New solar farm tariff urged

By Yuthana Praiwan

Businesses are urging the government to speed up work on a new tariff rate for solar farms after the process has been suspended for the last two years.

"This has been delayed for too long," said Danucha Noichaiboon, managing director of the Ekarat Engineering Plc (AKR), Thailand's largest transformer producer.

In 2008 the government announced solar development plans with a combined 500 megawatts and started granting operating licences to investors offering adder tariffs, a special rate given to private renewable energy producers to promote the sector, at 8.5 baht per unit above normal power rates.

A year later, the government through the Energy Ministry, received applications for the licences to operate solar farms of up to 3,000 megawatts. And that same year, the Energy Ministry suspended the granting of new licences and scrapped adder tariffs while applying the new "feed-in" tariff.

Phichai Tinsuntisook, chairman of the Federation of Thai Industries' renewable energy industry club, said a decision on the new rate of feed-in tariff has yet to be made, while the programme to support biomass, biogas, biofuel and waste remains unclear.

A feed-in tariff is a measure to support private investment in projects that produce alternative energy. The calculation of the tariff takes into account electricity production costs of the technology involved.

The feed-in tariff, which is a fixed rate paid to power plant developers for the life of a project, is considered fairer for both project owners and consumers than the existing adder system, which gives investors an additional payment on top of normal electricity tariff charges.

Currently, those who were granted operating licences operate only 159 MW electricity, leaving the remaining 2,841 MW idle.

Mr Danucha said the government should terminate idle licences and open a new round of licence granting.

"Approval [for new licences] should give priority to locally-developed solar technology," he said.

"We believe solar energy has tremendous potential growth in the future, as petroleum prices keep rising."

He proposed the government include conditions for the new licences requiring investors to use local materials and help develop local technology.

"Nearly all solar farms and parts are imported. No one wants locally-made solar panels," said Mr Danucha.

AKR itself has invested in aAir Foamposite One Pro