Thai businesses on track to navigate energy price cuts: TDRI concerns loom

Thai businesses are assessing the implications of the government’s recent energy price cuts, amidst concerns from the Thailand Development Research Institute (TDRI) about the potential adverse long-term effects of the policy.

The Srettha Thavisin-led government has decided to slash the power tariff from 4.45 baht per kilowatt-hour to 3.99 baht between September and December and cap the retail price of diesel at 30 baht a litre, a decrease from the previous price of 31.94 baht a litre.

This policy move is one of the government’s early interventions designed to mitigate the impacts of high energy prices on businesses and households. However, its impact is yet to be fully understood.

For example, Doctor Weerachat Kittiratanapaiboon, the chief executive of Biodegradable Packaging for Environment Co (BPE), a Thai company specialising in the production of food and beverage containers from agricultural waste, indicated that it is still assessing how the energy price reduction will affect its operating costs.

Dr Weerachat, a former doctor who transitioned into business, expressed scepticism about the potential for the policy to lead to substantial reductions in power bills and operating costs. He pointed out that the high cost of energy had previously led BPE to install rooftop solar panels, which now account for about 40% of the company’s electricity needs.

By Alex Morgan

Caption: Photo courtesy of Bangkok Post