Calling off IPP bids 'could put supply at risk'
Postponing bids to construct new electricity plants under the independent power producer (IPP) programme will put the country's electricity supply stability at risk, according to Viraphol Jirapraditkul, director of Energy Policy and Planning Office (EPPO). He was responding to a suggestion made at a public hearing on Thursday that the IPP bids be postponed until a new independent energy regulator is in place under a planned energy business law.The regulator should organise the bid for the sake of fairness and transparency since it would be immune from conflicts of interest, academic Chuenchom Sangarasri Greacen told the hearing on the national power development plan (PDP).
''We can't wait for regulators to handle the bid since the formation will take several months while the process of organising the bid until the completion of the new power plants will take another four years,'' Mr Viraphol said.
He said that electricity output from the new power plants was scheduled to enter the power grid in 2011 to meet anticipated demand.
''Who will take responsibility for the damage as a result of possible power blackouts if no new electricity output enters the grid?''
Between 3,000 and 4,000 megawatts of electricity to be generated from the new plants, costing about $4 billion, will be needed to meet local power demand between 2011 and 2013, based on current projections.
The IPP bid conditions, he said, would not restrict the type of fuel used in electricity production. Bidders can propose any types of fuel they deem viable for their power plants.
Businesses are also concerned about the possibility of power shortages if the PDP takes too long to put in place.
''The new PDP should be implemented as soon as possible to verify the exact power demand that will be the base for determining the new electricity output to be produced by the new IPP plants,'' said Somyos Polachan, senior executive vice-president of Electricity Generating Plc.
Alternatively, he said, the existing PDP should be extended and reviewed after the regulatory body is formed.
He was sceptical as to whether the regulator would have the capability to devise the PDP since members may not have the energy experience or in-depth information about power supply and demand.
Power development plans and demand forecasts have long been the responsibility of the state-run Electricity Generating Authority of Thailand.
Mr Somyos said businesses could not risk protests over proposed power plants using fuels that the public sees as harmful to the environment.
At the same time, he said, there was a very real risk of a natural gas shortage in the future if too many plants use the fuel. Policymakers have been trying to reduce the proportion of gas _ currently around 70% _ used in electricity generation. However, convincing the public that coal or even nuclear power should be considered will be a hard sell.
''No matter what kind of fuels will be specified in the PDP, nobody dares to invest in either coal-fired or nuclear energy since they realise that the government is incompetent when it comes to telling people the truth about the necessity of using the cost effective fuels and how well new technology can reduce harm to the environment,'' said Mr Somyos.