Fuel price changes 'needed'

[Lite Beer]

Fuel price changes 'needed'
Watcharapong Thongrung
The Nation

Narongchai: focusing on real cost

BANGKOK: -- Wasteful 'populism' a thing of the past, Narongchai warns

Energy Minister Narongchai Akrasanee said yesterday that the government would go ahead with reform of the energy sector, including adjustment of fuel prices to reflect their real costs.

In his first press conference since assuming the post, Narongchai said reform and reconciliation would be the important items on the government agenda, especially for the energy sector. In its policy address to the National Legislative Assembly yesterday, the government stated that it would reform fuel prices to conform with their true costs, and levy appropriate tax rates on each product and its consumers, in a bid to improve energy efficiency and prevent wasteful consumption.

Narongchai stressed that the policy also included opening a new round of bidding for petroleum exploration and production; building new power plants that use both fossil and renewable fuels; transparent, fair and environmentally friendly procedures; and joint development of energy sources with neighbouring countries.

He said his ministry would hold a weekly forum with the media in an effort to enhance public understanding of energy-policy matters, which are generally complex.

"The Energy Ministry must try to communicate to the majority of the citizens that these energy-policy guidelines follow the correct principles and are beneficial to the overall economy and the country's future.

"There will be no energy populism, except different forms of assistance that will be provided to low-income earners," he said.

Narongchai said the Bt30-a-litre cap on diesel fuel was an "energy populism" policy introduced by previous governments that caused diesel consumption to balloon to 60 million litres per day, while causing a surplus of other petroleum products that had to be exported at low prices.

The reforms will involve making every type of fuel subject to the same tax rates, he said.

The ministry supports the use of liquefied petroleum gas as a raw material for the petrochemical industry and as cooking gas, but not for use in the transport sector. Therefore, it will come up with a guideline to adjust LPG prices for the transport sector.

Narongchai said Thailand had relied too much on natural gas for its electricity generation, and thus to enhance its energy security, it would have to find other principal fuels such as clean coal and nuclear power to be added to the country's long-term power development plan.

The ministry will also consider whether there is a need to open a new round of bidding for IPP (independent power producer) projects.

The ministry considers the opening of the 21st round of petroleum-exploration bidding and negotiations on expiring petroleum concessions among urgent matters that must be finalised within the tenure of the current military-led government. It is uncertain whether it can conclude talks with Cambodia on joint development of the overlapping claims area in the Gulf of Thailand within its tenure, because this is a complicated matter.

Source: http://www.nationmultimedia.com/business/Fuel-price-changes-needed-30243171.html

-- The Nation 2014-09-13

[NongKhaiKid]

I'm no expert on this subject and am happy for other members to educate me.

One thing I do see is just how many vehicles, especially delivery, use diesel so if the price is allowed to find it's own higher level there must be a knock on effect for all manner of items.

[JeremyBowskill]

didn't they just change them like 10 days ago or something.......

I don't see any "wasteful consumption" going on, millions of trucks in traffic jams in BKK with only 1 person in each truck, what's wasteful about that?

Edited September 13, 2014 by JeremyBowskill

[Suriya4]

Please keep diesel under 30 baht. My merc bmw and volvo runs on them. Thanks.

[Robby nz]

it would have to find other principal fuels such as clean coal and nuclear power to be added

Please, please never nuclear.

Not because Thais cant do it right, but because it just isn't safe and when it comes down to disposing of the spent fuel rods and shutting down at the end of life it turns out not to be such a cheap option of producing power as it is cracked up to be.

[NongKhaiKid]

it would have to find other principal fuels such as clean coal and nuclear power to be added

Please, please never nuclear.

Not because Thais cant do it right, but because it just isn't safe and when it comes down to disposing of the spent fuel rods and shutting down at the end of life it turns out not to be such a cheap option of producing power as it is cracked up to be.

With all the corruption and lust for profits who could believe a nuclear plant here would be actually built to the most exacting specs ?

[alant]

it would have to find other principal fuels such as clean coal and nuclear power to be added

Please, please never nuclear.

Not because Thais cant do it right, but because it just isn't safe and when it comes down to disposing of the spent fuel rods and shutting down at the end of life it turns out not to be such a cheap option of producing power as it is cracked up to be.

Not because Thais cant do it right.

Big worry in my book, spent fuel rods being cut up in a back street dealers place???

[culicine]

Please keep diesel under 30 baht. My merc bmw and volvo runs on them. Thanks.

If you can afford those cars you can afford the fuel lol

At least urbanites and their pickups jamming up Bangkok streets may become less of a problem. Some of those people will opt for smaller cars if diesel equals benzene in prices.

There may be knock-on effects to other businesses, but in the long run that is better for the economy.

[kuiburi]

Most farmers and fishermen here are on diesel , if diesel goes up , food prices go up .

For us expats not really something to worry about , Its the poorer people that have trouble already with the increased livingcosts .

[Seligne2]

I agree with the minister that Thai energy policies need to be revamped. But moving to "clean" coal (there is no such thing) and nuclear is moving in the wrong direction due to a) exacerbating CO2 emissions and the expense and unresolved issues with nukes.

What is astounding to me is that in a country where solar energy is abundant, so little is done to capture it. I recall travelling in Japan in 1973(!). Almost every farmhouse had a passive solar collector on the roof to provide hot water. Here, in 2014, Thais wash their dishes (and themselves) in cold water. Scandalous!

[Seligne2]

I agree with the minister that Thai energy policies need to be revamped. But moving to "clean" coal (there is no such thing) and nuclear is moving in the wrong direction due to a) exacerbating CO2 emissions and the expense and unresolved issues with nukes.

What is astounding to me is that in a country where solar energy is abundant, so little is done to capture it. I recall travelling in Japan in 1973(!). Almost every farmhouse had a passive solar collector on the roof to provide hot water. Here, in 2014, Thais wash their dishes (and themselves) in cold water. Scandalous!

555! I inserted a "b)" and got an emoticon!

[ratcatcher]

Please keep diesel under 30 baht. My merc bmw and volvo runs on them. Thanks.

If you can afford those cars you can afford the fuel lol

At least urbanites and their pickups jamming up Bangkok streets may become less of a problem. Some of those people will opt for smaller cars if diesel equals benzene in prices.

There may be knock-on effects to other businesses, but in the long run that is better for the economy.

I do believe Suriya4 was using Thai flavored sarcasm otherwise they would have said "...run on it".

[Robert2006]

“reform fuel prices to conform with their true costs, and levy appropriate tax rates on each product and its consumers, in a bid to improve energy efficiency and prevent wasteful consumption”.

It’s the same old same old; forget all the misdirection it’s about separating individuals from their ever so popular fancy pieces of paper. To improve energy efficiency and prevent wasteful consumption, beautiful soft closing technique!

[airconsult]

it would have to find other principal fuels such as clean coal and nuclear power to be added

Please, please never nuclear.

Not because Thais cant do it right, but because it just isn't safe and when it comes down to disposing of the spent fuel rods and shutting down at the end of life it turns out not to be such a cheap option of producing power as it is cracked up to be.

A lot of the shutdown costs are artificially imposed because of the greenpeace inspired bogey man. eg. At one of the UK plants the current disposal cost is due to the fact that the regulations would have them "restore" the background level of radiation to a lower level than the natural radioactivity in the surrounding area!!

On safety.

However analyis presented in the international Journal, Human and Ecological Risk Assessment found that coal, oil, Liquid petroleum gas and hydro accidents have cost more than nuclear power accidents.^[14]

^{http://en.wikipedia.org/wiki/Energy_accidents}

[gandalf12]

<script type='text/javascript'>window.mod_pagespeed_start = Number(new Date());</script>

it would have to find other principal fuels such as clean coal and nuclear power to be added

Please, please never nuclear.

Not because Thais cant do it right, but because it just isn't safe and when it comes down to disposing of the spent fuel rods and shutting down at the end of life it turns out not to be such a cheap option of producing power as it is cracked up to be.

Agreed dont need Nuclear here in Thailand. Just look at the construction in general and then think if they used the same standard for Nuclear. It doesnt bere to think too long on this

[Krataiboy]

No mention of investing in solar or wave power in a country with over seven thousand miles of coastline, where the sun shines ninety per cent of the time.

Clean coal - are they kidding?

[seajae]

changing the pricing to reflect the real price is understandable as long as those doing the changes do not have shares in the companies selling it and getting a higher price, These people need to have no connection the the supply companies at all, I am sure they will not mind being investigated to make sure they are not attempting to line their own/familiy members pockets.....

[useronthenet]

All very well, but Islands like Phuket rely on vehicle transportation to get around, since nobody took the initiative to think ahead and provide an alternative form of transport. If the authorities are suggesting fuel prices to go up even further, then naturally all prices will increase.

I find it almost hypocritical, that after years encouraging Thais to new buy cars with attractive incentives, now the government is trying to put on the brakes. The country essentially has run before it learnt to walk.

[watso63]

12 hours of sunshine everyday. Solar panels (once paid for and installed) not only provide free electricity, but shade from the sun. Not one supplier or house/business with them where I live. Back in the UK I had an 18 panel system installed. It cost me nothing. The owning company got a guaranteed tariff from the government and I allowed them to use my roof. Winners all round, except the taxpayers 555.

[Jeremy50]

All fuel prices should be raised to at least 40 baht a litre. People will stop making all the short 'pleasure' journeys they are currently making , driving to 7/11 every 5 minutes and such like. People should walk and cycle, even though it is a million miles from the Thai mindset. Something should also be done to reduce the terrifying number of heavy trucks hurtling around Thailand. A lot of them seem to be empty, where the hell are they all going?

[Seligne2]

changing the pricing to reflect the real price is understandable as long as those doing the changes do not have shares in the companies selling it and getting a higher price, These people need to have no connection the the supply companies at all, I am sure they will not mind being investigated to make sure they are not attempting to line their own/familiy members pockets.....

Raising the price of fuel or, more accurately, allowing higher prices will not result in petroleum companies making more money. Oil is a fungible commodity and if the producers don't get their price, they sell it elsewhere. What's going on here is that the Thai government subsidizes the petroleum market allowing consumers to pay less than the worldwide going rate for fuel. Where does the government get the money for subsidies. From consumers/taxpayers ultimately. It's a bit of a shell game really. The winners are those who use fuel profligately.

[marcusd]

it would have to find other principal fuels such as clean coal and nuclear power to be added

Please, please never nuclear.

Not because Thais cant do it right, but because it just isn't safe and when it comes down to disposing of the spent fuel rods and shutting down at the end of life it turns out not to be such a cheap option of producing power as it is cracked up to be.

With all the corruption and lust for profits who could believe a nuclear plant here would be actually built to the most exacting specs ?

The Thais invested Nuclear fission did they not? OF COURSE it would be sfe and of course the waste which could be turned to Plutonium for Weapons is not going to disappear lie those 500 expensive cars is it?

[billd766]

All fuel prices should be raised to at least 40 baht a litre. People will stop making all the short 'pleasure' journeys they are currently making , driving to 7/11 every 5 minutes and such like. People should walk and cycle, even though it is a million miles from the Thai mindset. Something should also be done to reduce the terrifying number of heavy trucks hurtling around Thailand. A lot of them seem to be empty, where the hell are they all going?

What a wonderful thought. Do you live in the city by any chance? Out where I live the nearest 7/11 is 6km away, the next is 15km and the next again is 20 km away. The nearest BigC and Makro are 65km away.

Out where I live there is NO public transport and if you need to go anywhere it is by motoerbike, pickup, e-tan or tractor.

Not such an expense for me but for the many millions of Thais who live in rural areas the change will seriously affect their lives.

Don't worry about them though as they are only poor Thais and you are a rich farang so the extra expense will mean nothing to you.

Edited for poor spelling

Edited September 13, 2014 by billd766

[Seligne2]

Studies of the safety of nuclear power are intrinsically flawed for the simple reason that we don't know the long-term costs. When a gas-fired plant goes boom, we move in, count the bodies, clean up the site, and move on. We calculate the costs. When a plant like Cernyobl or Fukushima goes tits up, we have no clue what the longer-term effects will be. Chernyobl went kaput in the early '80s and we are still adding to the debit side of the ledger. Fukushimi appears to be worse, especially given that the problems are still unfolding.

[airconsult]

Studies of the safety of nuclear power are intrinsically flawed for the simple reason that we don't know the long-term costs. When a gas-fired plant goes boom, we move in, count the bodies, clean up the site, and move on. We calculate the costs. When a plant like Cernyobl or Fukushima goes tits up, we have no clue what the longer-term effects will be. Chernyobl went kaput in the early '80s and we are still adding to the debit side of the ledger. Fukushimi appears to be worse, especially given that the problems are still unfolding.

The WHO disagrees.

28 FEBRUARY 2013 | GENEVA - A comprehensive assessment by international experts on the health risks associated with the Fukushima Daiichi nuclear power plant (NPP) disaster in Japan has concluded that, for the general population inside and outside of Japan, the predicted risks are low and no observable increases in cancer rates above baseline rates are anticipated.

http://www.who.int/mediacentre/news/releases/2013/fukushima_report_20130228/en/

EDIT to add UNSCEAR report on Chernobyl long-term effects.

The accident at the Chernobyl nuclear power plant in 1986 was a tragic event for its victims, and those most affected suffered major hardship. Some of the people who dealt with the emergency lost their lives. Although those exposed as children and the emergency and recovery workers are at increased risk of radiation-induced effects, the vast majority of the population need not live in fear of serious health consequences due to the radiation from the Chernobyl accident. For the most part, they were exposed to radiation levels comparable to or a few times higher than annual levels of natural background, and future exposures continue to slowly diminish as the radionuclides decay. Lives have been seriously disrupted by the Chernobyl accident, but from the radiological point of view, generally positive prospects for the future health of most individuals should prevail.

http://www.unscear.org/unscear/en/chernobyl.html

Edited September 13, 2014 by airconsult

[Thai at Heart]

I'm no expert on this subject and am happy for other members to educate me.

One thing I do see is just how many vehicles, especially delivery, use diesel so if the price is allowed to find it's own higher level there must be a knock on effect for all manner of items.

Yup. But it goes beyond that. How many snake oil politicians on all parties were in the trucking businesses preventing trains for freight and pushing this diesel policy.

Its inflationary to get rid of the subsidy, but it should make people and businesses change their actions

[Jeremy50]

All fuel prices should be raised to at least 40 baht a litre. People will stop making all the short 'pleasure' journeys they are currently making , driving to 7/11 every 5 minutes and such like. People should walk and cycle, even though it is a million miles from the Thai mindset. Something should also be done to reduce the terrifying number of heavy trucks hurtling around Thailand. A lot of them seem to be empty, where the hell are they all going?

What a wonderful thought. Do you live in the city by any chance? Out where I live the nearest 7/11 is 6km away, the next is 15km and the next again is 20 km away. The nearest BigC and Makro are 65km away.

Out where I live there is NO public transport and if you need to go anywhere it is by motoerbike, pickup, e-tan or tractor.

Not such an expense for me but for the many millions of Thais who live in rural areas the change will seriously affect their lives.

Don't worry about them though as they are only poor Thais and you are a rich farang so the extra expense will mean nothing to you.

Edited for poor spelling

Well, I would go to the nearest 7/11 and forget about the other 2. Go to Big C once a month, or do your neighbors not have fridges?

Of course I see your point, but Thais seem to be increasingly 'living' in their cars which brings into question the myth of the 'poor' Thais. Anyway, every single Thai village I have ever been to has a 'mom and pop' store, and a butchers, egg salesmen and so on.

[rickirs]

Nuclear energy must be part of a diversified energy base for sustainable and reliable economic growth. On a capital cost per kilowatt-hour basis nuclear energy is at least competitive with coal and gas, and typically cheaper than wind and solar energy plants - even when decommissioning costs are included because the net present value is close to zero when discounted after 60 years of plant operation.

Note:

OECD = Organization for Economic Co-operation and Development

[airconsult]

Nuclear energy must be part of a diversified energy base for sustainable and reliable economic growth. On a capital cost per kilowatt-hour basis nuclear energy is at least competitive with coal and gas, and typically cheaper than wind and solar energy plants - even when decommissioning costs are included because the net present value is close to zero when discounted after 60 years of plant operation.

Note:

OECD = Organization for Economic Co-operation and Development

Also - because of the low amount of fuel needed - the cost of electricity produced is almost immune to market price fluctuations (unlike Gas - the coal price has been stable for years though). eg. France keeps a 10 year supply of fuel for all it's plants stored and ready.

[billd766]

All fuel prices should be raised to at least 40 baht a litre. People will stop making all the short 'pleasure' journeys they are currently making , driving to 7/11 every 5 minutes and such like. People should walk and cycle, even though it is a million miles from the Thai mindset. Something should also be done to reduce the terrifying number of heavy trucks hurtling around Thailand. A lot of them seem to be empty, where the hell are they all going?

What a wonderful thought. Do you live in the city by any chance? Out where I live the nearest 7/11 is 6km away, the next is 15km and the next again is 20 km away. The nearest BigC and Makro are 65km away.

Out where I live there is NO public transport and if you need to go anywhere it is by motorbike, pickup, e-tan or tractor.

Not such an expense for me but for the many millions of Thais who live in rural areas the change will seriously affect their lives.

Don't worry about them though as they are only poor Thais and you are a rich farang so the extra expense will mean nothing to you.

Edited for poor spelling

Well, I would go to the nearest 7/11 and forget about the other 2. Go to Big C once a month, or do your neighbors not have fridges?

Of course I see your point, but Thais seem to be increasingly 'living' in their cars which brings into question the myth of the 'poor' Thais. Anyway, every single Thai village I have ever been to has a 'mom and pop' store, and a butchers, egg salesmen and so on.

All the food that the mom and pop stores plus the food delivery cars that are about every day are delivered by diesel trucks and pickups.

Out here in rural Khampaeng Phet only the bigger villages have pork and chicken and egg dealers plus the market 2 or 3 times a week but the people still have to get there somehow using as I said earlier by motorbike, pickup, e-tan or tractor.

It is the same in most rural areas of Thailand and as usual the poorest will suffer the most.

Edited September 13, 2014 by billd766