"The Energy Regulatory Commission" is closely monitoring the economic situation and has announced a reduction in the FT rate in line with fuel price conditions, noting that the Thai economy remains uncertain until the end of the year.

     Mr. Komkrit Tantravanich, Secretary-General of the Energy Regulatory Commission (ERC), as the spokesperson for the ERC, revealed that the Energy Regulatory Commission has decided to further reduce the variable electricity tariff (FT) for the billing period from September to December 2020 by 0.83 satang per unit, resulting in an FT charge of -12.43 satang per unit, reflecting the actual reduced fuel costs, down from the previous charge of -11.60 satang per unit. This will lead to an average electricity cost reduction to 3.63 baht per unit, down from the current average of 3.64 baht per unit (excluding VAT).

"Although fuel prices have decreased due to the COVID-19 crisis, leading to lower electricity production costs,
the ERC remains concerned about the continuous decline in electricity consumption due to the economic slowdown, as well as the volatility of exchange rates, which could further pressure electricity production costs," said Mr. Komkrit.

       The main reason for this FT reduction is the previous decline in natural gas prices, which affects the current billing period. The ERC must continue to assess the ongoing decrease in electricity consumption due to the economic slowdown and cannot clearly predict the direction of electricity usage, which may negatively impact and burden the FT estimation for the next period.

Factors considered for the FT rate for the period from September to December 2020 include:

1. The demand for electricity during September to December 2020 is approximately 58,910 million units, a reduction from the expected demand of 69,920 million units during May to August 2020, or a decrease of -15.75%. The total electricity demand for 2020 is approximately 193,706 million units, down -1.62% from 2019, which was 196,896 million units.

2. The proportion of fuel used for electricity generation during September to December 2020 remains primarily natural gas at 51.13%, coal at 17.97%, and electricity purchased from abroad at 20.15%, with others at 10.75%.

3. The fuel price situation for electricity generation shows that the average prices of each fuel type have decreased from the previous period due to the decline in global oil prices, as shown in the table.

 

4. The average exchange rate used for estimation (from May 1 to May 31, 2020) is 32 baht per US dollar, depreciating from the estimated rate of 31.70 baht per US dollar in the previous May to August 2020 period.

      The ERC will conduct a public consultation on the FT rate for the billing period from September to December 2020 on the ERC website from July 17 to July 23, 2020, before making an official announcement.

 

Information from the Office of the Energy Regulatory Commission