Thailand Energy Transition Report - Outlook For 2024

THAILAND’S ENERGY TRANSITION
2024 OUTLOOK
Chandler MHM Limited

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Thailand’s Energy Transition – 2024 Outlook
INTRODUCTION
It has been a year since we released our inaugural energy transition report (Thailand’s Energy
Transition: 2023 Outlook). Last year, our three main predictions were: (i) an increased reliance
on liqui�ied natural gas (“LNG”) to meet Thailand’s energy needs; (ii) the additional deployment
of renewable energy projects; and (iii) the development of an electric vehicle (“EV”) ecosystem.
Each of our predictions has proven to be accurate, and indeed, the movement we have seen in
each of these areas has exceeded our expectations.
Thailand remains heavily reliant on natural gas for electricity and heat generation. Domestic
production has tailed off signi�icantly in the past few years, while electricity demand continues
to increase to support Thailand’s growing economy, meaning LNG has been relied upon heavily
to meet the country’s energy needs. We anticipated the announcement of additional renewable
energy projects in 2023; the trend of deploying additional green�ield renewable energy projects
is likely to continue for the remainder of the 2020s, and beyond. Finally, the EV ecosystem in
Thailand has already started to take off. In last year’s report, we commented that there “are few
[EVs] driving on Thai roads at the moment”; one year later, this statement is already out of date.
As 2024 approaches, the energy transition remains the primary lens through which investments
in the energy sector are evaluated. Once again, the 2024 Outlook will not provide an exhaustive
analysis of all aspects of Thailand’s energy transition, as the topic is broader and deeper than a
report of this nature would be able to cover. Rather, this report will provide a snapshot of key
legislative, regulatory and policy initiatives that are likely to guide the energy transition in 2024
and further into the future.
Should you have any questions or wish to discuss the contents of this report in greater detail,
please contact the individuals appearing on the �inal page.
CHANDLER MHM LIMITED

November 2023
Chandler MHM
TABLE OF CONTENTS
MARKET OVERVIEW ............................................................................................................................. 1

ELECTRICITY GENERATION ................................................................................................................. 5
TRANSPORTATION .............................................................................................................................. 15
INDUSTRY DEVELOPMENT ................................................................................................................ 21
EMERGING TECHNOLOGIES AND BUSINESS OPPORTUNITIES ...................................................... 24
ENVIRONMENT ................................................................................................................................... 31
AUTHORS ............................................................................................................................................. 40
Chandler MHM
MARKET OVERVIEW
Since we released our Energy Transition Report 2023 a little over one year ago, unsurprisingly,
Thailand’s energy sector has not experienced any revolutionary changes which fundamentally
alter its core structures. Nonetheless, as 2023 comes to an end, it is useful to focus on trends from
the past year within the context of mid-term and long-term views of the energy transition.
The power sector remains at the forefront of efforts to

decarbonize the economy. Since the power sector is still
based on an enhanced single-buyer structure, with the
main government utilities playing a central role in
procuring power, governmental planning remains the key
to facilitating the transition. Total installed capacity on the
Electricity Generating Authority of Thailand (“EGAT”)
system as of September 2023 was 48.799 GW, whereas
peak demand so far in 2023 occurred in May at 34.131
©baptiste_heschung via Canva.com
GW. 1
In May 2023, Thailand held a general election, which has resulted in the formation of a new
government and Prime Minister. Accordingly, we would be remiss if we did not consider the
impact Thailand’s newish government is likely to have on the energy sector generally and the
power sector speci�ically. Prior to the election, the outgoing government hurried the approval of
an additional tender of 3.66 GW of renewable energy on top of the awarding of projects with an
aggregate peak capacity of 4.88 GW in 2023.
The incoming government has so far indicated that its primary objective is to reduce energy costs
for consumers. According to the policy statement of the council of minsters to the Parliament on
11 September 2023, the new government af�irmed its priorities to: (i) reduce energy expenses,
(ii) promote the use of clean and renewable energy to align with sustainability goals, and (iii)
support new energy sources that will promote future energy security. Although no concrete
policies have yet been announced, if the government intends to reduce energy costs in the short-
term, it will likely need to rely on subsidies to speci�ic groups. In the mid- to long-term, however,
energy costs will likely be reduced by increasing competition in the sector. Luckily for the
government, today there is less of a trade-off to be made between decarbonization objectives and
reduced energy prices, with the levelized cost of energy for solar power decreasing signi�icantly
over the past decade. With the electri�ication of transportation, long-term reductions in energy
prices and greater overall predictability for consumers seem like achievable objectives.
Natural gas will be the key energy source for the foreseeable future
Source: Energy Policy and Planning Of�ice
1 Energy Policy and Planning Of�ice, Ministry of Energy. Electricity statistics

(http://www.eppo.go.th/index.php/en/en-energystatistics/electricity-statistic).
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Natural Gas remains the key driver in in Laos. Imports for the year-to-date in
Thailand’s energy mix, accounting for September, 2023 were down nearly 15%
approximately 57% of all electricity from the same period last year. Further, less
generation in 2023 to date, measured in electricity has been produced from coal and
GWh. 2 This is an increase from last year, lignite power plants so far in 2023 when
when natural gas accounted for 53% of compared to the same period in 2022.
electricity generation and appeared to be Although generation from domestic
trending downwards. The increased reliance hydropower and renewables has seen a
on natural gas comes in response to slight uptick in 2023, natural gas remains the
reductions in cross-border power purchases, pivotal fuel keeping the lights on in 2023.
which are mainly derived from hydropower
The trend towards reliance on natural gas for from the Middle East, accounting for 63% of
power production is likely to continue in imports. 3 On the whole, Thailand remains
2024. Although renewable energy capacity is heavily reliant on imports of petroleum
set to expand dramatically in the coming (including re�ined products and natural gas),
decade, much of the additional power accounting for 69.4% of total supply.
generation from solar and wind is not
expected to come online until 2025 at the The Department of Mineral Fuels, Ministry of
earliest. With an ever-increasing share of Energy (“DMF”) launched the 24th bid-round
natural gas coming from LNG, price volatility in April 2022, with three offshore blocks in
in global markets will continue to put the Gulf of Thailand being tendered. In June
upward pressure on Thai power prices. 2023, the DMF announced that PTTEP Public
Company Limited (“PTTEP”) was the
For more details on the natural gas outlook, successful bidder for its bids on the G1/65
please refer to the Electricity Generation and G3/65 blocks, whereas Chevron was
section. successful in its bid for the G2/65 block.
Petroleum operations under all three blocks
Petroleum will be carried out pursuant to production
sharing contracts, as is the DMF’s policy for
In 2022, Thailand imported 896.5 thousand all offshore blocks awarded after
barrels of oil equivalent per day amendments to the Petroleum Act in 2017.
(“MBOEPD”) of crude oil, representing a
5.9% increase from levels in 2021. The The Thai government has reportedly re-
majority of Thailand’s crude oil now comes started discussions with its Cambodian
counterparts on resolving the long-standing
2 Ibid. 3 Department of Mineral Fuels, Ministry of Energy.

Annual Report, 2022, at page 50.
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maritime border dispute in the Gulf of

Thailand. The Overlapping Claims Area A recent report from the International
(“OCA”) is the region in the Gulf of Thailand Energy Agency (“IEA”) 4 made a number of
claimed by both countries. As a result of the key �indings and recommendations for
deadlock, upstream petroleum exploration Thailand to achieve its greenhouse gas
and production activities have been blocked (“GHG”) reduction targets. Importantly, the
in the OCA since the early 1970s. The Thai report found that since power generation
and Cambodian governments have been currently accounts for 24.15% of all GHG
attempting to resolve the dispute emissions, decarbonizing the power sector
periodically for several decades, though will be crucial for Thailand to achieve its
there is no indication based on public reduction targets. Further, in order to
statements that the two parties are any effectively decarbonize the power sector, the
closer to resolving the matter. current PDP will need revisions in order to
drive down reliance on coal and natural gas
Although developing the OCA would appear derived power, as well as ramping up
to be a logical solution to securing energy reliance on renewables. If the updated PDP is
independence for Thailand, there are still a indeed released in 2024, it will be worth
number of practical hurdles that would need noting whether government planning is
to be overcome. Even if the parties can agree moving towards the IEA’s recommendations.
in principle on a resolution to the dispute,
the timeline to implement the agreement Decarbonization Targets
remains uncertain. Thereafter, further
exploration and development work will be Thailand updated its Nationally Determined
needed until the �ields in the OCA begin Contributions (“NDCs”) pursuant to the
producing in signi�icant quantities. In short, Paris Agreement under the United Nations
the timeline of when natural gas from the Framework Convention on Climate Change
OCA may become available could be (the “Paris Agreement”) in November 2022.
measured in decades, and will not have an The revised targets call for Thailand to
impact on short-term gas prices. reduce its GHG emissions by 30% from
projected business-as-usual (“BAU”) levels
Government planning – the NEP by 2030, with a caveat that it could
and PDP potentially achieve 40% reductions if
adequate technical and �inancial support is
The Thai government actively manages the provided by upper income nations. 5 The
energy sector through industrial policy and updated NDCs are more ambitious than
general market planning. The key policy in those submitted in 2020 in the lead-up to
this regard has traditionally been the Power COP26, where Thailand had only pledged to
Development Plan (“PDP”), which reduce GHG emissions by 20% below BAU
underwent its last major update in 2019 levels.
(with retroactive effect to 2018). In the past,
we have seen updates to the PDP every three Given Thailand’s current NDCs were issued
to four years, meaning an update to the PDP subsequent to the issuance of the most
is expected in the near future. The PDP recent amendments to the PDP, it is
comes under the umbrella of the Ministry of reasonable to assume that the next revisions
Energy’s overarching energy plan, which is to the PDP will incorporate new
now styled as the National Energy Plan decarbonization initiatives in order to assist
(“NEP”) Framework. Along with the PDP, the in achieving the targets set out in the NDCs.
NEP should include planning and policy Indeed, Thailand’s Long-Term Low
initiatives relating to petroleum, energy Greenhouse Gas Emission Development
ef�iciency, and renewable energy. Strategy (“LT-LEDS”), which was prepared
by the Climate Change Management and
4 International Energy Agency. Report, August 2023, 5 Thailand’s 2nd Updated Nationally Determined
at page 6. Contribution.
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Coordination Division of the Of�ice of Natural

Resources and Environmental Policy and
Planning and issued in November 2022 in
conjunction with Thailand’s updated NDCs,
hints at future policy planning in this regard.
Based on the LT-LEDS, renewable energy
production will make up 68% of Thailand’s
electricity mix by 2040 and 74% by 2050. In
order to achieve these targets, it is clear that
the remainder of the 2020s and the 2030s
will witness signi�icant deployment of
renewable projects.
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ELECTRICITY GENERATION
Overview
Electricity generation is currently the largest contributor to Thailand’s CO2 emissions. Further,
the transportation sector is responsible for the second highest levels of emissions, and the Thai
government has already announced ambitious plans to roll out the adoption of electric vehicles.
As such, decarbonizing the grid will be essential to allow Thailand to achieve its NDCs. In this
section, we will examine key aspects of the power sector in Thailand at present, as well as policy
initiatives being developed that will permit Thailand to accelerate its decarbonization objectives.
Natural gas outlook

As mentioned in the Market Overview section, natural gas remains the key energy source driving
Thailand’s economy. This is unlikely to change within the next 10-15 years, as new infrastructure
needed to support the transition to low carbon fuels will take some time to ramp up.
Source: Department of Mineral Fuels
With domestic reserves being depleted, the September 2023. 6 With proven and probable
Thai energy sector is increasingly reliant on reserves being depleted, this trend is likely
imported natural gas; unfortunately, to continue into the foreseeable future.
Thailand’s newfound reliance comes at an Thailand jumped from the 11th to the 8th
importune time. Domestic upstream biggest importer of natural gas in October
production, particularly in the Erawan gas 2023. 7 Given the time lag in developing new
�ield, has dropped signi�icantly over the past energy technology, Thailand’s reliance on
several years. In June 2021, Erawan was LNG to plug its energy gap will likely
producing 1,040 million standard cubic feet continue for at least the remainder of this
per day (“MMSCFD”), whereas it has only decade.
produced 295 MMSCFD from January to
6 7
Energy Policy and Planning Of�ice, Ministry of “Thailand Soars from 11th to 8th in Global LNG
Energy. Electricity statistics Import Rankings with 25% surge”
(http://www.eppo.go.th/index.php/en/en- (www.hydrocarbonprocessing.com).
energystatistics/electricity-statistic).
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Indeed, in May 2023, Thailand’s sources of outpaced imports, meaning we are

natural gas were split evenly between witnessing a shift towards greater reliance
imports and domestic production. on fossil fuel imports, and all corresponding
Historically, domestic production has always turbulence that entails.
Nonetheless, the government appears The PDP 2018 contemplates an additional

committed to natural gas playing a role in its 13.4 GW of cumulative capacity from natural
energy mix even as Thailand strives to gas-�ired power plants being developed
achieve its carbon neutrality and net zero between 2020 and 2037. Based on research
commitments. The current Gas Plan was done by the IEA, the current development
devised in 2018, and it envisions Thailand’s plans under the PDP will result in carbon
demand to increase from 4,676 MMSCFD in emissions exceeding 100 million tCO2eq 9
2018 to 5,348 MMSCFD in 2037, of which per year in 2037. By contrast, in order to
68% is projected to come from LNG. The meet its NDCs, emissions from the power
volume of natural gas to be allocated to sector need to be approximately 60 million
power generation is anticipated to increase tCO2eq by 2037; in other words, if the Thai
in both overall and relative terms by 2037, government intends on meeting its NDC
amounting to 3,583 MMSCFD (up from 2,665 commitments, green�ield natural gas
MMSCFD in 2018) 8 which will account for developments will need to be shelved.
two-thirds of its total use. Indeed, based on current projections, the IEA
estimates that the only way Thailand can
8 Department of Mineral Fuels, Ministry of Energy. 9 tCO2eq means one metric ton of carbon dioxide
Annual Report, 2022, at pages37-38. equivalent
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stay on track to achieve its NDCs is by adding Renewable energy tenders

32 GW of additional variable renewable
capacity by 2030, followed by a further 42 2022 Renewable energy procurement
GW by 2037. 10 Further, green�ield natural
gas- (and coal-) �ired power plants In 2022, the Energy Regulatory Commission
scheduled to come online after 2030 would (“ERC”) issued the Regulation for
need to be cancelled. In order to provide Procurement of Renewable Energy under
suf�icient baseload capacity and grid Feed-in-Tariff (FiT) Scheme for the Period of
balancing, expansion of BESS would also be 2022-2030 (the “2022 RE Regulation”) to
required. The IEA forecasts that if these procure: (i) green�ield produced electricity,
measures are adopted and an effective CO2 including: (a) power generated from biogas
price is implemented, in 2037 Thailand may (from wastewater and solid waste), wind,
still be on track to hitting its carbon and ground-mounted solar power from
reduction goals by mid-century. small power producers (“SPPs”) and very
small power producers (“VSPPs”) on a non-
There is clearly a degree of tension between �irm purchase basis; and (b) power
Thailand’s decarbonization goals and its generated from ground-mounted solar with
current energy policies. With the battery energy storage systems (BESS) from
deployment of carbon capture and storage SPPs on a partial-�irm purchase basis; and
(“CCS”) and carbon capture, utilization and (ii) power generated from industrial waste
storage (“CCUS”) technologies to gas-�ired from VSPPs on a non-�irm purchase basis.
power plants, these projects can credibly
claim to be facilitating the energy transition The procurement of 5,203 MW of electricity
by moving away from carbon emitting power to be generated from green�ield renewable
production. However, with the additional energy producers and 100 MW from
costs imposed by utilizing CCUS in industrial waste commenced in September
conjunction with higher LNG import costs, it 2022. To participate, power producers had
is not clear how economical natural gas to have the required quali�ications and
would be as a fuel for power production in submit their electricity offer and technical
the event Thailand expands its solar and readiness reports for consideration. The
wind capacity to levels being suggested by price of the feed-in-tariff was set in the 2022
the IEA. This could result in stranded or RE Regulation and was not a factor in
underused natural gas assets, which may assessing the quality of the bids. The
give rise to costly obligations under take-or- selection committee evaluated the quali�ied
pay clauses in the relevant power purchase producers’ technical readiness on a pass-fail
agreements. Accordingly, the forthcoming basis. Producers that passed the minimum
amendments to the PDP need to be studied technical readiness requirements were
closely in order to better understand how selected based on their technical readiness
the Thai government intends to strike a scores. Out of 670 proposals with over
balance between these competing policy 17,000 MW production capacity, 188 power
objectives. producers were selected to ful�ill the
procurement quota as follows:
Renewables Procurement quota Number of power Total Procured

(MW) producers selected Electricity (MW)
Biogas 335 0 0
Wind 1,500 22 1,490.2
Ground-mounted solar 1,000 24 994.06
(with BESS)
10 International Energy Agency. Report, August 2023,

at page30.
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Renewables Procurement quota Number of power Total Procured

(MW) producers selected Electricity (MW)
Ground-mounted solar 2,368 129 2,368
(without BESS)
Industrial Waste 100 13 100
We understand that all the selected power lack of transparency in the selection process.
producers have accepted the procurement Consequently, the court issued an order to
results and relevant requirements. Pursuant suspend the ERC Noti�ication on Selected
to the 2022 RE Regulation, the successful Power Producers pertaining to wind projects
bidders are obligated to enter into and the execution of relevant power
agreements with the respective power purchase agreements until the court has
utilities (i.e., EGAT, Metropolitan Electricity suf�icient time to evaluate the merits of the
Authority (“MEA”), and Provincial Electricity claim.
Authority (“PEA”)) within 180 days or two
years, depending on their respective 2023 additional procurement
scheduled commercial operation dates
(“SCOD”). In March 2023, the National Energy Policy
Committee approved an additional
Notwithstanding the above, certain bidders procurement of renewable energy for the
for wind projects �iled a petition against the years 2022-2030 (the “Additional
ERC with the administrative court, following Procurement”) and set out target
the announcement of the ERC Noti�ication on procurement quotas and scheduled
Selected Power Producers. The claim alleged commercial operations for each energy
that the ERC's failure to announce clear source as follows:
evaluation criteria and to permit companies
to observe the scoring process resulted in a
Renewables Proposed electricity to be sold (MW) for each year of SCODs

2026 2027 2028 2029 2030 Total
Biogas 6.5 6.5
Wind 200 400 400 1,000
Ground-mounted solar 232 200 600 800 800 2,632
Industrial Waste 30 30
According to the Policy Committee’s their offers, and the selection will be
resolution, after the ERC announced the made by considering their existing
selected power producers under the 2022 technical readiness scores.
RE Regulation, the Additional Procurement
will commence in accordance with the (2) The remaining quota from the purchase
following guidelines: under (1) will be used to procure
electricity from power producers that
(1) The priority of the Additional neither satis�ied the required
Procurement is to purchase electricity quali�ications nor passed the minimum
generated by wind energy and ground- technical requirements under the 2022
mounted solar from producers which RE Regulation. These producers may
have passed the minimum technical amend their electricity offer. The
readiness requirement but were not procurement will be prioritized based on
selected under the 2022 RE Regulation. fuel or generation sources as follows: (i)
These producers do not have to resubmit
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biogas; (ii) wind energy; (iii) solar farms; The oversubscription of the 2022
and (iv) industrial waste. procurement demonstrates the private
sector's readiness to supply renewable
Pursuant to the above guidelines, the ERC energy and the feasibility of adopting
conducted a public hearing in April 2023 on policies that would allow for greater
the Draft Regulation regarding the penetration. The competition and market
Procurement of Renewable Energy '1st pricing mechanism enabled by a more
Extension Round' to procure electricity liberalized model has the potential to reduce
generated from wind energy and ground- electricity prices for households and
mounted solar. However, there have been no businesses in the long run. Indeed, if the Thai
further updates on the public hearing or the government wishes to achieve both its
potential announcement for the 1st decarbonization goals and its pledges to
Extension Round from the press or the ERC. lower electricity costs, it will need to harness
market forces to drive down pricing. This
According to the IEA, in order for Thailand to may occur through the granting of access to
be on track to achieve its NDCs by 2050 and the power grids by third parties (see the next
2065, it will need to deploy 32 GW of section), or by implementing a reverse
additional variable renewable energy (i.e. auction mechanism to allow bidders to
wind and solar) to the grid by 2030. 11 If the submit their proposed FiTs as part of their
Thai government intends to achieve its proposals.
NDCs, or at least to have a chance at doing so,
further rounds of renewable energy will be Third party access codes
need to be procured during the remainder of
this decade. As an attempt to increase competition within
the electricity market, in 2022, the ERC
Electricity generation and the public introduced the Noti�ication Re: Criteria and
procurement of electricity have emerged as Guidelines on Preparation of the Third-Party
contentious issues in Thai politics. Over the Access Code for the Electricity Network
past few years, household electricity prices Systems ("ERC TPA Noti�ication"). The ERC
have consistently risen. Several factors TPA Noti�ication mandates speci�ic
contribute to this escalation, including a electricity transmission and distribution
surge in gas prices, capacity payment licensees to develop TPA Codes to allow third
commitments, and an excess supply of parties to connect to or use a licensee's
electricity. Certain political parties are electricity network (a "TPA Code"). EGAT,
pushing for measures to reduce electricity MEA, and PEA will be the initial TPA Code
prices, such as by negotiating a reduction in issuers per the ERC TPA Noti�ication
capacity payments with private power (“Issuers”), with the ERC empowered to
producers and restructuring the country's designate more licensees in the future. The
electricity generation system. The Issuers were obliged to prepare their TPA
contention is that the current policy-led Codes in accordance with the Third-Party
centralised generation system, where only Access Framework Guidelines appended to
few producers generate signi�icant volumes the ERC TPA Noti�ication (the "TPA Code
of electricity pursuant to the government Guidelines"), conduct a public hearing on
policy, should be shifted to the market-led the draft, and submit such draft to the ERC
distributed generation system. Under this within November 2022. EGAT, MEA, and PEA
proposed revised structure, multiple power conducted public hearings on their
producers (including EGAT, MEA and PEA) respective draft TPA Codes in October 2022.
would be able to offer electricity to end users
at the price dictated by the market. A TPA Code is a set of rules the Issuers create
to govern how third parties (private power
operators or licensees under the Energy
11 International Energy Agency. Report, August 2023,

at page 7.
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Industry Act, B.E. 2550 (2007), other than and out of the Issuer's system is
the Issuers themselves) can utilise their continuously balanced. If an electricity
transmission and distribution grids. The TPA imbalance occurs, the Issuer may notify
Code consists of three parts: (i) a Service the user to remedy such imbalance,
Code; (ii), a Connection Code; and (iii) an purchase the surplus electricity or sell
Operation Code. The Service Code sets out the shortfall using its own electricity;
procedures for third parties to �ile impose �ines on the user causing the
applications to utilise the Issuer's electricity imbalance, or remove the user from the
network, conditions to such utilisation, key system.
features of the service agreement between
the user and the Issuer, and criteria for • congestion management: the Issuers
allocation of the transfer capacity to each will manage congestion within the
user. Technical issues related to the use of transmission grid to maintain the
Issuer's network are covered by the stability and agility of the network. If
Connection Code. These include, for congestion occurs, the Issuers will
example, the minimum technical reduce the allocated capacity of the users
requirements of the user's equipment, the on a �irst-come-�irst-served basis:
process of connecting the user's equipment reducing the capacity allocated to the
to the Issuer's transmission grid, and the user that engaged in the service in
standard data transmission system, security reverse order from the user that entered
system and electrical energy metering into the service agreement last.
system. After interconnection and during the
term of service, the Issuer and the users Currently, the drafts are subject to potential
must comply with the rules prescribed in the revisions based on issues highlighted during
Operation Code to ensure the safe and the public hearing and the ERC's review
ef�icient operation of the transmission grid. process. Given that the drafts are awaiting
the ERC's consideration, the �inal TPA Codes
The introduction of TPA Codes, granting may differ from the current draft versions.
broader access to private electricity Consequently, the timeline for the public
generators, will likely spur competition in announcement and implementation of these
Thailand’s power sector, and possibly reduce initial TPA Codes remains uncertain.
retail electricity prices. A critical aspect to
watch will be the wheeling charges set by Utility green tariff
Issuers, as these will signi�icantly in�luence
the economic feasibility of private electricity A utility green tariff is a voluntary program
trading. provided by local utilities in various
countries, whereby renewable energy
The following are selected key elements certi�icates (“RECs”) are issued to power
under the current draft TPA Codes: purchasers to signify that a speci�ic portion
of the power they consume comes from
• use-it-or-lose-it rule: the users are renewable sources. This program enables
required to connect or use the Issuer's businesses, as customers, to claim to be
electricity network up to a speci�ied buying renewable energy exclusively or at a
threshold. Failure to do so allows the speci�ied level in order to power their
Issuer to suspend the service to that user operations, and therefore presumably lower
or reduce the allocated capacity of that their Scope 2 carbon emissions. Depending
user and reallocate it to other users. on the requirements of the utility green tariff
scheme, typically the renewable energy can
• electricity balancing obligation: the be generated either by projects owned by the
users have the duty to submit an local utility or from independent producers
electricity management plan to the in a regulated electricity market. There are
Issuer and manage the volume of three main models of utility green tariff
electricity in the grid. They must ensure programs, i.e., (i) a sleeved power purchase
that the amount of electricity put into
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agreement (“PPA”) model where the local Nestlé (Thai) Ltd., and Innopower Co., Ltd.
utility may manage the power supply on the with respect to the production of ice cream
customer’s behalf by way of entering into at Nestlé (Thai) Ltd.’s factory to be powered
power PPAs with independent power by entirely renewable energy through a
producers; (ii) a subscriber model where the utility green tariff sandbox program offered
customers subscribe to a portion of larger by the EGAT throughout 2023. 13
renewable energy projects with the local
utility; and (iii) a market-based rate model, It will be intriguing to observe how the
where the customers are allowed to contract utility green tariff program will unfold at a
with project developers directly or purchase larger scale, since the provision of the
electricity at wholesale prices. 12 Each program will require both reliable sources of
scheme will determine the characteristics of renewable energy and an upgrade of EGAT's
the utility green tariff programs being grid infrastructure. While the utility green
offered such as the capacity of the program, tariff in Thailand may introduce an
contract period, type of resources and appealing concept for companies who are
eligible customers. looking to have quick access to green power,
there are several potential obstacles that
Every green tariff program will establish its may need to be overcome. First, smaller
own unique set of regulations, procedures companies may be priced out or otherwise
and eligibility criteria. In this regard, if prevented from joining the utility green tariff
participation in the program is limited to program if they do not qualify within the
certain customers (e.g., industrial users), the criteria, and limitations of the program being
local utility will typically de�ine the offered or if the program is oversubscribed.
standards for determining which customers Second, although the intention of a utility
qualify to purchase utility green tariffs green tariff program is to facilitate
within the respective program. businesses aiming to reduce their Scope 2
emissions in order to achieve
A utility green tariff scheme is intended as an decarbonization goals, it is unclear how
alternative for buyers to procure renewable purchasing RECs under a utility green tariff
power for their operations without having to scheme will be evaluated in various
be co-located with a renewable power plant circumstances. For instance, exporters to
(e.g., rooftop solar) or be supplied power Europe or other jurisdictions that are
directly from a renewable generator. It also looking to impose carbon import pricing will
allows companies to gain access to want to gain clarity on how RECs purchased
renewable power more easily, especially for under this scheme will be treated for the
those who are aiming to lower their carbon purposes of carbon reporting. Further
footprint to meet their sustainability or developments in greenwashing claims must
decarbonization goals under their also be closely monitored by those intending
environmental, social and governance to make use of the utility green tariff
policies. program in order to achieve their stated
decarbonization goals.
In Thailand, EGAT, the main power producer
in the country, is in the process of developing Potential areas of new growth
a utility green tariff program which it plans
to commence within 2024, with an aim to Nuclear
attract foreign investors. In response to
global food manufacturer Nestlé ’s goal to As mentioned above, Thailand depends
achieve zero GHG emissions by 2050, EGAT mostly on natural gas for its electricity
is currently collaborating with its subsidiary, needs, with other traditional sources of
12 Clean Energy Buyers Association. Introduction to https://www.bangkokpost.com/business/general/

Green Tariff Options, 2022. 2503244.
13 https://www.nestle.co.th/en/media/pressreleases
/nestle-egat-erc-sandbox;
Chandler MHM 11
power such as oil, coal and hydropower also under the Ministry of Higher Education,
playing a signi�icant role in the electricity Science, Research, and Innovation. 14
mix. At the moment, Thailand does not have
any nuclear plants supplying power to the In Thailand, the Nuclear Energy for Peace
grid. However, nuclear energy is emerging as Act, B.E. 2559 (2016) is the current law
an attractive alternative across the globe as a governing the regulation and management
potential tool to both address climate change of nuclear energy activities. This Act outlines
and reduce dependence on fossil fuels. the legal framework and provisions related
Unlike fossil fuels, nuclear power plants do to the licensing process and compliance
not generate direct carbon dioxide emissions considerations for the production,
during their operations, making them an possession, importation and exportation of
attractive option in this regard. radioactive materials, radiation source
materials, and nuclear facilities. The Nuclear
Energy for Peace Commission is the primary
regulator under this Act.
Despite having a core regulatory framework

and regulator in place, there are major
challenges relating to any introduction of
nuclear power in Thailand. First, consent
from local communities and the public at
large will be necessary. A nuclear power
plant of any size would necessitate
conducting an environmental and health
©Vladimír Sládek via Canva.com
impact assessment, which would include a
Thailand has had plans to develop nuclear public consultation process. Nuclear power
power since 1960s, but these have never remains stigmatized due to high-pro�ile
come to fruition due to economic recessions, mishaps, such as those at Three Mile Island
global oil crises and opposition from local in the US in 1979, Chernobyl in the USSR
of�icials and the public. Nonetheless, (now part of Ukraine) in 1986, and
according to the Power Development Plan Fukushima in Japan in 2011. Despite nuclear
(PDP) 2012 – 2030 and the PDP 2015 – having a comparatively strong track-record
2036, nuclear power with capacity of 2,000 for safety, memories of these incidents are
MW was intended to be added to total long-lasting and ever-present in the minds of
capacity during the 2020s and 2030s. The many civil society organizations and the
ambition to develop nuclear power was public at large. Moreover, in March 2023,
dropped from the PDP 2018, however, radioactive material (i.e., Caesium-137) was
meaning Thailand does not currently have removed from a coal-�ired power plant,
any active plans to develop nuclear energy. without proper safety precautions being
The latest draft of the PDP has not yet been taken which left the public exposed. This
of�icially released, and it is unclear whether incident merely exacerbated concerns that
nuclear power will be included in the plan. Thailand is still lacking the readiness to
properly handle and secure radiation-source
Although Thailand has not yet developed any materials. The formation of a rigorous
nuclear power plants for commercial regulatory framework pertaining to
production, the country does possess a small fundamental infrastructure and safety
nuclear facility dedicated to research protocols could potentially ease the negative
purposes. Speci�ically, a 2 MW thermal view from the public regarding the use of
research reactor (TRR-1/M1) is situated at nuclear power. Gaining a critical mass of
the Thailand Institute of Nuclear Technology, public acceptance will be a signi�icant hurdle
which operates as a public organization to overcome.
14 Of�ice of Atoms for Peace, Ministry of Higher National Report of Thailand Convention on Nuclear
Education, Science, Research and Innovation. Safety, 2019.
Chandler MHM 12
Secondly, the cost of developing nuclear 10% of the country’s projected electricity
facilities is much higher than other low- demand by the year 2037. 16 Therefore, it is
carbon sources, such as wind and solar. reasonable to assume that the government
Although nuclear provides the bene�it of intends to develop offshore wind power in
baseload power that is unavailable to the coming decades.
variable renewable energy plants, it is
unclear whether this will be an attractive Although many of the general laws and
complement to Thailand’s grid, given the regulations relating to power projects would
existing abundance of thermal power plants apply in the context of offshore wind, a
providing baseload power. In the short- to framework to allocate development rights in
mid-term, it is not clear whether nuclear speci�ic offshore blocks would need to be
power would be cost competitive. created. At the moment, offshore petroleum
exploration and production is the closest
Nonetheless, there are some indications that analogue of �ixed assets operating in
policymakers may include nuclear power Thailand’s territorial waters and exclusive
development plans in the country’s updated economic zone. Upstream petroleum
PDP, expected to be released in late 2023 or operations are governed under the
2024. Given the lack of local expertise, Petroleum Act, where concessionaires and
foreign sponsors, suppliers and technology contractors are granted concessions or
providers will likely play a key role in laying production sharing
the foundations for Thailand’s nuclear contracts to operate
industry, should it ever materialize. in speci�ic areas in
the Gulf of Thailand.
Offshore Wind A similar
framework may
There are few locations in Thailand where need to be devised
wind speeds render wind power economical. under the Energy
The northeast of the country is the site of Industry Act to
most of the current onshore wind projects. permit offshore
Although there are currently no offshore wind projects to be
developed. ©Bing Jhen Hong via Canva.com
wind projects under development, the
nation's extensive coastlines present a
potential opportunity for this sustainable A further challenge would be costs;
energy solution. development and construction of offshore
wind projects typically results in higher
According to the research conducted by the costs than onshore wind or solar projects. In
Of�ice of Natural Resources and addition, offshore power projects would
Environmental Policy and Planning, require specialized equipment, such as
Thailand has wind potential with an average �loating platforms and subsea cables, along
wind speed of 6 meters per second at a with the intricate and specialized
height of 90 meters, and potentially can installation and maintaining procedures.
reach 13 GW in 21 areas across the country. Fortunately, a number of Thai developers
Along the coast of Thailand, the offshore have gained experience in offshore and
wind potential is estimated to be generate up nearshore wind projects in neighboring
to 7 GW. 15 In addition, according to a study jurisdictions. Other challenges that Thai
done by the EGAT, the generation of up to 13 regulators would need to consider include
GW of electricity from offshore wind power noise pollution, visual disturbances, and
would be suf�icient to meet approximately their impact on marine ecosystems, which
15 Of�ice of Natural Resources and Environmental evolving-energy-

Policy and Planning. Thailand’s Long-Term Low landscape/92646#:~:text=According%20to%20a
Greenhouse Gas Emission Development Strategy %20study%20by,projected%20electricity%20dem
(Revised Version), 2022. and%20by%202037.
16 https://www.evwind.es/2023/07/05/exploring-
the-potential-of-offshore-wind-power-in-thailands-
Chandler MHM 13
would require an environmental and social

impact assessment to move forward. Given
the importance of (unimpeded) sea views to
the tourism sector, this would likely not be a
perfunctory exercise.
Despite these hurdles, offshore wind power

could become a pivotal element of Thailand's
renewable energy future, leading the
country towards a more sustainable energy
system.
Final thoughts
With its comparatively large carbon-
footprint, the power generation sector is at
the core of Thailand’s energy transition.
Although the energy transition remains in its
early stages, a roadmap is slowly coming into
focus, with a continued reliance on natural
gas in the short- to mid-term, and a heavier
reliance on renewables such as wind and
solar in the mid- to long-term. An open
question is whether and how quickly Thai
policymakers will permit greater
competition in supplying electricity in order
to help drive the energy transition forward.
Chandler MHM 14
TRANSPORTATION
Thailand is at the forefront of an ambitious
energy transition, with a strong emphasis
on transforming its transportation sector.
The nation’s commitment to combat
climate change and reduce GHG emissions
is underscored by strategic initiatives
aimed at revolutionizing its transport
ecosystem. According to the Thailand’s
Mid-century, Long-term Low Greenhouse
Gas Emission Development Strategy dated
October 2021 submitted under the Paris
Agreement, Thailand’s national greenhouse
gas inventories can be categorized into �ive
©VichienPetchmai via Canva.com
sectors of sources and sinks: (i) energy; (ii)
industrial processes and product use
(IPPU); (iii) agriculture; (iv) land use, land-use change and forestry (LULUCF); and (v) waste.
Notably, the energy sector holds the largest share, with the transport sector being a signi�icant
contributor to increased energy consumption and GHG emissions. 17
According to the Asian Development Bank, We have set out a number of updates on
among transport modes, road transport Thailand’s transition to electric mobility in
accounts for 26% of the country’s annual public transport.
GHG emissions. 18 Tackling emissions in this
sector is therefore vital to Thailand’s efforts Decommissioning of fossil fuel-
to combat climate change and reach its GHG powered buses
emissions reduction goals by 2030.
Key updates on Thailand’s

transition to electric mobility in
public transport
The synergy between electric public
transportation and the energy transition is a
crucial pathway for fostering sustainable
urban development and combating climate
change. The Thai government’s proactive
©89Stocker via Canva.com
embrace of electric public transportation
stands out as a potential solution, offering a Switching to electric buses is a
cleaner and less polluting substitute for straightforward approach to addressing the
conventional fossil fuel-powered vehicles. environmental downsides caused by
This transition not only helps reduce local air traditional internal combustion engines on
pollution but also contributes signi�icantly to local populations. Since buses tend to spend
tackling the broader issue of greenhouse gas a signi�icant amount of time on the road, they
emissions, a key driver of global climate have relatively higher fuel consumption than
change. other modes of transport. This signi�icantly
contributes to air pollution, especially in
urban settings. The move to electric buses
17 https://unfccc.int/sites/default/�iles/resource/Thailand_LTS1.pdf.
18 https://www.adb.org/news/photo-essays/transforming-thailand-s-transport-using-green-solutions.
Chandler MHM 15
can be a game-changer, substantially cutting presented by the energy transition, mass

down or eliminating the reliance on fossil passenger transit, and freight mobility. The
fuels, and making a meaningful impact on shift from diesel-powered trains to electric
reducing air pollution. trains already plays a crucial role in the
transportation industry, providing a greener
In Bangkok, the Bangkok Mass Transit alternative for passenger travel and freight
Authority (“BMTA”) has set an ambitious transportation. This transition not only
target to replace fossil fuel-powered buses offers an eco-friendly choice but also serves
with over 2,000 electric buses within 3-5 as an alternative to road transport,
years. Electric buses not only have lower contributing to the reduction of the
maintenance and fuel costs but also transportation sector’s net carbon emissions
contribute to a reduction in air pollution. and mitigating air pollution.
Further, as the Thai grid continues to
decarbonize, GHG emissions associated with In 2016, Thailand and China entered into an
the use of electric buses will continue to fall. agreement for the Bangkok-Nong Khai High-
The BMTA originally operated 119 public Speed Train project, establishing a
bus routes in Bangkok; however, as part of a connection between Bangkok and Kunming
bus route reform, the Department of Land through Laos. Despite construction delays,
Transport has granted permission to private the previous Thai government committed to
operators to deploy electric buses on 77 new completing the project by 2028. During the
routes within the greater Bangkok Belt and Road Forum in Beijing on in October
metropolitan area. Currently, there are three 2023, the incoming Prime Minister, Srettha
private operators that have obtained permits Thavisin, reaf�irmed his government's
to manage these 77 bus routes. dedication to accelerating the construction
of the China-Thailand railway, emphasizing
In a concerted effort to extend the bene�its of Thailand’s strong commitment to the
electric buses beyond Bangkok, major cities project.
are also actively exploring the integration of
electric bus systems. Other provinces, In addition, as part of its urban development,
including Chiang Mai, Phuket, and Khon substantial investments have also been
Kaen have embarked on pilot projects aimed made in Thailand's rail infrastructure,
at introducing electric buses to the including the recently inaugurated Yellow
designated areas. For instance, Chiang Mai Line, a straddle beam monorail covering 30.4
has successfully launched an electric bus kilometers of Bangkok, from Lat Phrao to
route operating four times a day, connecting Samrong. The Pink Line commenced its free
Chiang Mai International Airport to Chang public trial operation on 21 November 2023
Puak Bus Terminal. and is scheduled for of�icial launch on 18
December 2023. These initiatives aim to
Expanded electric trains alleviate congestion, enhance air quality, and
reduce greenhouse gas emissions by an
estimated 50,000 tons annually.
Outside Bangkok, a proposal has been made

to develop light rail transit (LRT) and bus
rapid transit (BRT) projects in Khon Kaen
Province in the Northeast Thailand. The
22.6-kilometre LRT is slated to feature 17
stations and will be seamlessly integrated
with the high-speed railway station,
facilitating direct connections between
©Tuu Sitthikorn via Canva.com
Bangkok, Vientiane, and the China-Laos
The rail system, with its comparatively railway. Additionally, public consultations
attractive energy ef�iciency, is being for electric trains in Phuket and Chiang Mai
positioned as a response to the challenges are currently in progress.
Chandler MHM 16
New electric boats However, there exist signi�icant challenges

ahead, notably the relatively elevated cost of
To further reduce pollution and GHG electric vehicles (“EV”) and the imperative
emissions, Thailand is transitioning its water for an expanded public charging
transport. By introducing electric boats on infrastructure. To bolster the long-term
key routes, the country aims to enhance prosperity of the EV industry, the
transportation ef�iciency while minimizing government has implemented measures
environmental impacts. In March 2023, the such as subsidies for EV purchases and
Marine Department collaborated with the providing customs duty exemptions for
private sector to introduce electric boats on imported parts utilized in EV production. As
�ive routes spanning Bangkok and other highlighted in our report last year,
provinces within 2023. The new services ‘Thailand's Energy Transition – 2023
will encompass: (i) the Chao Phraya River Outlook,’ the Thailand National EV Policy
route (a 250-passenger electric boat Committee has announced an ambitious
developed by the Marine Department and its roadmap of Thailand’s EV development
partnered private company); (ii) the spanning from 2021 to 2035, with the
Phadung Krung Kasem canal route (seven objective of developing a well-established
new electric boats and one modi�ication of supply chain for manufacturing EVs. On the
an existing vessel, each capable of carrying demand side, in February of 2022, the
up to 30 passengers); (iii) the Khlong Saen government announced an incentive
Saep canal (eleven electric boats, package, including a reduction in import
accommodating up to 40 passengers, will be duties for completely built-up battery
available for the 11.5-kilometer journey); electric vehicles (“BEVs”), an excise tax cut
(iv) the Khlong Damnoen Saduak canal route for imported EVs, and an EV subsidy for
(two electric boats will be put into service as passenger cars. This subsidy program
part of a tourism promotion campaign in helped put 77,741 BEVs on the road in the
Ratchaburi province); and (v) the sea route �irst ten months of 2023 which are far above
(a 50-passenger boat operating once a day the 20,816 units in the whole 2022.
between Nakhon Sri Thammarat’s Sichon
Harbour and Khao Phlai Dam). The new government’s strong
message to support EV production
Thailand's Leap into EVs
In a signi�icant move, the new Thai
government has expressed unwavering
support for EV policies in the country. Prime
Minister Thavisin has not only actively
promoted these initiatives but has also taken
a hands-on approach by chairing the
National Electric Vehicle Policy Committee,
underscoring the government’s strong
dedication to promoting the deployment of
EVs. A joint venture between Malaysian
automaker Proton and Chinese carmaker
©Vo Van Quy via Canva.com Geely, aiming to establish an EV factory in
Thailand has solidi�ied its standing as the Thailand has been announced; further,
preeminent car manufacturer in the region, Toyota Motor Corp is advancing the
country's EV industry, with Toyota
boasting an impressive output of over 1.6
million vehicles in 2021. Recognized as an recognising the potential of Thailand’s auto
automotive hub of Asia, Thailand is poised to
spearhead the global shift towards
electri�ication.
Chandler MHM 17
manufacturing industry, especially for Continued incentive packages

pickup trucks and eco-cars. 19
On 1 November 2023, the National Electric
Rapid growth in domestic EV demand and Vehicle Policy Committee took a signi�icant
pro-active government policies have helped step to extend the existing EV incentive
attract signi�icant investment in the country, package, set to expire on 31 December 2023,
with a growing number of vehicle by approving a new subsidy scheme,
manufacturers having announced plans to referred to as ‘EV 3.5,’ spanning a four-year
produce BEVs in the country– particularly period from 2024 to 2027. This initiative
Chinese companies including Changan Auto, aims to foster the ongoing growth of the EV
BYD, Geely, Great Wall Motors, SAIC Motor industry, create opportunities for new
and Chery Auto. The massive investments in entrepreneurs, and stimulate investment in
EVs from China and the Thai government's EV production in Thailand. The scope of this
strong message to support EV production support covers passenger cars, electric
have also encouraged European makers of pickup trucks, and electric motorcycles, as
EVs and hybrids to consider investing in follows:
Thailand.
Type of Vehicle Subsidy Package (Baht/Vehicle)

Electric cars priced no more than 2 million baht with a 50,000 – 100,000
battery size of 50 kWh or more
Electric cars priced no more than 2 million baht with a 20,000 – 50,000
battery size of less than 50 kWh
Electric pickup trucks priced no more than 2 million baht 50,000 – 100,000
with a battery capacity of 50 kWh or more
Electric motorcycles priced no more than 150,000 baht 5,000 – 10,000
with a battery capacity of 3 kWh or more
The new subsidy, ranging from 50,000 to for EV manufacturers. These incentives
100,000 baht per car, is slightly less than the include zero import duty for machine/raw
existing subsidy scheme, which currently materials and a corporate income tax
ranges from 70,000 to 150,000 baht per car. exemption for three to eight years, covering
This adjustment re�lects the growing all types of EVs, including passenger cars,
preference for EVs among buyers. buses, trucks, motorcycles, three-wheelers,
and ships. The BOI is also actively promoting
The EV board has also directed the Excise the establishment of an electric charging
Department to extend the registration network and other essential elements to
period for EVs from the end of December to strengthen the EV ecosystem and related
the end of January. This extension aims to industries in Thailand.
accommodate buyers of EVs during the
Thailand International Motor Expo in In November 2023, the BOI sanctioned tax
December, allowing them to claim the incentives for companies in the automotive
subsidy. industry that invest in ‘automation and
robotics’ to enhance productivity. These
New BOI promotion incentives are applicable to both existing and
new investments aimed at improving
The Board of Investment (“BOI”) remains production ef�iciency. Companies meeting
committed to providing various incentives the criteria and investing in automated
19 https://www.reuters.com/business/autos-
transportation/thailand-toyota-jointly-develop-
domestic-ev-industry-2023-11-09/.
Chandler MHM 18
systems or robotics can enjoy a 50% importation of completely built up (CBU)

corporate income tax exemption on the EVs issued in 2022, the Revenue Department
invested capital over a three-year period. has proposed a draft royal decree to exempt
Furthermore, for projects in the country companies and juristic partnerships from
utilizing automated machinery to generate paying corporate income tax on the amount
at least 30% of the total output, a 100% tax of subsidies received for a �iscal year in
exemption on the invested capital is which such subsidies were received, on a
provided. condition that such companies and juristic
partnerships have complied with regulations
Other updates on laws and policies and conditions imposed by the Excise
Department. Non-compliance with the
New noti�ication issued in 2023 regulations and the conditions imposed by
the Excise Department will result in a
To improve the supply chain and support the retroactive tax assessment. The Excise
increasing demand of EVs by making it more Department is currently drafting regulations
affordable for consumers and manufacturers and conditions for companies and juristic
to transition to EVs, in 2023, the Ministry of partnerships to receive the corporate
Finance issued a noti�ication regarding the income tax exemption, but no of�icial draft
exemption of import duties for parts of BEVs has been made publicly available thus far.
and battery-powered boats. This exemption
will be effective from 26 May 2023 until 31 In addition, on 16 March 2023, the Cabinet
December 2025. acknowledged the proposal put forth by the
National Electric Vehicle Policy Committee,
To qualify for the import duty exemption, the which aims to introduce �lexibility by
imported parts of BEVs and battery-powered granting the following entitlements:
boats must ful�ill the following criteria: (i)
they must be certi�ied by the Thailand • importers of BEVs with a seating
Automotive Institute; and (ii) they must be capacity of up to 10 seats, a battery
assembled or utilised for the production of capacity of 10 kilowatt-hours (kWh), and
BEVs or battery-powered boats within one a suggested retail price (“SRP”) below
year from the date of importation. In the two million baht will have the right to
event that the one-year deadline cannot be offset their tax exemption by engaging in
met, importers are required to either export domestic manufacturing of pickup
the imported parts or pay the full amount of trucks or any BEV units of the same size,
duties which were exempted. capacity, and SRP; and
Parts of BEVs and battery-powered boats • importers of BEVs with a seating

which are eligible for import duties capacity of up to 10 seats, a battery
exemptions under the noti�ication are: capacity of at least 30 kWh, and an SRP
batteries, traction motors, EV compressors, ranging from two to seven million baht
battery management systems, driving will have the right to offset their tax
control systems, on-board chargers, DC/DC exemption by engaging in domestic
converters, inverters and power manufacturing of the same BEV model,
conditioning unit (PCU) inverters, and irrespective of the series.
reduction gears.
This proposal, once adopted by the Excise
New EV incentives approved by the cabinet Department, will amend the current
that will be implemented as subordinate requirements set out in the Excise
laws by competent authorities in the near Department’s noti�ication dated 21 March
future 2022 which allows importers to offset their
granted tax exemptions only through their
Following the EV subsidy package to domestic manufacturing of the same type of
incentivize the local manufacturing of BEVs imported by them into Thailand.
completely knocked down (CKD) and
Chandler MHM 19
Final thoughts Infrastructure developments, such as

charging stations and upgraded grids, must
Thailand’s integration of electric modes of be promoted to respond to the increasing
transport into public transport networks is a use of EVs on the road.
key step toward achieving broader
sustainability goals and fostering a cleaner More importantly, consumer education will
environment. Beyond the immediate become a top priority for automakers, as
reduction in tailpipe emissions, this providing clear information about EV
initiative in�luences broader energy systems advantages can bridge the knowledge gap,
and supports the growth of clean energy dispel myths, and empower consumers to
infrastructure. In this symbiotic relationship, make informed decisions about adopting
electric public transportation has emerged EVs.
as a driving force behind energy transition
efforts. The collective impact of widespread
adoption of green mobility is crucial for
moving towards a low-carbon future,
contributing to cleaner air, reducing
dependence on �inite fossil fuels, and
mitigating the global impact of climate
change.
Thailand’s commitment to becoming the EV

hub of Southeast Asia is evident through its
comprehensive policy framework, strategic
incentives, and collaborative initiatives.
While challenges like limited infrastructure
and concerns about EV usage persist,
Thailand’s vision for a sustainable, green
future in transportation is well within reach.
The transition to electric vehicles marks a
signi�icant milestone in the automotive
industry, setting a precedent for sustainable,
forward-thinking transportation solutions.
However, challenges such as limited

infrastructure and skepticism about EV
usage persist. Thailand's EV market growth
is still developing, influenced by the
dominance of internal combustion engine
(ICE)-powered cars, which remain
competitively priced. While high-income
individuals are early adopters of EVs, the
charging infrastructure gap remains a
significant hurdle for broader adoption.
To address these challenges, Thailand needs

streamlined policies, enhanced product
manufacturing, and improved infrastructure
for mass EV adoption. Incentive measures,
including subsidies and tax incentives,
should be maintained to make EVs more
affordable for consumers and attract
investments in local EV production.
Chandler MHM 20
INDUSTRY DEVELOPMENT
Thailand's industrial development has which corresponds to the actual amount of
evolved signi�icantly in recent years. The GHG emissions generated in the production
nation has begun aligning national policies of those goods. The CBAM Certi�icate is
with green initiatives, supporting priced at the average closing price of
collaboration between the public and private emissions rights under the ETS.
sectors. Emphasis has been placed on
motivating business owners to prioritize In the initial phase, CBAM will apply to six
environmental concerns, offering bene�its targeted products with the potential for a
and promotions to encourage the transition high carbon footprint, i.e., cement, steel,
towards eco-friendly practices. aluminum, fertilizers, electricity, and
hydrogen. The transitional period for
This joint effort not only aims to boost the implementing CBAM began on 1 October
competitive capabilities of Thai industries 2023 and will end on 31 December 2025,
but also acknowledges the global trend during which time EU importers are
favoring business activities that prioritize required to report the quantity and the
sustainability and eco-conscious practices. direct and embedded carbon emissions of
This section will discuss factors that impact imported products. The full implementation
the direction of industrial development, of the CBAM is set to take place in 2026,
including the European Union’s (“EU”) where importers in the EU will have to
Carbon Border Adjustment Mechanism purchase CBAM Certi�icates to address
(“CBAM”), investment promotion embedded carbon emissions.
opportunities and other initiatives to
decarbonize in certain industries. Impact of CBAM in Thailand
Impact of Carbon Border During the transition phase, Thailand is

Adjustment Mechanism expected to face limited impacts from CBAM
as the six targeted products are not exported
in signi�icant quantities to the EU. According
Overview of CBAM
to the Bank of Thailand's assessment, the
products currently covered under the CBAM,
The CBAM is an EU initiative aimed at pricing
including plastics, chemicals, steel, and
carbon emissions at the EU's borders. With
aluminum, account for approximately 4.3%
the adoption of the EU’s Emissions Trading
of Thailand's total exports to the EU,
System (“ETS”), the cost of producing goods
equivalent to a total value of USD 952 million
within the EU has increased, due to the
(based on 2021 �igures). Further, Thai
pricing or carbon emissions imposed on
exports of cement, electrical equipment, and
manufacturers. This has resulted, or has the
fertilizers to the EU are minimal. In any case,
potential to result, in carbon leakage, which
it is very likely that the trends in
involves moving high carbon-emitting
international commerce will impose
production facilities from the EU to countries
increasing challenges to Thailand's
where no price on carbon exists. CBAM aims
industrial sector and cause wider impacts
to uphold the competitiveness of EU-
not only to exporters but also manufacturers
manufactured products without
throughout supply chains. This, in turn,
undermining the carbon reduction
should incentivize the Thai government (and
objectives under the ETS.
governments elsewhere) to be more
proactive in terms of launching domestic
In this mechanism, businesses outside the
policies to support the reduction of GHG
EU that exceed the permitted threshold of
emissions. The changing trading landscape
carbon emissions and wish to import goods
should also motivate the private sector to
into the block will be required to purchase a
take measures to reduce its own emissions,
certi�ication known as a “CBAM Certi�icate”,
Chandler MHM 21
regardless of whether they are legally battery swapping stations; (b) businesses
obligated to do so under their domestic law. related to new energy technologies, such as
hydrogen production from renewable
In general, complying with CBAM will result energy, green ammonia, hydrocarbons or
in an increase in expenses for Thai fossil fuels, and power or steam production
manufacturers and exporters both in terms from hydrogen; and (c) novel food or organic
of direct costs for compliance and indirect food businesses.
costs related to monitoring, measuring and
reporting carbon emissions. In order to Initiative to Decarbonization
retain its competitiveness in the EU market,
Thai business operators may need to start Industrial processes are a major contributor
exploring ways to reduce their GHG to GHG emissions in Thailand. Addressing
emissions (i.e., their Scope 1 emissions), as these emissions is crucial for Thailand to
well as requiring their suppliers to source achieve its net-zero emissions goal, since the
their materials from low-emitted carbon manufacturing processes for products like
origins (i.e., their Scope 2 and 3 emissions). cement, metals, chemicals, and ozone-
It may also be helpful for operators to depleting substances are signi�icant sources
proactively expand their investments into of GHG emissions.
carbon reducing initiatives.
To tackle this challenge, the Department of
Summary Industrial Works, Ministry of Industry, has
developed the National Action Plan for GHG
The ability to manage GHG emissions will Mitigation from the Industrial Processes and
become another factor determining the Product Use Sector and Industrial
competitiveness of Thai businesses in the EU Wastewater Measures (2021-2030). This
market, and other countries that implement plan includes strategies like clinker
similar border adjustment measures. Thai substitution and replacing high global
businesses in industries targeted by CBAM warming potential refrigerants. With this
should make efforts to reduce GHG plan in action, Thailand aims to achieve net-
emissions in their production processes to zero CO2 emissions from industrial
enhance their long-run competitiveness. processes and product use by 2050 and net-
zero GHG emissions by 2065.
BOI Promoted Businesses
Additionally, the Ministry of Industry is
The BOI recently announced new incentive promoting the Bio, Circular, and Green
packages for several sustainable business (“BCG”) economic model. This model aims to
activities. Based on Thailand’s investment enhance the sustainability of biological
promotion strategy for 2023-2028, the BOI’s resources, support local economies, improve
aim is to promote investments for the competitiveness of Thai BCG industries,
restructuring Thailand’s economy into a and adapt to global changes. The BCG policy
“new economy” in three aspects: (i) encourages the development and
innovation (being an economy that is driven manufacturing of sustainable products and
by technology, innovation and creativity); (ii) services using green technologies and
competition (being an economy that is circular concepts, emphasizing eco-friendly
competitive, adaptive and generates high manufacturing practices.
growth); and (iii) inclusivity (being an
economy that values environmental and The Industrial Estate Authority of Thailand
social sustainability, creates opportunity and (“IEAT”), a governmental body responsible
reduces inequality). The promoted activities for promoting industrial investment and
were recategorized into 10 new promoted operations, is enthusiastically embracing the
businesses which now include: (a) BCG model. Notably, IEAT has embarked on a
businesses related to electric vehicles, such mega project—a carbon-neutral model
as fuel cell electric vehicles (FCEV) and industrial estate known as a "Smart Park"
Chandler MHM 22
located in Rayong province. During its

construction, the Smart Park utilized
decarbonized hydraulic cement instead of
conventional Portland cement, resulting in a
substantial reduction of approximately
2,000 tons of CO2 emissions. In its
operational phase, the Smart Park will be
powered by renewable energy and hydrogen
sources, complemented by carbon capture
storage systems and an eco-friendly
transportation network, expected to cut CO2
emissions by approximately 72%
(equivalent to 1,014,000 tons per year)
compared to conventional industrial estates.
The Smart Park is a signi�icant government

project focused on developing industrial
estates that prioritize carbon neutrality,
reduce electricity consumption, minimize
fossil fuel use for heating, and decrease
transportation-related emissions.
In summary, the coordinated efforts by

various government authorities mentioned
above demonstrate a commitment to
navigating the global energy transition and
achieving the net-zero emissions goal. While
there is still work ahead, Thailand's actions
thus far illustrate its dedication to
addressing the energy transition and
securing a sustainable future.
Chandler MHM 23
EMERGING TECHNOLOGIES AND BUSINESS

OPPORTUNITIES
The task of decarbonizing energy systems has resulted in countless new and ever-improving
technologies and opportunities. Certain innovations have niche applications and are appropriate
to addressing one or a small number of tasks. Others have the potential to offer wide-ranging
solutions for otherwise dif�icult to abate sectors. In this section, we examine three emerging
technologies and the role they are playing in the Thai context.
Carbon Capture and Storage and

Carbon Capture, Utilization, and
Storage
Overview
The Intergovernmental Panel on Climate

Change (“IPCC”) highlighted that, if we are to ©Fahroni via Canva.com
achieve the ambitions of the Paris their source and then transporting this
Agreement and limit future temperature captured CO2 to secure storage in deep
increases to 1.5°C (2.7°F), we must do more underground rock formations, ensuring they
than just increasing efforts to reduce remain isolated from the atmosphere. The
emissions, but we also need to deploy primary objective of CCS is to signi�icantly
technologies to remove carbon from the reduce the amount of CO2 being released
atmosphere. On this note, CCS and CCUS have into the environment, thus curtailing its
the potential to play an important role in detrimental impact on our planet’s climate.
addressing climate change.
By comparison, the “U” in CCUS stands for
In its NDCs under the Paris Agreement, “utilization”, which introduces an additional
Thailand has committed to achieving net phase into the carbon management
zero emissions by 2065 and carbon equation. After capturing the CO2 emissions,
neutrality by 2050. To this end, various instead of directing them straight to storage,
policies and mitigation strategies have been they are repurposed and utilized in various
implemented. Under Thailand’s applications. This can range from aiding in
decarbonization policy, the draft National enhanced oil recovery operations to being
Energy Plan reportedly envisions a role of converted into bene�icial chemicals and
CCS and CCUS technology as a critical fuels. There is also potential for the CO2 to be
decarbonization tool to address Thailand's incorporated into construction materials or
increasing energy demands and greenhouse used in biofuel production. The essence of
gas emissions. CCUS is not only to limit CO2 emissions, but
also to convert them into something of value,
What are CCS and CCUS? highlighting a transition from a linear
industrial approach to a more sustainable
CCS is a technology designed to combat one.
climate change by directly targeting CO2
emissions at their source. These emissions, According to the Global CCS Institute’s 2022
mainly stemming from power plants, report, there were 194 large-scale CCS
factories, and other industrial operations, facilities globally at the end of 2022. Of the
are released as �lue gas and have historically total number of projects, 94 were in the
been major contributors to the greenhouse Americas, 73 in Europe, 21 in Asia-Paci�ic
effect and subsequent climate change. CCS and 6 in the Middle East. In Thailand, the
involves the capture of these emissions at upstream national oil and gas producer,
Chandler MHM 24
PTTEP, announced the country's �irst CCS that may affect health, safety, and the
project in June 2022, located at the Arthit environment. It is worth noting that the
offshore gas �ield. The project is currently public hearing period for the draft
undergoing a preliminary front-end amendment to the Petroleum Act has already
engineering and design (Pre-FEED) study, ended, and the draft is being reviewed by the
and it is anticipated that CCS operations will relevant government authorities. Once the
commence in 2026. PTTEP is also exploring draft has been �inalized, it will be proposed
additional opportunities in CCUS initiatives. for the approval of the Cabinet accordingly.
Role of CCS and CCUS in industry Final thoughts
The oil and gas industry has been a pioneer CCUS has become increasingly recognized as
in embracing CCS. This adoption was rooted a critical component on the path forward
in the industry's pre-existing practices and toward reaching net-zero GHG emissions.
technological expertise. Techniques The shift away from the use of fossil fuels will
fundamental to CCS, such as the separation not be able to take place immediately due to
of CO2 from natural gas, are already in place the existing infrastructure and economic
and are essential in order to transport gas linkages involved in implementing this
through pipelines. Additionally, the oil and transition. The ultimate objective is to have
gas sector discovered some time ago that the majority of energy originate from low-
once CO2 is isolated, it can be re-injected into carbon sources. In the meantime, CCS and
geological structures in order to produce CCUS can dramatically reduce emissions
additional quantities of petroleum. In other from fossil fuel-based power plants and
words, it not only serves to decrease the businesses, therefore lessening the negative
emissions footprint of various operations impact on the environment caused during
but also has the strategic advantage of being the transition to renewable energy sources.
deployed in reservoirs to boost oil
production through the process of enhanced The other supportive role of CCS and CCUS is
oil recovery. The integration of CCS and CCUS to stabilize the grid. As we increase the share
in the oil and gas industry is a testament to of intermittent renewable sources like wind
how traditional practices can be adapted and and solar on the grid, there will be periods
re�ined to address modern challenges. where energy demand exceeds supply,
especially without suf�iciently advanced
Development from Thai policies and energy storage solutions. During these
regulatory authorities periods, gas-�ired power plants equipped
with CCS can serve as a cleaner backup,
Currently, there are two ongoing maintaining the resilience of the grid
developments in relation to the CCS and without signi�icantly adding to carbon
CCUS. First, the draft amendment to the emissions. Given the extent natural gas plays
Petroleum Act, B.E. 2514 (1971) (as in Thailand’s electricity mix, CCS and CCUS
amended) (the “Petroleum Act”) which have the potential to be a key technology in
introduces the operation of carbon allowing the country to hit its
businesses. This will cover the approval decarbonization targets under the Paris
process, supervision, inspection, and Agreement. This shows that while CCS and
monitoring of CCUS operations in general. CCUS are not renewable technologies, they
Second, the draft ministerial regulation that can play a vital role in complementing and
will be issued in accordance with the accelerating the adoption of renewable
Petroleum Act will exclusively regulate CCUS energy.
business activities that are pertinent to the
operation of petroleum-related businesses. While these innovations are signi�icant, it is
Both the draft amendment to the Petroleum also important to note and address other
Act and the draft ministerial regulation could challenges that exist. To be widely adopted
potentially help prevent impacts and risks and effective, these technologies must
overcome challenges such as economic
Chandler MHM 25
implications, particularly the high costs per incorporated for residential use; for
ton of avoided CO2, the uncertainty example, electric vehicles with bidirectional
surrounding the long-term reliability of charging equipment can store solar power
storage sites, the energy overheads during generated from rooftop panels during the
the capture process, and the need for daytime for local consumption during off-
suitable storage locations. peak hours.
Battery Energy Storage System Thailand's outlook of BESS
Overview Action plan to promote BESS industry

during 2023-2032
Battery energy storage systems ("BESS") are
a form of energy storage which enables In February 2023, the Energy Policy and
electricity from variable renewable energy, Planning Of�ice ("EPPO") approved the
e.g., from wind or solar, to be stored during initial scope of the action plan to promote
low demand periods and distributed during BESS for years 2023-2032 ("Action Plan") in
high demands periods. order to enable the issuance of relevant
regulations. The Action Plan aims to create
Energy storage can come in the form of an ecosystem and larger scale of demand for
chemical processes, such as lithium-ion the BESS industry, as well as increase the
batteries, as well as gravity-based or heat- capacity to compete in the market for BESS
based alternatives. At the moment, lithium- manufacturers or operators utilizing BESS.
ion batteries have a clear technical edge, due The Action Plan includes strategies on four
to their proven and well-understood track main aspects:
record as well dispatchability; indeed, in
addition to storing energy, one of the key • utilization of BESS: to incentivize the
bene�its provided by lithium-ion BESS market, EPPO plans to increase the
projects is their ability to provide frequency demand from the governmental side,
balancing to the grid, a problem that can including the transition of PPAs from
intensify with greater variable renewable renewable energy based on a non-�irm
energy sources coming online. PPA structure to partial-�irm or �irm PPA
structures, with the integration of BESS
to existing renewable energy projects. In
addition, BESS integration will extend to
PPAs from renewable energy produced
by green�ield producers. EPPO also
anticipates that the BESS will help in
reducing costly investments on
transmission and distribution lines. In
this connection, we understand that
EPPO intends to include BESS
©Es_sarawuth via Canva.com development targets in the new power
development plan.
With greater integration of renewables,
BESS provides stable and viable power when • manufacturing of BESS systems: the
variable renewable energy plants are not Thai government believes that
directly feeding power to the grid. Although developing a battery energy storage
BESS is well-suited to complement system will enhance the country's
renewable energy developers, businesses manufacturing competitiveness in the
seeking a continuous power supply from value chain. EPPO seeks to promote
intermittent renewables or to optimize self- strategic partnerships through
consumption of power may also bene�it from government to government (G2G) and
the technology. BESS may also be business to business (B2B)
Chandler MHM 26
collaboration. EPPO also plans to BOI incentives

establish a one-stop service to facilitate
the business operations of private As part of the incentives for the
investors. In addition, EPPO will manufacturing of energy storage, the BOI has
promote the BESS manufacturing plants included the manufacturing of energy
with zero carbon emissions to achieve storage equipment in its list of promoted
zero carbon emissions. industries and granted the following
privileges to successful projects:
• legal framework: a vital element to
incentivize BESS investment includes • high-density battery manufacturing
adapting the legal framework to having cell process will be eligible for A1
facilitate the operation of the BESS privileges, which include the exemption
industry, while establishing safety and of corporate income tax for eight years
quality standards of BESS users. For without a cap. In addition, a reduction of
instance, the batteries used in BESS import duties for raw materials and
projects will need to pass safety and essential materials will be provided at a
quality standards, and the disposal of rate of 90% for parts or raw materials
batteries must be in accordance with not produced in the country for �ive
standards to be set out in the newly years (approved annually);
devised regulatory framework. Although
a comprehensive legal framework for the • high-density battery storage
promotion of BESS has not yet been manufacturing using cells as material
outlined in detail, we anticipate that the (e.g., as a module or battery pack) will be
regulatory landscape will become more eligible for A2 privileges, which include
re�ined as the authorities continue to the exemption of corporate income tax
conduct further studies and research in for eight years with a cap equivalent to
this area. net pro�its. In addition, a reduction of
import duties for raw materials and
• research and development of BESS essential materials will be provided at a
innovation: EPPO intends to promote rate of 90% for parts or raw materials
the BESS industry through material and not produced in the country for �ive
technology readiness and skilled human years (approved annually); and
resources.
• high-density battery storage
Procurement of renewable energy manufacturing using modules to
integrated with BESS produce battery packs will be eligible for
A3 privileges, which include an
In 2022, the ERC released the Regulation for exemption from corporate income tax
the Procurement of Renewable Energy for �ive years.
under Feed-in Tariff (FiT) Scheme for the
Period of 2022-2030. The power being Final thoughts
procured includes the partial-�irm purchase
of power generated from ground-mounted BESS is integral to modern power systems,
solar with BESS generated by green�ield especially with the growing emphasis on
SPPs. variable renewable energy sources and the
need for grid stability. It offers �lexibility,
The procurement target for ground- ef�iciency, and increased reliability to the
mounted solar with BESS for the year 2024 energy sector. It is expected that the
is set at 100MW and will progressively utilization of BESS will continue to grow
increase to 200MW in 2028. By 2030, the globally and will be integrated into larger
total aggregate procurement for ground- scale of renewable energy production and
mounted solar with BESS is targeted at 1,000 may also expand into the residential sector.
MW. With the right governmental promotion,
Chandler MHM 27
BESS will play a more integral role within hydrogen remain with the cost of production
Thailand's energy sector. and the demand for hydrogen generally.
However, with the development of cheaper
Hydrogen and more ef�icient electrolyzers, along with
Overview falling prices for renewable energy inputs,
green hydrogen production may become
In the pursuit of achieving decarbonization more commercially viable.
targets worldwide, the global hydrogen
market continues to grow rapidly, as It is projected that Southeast Asia has the
hydrogen provides an alternative means to potential to emerge as a key supplier for
fossil-fuels of holding or transporting energy hydrogen, whilst European countries are
in liquid or gaseous form. Further, hydrogen likely to be importers of hydrogen due to the
has the potential to be deployed in a number relatively limited availability of natural gas
of different settings, such as fuel for and renewable resources. 21 However,
transport, power generation, heating, steel Southeast Asian countries may seek to
manufacturing, and ammonia production. import technologies to develop green
The global demand of hydrogen is projected hydrogen from Europe, as well as North
to expand �ivefold by 2050. 20 America, Japan and China.
Hydrogen market in Thailand
In recent years, policy and regulatory

authorities as well as a number of large
corporations in Thailand have initiated
feasibility studies relating to hydrogen. They
have also sought domestic and international
collaboration to explore pathways and
©vanitjan via Canva.com investment in the hydrogen industry,
including hydrogen production, hydrogen-
Hydrogen is differentiated by color based on fuel transport and hydrogen �illing stations,
the method of production. The major types power generation from hydrogen, and
include: grey hydrogen which is produced hydrogen storage.
by steam reformation with natural gas as a
feedstock, creating carbon dioxide as a Recently, PTT Public Company Limited,
byproduct; blue hydrogen which is EGAT and ACWA, a Saudi renewable energy
produced in similar manner as grey company, signed an MOU to establish large
hydrogen but with CCUS technology to scale green hydrogen production in
reduce carbon emissions; and green Thailand. The value of the investment is
hydrogen which is produced from reported to be approximately USD 7 billion. 22
renewable energy through electrolysis with
no carbon emissions produced as a The induction of a “hydrogen economy” in
byproduct. Thailand is not occurring in a vacuum; the
development of the industry will depend
Currently, most hydrogen production largely on global factors. A number of use
globally comes in the form of grey hydrogen. cases for hydrogen are being considered
Although green hydrogen is attractive due to across various sectors, including in fertilizer
the fact that it will not emit carbon in its production, steel manufacturing and as
production, the primary challenges for green transportation fuel in aviation and long-haul
20 https://www.mckinsey.com/industries/oil-and- 21 https://www.pwc.com/gx/en/industries/energy-
gas/our-insights/global-energy-perspective- utilities-resources/future-energy/green-hydrogen-
2022?cid=other-eml-mtg-mip- cost.html.
mck&hlkid=9368c58eacb249b5bd378c69745b97c 22 https://asia.nikkei.com/Business/Energy/
6&hctky=1926&hdpid=1601ca82-a599-4782- Thailand-s-PTT-to-invest-7bn-in-green-hydrogen-
a60e-364585a8538b. with-Saudi-�irm.
Chandler MHM 28
shipping. Further developments in Thailand • mid-term phase (2031-2040): blue

will depend on market demand for new hydrogen begins to be used as fuel in
applications. power generation.
• long-term phase (2040-2050):
Developments in Thai policies and the infrastructure for hydrogen production
regulatory landscape technology to be developed, including
pipeline, storage, transport system and
Currently, Thai policymakers are fueling station.
concentrated on the process of conducting • from 2051: green hydrogen to be
feasibility studies on the hydrogen industry available for commercial use.
in order to develop further hydrogen-
speci�ic guidelines, standards and EPPO expects the pilot sectors to include
regulations. As such, there is still no speci�ic hydrogen mixing at natural gas �ired power
and dedicated legal framework for hydrogen plants, the transport sector, and the
in Thailand. However, Thai policy and industrial sector using hydrogen as a fuel for
regulatory bodies have demonstrated their heating. While the government is in the
support of the development of the hydrogen process of devising a national roadmap for
industry, as part of decarbonization hydrogen, the hydrogen market may in fact
initiatives and with the aim of becoming less advance ahead of the pace set by the
dependent on fossil fuels. government. For instance, grey hydrogen has
already been produced and is sold within the
National policies industrial sector, while certain automotive
manufacturers have initiated test runs of
EPPO is planning to include hydrogen in the hydrogen-fuel vehicles and established pilot
updated PDP, which will reportedly be projects for hydrogen fueling stations in
announced before the end of 2023 and is Thailand. However, the viability of hydrogen
scheduled to apply from 2023 to 2037. fueling station would be linked to the
According to EPPO, hydrogen has the commercial feasibility of hydrogen-fuel
potential to replace 20% of the natural gas vehicles, which is uncertain at this time. 24 In
and lique�ied natural gas currently used in certain foreign countries, there have been
the power generation sector. initiatives to explore the possibility of
repurposing natural gas pipeline
In addition, EPPO has collaborated with infrastructure for hydrogen; however, in our
Department of Alternative Energy view, this is unlikely to be the approach
Development and Ef�iciency, ERC, EGAT, PTT adopted by the Thai government and PTT,
Public Company Limited and other the primary owner of natural gas pipeline
authorities to formulate a strategic plan for infrastructure.
hydrogen utilization in the energy sector
(the "Hydrogen Strategic Plan"). Although Although the Hydrogen Strategic Plan
the details of the Hydrogen Strategic Plan foresees an increasing role for hydrogen in
have not been published, the roadmap of Thailand's energy landscape, currently the
hydrogen development in Thailand is cost of hydrogen production is still relatively
expected to include the following phases:23 high. Therefore, the future may hinge on
whether production costs can be suf�iciently
• short-term phase (2021-2030): reduced to make hydrogen a more cost-
starting from grey hydrogen, together competitive option of energy storage,
with support from studies and the use of transportation, and other speci�ic use cases.
trial technologies as well as investment Hydrogen valley
incentives.
In addition to the development of hydrogen-
related guidelines and strategic plan in
23https://www.prachachat.net/economy/news- 24 https://www.nationthailand.com/business/
1340759. automobile/40021174.
Chandler MHM 29
Thailand, EPPO has also initiated a hydrogen legal framework for hydrogen in Thailand is
sandbox, also known as the "Hydrogen in its early phases and will require further
Valley", in the Eastern Economic Corridor development, the policies and movement
zone to establish operating areas for the from Thai policymakers and regulatory
production and utilization of hydrogen. In bodies have demonstrated positive
the Hydrogen Valley, transportation systems perspective toward the potential of
of hydrogen, speci�ically pipelines leading to hydrogen while also presenting a modest
different stations, will be carried out for outlook for its future prospects. Once the
testing and the infrastructure for hydrogen Hydrogen Strategic Plan is implemented, the
will span across various sectors, including outlook for the hydrogen industry in
electricity, industry, and transportation. As Thailand may come into focus.
of the date of this report, the commencement
date for the Hydrogen Valley has not yet been
determined.
BOI incentives
In early 2023, BOI announced that the

manufacturing of hydrogen-fuel vehicles and
hydrogen production from renewable
energy (i.e., green hydrogen) will be added to
categories of industries eligible for BOI
privileges.
Green hydrogen production is now eligible

for A1 incentives, which includes an
exemption on duties for the import of
machinery as well as a corporate income tax
holiday (without cap) for eight years.
Meanwhile, the hydrogen production

business from hydrocarbons or fossil fuels
with the use of CCS as well as power plants
that generate electricity from hydrogen will
be eligible for A2 incentives, which includes
an exemption on duties for the import of
machinery as well as a corporate income tax
holiday (capped by the amount of the
investment, excluding the cost of land and
working capital) for eight years.
Final thoughts
The hydrogen market in Thailand is at its

inception but is gradually aligning with
emerging global trends. With abundant
renewable resources in Thailand and
support from policy and regulatory bodies,
several major companies (mainly from
energy and automotive sectors) are
exploring how hydrogen has the potential to
recon�igure their businesses. Although the
Chandler MHM 30
ENVIRONMENT
In the wake of numerous global disruptions in recent years and growing environmental concerns,
Thailand is confronting these critical challenges while striving for economic progress. Because
the continued increase in emissions and the absence of eco-conscious practices have led to the
signi�icant degradation of the atmosphere, the urgency of addressing the climate crisis is a
mounting concern. Thailand has adopted several new environmental laws in recent years,
demonstrating its commitment to a sustainable future. Concurrently, Thailand’s commitment to
sustainable investment is also evident in its efforts to establish a taxonomy system, thus
simplifying environmentally-friendly economic ventures and �inancial products.
In this section, we will discuss the progress of

some of the signi�icant legal developments related
to environmental laws in Thailand, including the
draft Climate Change Act, the legal framework for
voluntary carbon credits, the draft Clean Air Act
and the Thailand Taxonomy.
Draft Climate Change Act

©vencavolrab via Canva.com
Thailand has been a signatory to the United
Nations Framework Convention on Climate Change Act. This change was proposed by
Change (“UNFCCC”) since 1994. Recently, the Ministry of Natural Resource and
Thailand has updated its NDCs to reduce its Environment to re�lect the department’s
greenhouse gas emissions by 30 percent missions and goals, which have been
from the projected BAU levels by 2030. It focusing on climate change efforts. The
aims to achieve carbon neutrality by 2050 Ministry aims to make the DCCE the central
and net-zero greenhouse gas emission by agency driving Thailand’s climate change
2065. missions and operations, as well as
coordinating with public, private and
In order to make these goals achievable, international agencies on issues related to
Thailand has initiated a multi-leveled climate change.
approach to tackling climate change at the
policy, sectorial and project levels. A Under the draft Climate Change Act, the
fundamental element underpinning these National Climate Change Policy Committee
objectives is a robust regulatory framework, (“NCCPC”) would be formed to suggest a
compelling all relevant sectors to uphold master plan which would include policies
sustainable objectives. The draft Climate and strategies to handle climate change, GHG
Change Act, if enacted, would represent a reduction action plans, and climate change
pivotal step towards a holistic approach to adaptation plans, as well as to recommend or
addressing climate change. introduce new legislation to support the
country’s mission to combat climate change.
Responsible authorities The NCCPC would also oversee the
development and monitor implementation
The Department of Climate Change and of the plans, described in further detail
Environment (“DCCE”), a newly reformed below. The NCCPC would work
of�ice, rebranded from the Climate Change collaboratively with the DCCE to compile
Management and Coordination Division of GHG emission data and climate change data,
the Of�ice of Natural Resources and while cooperating with other governmental
Environmental Policy and Planning and the authorities to support the objectives
Department for Environmental Quality contemplated in the draft law.
Promotion, is set to oversee and monitor
matters surrounding the draft Climate
Chandler MHM 31
Climate Change Master Plan Database for GHG emissions
The draft Climate Change Act would A GHG emission database system would be
introduce a climate change master plan (the established under the Draft Climate Change
“Climate Change Master Plan”) as a Act and would be generally available to the
framework to guide climate change efforts. public. This system would initially
The Climate Change Master Plan would be necessitate six government authorities,
broken into several sections, and include the namely the Ministry of Agriculture and
following: Cooperatives, the Ministry of Transport, the
Ministry of Natural Resources and
• duration of enforcement; Environment, the Ministry of Energy, the
• information on the national climate Ministry of Interior, and the Ministry of
situation including GHG emission Industry, to report to the DCCE on GHG
data; emissions from human activities at their
• climate change projections; source, stored GHG emissions, and net GHG
• climate change impact assessment; emission reductions as outlined in the
• GHG emission reduction targets; emission reduction plan. Each government
• guidelines for its implementation; of�ice will be authorised to request for more
• the private sector’s participation; information from the private sector, such as
• a budget estimate; and factory business operators, power business
• evaluation and reporting guidelines. operators, etc.
The Climate Change Master Plan is intended Current status

to be updated every �ive years, or more
frequently as necessary. Currently, the draft Climate Change Act is
under consideration by the Cabinet, with
GHG emission reduction plan DCCE being tasked with summarizing the
bill’s implications and impact assessment for
The GHG emission reduction plan would aim the Cabinet’s review and approval. It is
to create a framework for government possible that the draft Climate Change Act
authorities to align their efforts with the will be subject to further changes based on
Climate Change Master Plan by reducing concerns raised by the Cabinet including the
GHG emissions. As presently drafted, the issue relating to the overseeing authority,
GHG emission reduction plan would include pricing for emissions, etc. In any case, we
an action plan with corresponding timelines, believe that once this law is enacted, it will
and national emission reduction targets with result in signi�icant changes to Thailand’s
sectors-speci�ic goals. environmental governance, and better
facilitate the realization of long-term climate
goals.
Climate change adaptation plan
The climate change adaption plan would aim Carbon credit framework
to serve as a guideline for the formulation of
policies and measures to enhance resilience As global attention shifts to clean energy and
against the effects and risks of current and a low-carbon economy, businesses are
future climate change. It would encompass considering how carbon markets may help in
goals for adaptation, spanning areas such as achieving decarbonization targets. In this
water management, agricultural respect, Thailand's voluntary carbon market
sustainability, food security, tourism, offers a platform for companies to acquire
healthcare, natural resources management, carbon credits from independent projects
human stabilization, and rehabilitation. dedicated to reducing or eliminating
greenhouse gas emissions.
Chandler MHM 32
Around the world today, there are generally Projects involving the planting, maintenance,
two types of carbon markets: regulatory conservation, and rehabilitation of forests as
compliance markets and voluntary markets. reservoirs of greenhouse gases in forestry
Regulatory compliance markets are legally areas or conserved forests owned by speci�ic
mandated, with consequences for failing to governmental authorities are regulated by
meet emission reduction targets and separate sets of regulations. Those in
bene�its for successful compliance. In forestry areas pursuant to the Forest Act, B.E.
contrast, voluntary carbon markets, like 2484 (1941), or national reserved forests
Thailand's, operate without any legal pursuant to the National Reserved Forest
requirement on companies to reduce Act, B.E. 2507 (1964), are governed by the
emissions, but rather, offer an independent Royal Forest Department Rules Re: Sharing
platform for GHG emission reduction of Carbon Credits from Planting,
projects. In Thailand, carbon credits are Maintenance, Conservation, and
tradable certi�icates representing the Rehabilitation of Forests in Forest Areas, B.E.
reduction, or removal of greenhouse gas 2564 (2021), while projects in national
emissions, typically on a tCO2eq basis. parks, forest parks, botanic parks,
arboretums, preservation zones or wildlife
Thailand – Voluntary Emission sanctuary zones are governed by the
Reduction Regulation of the Department of National
Parks, Wildlife and Plant Conservation Re:
Thailand Greenhouse Gas Management Sharing Carbon Credits from Planting,
Organization (“TGO”) is the sole agency Maintenance, Conservation, and
authorized to oversee and implement carbon Rehabilitation of Forests in Conserved Forest
credit activities in Thailand. TGO introduced Areas, B.E. 2564 (2021).
the Thailand – Voluntary Emission
Reduction (“T-VER”) Program to facilitate To operate projects in these areas, the
voluntary greenhouse gas reduction efforts project developer must obtain a license
across various sectors. Certi�ied carbon approved by the Department of National
credits generated through T-VER can be used Parks or the Royal Forest Department (as the
for offsetting emissions or trading within case may be) and coordinate with the
Thailand. T-VER project development respective departments to register the
consists of two main steps: (i) project project with TGO for participation in the T-
registration; and (ii) greenhouse gas VER to collect carbon credits.
certi�ication. Projects, including those in
forestry, agriculture, waste management,
renewable energy, and more, can be
registered with TGO by the project developer
submitting project design documents and
other required documentation. Certi�ication
involves a third-party Validation and
Veri�ication Body (“VVB”) auditing and
verifying the project’s legitimacy and
subsequent credit issuance. Once the
veri�ication process is completed, TGO will
grant certi�ication, recording the credits in a ©Khanchit Khirisutchalual via Ccanva.com
designated account. In principle, these

credits can be used for offsetting emissions
Carbon credit markets
or sold to entities with registered carbon
credit accounts at TGO. Detailed procedures Once a carbon credit is certi�ied and
for project registration and greenhouse gas registered, it becomes available for purchase
certi�ication are set forth in TGO’s by end-users. Carbon credit trading can
regulations. occur through two main channels:
Chandler MHM 33
• trading platforms or carbon credit established by the International Civil

trading centers: these are structured Aviation Organization (ICAO) aiming to
marketplaces where buyers and sellers stabilize GHG emissions from international
can engage in trading activities. They aviation which is currently approved as
provide a centralized and regulated conditionally eligible, pending the
environment for carbon credit trading; completion of further actions.. The Premium
and T-VER initiative is designed to assess
tangible, enduring, and extra reductions in
• over-the-counter (OTC): in this binary GHG emissions, ensuring the permanence of
system, buyers and sellers directly enter a project’s emission reductions. It also aims
into agreements without the to support the Sustainable Development
involvement of a centralized platform. Goals (“SDGs”) under two or more than two
This method of trading offers more facets, and includes safeguards to prevent
�lexibility but may involve more adverse effects. It adheres to the guidelines
negotiations and higher transaction set by the Board of Directors of the TGO,
costs. ensuring it does not generate negative
impacts, thus adhering to the principle of
Recently, the Federation of Thai Industries "do-no-net harm" which is an additional
(“FTI”) has introduced the FTIX platform component that project developers have to
speci�ically for trading carbon credits undertake beyond the standard T-VER
derived from Thailand's T-VER program. The principles.
FTIX platform operates under the
supervision of a supervisory committee in Challenges and critiques
collaboration between the TGO and FTI.
At �irst glance, voluntary carbon credit
Moreover, companies participating in programs in Thailand and elsewhere appear
Thailand's T-VER program can enjoy an to be an effective mechanism for
income tax exemption on the net pro�it from encouraging the private sector to operate
the sale of domestic carbon credits until 31 businesses responsibly. These programs
October 2027. To qualify for this exemption, enable companies to adopt practices aimed
companies must register their voluntary at reducing emissions or capturing and
greenhouse gas reduction projects under T- storing carbon through afforestation and
VER for three consecutive accounting reforestation. However, projects based on
periods, meeting criteria set by the TGO's protecting or developing forests have been
Board of Directors. However, VAT-registered subject to criticism, particularly with respect
operators are still required to charge 7% VAT to their long-term viability and the
on the sale of carbon credits. permanence (or lack thereof) of carbon
sequestration.
Recent developments with
international standards In addition, a corporate trend in recent years
is to pursue environmental, social and
TGO has enhanced the T-VER standards with governance (“ESG”) goals and project an
the Premium T-VER project, as an option for environmentally conscious image.
project developers who want to develop Nevertheless, a drawback to these initiatives
projects based on more stringent is the potential for businesses to overstate
requirements and higher standards. Thai their ESG performance or vaguely claim their
companies may have the opportunity to products to be eco-friendly without further
register projects for Premium T-VER, detailing or being able to otherwise support
aligning with Article 6 of the Paris their public statements. In some cases,
Agreement and the Carbon Offsetting and companies are relying on carbon credits and
Reduction Scheme for International Aviation offsetting to achieve a “carbon neutral” or
(CORSIA) criteria, a plan to reduce and offset “net zero” badge, which could inadvertently
carbon emissions for the aviation industry lead to a sense of entitlement to emit more
carbon. Instances of greenwashing, where
Chandler MHM 34
organizations exaggerate their actors in this market.

environmental achievements and
consequently mislead investors and the
public, have been observed in several
Clean Air Act
countries, raising ethical and legal concerns
Air pollution, especially when arising from
that need to be properly understood.
elevated PM 2.5 levels, are a far-reaching
environmental problem which is currently of
Thailand is no exception to these challenges.
great concern in Thailand. The concept of the
TGO’s veri�ication processes, effective
"right to clean air" has gained attention, both
regulation, and clear guidelines, can serve as
in Thailand and globally as the World Health
tools to ensure that technical issues relating
Organization (WHO) has recognized air
to voluntary carbon credits are addressed.
pollution as a global environmental health
Further, the Thai Securities Exchange
risk and actively promoted interventions for
Commission (“SEC”) has introduced
healthy environment policies to address this
guidelines designed to enhance the
chronic problem. Moreover, the Special
reliability of companies’ disclosure
Rapporteur of the United Nations Human
obligations. The approach taken by the SEC
Rights Council has opined that access to a
is threefold: promoting the availability,
clean, healthy, and sustainable environment
comparability and reliability of carbon
is a basic human right (the "Clean Air
credits. Such disclosures must also be made
Report"). 25 The Clean Air Report
readily accessible to the public through a
emphasizes the right to breathe clean air as
centralized platform, promoting
being crucial to the enjoyment of human life.
transparency and building trust among
In order to achieve the goals set out in the
stakeholders. On the public side, the SEC has
Clean Air Report, a domestic law governing
played a vital role in raising awareness of
the clean air would be a crucial tool.
greenwashing risks by sharing information,
highlighting common tactics of
greenwashing and urging investors to
exercise due diligence and prudence when
making investment decisions.
Summary
Thailand's voluntary carbon market is

growing in response to public and private
efforts to reduce emissions. However, ©anutr’s Images via Canva.com
challenges such as project selection, quality
assurance, transparency, and fraud There have been many proposed drafts of
prevention exist. Navigating the evolving legislation related to addressing air pollution
market while adhering to international presented to the Thai parliament in recent
standards is crucial for a sustainable years. However, as of the date of this report,
transition to a low-carbon future. In only two bills are currently under
conclusion, while Thailand's voluntary consideration: (i) the draft Act to Regulate
emission reduction framework may the Integrated Management of Clean Air for
encourage the development of projects that Health; and (ii) the draft Act to Regulate the
have the potential to remove carbon from the Clean Air for Fundamental Human Rights.
atmosphere, the legal risks associated with Both drafts set out fundamental concepts
trading and relying on carbon offsets must relating to, legal proceedings, governmental
be analyzed and properly understood by bodies, environmental concerns, and
25David Boyd, Special Rapporteur on Human Rights Promotion and protection of all human rights, civil,
and the Environment. (2019), Issue of Human Rights political, economic, social and cultural rights,
Obligations relating to the enjoyment of safe, clean, including the right to development (A/HRC/40/55).
healthy and sustainable environment, Agenda item 3 Human Rights Council, United Nations.
Chandler MHM 35
penalties. Some key features of both of the Clean air standards and
bills are set out below. measurements
Right to clean air Standards for controlling air quality would

be clearly set out. In achieving such
Every individual would be explicitly entitled standards, measures to create, incentivize
to clean air with no harmful levels of and modify behavior would be established,
pollutants. This is in line with international such as contributions to health funds,
principles of basic human rights, as allocation and transfer of rights to
con�irmed by the Clean Air Report. emissions, and risk insurance for damages in
Moreover, everyone would be entitled to relation to environmental systems resulting
receive information about air quality and the from reduced air quality. The authorities
impacts of air quality on the environment would be empowered to penalize individuals
and their health, to participate in the law and for any action that poses a serious danger to
policy-making processes, and to establish air quality.
measures to address societal or cultural
factors that contribute to air pollution Potential impact
without affecting the rights and freedoms of
the public. The potential impact of either clean air act
on the private sector could be significant. If
Governmental bodies either piece of legislation is enacted,
businesses will likely face increased
In supervising this issue, several committees compliance costs relating to environmental
and sub-committees comprising of qualified matters as they will be required to invest in
individuals with expertise in various fields technologies to reduce air pollution and
would have significant responsibilities, meet legal requirements. Non-compliance
including evaluating policy implementation could result in significant penalties. On the
and covering plans, overseeing, monitoring, other hand, there may also be new
supporting, and providing opportunities for businesses, especially for
recommendations regarding clean air for those involved green technologies,
public health. They would also be renewable energy, or pollution control
responsible for coordinating with innovation, to market themselves in the new
government agencies in implementing these regulatory landscape.
policies. Additionally, some committees
would act as a public investigator for Thailand Taxonomy
environmental concerns, such as the Clean
Air Management Overseeing Committee Internationally, taxonomies have been
under the Draft Act to Regulate the developed by regional and international
Integrated Management of Clean Air for organizations and independently
Health, who would be authorized to propose established by several jurisdictions in order
matters to independent organizations under to create a standardized framework for
the Thai Constitution (i.e., Ombudsman, categorizing economic activities, which will
National Anti-Corruption Commission, allow corporations, financial institutions,
Public Sector Anti-Corruption Commission, and investors to effectively oversee and
National Human Right Commission) in case evaluate risks while encouraging
a state agency fails to act in accordance with sustainable projects and investments.
the laws. Moreover, there would also be
collaborative air quality management at the As part of the global movement towards
provincial level, with the establishment of carbon neutrality and zero emissions, the
local committees which emphasize Working Group on Sustainable Finance (led
participation from the public. by the Bank of Thailand and the Securities
and Exchange Commission and joined by the
Fiscal Policy Office, the Office of Insurance
Chandler MHM 36
Commission, and the Stock Exchange of Key criteria of Thailand Taxonomy

Thailand) published the finalized version of
Thailand Taxonomy, Phase 1 on 30 June In the initial phase, the Thailand Taxonomy
2023. While the Thailand Taxonomy has has a targeted approach and focuses on
been developed by regulatory bodies in voluntary disclosures. Details of the key
Thailand, it will serve as a tool or guideline structure and criteria of the Thailand
for the market to be used on a voluntary Taxonomy are as follows:
basis without any legally binding effects.
Structure and Details

Criteria
Sectoral The first step of the taxonomy involves categorizing economic activities into sectors
classification according to their GHG emission profile and economic parameters. In the sectoral
classification, the ISIC 26 Code system will be utilized. The pilot sectors for the
Thailand Taxonomy are the energy and transportation sectors, given that they
contribute the highest shares of domestic GHG emissions.
Activities The foundation of the Thailand Taxonomy lies in technical screening criteria. Within
assessment – this framework, every sector will undergo a process of disaggregation, with activities
Traffic Light being categorized based on specific environmental thresholds referred to as the
System 'traffic light system', based on the activities undertaken:
Activities exhibiting nearly zero carbon emissions or

demonstrating a clear route to achieving net-zero
emissions.
Activities progressing along a transitional path to

carbon emissions reduction. Note that all activities
marked as amber in Thailand Taxonomy are subject
to a sunset date of 2040.
Activities that do not align with a net-zero

trajectory and are unlikely to become compatible in
the foreseeable future.
The traffic light system takes into account the supporting role of each activity. For
instance, while solar power plants are typically classified as green, if a solar power
plant is primarily dedicated to supporting an end user that emits high levels of GHGs,
it may be categorized as a red activity.
Compliance In order to be considered taxonomy-aligned, projects or activities must also adhere
with the 'Do No to the DNSH principle and comply with MSS.
Significant
The DNSH principle's primary role is to ensure that an objective will not harm other
Harm'
objectives, whereas the MSS principle ensures that a given activity does not result in
principle
adverse social impacts. Even though Thailand Taxonomy Phase 1 will focus on
("DNSH") and
climate change mitigation as the sole objective in the pilot phase, the Thailand
minimum
Taxonomy aims to eventually cover broader range of objectives, including, among
social
others, climate change adaption and the transition to a circular economy. When these
safeguards
additional objectives are introduced, further DNSH criteria will be developed, and
("MSS")
projects must ensure compliance with all DNSH criteria for each of the objectives.
DNSH criteria and MSS require each project and activity to abide by: (i) the laws of
Thailand or the laws of the local jurisdiction where such activity takes place; and (ii)
relevant international conventions related to each objective of the taxonomy. For
I S I C s t a n d s f o r I n t e r n a t i o n a l S t a n d a rd I n d u s t ri a l
Classification. ISIC is a hierarchical classification system
which is a framework established by the United Nations.
Chandler MHM 37
Structure and Details

Criteria
example, if a Thai company engages in energy business activities abroad, the
Thailand Taxonomy will also take into account compliance with local laws and
regulations in the location of those activities, as well as relevant international
conventions, such as the Basel Convention on the Control of Transboundary
Movements of Hazardous Waste and their Disposal. 27
If a project meets the technical screening criteria but falls short on DNSH criteria or
MSS, it may require the development of additional plans for it to qualify as green or
amber under the taxonomy.
Partial As it was designed to be a living document, the criteria under the Thailand Taxonomy
grandfathering will be revisited every three years. Incorporating partial grandfathering provisions
into the Thailand Taxonomy will allow financial products, e.g., bonds and loans, to
maintain their green or amber certifications based on their pre-existing criteria.
Nevertheless, the green or amber label may be revoked, if, after five years, such bonds
or loans do not satisfy the new criteria.
Implications on investments important considerations for investors and

businesses, especially for Thai listed
Globally, governments, businesses and companies whose reporting obligation in
individuals are actively pursuing sustainable relation to their ESG performance is
development goals. Several financial mandatory – the adoption of a taxonomy can
institutions across various jurisdictions have be used as a benchmark to help these
also displayed their commitments to companies and other stakeholders better
sustainable financing, with some
understand how to align investments with
commercial banks in Thailand also joining
sustainability goals. It is also important to
this effort. Thailand Taxonomy Phase 1
represents a gradual but significant shift note that where business is conducted on a
towards sustainable financing. While it may cross-border basis, the overlapping and
pose some challenges for businesses and different taxonomies could lead to
investors in the short term, it also provides challenging scenarios. Therefore, it is
an opportunity to transition toward a more imperative for companies and other
sustainable future. To this end, we expect to stakeholders to understand and comply with
see various incentives for taxonomy-aligned the applicable rules as well as the applicable
projects and financial products such as taxonomy.
better loan packages with more favorable
terms, particularly on interest rates and
pricing or the issuance of green bonds, etc.
Although the Thailand Taxonomy itself is not
legally binding as of the date of this report,
the Thai government could take Thailand
Taxonomy into consideration when forming
and proposing any relevant policy or
regulations in the future.
Since taxonomy is closely linked to

environmental, social, and governance (ESG)
factors – all of which are increasingly
27 The Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and their Disposal was
adopted on 22 March 1989 and came into force on 5 May 1992.
Chandler MHM 38
LOOKING AHEAD
The predictions we made in the 2023 Outlook were all long-term assessments of the direction of
Thailand’s energy transition. Speci�ically, we foresaw that: (i) an increased reliance on LNG to
meet the country’s energy needs; (ii) the announcement of new renewable energy projects; and
(iii) the development of an EV ecosystem, would each be key themes driving the energy transition
in 2023. In 2024, these areas will remain important focal points in assessing the status and
direction of the energy transition.
Rather than attempting to predict any particular legal or policy development, we set out below
three areas where legal and policy developments could potentially have the largest impact in
2024:
• Adoption of the PDP and NEP. Since energy policy is still centrally coordinated in Thailand,
the announcement of a revised PDP and the over-arching NEP would have a major impact in
shaping the energy sector in 2024. A particular point to watch is the degree to which the
revised targets for renewable energy deployment will track the IEA’s recommendations on
necessary action to achieve Thailand’s NDCs.
• Progress on TPA Codes. The adoption of TPA Codes has the potential to allow for a vast
expansion of renewable energy projects outside of the government procurement model.
Demand for decarbonized energy is growing, and Thailand’s on-grid electricity mix is
increasingly seen as unattractive to multinational corporations with their own
decarbonization targets. Permitting the private procurement of electricity at a distance will
increase demand for renewables (particularly solar), and thus potentially increase
deployment beyond the levels contemplated in the PDP and NEP.
• Adoption of carbon pricing. Carbon pricing would accelerate the energy transition across all
sectors by incentivizing private actors to prioritize decarbonized energy and industrial
processes. Accelerated deployment of EV �leets, CCS, and greater procurement of electricity
from renewables are all foreseeable outcomes if a carbon tax or cap-and-trade mechanism
were adopted.
The energy transition is a multi-decade journey that is still in its initial phase. Thailand has started
the process of adopting policies, laws and regulations that will facilitate the move to a
decarbonized future, but there is still a long road ahead. Although its direction and speed are
uncertain, there are clear grounds for optimism that the energy transition will yield countless
opportunities for investors operating across a wide range of sectors.
Chandler MHM 39
AUTHORS
David Beckstead Nuanporn Wechsuwanarux

Partner Partner
david.b@mhm-global.com nuanporn.w@mhm-global.com
Sarunporn Chaianant Tip-apa Limvichai Disaporn Saengpetch

Counsel Counsel Senior Associate
sarunporn.c@mhm-global.com tip-apa.l@mhm-global.com disaporn.s@mhm-global.com
Sooksun PopunNgarm Theerapat Adamas Onglaor

Senior Associate Sombatsatapornkul Associate
sooksun.popunngarm@mhm- Senior Associate adamas.o@mhm-global.com
global.com theerapat.s@mhm-global.com
Jongkotchakorn Phantophas Supawin Pongthananikorn Varisa Soonyakanit

Associate Associate Associate
jongkotchakorn.p@mhm- supawin.p@mhm-global.com varisa.s@mhm-global.com
global.com
Chandler MHM 40
Chandler MHM advises leading Thai and international clients on a wide
range of projects, with principal practice areas of antitrust, aviation,
banking and project �inancing, corporate and mergers & acquisitions,
data protection, dispute resolution/litigation, regulatory, energy and
natural resources, insurance, labor and employment, real estate,
REITs/capital markets, restructuring and insolvency, technology, and
media and telecommunications (TMT). The �irm’s
lawyers draw on integrated practice expertise to deliver
legal solutions that are practical, innovative, and
consistently responsive to clients’ needs.

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THAILAND’S ENERGY TRANSITION

Chandler MHM Limited

CHANDLER MHM LIMITED

MARKET OVERVIEW ............................................................................................................................. 1

The power sector remains at the forefront of efforts to

Source: Energy Policy and Planning Of�ice

1 Energy Policy and Planning Of�ice, Ministry of Energy. Electricity statistics

Source: Energy Policy and Planning Of�ice

2 Ibid. 3 Department of Mineral Fuels, Ministry of Energy.

maritime border dispute in the Gulf of

Coordination Division of the Of�ice of Natural

Natural gas outlook

Source: Department of Mineral Fuels

Source: Energy Policy and Planning Of�ice

Indeed, in May 2023, Thailand’s sources of outpaced imports, meaning we are

Source: Energy Policy and Planning Of�ice

Nonetheless, the government appears The PDP 2018 contemplates an additional

stay on track to achieve its NDCs is by adding Renewable energy tenders

Renewables Procurement quota Number of power Total Procured

10 International Energy Agency. Report, August 2023,

Renewables Procurement quota Number of power Total Procured

Renewables Proposed electricity to be sold (MW) for each year of SCODs

11 International Energy Agency. Report, August 2023,

12 Clean Energy Buyers Association. Introduction to https://www.bangkokpost.com/business/general/

Despite having a core regulatory framework

15 Of�ice of Natural Resources and Environmental evolving-energy-

would require an environmental and social

Despite these hurdles, offshore wind power

Key updates on Thailand’s

can be a game-changer, substantially cutting presented by the energy transition, mass

Outside Bangkok, a proposal has been made

New electric boats However, there exist signi�icant challenges

manufacturing industry, especially for Continued incentive packages

Type of Vehicle Subsidy Package (Baht/Vehicle)

systems or robotics can enjoy a 50% importation of completely built up (CBU)

Parts of BEVs and battery-powered boats • importers of BEVs with a seating

Final thoughts Infrastructure developments, such as

Thailand’s commitment to becoming the EV

However, challenges such as limited

To address these challenges, Thailand needs

Impact of Carbon Border During the transition phase, Thailand is

located in Rayong province. During its

The Smart Park is a signi�icant government

In summary, the coordinated efforts by

EMERGING TECHNOLOGIES AND BUSINESS

Carbon Capture and Storage and

The Intergovernmental Panel on Climate

Role of CCS and CCUS in industry Final thoughts

Battery Energy Storage System Thailand's outlook of BESS

Overview Action plan to promote BESS industry

collaboration. EPPO also plans to BOI incentives

Hydrogen market in Thailand

In recent years, policy and regulatory

shipping. Further developments in Thailand • mid-term phase (2031-2040): blue

In early 2023, BOI announced that the

Green hydrogen production is now eligible

Meanwhile, the hydrogen production

The hydrogen market in Thailand is at its

In this section, we will discuss the progress of

Draft Climate Change Act

Climate Change Master Plan Database for GHG emissions

The Climate Change Master Plan is intended Current status

designated account. In principle, these