Enigin Update - Thailand Needs to Improve Energy Efficiency to Dent Energy Price Shock
THE Bangkok Post reports that economists believe Thailand will inevitably suffer impacts from higher energy prices unless it improves existing regulations and enhances energy efficiency.
Jeeva A. Perumalpillai-Essex, sustainable development leader for Southeast Asia with the World Bank commented that Thailand's resolve in the 1970s to advance energy efficiency has unfortunately long since diminished, because of energy price distortions created by various governments over the intervening years. Thailand is now among the countries with highest energy intensity per unit of output.
Perumalpillai-Essex added at a recent forum, "The key challenge is low and underpriced energy, the lack of institutional capacity as no one championed [conservation], and misplaced incentives. Tenants pay utility costs in Thailand, so landlords lack incentives to promote efficiency."
She also commented that the country has energy conservation laws and energy conservation funds, but lacks any serious implementation of the laws and policies. This has lead to the economists calling for policymakers to improve disclosure of the details of subsidies and policies to enable people to understand what impact these laws can have.
The Bangkok Post reports Yanyong Thaichareon, an economist with the Bank of Thailand, warned energy prices were unlikely to return to the previous lower levels, particularly in view of pressure of rising energy demand, leading to the reduction and elimination of energy subsidies.
"The lifting of subsidies needs to be well communicated and well-timed when the oil price decreases. The government should lift the subsidies gradually. It should not allow itself to get stuck in a corner and have to lift all subsidies immediately.
"In 2010, oil import bills accounted for 7 percent of gross domestic product. We export food at 6.3 percent GDP. This means that the money we earned from exports of foods is used for imports of oil," Thaichareon said. "China and India can afford energy consumption, but they have more energy efficiency than Thailand."
Enigin Distributors in the region can help businesses and public sector organisations to improve their energy efficiency, lowering energy demand and energy costs through implementing energy saving technology and solutions from Enigin.
Picture of Bangkok, Thailand by Sam Badeo
