Thailand Faces 18 Percent Increase in Electricity Prices

(MENAFN) Thailand’s electricity consumers could be staring down a steep 18 percent rise in power tariffs for the May–August billing cycle, as soaring liquefied natural gas (LNG) costs tied to the Middle East conflict pile mounting pressure on the kingdom’s import-reliant energy sector, the Bangkok Post reported Wednesday.

The Energy Regulatory Commission (ERC) is readying a proposal to set electricity tariffs within a band of approximately 3.95 to 4.59 Thai baht — equivalent to $0.12 to $0.13 per kilowatt-hour — compared to the roughly $0.11 rate currently in force through the end of April. The ceiling of that proposed range would translate directly into the 18 percent increase now alarming households and businesses alike.

Thailand’s vulnerability is structural. The country leans on LNG, supplemented by gas sourced from the Gulf of Thailand and Myanmar, for roughly 60 percent of its total electricity generation — leaving it deeply exposed whenever global energy prices convulse.

The latest shock arrived when two QatarEnergy LNG cargoes, each carrying 60,000 tons of fuel, were barred from transiting the Strait of Hormuz. The blockage sent spot LNG prices climbing to around $25 per million British thermal units — nearly twice last year’s average — dramatically inflating fuel bills for power generators.

A government energy official acknowledged that authorities are bracing for a substantial rise in electricity costs, while signaling that broad-based subsidies are unlikely to materialize given the fiscal hangover from interventions deployed during the Russia-Ukraine war in 2022. During that period, the Electricity Generating Authority of Thailand (EGAT) and state energy giant PTT Plc absorbed enormous costs to shield consumers from surging LNG prices. EGAT still carries losses exceeding $1 billion, while PTT remains saddled with roughly $360 million in unrecovered expenditures.

One relief mechanism under consideration involves suspending debt repayments owed to EGAT and PTT, redirecting idle funds held by state electricity agencies to cushion the blow to end consumers.

Caretaker Energy Minister Auttapol Rerkpiboon has publicly committed to holding tariffs at current levels, but the final call rests with Prime Minister Anutin Charnvirakul, whose administration is expected to deliver its formal policy statement in early April.

Coal-fired generation, which can produce electricity at below six U.S. cents per kilowatt-hour, offers a theoretically cheaper pathway — and moves to restart units at EGAT’s Mae Moh plant are already underway. However, Thailand’s constrained lignite reserves cap how far coal can realistically offset the LNG crunch at a national scale.

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