With a GDP growth forecast of 5 percent per year, energy demand would double every 10 years, making it increasingly difficult for Thailand to secure adequate energy to fuel its economy. Thailand’s energy sector faces the following priorities and challenges in the medium term:

 High Energy Intensity and Rising Consumption Levels
 Paucity of Domestic Energy Resources and Concerns about Energy Security
 Slow Implementation of Energy Conservation and Demand Side Management (DSM)
 Slow Implementation of Renewable Energy Programs

High Energy Intensity and Rising Consumption Levels

Energy intensity (ratio of energy consumption to GDP) is about 1.4 (compared to about 0.8 or less for more advanced countries) and is increasing. With a GDP growth forecast of 5 percent per year, energy demand would double every 10 years, making it increasingly difficult for Thailand to secure adequate energy to fuel its economy. The Government plans to reduce the energy intensity of GDP from the current level of about 1.4 to about 1.1 by 2007. This plan is ambitious and would require concentrated efforts on energy conservation and structural changes in the transport and industry sectors.

Paucity of Domestic Energy Resources and Concerns about Energy Security

Thailand is a net importer of energy, importing about 63 percent of its commercial energy demand with a continuing upward trend and low domestic reserves This has the potential to exacerbate concerns about energy security of which the Government is already cognizant. Some options being considered by the Government for ensuring security of supply are: making Thailand a regional energy center (a hub for energy trading) particularly for oil trade; development of the Greater Mekong Sub-region grid; import of hydropower from Myanmar (Salaween); and import of gas and/or gas-based power from Myanmar.

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Slow Implementation of Energy Conservation and Demand Side Management (DSM)

While Thailand has devoted attention to energy conservation, much still remains to be done, if it expects to achieve the ambitious targets that it has set for energy conservation. A strategic plan for energy conservation over the period 2002-2011 was approved by the Council of Ministers in May 2002. However, savings targets for electricity supply through conservation and DSM measures have not been met in the past. The overall effort is diffuse even though the agencies to promote energy conservation are in place. 
 
Slow Implementation of Renewable Energy Programs

Renewable energy remains a miniscule 0.5 percent of primary energy. The Government‘s Strategic Plan for Renewable Energy Development envisages an average growth rate of 8 percent per annum compared to a growth rate of 2 percent per annum for various types of fossil fuels. Over the 2002-2011 period, the Government envisages a steep increase in the share of renewable energy from a level of 0.5 percent to about 8 percent of primary energy. 

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