Minister vows to cap prices
Bangkok Post, May 3, 2003
By: Yuthana Praiwan
Energy Minister Prommin Lertsuridej says the government intends to hold the line on electricity bills even though an increase in the fuel tariff adjustment charge (Ft) is likely in June. State power utilities and PTT Plc, as the natural gas supplier to electricity plants; have been asked to manage their production costs more effectively to contain increases in the Ft charge.
The Ft charge, currently 26.12 satang per unit (kilowatt/ hour), is reviewed every four months to reflect changes in fuel costs, exchange rates and other factors. It is expected to rise by nine satang for the June 1 to Sept 30 periods.
If the Ft cost rises while power bills remain capped, suppliers will have to absorb costs of about three billion baht over the four-month period if they are unable to manage their costs efficiently. Dr. Prommin said PTT must also freeze the price of natural gas, which accounts for about 70% of all fuel used in power generation, at 148 baht per one million BTU, (British Thermal Units) by holding talks with gas producers.
As well, leniency will be given to Electricity Generating Authority of Thailand (Egat) and privately run power plants to use bunker oil with sulphur content level exceeding 2%, if the facilities are equipped with sulphur filters.
Bunker oil with higher sulphur content level is US$5 per tone cheaper than standard low-sulphur bunker oil, and is also cheaper than natural gas.
Dr. Prommin said he would meet with officials from power utilities to look at ways to reduce duplicated investment costs as part of an effort to curb the Ft charge before the next review in October.
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