Thailand's largest private power company, Gulf Energy Development, is continuing to expand its footprint in the solar energy sector. On Thursday (12/21), the company signed a 25-year power purchase agreement with the Electricity Generating Authority of Thailand (EGAT). This agreement commits Gulf Energy Development to the development of 12 additional solar power plants, with the earliest expected to be operational by 2024.
These 12 solar power plants will be operated by Gulf Renewable Energy, a wholly-owned subsidiary of Gulf Energy Development. Among them, 5 plants will have a contracted installed capacity of 259.6 MW, while the remaining 7 will be equipped with energy storage systems, with a contracted installed capacity of 385.2 MW.
Prior to this, Gulf Energy had already signed power purchase agreements with EGAT for the development of 24 solar power plants, including 11 with energy storage systems. The combined contracted installed capacity for these projects is 1,294 MW. Gulf Energy aspires to increase the share of renewable energy in its power generation portfolio to 40% by the end of 2035.
According to the contract terms, the feed-in tariff (FiT) for the solar power plants without energy storage systems is at 2.16 Baht per kilowatt-hour (about 0.062 USD). For those solar power plants equipped with energy storage systems, the FiT is set at 2.83 Baht per kilowatt-hour (about 0.082 USD).
(Photo: Gulf Energy)
Gulf Energy's Deputy chief executive, Yupapin Wangviwat, believes that the fluctuation in fuel prices leading to an increase in electricity prices makes renewable energy generation a viable solution. He particularly emphasizes that solar power generation is more cost-effective than using fossil fuels. Currently, Thailand relies primarily on nature gas for power generation, constituting 60% of the total fuel mix.
In 2022, Thailand launched the first phase of its renewable energy program, aiming for a total power generation capacity of 5.2 GW. Gulf Energy Development emerged as the biggest winner among bidders, securing a total of 28 projects.
Thailand is expected to increase electricity prices next year. According to the Prime Minister and Finance Minister Srettha Thavisin, the Cabinet has approved the decision that for households consuming less than 300 kWh per month, the cap for electricity prices will not exceed the current rate of 3.99 Baht per kWh (about 0.12 USD). This comes in response to the Energy Regulatory Commission (ERC) of Thailand proposing a hike to 4.68 Baht per kWh (about 0.14 USD) at the end of November, representing a substantial increase of 17.3% and sparking discussions locally.
However, Minister of Energy Pirapan Salirathavibhaga still emphasizes that the cap for electricity prices is not yet firmly set, as it needs to consider other factors, including global nature gas prices before the end of the year. Efforts will be made to ensure that the cost for household electricity does not exceed 4.2 Baht (about 0.12 USD). The new electricity prices are expected to be announced before they take effect on January 1st of the coming year.