from the Bangkok Post

A former minister calls for policy shift from ethanol.

By: Yuthana Praiwan
Published: 16/03/2009 at 12:00 AM
Newspaper section: Business

The Abhisit Vejjajiva government should adjust its energy policy to cover all types of alternative and renewable energy rather than focus only on ethanol-based petrol, says former energy minister Piyasvasti Amranand.

Dr Piyasvasti said policymakers seemed to be focusing on ethanol-based petrol while ignoring other high-potential fuels. Instead, they should promote the development of all kinds of green energy, such as biodiesel as well as renewable energy including solar, wind, biomass and biogas.

"Rather than see the drop in oil prices as a threat to the development of alternative and renewable energy, we can take this opportunity to speed up the enforcement of alternative fuels, for example biodiesel B5, and wipe mainstream fuels out of the market," he said.

"Otherwise they will lose the opportunity to develop the whole green fuels industry. Gasohol can be used for benzene-compatible engines but other engines still need something else to be substituted and we can make it if we want to."

The anticipated return of high oil prices increased the relevance of green fuels.

"Given the fact that oil prices will roll back to a high level in the future, if we don't develop [green fuels] now, we will suffer from high imports of crude again and Thai people will suffer the most," said Dr Piyasvasti, a veteran energy technocrat and currently an adviser to Kasikornbank.

He also forecast ethanol and biofuels would stay more expensive than refined oil for a while, due mainly to the government's farm price subsidy policy, but oil would pass biofuels again in the future.

During a period of low oil prices, he said the government could improve the finances of the Oil Fund and the Energy Conservation Fund by raising the levies on mainstream fuels, which are still affordable for most motorists. This extra income could help subsidise green fuels to keep their prices as low as possible.

"The more revenue the state funds can obtain, the greater flexibility for us to subsidise any types of fuel you want to promote," he said.

Dr Piyasvasti, who spearheaded some major alternative-energy campaigns during his tenure as Energy Minister in the Surayud Chulanont administration, proposed 13 measures to the current government two months ago.

But he said the government was still ignoring his proposals, including one to move ahead more forcefully with biodiesel. During his term, B2 - 2% crude palm oil blended in diesel - was introduced to replace high-speed diesel across the country.

He suggested the government adopt the same policy for B3 this year, for B4 in 2010 and for B5 in 2011, while B10 should be available as an option for motorists.

Dr Piyasvasti said he was pleased, though, that the Energy Ministry had picked up his idea to offer more incentives to renewable power generators.

The ministry last week announced new "adder" rates, which are additional sums paid for electricity generated from renewable sources beyond the standard rate per unit (kilowatt/hour). The sums vary depending on the energy source used. "More incentives will encourage more private investors to produce more renewable energy. Energy policymakers should relax their criteria for investors to greater encourage investors to join the programme," he said.

Biogas, which turns municipal solid waste into methane for power generation, should be the priority - in particular for plastic waste. Methane from solid waste has great environmental impact, around 21 times that of carbon dioxide.

"Therefore, if we can turn methane into fuel to run power generators, apart from the power output we get, it also means fewer greenhouse gas emissions."

Dr Piyasvasti earlier suggested the government float liquefied petroleum gas prices to move freely. This would ease tight supply, discourage motorists from using LPG and also cut the burden from LPG price subsidies.

He also advised the government to allow natural gas prices to rise, as gas would still be cheaper than other fuels.