Giants join rooftop solar battleground; get rid of high electricity bills with 4 baht/unit

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Big business jumps on the ‘solar market’, private companies flock to get rid of high electricity bills and save up to 30% on the privilege of selling carbon credits to fight global warming, ‘The Gulf’ and PTT’s joint venture with OR-GPSC and SCG- CRC, which competes with CPF’s joining Kankul, plans to install solar panels on the roofs of 40 factories. The ERC secretary pointed out that factories with solar panels are a big trend, and they are ready to open conditions to buy back solar energy from citizens at a price of 0.50 baht – 2.20 baht to incentivize the reduction of LNG imports for power plants.

After COP 26, the United Nations climate change conference in Glasgow, the UK has drawn Thailand’s pledge to reduce its climate problem. To achieve carbon neutrality by 2050, Thai industry sees a need to turn to renewable energy to achieve the goal. Just like the direction of the international community, coupled with pressure from export-producing industries, carbon emissions must be reduced in accordance with the requirements of importing countries. Importantly, fossil energy prices are significantly higher, both of which are pressures leading to increased costs in the renewable energy market.

Recently, Thailand is preparing a national energy plan, which was reviewed last year and will be released in the next 1-2 months, moving in this direction. The Renewable Energy Development Plan (AEDP), recently reviewed by the National Energy Commission (NEPC), has approved plans to produce several megawatts of COD in the system by 2024.

Commercial giants enter the solar business

Recently, there has been a movement in the energy industry. The country’s major energy producers have entered the solar business in a big way, whether it is Gulf Energy Development Public Co., Ltd. or GULF and SCG Cleaning Company established SG Solar Co., Ltd. with a registered capital of 5-million-baht, operating rooftop solar power generation and rooftop Solar power sales business.

In addition, GULF and a subsidiary of “Gulf Renewable” signed a cooperation agreement with GUNKUL on the creation of renewable energy projects and established a joint venture company. And established a joint venture with Central Retail Corporation Public Company Limited or CRC, Greengen Energy Company Limited, with a registered capital of 90 million baht, to operate rooftop solar power generation and distribution business.

While PTT Public Company Limited, which previously owned GPSC, has partnered with EXIM Bank and Neo Energy to operate The Solar Orchestra project to provide integrated solar system installation services. Including managing credit for industrial clients 100% EECi and VISTECH using various technologies as a sandbox to make smart energy solutions. According to the PTT NET ZERO Ambition goal, energy management peer-to-peer trading is ready to scale, reducing carbon emissions by 10% by 2025 and 35% by 2030

Ms. Jiraporn Khaosawad, CEO and President of PTT Oil and Retail Public Company Limited (OR), said there are plans to expand the clean energy business by focusing on the development of solar energy. Rooftop solar panels will benefit from clean energy cost savings. They say investing in rooftop solar panels at gas stations or Amazon cafes can save up to 20 percent on electricity bills compared with companies generating electricity from existing energy sources.

The company also provides solar roof installation and commissioning services, enabling Thailand’s clean energy business. The existing customer base is about 2,000 PTT Station oil dealers, and another customer base is commercial market customers, whether it is factories, hotels, shopping malls or universities, “we have started to provide services”.

Rooftop power station CPF up to 40 MW

On the power user plant side, Dr Somboon Eua-atchasai, CEO of Gunkul Engineering Public Company Limited or GUNKUL, said the company has the opportunity to participate in the installation of solar roof (CPF) plants under the CPF solar project on the roof of Charoen Pokphand Foods Group. Rooftop is a partnership in the form of a power purchase agreement with a project value of about 1.4 billion baht.

Among them, “Gunkul” is the investor and maintains the system during the 15-year contract. 120,000 solar panels are installed on the roofs of 34 CPF plants with a generating capacity of 40 megawatts (MW). With 53 million solar installations per year, it is considered the largest solar roof project in Thailand.

In addition to Mr Wasit Taepaisitphong, CEO and President of Betagro Group, Betagro Public Company Limited stated that Betagro has invested in developing a solar power generation capacity of approximately 42 MW. It can generate 5% of the company’s electricity needs. This aligns with the Sustainability Strategic Plan, approaching 1,000 MW of private solar installations.

Energy Regulatory Commission (ERC) General Secretary Mr Komkrit Tantravich said the private sector or IPS in factories and commercial sectors are vigilant in installing solar roof panels on the back of factories. It is well worth the investment, with 7.469 IPS and 994.87 MW of public solar panels to date. Especially for factories that use much electricity during the day, you can save about 3-4 baht per unit of electricity.

“Previously, the government did not purchase the excess power generated during the shutdown. However, due to the rising LNG price, which affects the cost of power generation, the ERC has announced to buy back power from those who have signed power sales contracts on both sides. But the price is about 0.50 baht/unit or lower. At the public solar price of 2.20 baht/unit, most solar systems in the factory are designed to use all the electricity produced. Usually, during off-peak periods, there will be excess electricity for sale. This requires less electricity when the government buys it. There has to be a cost to manage it when it does,” Mr Komkrit said.

As for the People’s Sector Solar Project, which aims to buy back 2.20 baht/unit of electricity, 1,642 units have been installed from 2019 to 2021, with a total installed capacity of 9,078.5 kWh.

“To be fair, the redemption system we don’t use that term. Whenever you return it, you get your electricity bill. If you sell it back during peak hours, it can be cheap. But if it’s peak at night, the electricity bill Expensive, it can provide 2.50-3.00 baht, but it is fixed that the factory has no extra electricity to sell at that time. But he will only sell electricity during off-peak periods when the factory stops using electricity.”

There are concerns that if more power producers are used for their own use, it will affect the income of major power producers. Mr Komkrit believes that this will not affect the revenue of large power producers. But in the future, power producers, especially power companies, need to look at opportunities, adjust their views on the role of e-commerce retailers, and become carriers of more transmission lines.

Pay close attention to the Ft value at the end of the year, up to 40 satang.

Considering the trend, the variable cost of electricity (Ft) for the next period (i.e. September 2022 to December 2022) is expected to increase by about 40 satang/unit, which is consistent with the original step-by-step assumption. But you have to reconsider all the factors around you.

“At the time we were assessing the gas price situation at the time of Ft May-August 2022 delivery to the Erawan gas field in the Gulf of Thailand. There is no certainty how much gas will be received, but it is now past the time for field delivery. Although the production of the Erawan field is still lower than before, we have to import more LNG at a higher rate. So electricity prices have to be adjusted according to LNG prices. LNG prices are very expensive between January 2022 and March 2022, around $30-40/MMBtu, so power plants have switched to oil instead of LNG, but by May-June. Now, LNG prices have dropped to just $20-23/MMBtu units and have returned to using LNG as its main fuel,” Mr Komkrit said.

FTI is asking to unlock the sale of Huo Rong.

Mr. Arthit Vejkit, Vice President of the Renewable Energy Industry Group of the Federation of Thai Industries (FTI) and Chairman of the Board of Directors of Neo Clean Energy Company Limited, a provider of solar engineering design (EPC) and investment services and power distribution solar power systems. (PPA) said the market for integrated solar panel installation services is now more popular. From industrial customers “there will definitely be exponential growth.”

Judging from the factors that evaluate the domestic electricity trend, the electricity bill will gradually increase from 1 baht last year to 5 baht in 2023, so the installation of solar panels can help the factory save 5-10% of electricity on average, but it can be saved. Get more Save up to 30% on electricity use during the day if the affiliated factory is a factory that produces 6-7 days a week.

For example, installing a 1 MW solar panel in a factory with monthly electricity consumption of 800,000 baht, the installation cost is between 240,000-250,000 baht (including design, installation and permitting), saving 500,000 baht in electricity bills per month. Baht, but this system does not include the cost of the energy storage system or energy storage, which is still very high at the moment. The electricity fee is 6-7 baht/unit.

But we are confident that in the next few years, the ESS energy storage system will definitely arrive, resulting in a 2-3 times the scale of solar installations.

“If the ERC agrees to unlock electricity sales, and access to the people’s solar system, this is a proposal that the Federation of Thai Industries (FTI) has been asking for. It will stimulate more solar panel installations to grow. This will significantly reduce the amount of electricity used to generate electricity. Imports of LNG. In the future, Thailand should plan to manage power generation. Now, because there is no containment system, 15% of the electricity generated by solar is wasted,” Mr Athit said.

Kris Lam
Author: Kris Lam

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