Come December, Thailand will have more solar power capacity than all of Southeast Asia combined as record sums of money is poured into the sector in the hopes of nurturing a new energy source to help drive the region’s second-biggest economy.
Thailand has been shifting away from natural gas as once-plentiful reserves are expected to run out within a decade, forcing it to rely on imported fuel more than any other country in the region except Singapore. A plunge in solar-component costs and subsidised tariffs have also helped feed the country’s solar boom.
About 1,200-1,500 megawatts of solar capacity will be connected to the grid this year, requiring as much as 90 billion baht (US$2.7 billion) of investment, Pichai Tinsuntisook, chairman of the Federation of Thai Industries’ renewable energy division, told Reuters.
Thailand’s solar capacity will rise to 2,500-2,800 MW this year from about 1,300 MW in 2014. That is almost six times more than the capacity added last year. The new capacity, while modest compared to Japan or Germany, will turn Thailand into the first significant solar power producer in a region where the sector has barely taken off.
"Thailand has strong potential for both solar farms and rooftop solar systems," said Sopon Asawanuchit, managing director of advisory firm Confidante Capital, adding that its location in the tropics is an advantage.
While the bulk of the power will come from solar farms, rooftop solar panels may have enough capacity over the next five years to supply as many as 250,000 households in urban areas, renewables analysts say.
Thailand aims to increase its solar capacity to 6,000 MW by 2036. That would account for 9 per cent of total electricity generation, up from 4 per cent in 2014, and be able to meet the electricity needs of up to 3 million households.