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Ministry of Energy plans to develop “Direct PPA” Measures for Renewable Energy according to Prime Minister’s policy



According to a Cabinet meeting chaired by Mr. Srettha Thavisin, Prime Minister on June 11, 2024, the Ministry of Energy (MOE) was instructed to collaborate with the Board of Investment (BOI) to develop measures to enable private companies to purchase clean and renewable energy directly from power producers through Direct PPA (Power Purchase Agreement). This initiative aims to support the government's policy of promoting data center investment in Thailand and attracting foreign investment. The MOE is assigned to propose these measures to the National Energy Policy Council (NEPC) by the end of June 2024.

 

Mr. Prasert Sinsukprasert, Permanent Secretary of the MOE, stated that the MOE is currently discussing with relevant agencies, such as the Energy Regulatory Commission (ERC), to establish appropriate measures for the Direct PPA pilot project. This will include considerations for the construction of renewable energy power plants within targeted industrial areas in the country, the determination of electricity tariffs for direct transactions, and wheeling charges. Initially, it is anticipated that the Direct PPA pilot project will start within 2024, with an estimated demand for at least 50 megawatts (MW) of electricity in Data Center areas.

 

The MOE will further discuss with relevant agencies whether electricity generated from the Power Project Procurement from Renewable Energy Sources under a FiT Scheme between 2022-2030 for Power Plants with No Fuel Costs, amounting to 5,203 MW, or RE Big Lot Phase 1, can be traded in the Direct PPA pilot project. This is because several projects are still in the process of signing power purchase agreements (PPAs).

 

As for Phase 2 of the RE Big Lot, with an additional 3,668.5 MW, it is expected to proceed within 2024 without waiting for the approval of Thailand’s Power Development Plan (PDP 2024). This is because it is a continuation of the PDP 2018 Rev.1 plan. While RE Big Lot Phase 1 has faced legal challenges related to wind power, solar power can still be procured. The ERC is likely preparing for the next phase of power procurement.

 

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