Incentives for Renewable Energy in Southeast Asia: Case study of Thailand

The report assesses Thailand's renewable energy incentives, highlighting the success of the ENCON fund and the 'adder' (feed-in premium) scheme, while identifying persistent barriers such as transmission constraints and high import duties on technology.

• Thailand's electricity generation is heavily dependent on fossil fuels, primarily natural gas, with renewable energy accounting for only 6.8 per cent (2,156.9 MW) of the total installed capacity of 31,773 MW in 2011.
• The 'adder' or feed-in premium scheme, introduced in 2007, was viewed by stakeholders as the most attractive incentive because it allowed investors to estimate returns and reduce risk through payments on top of market electricity prices.
• The Thai government temporarily suspended the purchase of solar energy under the adder program in 2010 due to over-subscription and high costs to consumers, leading to an investment vacuum in the solar sector.
• The Energy Conservation (ENCON) fund serves as the primary source of public finance for renewable energy subsidies, providing investment grants, revolving funds, and ESCO funding.
• The revolving fund, which provides low-interest loans (maximum 4 per cent) for up to seven years, has helped increase the confidence of commercial banks to invest their own capital in renewable energy projects.
• High import duties on renewable energy equipment, such as a 35 per cent duty on solar panels and inverters, act as a barrier to deployment and increase generation costs.
• Non-economic barriers significantly hinder investment, specifically the lack of published electricity transmission expansion plans and a slow, non-transparent permitting process involving multiple government departments.
• Analysis using the Total Cost Indicator (TCI) suggests that biomass adders provide better value for money than solar PV adders, as solar power requires significantly higher premiums to achieve smaller increases in additional generation.
• The Board of Investment (BOI) provides fiscal incentives including corporate income tax exemptions for up to eight years for the manufacture of solar cells and the generation of renewable energy.

APA

Beerepoot, M., Laosiripojana, N., Sujjakulnukij, B., Tippichai, A., & Kamsamrong, J. (2013). Incentives for Renewable Energy in Southeast Asia: Case study of Thailand. International Institute for Sustainable Development. https://www.iisd.org/system/files/publications/investment_incentives_thailand.pdf

Chicago

Beerepoot, Milou, Navadol Laosiripojana, Boonrod Sujjakulnukij, Atit Tippichai, and Jirapa Kamsamrong. Incentives for Renewable Energy in Southeast Asia: Case study of Thailand. International Institute for Sustainable Development, 2013. https://www.iisd.org/system/files/publications/investment_incentives_thailand.pdf.

Wikipedia

{{cite report |last1=Beerepoot |first1=Milou |last2=Laosiripojana |first2=Navadol |last3=Sujjakulnukij |first3=Boonrod |last4=Tippichai |first4=Atit |last5=Kamsamrong |first5=Jirapa |title=Incentives for Renewable Energy in Southeast Asia: Case study of Thailand |publisher=International Institute for Sustainable Development |date=February 2013 |url=https://www.iisd.org/system/files/publications/investment_incentives_thailand.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{beerepoot2013incentives, author = {Beerepoot, Milou and Laosiripojana, Navadol and Sujjakulnukij, Boonrod and Tippichai, Atit and Kamsamrong, Jirapa}, title = {{Incentives for Renewable Energy in Southeast Asia: Case study of Thailand}}, institution = {International Institute for Sustainable Development}, year = {2013}, month = feb, url = {https://www.iisd.org/system/files/publications/investment_incentives_thailand.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }