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BMI View: Thailand's plan to reduce its reliance on gas-fired power generation will create opportunities
for alternatives such as coal and renewables, which poses upside risks to our outlook for the country's
energy related infrastructure. That said, the scale of upside risk has been limited somewhat following the
announcement that EPAC has approved the construction of a new LNG import terminal at Rayong. We
highlight that lower than expected power consumption over the near term means such opportunities will
begin to have an impact on infrastructure construction only beyond 2017-2018 as projects are delayed until
demand picks up. We retain a modest growth forecast for 2016 and 2017, with power generation set to
grow by 3.0% and 3.1%, respectively.
Latest Updates And Structural Trends
? The Electricity Generating Authority of Thailand (EGAT) plans to build six new coal-fired power plants
by 2025 in a bid to improve its share of the power supply market from 37% to 50%. The six new plants
are expected to have a combined capacity of 4,390MW. Two of the plants will be located in the southern
provinces of Krabi and Songkhla and are expected to be operational by 2020-2022. Currently, 20% of
EGAT's electricity generation is from coal-fired power plants, which will increase to 30-35% after the six
new facilities become operational.
? The largest source of growth in 2016 will be thermal generation, while non-hydropower renewables will
be the fastest growing sub-sector at 11.0%. Meanwhile, the Thai power sector's long-term growth outlook
is muted, as the country continues to experience challenges in procuring gas supplies and is clearly
moving towards increasing reliance on electricity imports. We see electricity generation growing at an
average rate of 3.0% per annum between 2016-2025. Growth will be primarily driven by nonhydropower
renewable energy generation and coal-fired generation. We see limited scope for expansion
in gas-fired generation.