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Out-Law News 1 min. read

Thailand to replace coal-fired plants with gas-fired complex

Thailand’s state-owned Electricity Generating Authority (EGAT) will now no longer build two proposed coal-fired power plants and will instead build a Bt34 billion ($1.03bn) gas-fired complex.

The gas-fired complex includes two 700 megawatts (MW) plants which will be in Phunphin, Surat Thani, southern Thailand. The two plants will be operational in 2027 and 2029 respectively. The coal plants were to have a combined capacity of over 3 gigawatts (GW).

According to EGAT governor Boonyanit Wongrukmit, the project must be approved by the Energy Ministry, the National Energy Policy Council, and the Ministry of Natural Resources and Environment. It is currently the subject of a feasibility study, with approval hoped for between October and December.

The two shelved coal-fired projects are 870MW Krabi coal-fired in Krabi and 2.2GW Thepha coal-fired in Songkhla, according to IjGlobal.

EGAT plans to partner with Thailand’s national oil and gas group PTT in developing a liquid natural gas (LNG) terminal near the complex to supply LNG as fuel to the power plants.

John Yeap of Pinsent Masons, the law firm behind Out-Law, said: “This move by EGAT is consistent with the trajectory of the region’s energy transition plans. With economies looking to their nationally determined contributions for the 26th UN Climate Change Conference of the Parties (COP26), the logical progression beyond avoiding new coal plants would be for policy agendas to be implemented that would enable the early retirement of less efficient and more environmentally damaging older coal plants. In the absence of convincing cost and benefit analysis to do otherwise, continuing with the development of early stage coal fired power projects would clearly be inconsistent with such a trajectory.”

“Gas as a transition fuel may itself have reducing traction in the region if the current momentum and enthusiasm for decarbonisation continues, though much more in terms of regulatory support for renewable energy generation may be required,” he said.

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