Electricity up 5% Biggest leap in 4 years
Hike necessary to help Egat attract investors
and
offset fuel rises: govt
The Nation, 14 February 2004
Watcharapong Thongrung
CONSUMERS WILL have to pay 4.84 per cent more for their electricity early next month when they receive their bills for February.
The Electricity Generating Authority of Thailand (Egat) said the price hike was necessary to ensure investor confidence ahead of its initial public offering (IPO) in May.
This is the highest price adjustment in four years.
A government committee authorized to revise the fuel adjustment (Ft) electricity tariff yesterday said the Ft charge would be raised by 12.16 satang per kilowatt-hour (unit) to 38.38 satang, retroactive from February.
Inclusive of the base tariffs, which vary according' to the type of user, the average tariffs were raised from Bt2.51 per unit to Bt38.38, a 4.81 per cent increase.
Metta Buntherngsuk, director general of the Energy Ministry's Energy Policy and Planning Office, said 8.98 million small households who use an average of 65 units of electricity per month would pay only Bt7.90 more. This group represents 67 per cent of all households in Thailand .
"The government could no longer restrain the electricity price as it had done' during the past eight months because it would induce too large a burden on the Egat and would affect investor confidence ahead of the IPO," he said.
Metta, who is vice-chairman of the Ft committee, said the government thought it best to assist affected consumers on a selective basis, rather than helping everyone by maintaining the power price.
The government restrained the Ft increase twice since June 2003, when Egat shouldered Bt4.8 billion and PTT Plc Bt1.85 billion.
This round of Ft increases would pay off Egat's burden, he said, but PTT would have to help itself by negotiating with its natural gas suppliers to reduce prices.
Metta said the increase was necessary because Egat had to pay higher costs for fuel oil and diesel for electricity production because of insufficient supplies of gas. This is because Yetagun gas field in Burma ceased production from August to March to accommodate its plan to increase output from 260 million cubic feet per day (mmcfd) to 400 mmcfd, he said.
The Ft rate, which is subject to a review in the next four months, might be raised further after PTT's gas pipeline in the Gulf of Thailand reaches full capacity, he said.
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