy use. Section 3 of the Royal Decree
provides that the following buildings are regulated buildings:
(1)
a building or
group of buildings whose electricity installation is at least 1,000 kW or 1,175
KVA; and
(2)
a building or
group of buildings whose electricity, steam heat, or any other non-renewable
energy consumption between 1 January and 31 December of each year is at least
20 million MJ of electricity equivalent.
Section 17 of the Act provides a number
of energy conservation measures for regulated buildings. However, none of these
measures provides for renewable energy use in regulated buildings, in particular,
the energy substitution measure as provided for regulated factories under
section 7. As a result, the owners of regulated buildings that employ such
substitutions of power generated from non-renewable energy by power generated
from renewable energy in regulated buildings are not eligible for the promotion
or assistance provided in Part 5, from which the owners of regulated factories
benefit.
It may be argued that the Act does not provide
an energy substitution option for regulated buildings like that for regulated
factories because – probably owing to lack of appropriate renewable energy
technologies – it is unlikely that the owners of regulated buildings would put
much effort into substituting conventional energy sources with such renewable
energy resources.
Section 23(1) of the Act empowers the
Minister,
under a recommendation from NEPC, to issue a ministerial regulation prescribing
any machinery or equipment by types, sizes, quantities of energy use, energy
consumption ratio or energy efficiency, as highly efficient machinery or
equipment, or prescribing any material by types, quality and standards, as highly
efficient material. By virtue of section 23(2), any producer or distributor of
such prescribed machineries, equipments or highly efficient materials is
eligible to apply for promotion or assistance under section 40.
Unfortunately, no ministerial regulation
prescribing highly efficient machineries, equipments or materials has been
issued. As a result, no one has been eligible for promotion and assistance
through this measure.
Section 24 of the Act established the
Fund for Promotion of Energy Conservation (FPEC) in the Ministry of Finance.
Section 27 established the FPEC Committee to administer and manage FPEC.
Section 25 provides that the use of FPEC will be limited mainly to energy
conservation and to solving problems resulting from energy conservation, but
not resulting from renewable energy use or development. Fortunately, section
25(3)(d) distinctively provides that FPEC can be used for studies, training or
conferences related to energy, including renewable energy. As a result, FPEC is
able to play a significant role in the promotion of renewable energy. It can be
used to provide grants or subsidies for any study, training or conference
related to renewable energy promotion.
5
Promotion and
Assistance Measures
Part 5 of the Act provides the promotion
and assistance benefits as incentives to those who put their efforts into
achieving the designated energy conservation measures. Section 40(1) provides
that any regulated factory or building that is required to establish an energy
conservation programme and is required to acquire machineries, equipments,
tools, articles and materials essential for such a programme, or any producer
or distributor of highly efficient machineries or equipments or materials used
in energy conservation, is eligible to apply for exemption from paying
surcharges, grants or subsidies from FPEC under section 25. Section 40(2)
further provides that any owner of a factory or building and any state agency
that is not required to establish an energy conservation programme, but desires
to acquire machineries, equipments, tools, articles or operation control
systems of its own for the purpose of energy conservation, is also eligible to
apply for promotion and assistance measures under section 40(1).
Sections 35, 36 and 37 require all
petroleum producers or petroleum importers for domestic consumption and those
who purchase or obtain gas from any concessionaire who produces such gas from
the separation of natural gas to send contributions to FPEC at the rates
prescribed by NEPC. Under section 58, those who fail to send such contributions
are subject to imprisonment for between three months and two years, or a fine
of 100,000 to 10,000,000 Thai Baht, or both.
6
Surcharges and
Promotion of Renewable Energy
Part 6 of the Act provides for the
imposition of surcharges as a disincentive to those who fail to comply with the
designated energy conservation measures. Section 42 requires owners of
regulated factories or regulated buildings that violate or fail to comply with
the ministerial regulation issued under section 9 or 19 to pay surcharges.
These surcharges apply to electricity consumption generated either from
non-renewable or renewable energy sources.
Section 9 requires owners of regulated
factories to conserve energy, and audit and analyse energy use in their
factories so as to comply with standards, rules and procedures prescribed under
ministerial regulation, whereas section 19 empowers the Minister, under a
recommendation from NEPC, to issue ministerial regulations to prescribe:
(1)
total building
thermal transfer values and building energy consumption values;
(2)
rules, procedures
and conditions for the estimation of the thermal transfer value of construction
materials, building total thermal transfer values and building energy
consumption values; and
(3)
standards for air
conditioning, hot water and building heating systems for regulated buildings.
At present, the Ministerial Regulation (BE 2538 (1995)) issued under the
Promotion of Energy Conservation Act, BE 2535
(1992) is the only ministerial regulation issued under section 19. It
prescribes the total thermal transfer values of buildings and building parts,
such as roof and external walls, building energy consumption values and also
prescribes procedures for the estimation of thermal transfer values of
construction materials, total building thermal transfer values and electricity
consumption values. No ministerial regulation under section 9 to prescribe
similar parameters for regulated factories has yet been issued. As a result, no
regulated factory is subject to the surcharges. Only regulated buildings that
violate or fail to comply with the 1995 Ministerial Regulation are subject to
the surcharges.
Section 43(1) empowers the FPEC
Committee, with the approval of NEPC, to prescribe the rates of the surcharges
for electricity consumption, whereas section 43(2) sets out criteria for
prescribing the surcharge rates, ie the differences between the rates payable
to the Electricity Generating Authority of Thailand, the Metropolitan
Electricity Authority or the Provincial Electricity Authority and the total
inclusive costs of the production and distribution of such quantities of
electricity to the regulated factories or regulated buildings.
Under section 45, the FPEC Committee has
sole discretion as to whether to terminate temporarily or reduce the violator’s
rights to apply for the aforementioned support and assistance.
Section 46 provides that the surcharge
payment, termination and reduction of support and assistance will be terminated
as of the first day of the following month of compliance with the Ministerial
Regulation.
As part of the 2002 public administration
reform, the former Department of Energy Development and Promotion was converted
to the Department of Alternative Energy Development and Efficiency (DEDE) under
section 27 of the 2002 Public Agency Organisation Act. The Ministerial Regulation Organising the Department of Alternative Energy
Promotion and Energy Conservation, BE 2545 (2002) outlines the missions, powers and duties of DEDE.
DEDE is the key state agency in charge of
the regulation of energy conservation and renewable energy matters in Thailand. Under clause 1 of the
Ministerial Regulation, DEDE’s missions include the promotion of efficiency of
energy use, the regulation of energy conservation, the acquisition of energy
sources, the development of the integrated use of energy and the systematic
dissemination of energy technologies to suit the needs of all sectors of the
society, while being practical for the country’s development and promoting a
better quality of living. Clause 1 also specifies the powers and duties of
DEDE. These include:
(1)
research, studies
and the development of alternative energy;
(2)
the prescription
of rules and standards on alternative energy technologies;
(3)
the dissemination
of technologies for alternative energy production, transmission and
utilisation; and
(4)
the monitoring
and evaluation of alternative energy development.
The above missions, powers and duties
cover any activity of DEDE related to renewable energy.
The term ‘alternative energy’ is widely
used among concerned Thai State agencies. As Thailand heavily relies on
imported gasoline and diesel, the term tends to include any alternative
non-renewable energy sources that can substitute imported gasoline and diesel,
such as natural gas, clean-coal-technology, gasohol and bio-diesel, which are
either fossil-proper or fossil-based energy. The term also includes all forms
of renewable energy.
C Energy Development and Promotion Law
Energy development and promotion in
Thailand is administered under the 1992 Energy Development and Promotion Act.
This Act replaces the 1953 National Energy Act. It specifically provides powers
and duties to DEDE in relation to research, development and the regulation of
energy production, transmission and distribution.
1
DEDE
As mentioned earlier, DEDE was converted
from the Department of Energy Development and Promotion as part of the 2002
public administration reform. Section 7 of the 1992 Energy Development and Promotion Act appoints the Director-General
to be the superior official and responsible for the performance of the official
affairs of DEDE. In addition, the Ministerial
Regulation Organising the Department of Alternative Energy Promotion and Energy
Conservation, BE 2545 (2002) provides
the missions, powers and duties of DEDE.
Besides the Ministerial Regulation,
section 6 of the Act provides that DEDE should:
(1)
explore, collect
information, analyse, experiment and examine activities concerning energy
sources, production, process, transmission and utilisation;
(2)
study, plan and
formulate projects concerning energy and related activities;
(3)
research,
develop, demonstrate and initiate pilot projects concerning energy production,
process, transmission, utilisation and conservation;
(4)
design, construct
and maintain sources of energy production and process, and energy transmission
and utilisation systems;
(5)
prescribe rules
and standards concerning energy production, process, transmission, utilisation
and conservation, as well as regulate the implementation of such rules and
standards;
(6)
prescribe
remuneration for energy use operated by DEDE;
(7)
provide,
regulate, construct, purchase, sell, rent, lease out, transfer or accept
transferral sources of energy production or process, transmission or
distribution systems, and issue licences for energy production or the expansion
of production capacity;
(8)
transfer
technologies, promote, train, and disseminate matters concerning energy
production, process, transmission, utilisation and conservation, as well as act
as a centre for cooperation on related activities.
By virtue of section 5 of the Act, which
defines the term ‘energy’ to include renewable energy, these powers and duties
also apply to renewable energy.
There are a number of bureaus under DEDE
that are in charge of renewable energy matters, ie the Bureau of Energy
Technology Transfer (BETT), the Bureau of Energy Development (BERD), the Bureau
of Solar Energy (BOSE) and the Bureau of Energy Research and Study (BERS).
These bureaus individually and jointly perform their powers and duties.
BETT has the powers and duties to
disseminate and transfer energy technologies, and to campaign and demonstrate energy
technologies, including those related to renewable energy.
BERD has the powers and duties to
prescribe rules, standards of energy production, process, transmission and
utilisation, to prescribe guidelines for energy acquisition and development and
to explore, design, construct and maintain energy production, process,
transmission, distribution and utilisation, including those related to
renewable energy.
BOSE is the most
renewable-energy-oriented bureau in DEDE and in Thailand. It has the powers and
duties to study, research, demonstrate and develop solar energy production,
process and utilisation technologies, to study the application of solar energy
innovations that suit domestic potential and resources, and to disseminate,
transfer and promote knowledge on solar energy.
BERS has the powers and duties to study,
research, demonstrate and develop energy production, process and utilisation
technologies, and to study the application of energy innovation that suits
domestic potential and resources, including those related to renewable energy.
DEDE may seek assistance from any state
agency, local administration or state enterprise. Sections 8 of the Act
empowers DEDE to assign any of these bodies to perform any particular task on
its behalf. To ensure the achievement of the assigned task, section 9 requires
the relevant bodies to perform the assigned tasks accordingly. Section 9(1)
appoints officers of such bodies as competent officers who enjoy the same
powers and duties as competent officers of DEDE to ensure the proper authority
of the assigned bodies and their workforce. In addition, section 10 provides
that DEDE may request any state agency, local government, state enterprise or
any individual to furnish technical, financial, and statistical or any other
information as required. This provision allows DEDE to acquire any specific
information required, including those related to renewable energy, from experts
to help it in achieving its work.
2
Competent Officer
Section 5 of the Act defines the term
‘competent officer’ as an officer of DEDE and an officer of any state agency,
local administration or state enterprise who is designated under this Act.
Section 11(1) empowers the competent officer to enter any place during the
period between sunrise and sunset, or during the working hours of such place,
for the purpose of enquiring after facts or inspecting documents or other
articles related to energy activities from any individual who is at such place
as it is deemed necessary. Accordingly, the occupant must comply with the
requests of the competent officer. To ensure individual privacy and property
rights, section 11(2) provides that, except in emergencies, a competent
official who wishes to enter a private place must notify the occupant of that
place in writing at least three days in advance. Section 33 provides that any
person who fails to comply with the requests of the competent officer will be
subject to imprisonment for up to one month, or a fine of up to 1,000 Thai
Baht, or both.
Section 14 empowers a competent officer
to use or occupy any real property that is not a place of residence on a
temporary basis if it is necessary for exploration of energy production
sources, energy transmission or distribution systems, safety precaution against
any danger or damage that may be caused to energy production or transmission or
distribution, provided that the owner or occupant of such property is notified
at least 15 days in advance. Any person who obstructs or fails to facilitate
the competent officer will be subject to imprisonment or a fine under section
33. However, if any damage occurs to the owner or occupant of, or any person
who holds any other right over, such property as a result of the execution of
work by the said competent officer, the affected person may claim compensation
from DEDE. The Liabilities of Officials
on Wrongful Acts, BE 2539 (1996) then applies to the proceeding of such
claim.
In cases of emergency, section 21
empowers a competent officer to enter any place of any person to inspect,
repair or correct energy lines or pipelines or equipments at all times,
provided that the owner or occupant has been notified. Section 33 also provides
for imprisonment or a fine against any person who obstructs or fails to
facilitate the competent officer in performing his or her duties.
Section 13 provides that a competent
officer is also an officer designated under the Penal Code. This provision
grants considerable protection to a competent officer in performing his or her
powers or duties, while providing a severe penalty to a competent officer who
abuses his or her duties.
3
Rights of Way
On many occasions, DEDE may need a right
of way for the execution of its works, for example, in mobilising machineries
or equipments for power lines or equipment installation. As a result, section
16(1) of the Act empowers DEDE to establish an energy station, install energy
lines or pipelines under, above, along or across the land of any person, or to
install poles or equipments into or on undeveloped land of any person, provided
that this is necessary for the benefit of the community. Section 33 provides
for imprisonment and a fine against any person who obstructs or fails to
facilitate the competent officer. On the other hand, to ensure the protection
of property rights, section 16(2) requires DEDE to pay a fair amount of
compensation to the landowner or occupant for such use, unless the owner or
occupant gains worthwhile benefits from such action.
In certain cases, DEDE may only need to
fix certain lines or pipelines onto buildings adjacent to a public road without
occupying any land. In such a case, section 17 empowers DEDE to fix energy
lines or pipelines, for the benefit of the community, onto the building of any
person that is above or next to a public thoroughfare. However, section 18
provides that, in exercising its power under section 16 or 17, DEDE should
notify the relevant owner or occupant of such land or building. In this case,
the relevant landowner or occupant may file a petition to the Minister within
15 days.
Section 19 empowers DEDE to cut down any
trunk, branch or root of trees that are close to energy lines or pipelines or
equipments, for the sake of safety in energy transmission, provided that the
owner or person who holds the right over such property is notified in advance
and within a reasonable amount of time. Any person who obstructs or fails to
facilitate the competent officer is subject to imprisonment or a fine under
section 33.
Section 20 provides that the owner or
occupant of property involved who wishes to construct or conduct any activity
on the land where energy lines or pipelines or equipments may obstruct such
action may request DEDE to move, remove, modify or correct such obstruction. It
is in DEDE’s sole discretion as to whether to comply with such a request,
provided that all expenses incurred are borne by the owner or occupant.
Section 5 defines the term ‘regulated
energy’ as energy that is subject to regulation under the Act, except for
petroleum that is administered under the law on petroleum.
Section 24 provides that regulated energy
shall be prescribed by a royal decree. The Royal
Decree Prescribing Regulated Energy, BE 2497 (1954) was enacted under the repealed 1953 National Energy Act, but still
continues in force by virtue of a transitional provision, i.e. section 39. This
Royal Decree prescribes only electricity as regulated energy. No renewable
energy resource has ever been prescribed as regulated energy. Electricity
technically is not energy, but power. However, section 5 follows its
predecessor, the 1953 National Energy Act, to define the term ‘energy’ to
include electricity. The electricity under the said Royal Decree is: (1)
electricity with a total production capacity of 25 kW and above, in the case of
the production for distribution to the general public; and (2) electricity with
a total production capacity of 50 kW and above, in the case of production not
for distribution to the general public.
Section 25(1) prohibits any person from
producing or expanding the production capacity of regulated energy, unless a
licence is granted by DEDE. Any person who violates this section is subject to
imprisonment for up to two years, or a fine of up to 20,000 Thai Baht, or both,
under section 34. Section 25(2) provides that any application for a licence
must comply with the rules and procedures prescribed in the ministerial
regulation. In addition, section 26 provides matters that will be taken into
account in prescribing such rules and procedures. They are:
(1)
impacts on the
environment, economy and national security;
(2)
potential dangers
that might be caused by energy production or expansion of such production; and
(3)
experience in the
use of raw materials or natural materials.
Ministerial
Regulation No 2 (BE 2539 (1996)), issued under the Energy Development and Promotion Act, BE 2535
(1992), prescribes such rules and procedures.
In granting a licence, section 27 of the
Act provides that DEDE may prescribe the following conditions:
(1)
the highest
possible rates of compensation that the licensee may demand from users of the
regulated energy;
(2)
the specific area
for energy distribution and size of machineries to be installed for production
process;
(3)
scientifically-acknowledged
and accepted performance on works such as the installation of energy lines,
fire protection, safety precaution for damage to machineries, other safety
precaution measures, or classification of or procedures for the use of raw
materials or natural materials in the production of regulated energy.
In the event of a periodic shortage of
regulated energy or of any other necessity of benefit to the country’s economy,
section 28 provides a number of measures that the Director-General may order in
writing to any regulated energy producer. They are:
(1)
to decrease or increase
any production, distribution or utilisation of regulated energy;
(2)
to change the
kinds of raw materials or natural materials used in producing regulated energy;
and
(3)
to change the
highest possible rates of compensation that the licensee may demand from users
of regulated energy.
In addition, in order to eliminate or
prevent possible hazards to any person, property, public health or national
security, section 29 provides a number of measures that the Director-General
may order in writing to any regulated energy producer. They are:
(1)
to change, repair
or renovate any building, machinery, equipment, tool or article;
(2)
to acquire or
construct any structure that will eliminate or prevent hazards; and
(3)
to terminate
temporarily the production, transmission, utilisation or distribution of
regulated energy until proper action under (1) or (2) has been taken.
Section 35 provides that any person who
fails to comply with an order issued under section 28 or 29 is subject to
imprisonment for up to one year, or a fine of up to 10,000 Thai Baht, or both.
Section 30 ensures the practicality of
the order given under sections 28 and 29 by requiring DEDE to take into account
the additional expenses that a regulated energy producer may incur or the
ability of the producer to raise funds.
Section 31 provides a right of appeal to
any person who is aggrieved with a decision on a licence application or order
made under section 28, 29 or 30. This person may file an appeal to the
Minister. If the appellant does not agree with the decision made on the appeal,
he or she may file a case to the court. This kind of disputes are
administrative cases and fall within the jurisdiction of the Administrative
Court under the Establishment of the
Administrative Court and Procedures of the Administrative Court Act, BE 2542
(1999).
Section 32 provides protection to
regulated energy production in that any action by any person that may obstruct
or diminish regulated energy production is prohibited. Section 36 provides that
anyone who violates this section is subject to imprisonment for up to one year,
or a fine of up to 10,000 Thai Baht, or both.
III
The Recent Developments
A The National Energy Policy Council and the Ministry of
Energy
The incomplete public administration
reform in October 2002 has left the composition of NEPC and the transfer of
powers and duties among the Prime Minister, Deputies Prime Minister, Minister
Attached to the Office of Prime Minister and the Minister of Energy in an
awkward situation. The Prime Minister, Deputies Prime Minister and Minister
Attached to the Office of Prime Minister, who were attempted to be removed from
NEPC, and replaced by the Minister of Energy, are still lawful members of NEPC
and hold most powers and duties under the 1992 National Energy Policy Council
Act whereas the Minister of Energy, who was attempted to exercise such powers
and duties, play no significant role. Despite the absence of clear
consequences of this confusion, a proper amendment to section 5 of the Act by
way of legislation is still needed before its difficulties cause any damage.
B RPS
RPS has been introduced among independent
power producers (IPPs). However, at present, no legislation requiring RPS has
been enacted to ensure the country’s sustainable and mandatory goal for
renewable energy use as suggested by OEPP’s report. IPPs are required to adhere
to RPS under bidding contracts. That is, in bidding to supply their power to
Electricity Generating Authority of Thailand, all IPPs must produce 5% of their
installed energy generating capacity from renewable sources.
C Power Substitution in Regulated Factories
The substitution of power generated from
non-renewable energy by another power generated from renewable energy provided
under section 7(4) of the 1992 Promotion of Energy Conservation Act can be a
renewable energy conservation measure. This measure allows the owners of
regulated factories to benefit from the promotion or assistance provided in
Part 5 of the Act, ie an exemption from paying surcharges, grants or subsidies
from the Fund for Promotion of Energy Conservation under section 25. However, this measure has
never been used or even considered.
D FPEC
Despite the powers under section
25(3)(d), FPEC has never played its role in the promotion of renewable energy
by providing grants or subsidies for any study, training or conference related
to renewable energy promotion. FPEC tends to limit its powers to the promotion
of energy conservation and related problems.
As the key state agency in charge of the
regulation of renewable energy matters, DEDE has played significant roles in
the promotion of renewable energy, mostly in renewable energy technology
research and development.
A number of investment incentives have
been introduced. An initiative promoting industries and businesses related to
energy conservation and renewable energy use has been implemented under the
cooperation project between the Ministry of Energy through DEDE and the Board
of Investment of Thailand. That is, by virtue of sections 16 and 31 of the Board of Investment Act, BE 2520 (1977),
the Board of Investment of Thailand has issued a series of announcements to
introduce and improve incentives to producers of energy conservation
machineries or equipments or producers of equipments utilising alternative energy,
in particular producers of solar cells, producers of alcohol or fuels from
agricultural produce, agricultural wastes or residues, producers of fuel cell
and energy service companies. These incentives include exemptions from
machinery import duties and income taxes to the producers. As at August 2005, four
energy service companies have been benefited from these incentives. It has been
estimated that these four companies could conserve up to 2.4 MJ of energy each
year and could save up to 99.3 million Thai Baht each year. However, the effectiveness
and efficiency of this initiative should be evaluated for the sake of future
expansion.
2
Regulated Energy
The 1992 Energy Development and Promotion
Act provides measures regulating the production, distribution and utilisation
of energy sources once they are prescribed as ‘regulated energy.’ Over the last
five decades, the Royal Decree
Prescribing Regulated Energy, BE 2497 (1954) prescribes only electricity as
regulated energy. As a result, renewable
energy production is not fully regulated and protected under the above
measures. The Royal Decree should be amended to include certain renewable
energy sources as regulated energy so that the production, distribution,
utilisation and protection measures can be fully applied to renewable energy
sources. This will allow a better promotion of renewable energy production in
Thailand.
A number of research and development
projects of high potential renewable energy sources in Thailand have been conducted,
eg potential and possibilities of solar cell production industries in Thailand
is now being jointly studied by DEDE and Chulalongkorn University. In addition, a conceptual
design of solar-heat dryer for agricultural buildings has been released by
DEDE.
A number of international cooperation
projects have been implemented, eg the Promotion of Renewable Energy
Technologies: Action Plan for the Development of the Market in Thailand is a
project under cooperation between the Thai and Danish governments to be inline
with the Energy Strategy for
Competitiveness and to focus on developing
renewable energy sub-strategies and measures able to reach the targets set in
the aforesaid strategy.
IV
Conclusion
Thai energy laws can be used to promote
renewable energy in three aspects. First, the 1992 National Energy Policy Act
empowers NEPC and OEPP to be responsible for the making and regulating of
Thailand’s energy policies and plans, including those of renewable energy.
However, the incomplete modification of the NEPC component under the 2002
public administration reform is of concern. Despite the absence of clear
consequences, an appropriate amendment to the relevant provision of the Act is
still needed before the difficulties cause any damages.
In addition, enactment of legislation
requiring RPS is needed to ensure Thailand’s mandatory and sustainable goal for
renewable energy use.
Secondly, the 1992 Promotion of Energy
Conservation Act, which aims at the efficient and economical production and use
of energy by providing incentives to those who put efforts into energy
conservation measures and providing disincentives to those who fail to comply
with such measures, can be used to promote renewable energy, especially by
substituting non-renewable energy with renewable energy. However, such
substitution measures have never been used or considered. Hence, they should be
prioritised to encourage wider use of renewable energy in regulated factories.
Thirdly, DEDE, which is the key state
agency in relation to technical aspects and regulation of energy production,
transmission and distribution under the 1992 Energy Development and Promotion
Act, can play a significant role in renewable energy promotion. In addition,
the measures related to ‘regulated energy,’ if wisely used, can be useful in
renewable energy promotion. However, over the last five decades, only
electricity has been prescribed as regulated energy. Certain renewable energy
sources should be prescribed as regulated energy so that the production,
distribution, utilisation and protection measures can be fully applied to
renewable energy sources. This will allow a better promotion of renewable
energy production in Thailand.
Despite the absence of the use of the
measures related to ‘regulated energy,’ a number of initiatives have been
implemented by DEDE. These include the cooperation between DEDE and the Board
of Investment of Thailand to introduce a series of investment incentives, ie
exemptions from machinery import duties and income taxes to producers of energy
conservation machineries or equipments or producers of equipments utilising
alternative energy and energy service companies.
In addition, a number of research and
development projects of high potential renewable energy sources and use in
Thailand have been conducted both at national level through joint project
between DEDE and universities, and at international level through international
cooperation.
