Pachara Naripthaphan highlights Thailand's opportunity for energy transition under the 2026 Loan Decree and recommends three immediate government actions, emphasizing that it is time for serious energy structure reform.
10 May 2026 GMT+7 Pachara Naripthaphan, a member of the Securities and Exchange Commission (SEC) board, discussed Thailand's upcoming energy structural adjustment under the Royal Decree empowering the Ministry of Finance to borrow funds to address impacts from the energy crisis and drive the country's energy transition in 2026 ( Loan Decree ). He stated that Thailand's energy prices are higher than many regional countries, not due to resource scarcity but because the structure was designed in a different era and still operates in a world that has completely changed. Rising electricity costs, oil price volatility linked to geopolitics, and declining reliance on Gulf of Thailand natural gas are clear warnings that serious reform is overdue.
Thailand is not lacking energy resources. Vietnam, which only recently began its efforts a few years ago, has become the largest solar producer in ASEAN, despite Thailand’s superior potential and location as a regional hub. The problem lies not in resources but in a structure that does not allow competition. Pachara added that the world competes to attract investment in future industries. Lego announced a $1 billion investment to build its first carbon-neutral factory globally in Vietnam, powered 100% by solar energy. This clearly signals that the ability to supply competitively priced clean energy is now a key factor in multinational investment decisions.
In 2023, Vietnam became ASEAN’s largest solar energy producer, proving rapid energy transition is possible. However, this success carries costly lessons. The rapid growth driven by subsidies exposed planning and financial sustainability weaknesses. Vietnam Electricity (EVN), the state power utility, faced heavy financial burdens as electricity purchase costs soared from $4.5 billion in 2018 to $11.5 billion in 2023, while retail prices were strictly controlled and could not keep pace with rising costs, causing EVN to lose over $1 billion in 2023.
"This is a trap Thailand must avoid. Vietnam’s problem was not expanding renewables too fast but fixing high feed-in tariff prices in long-term contracts while forcing EVN to sell electricity to consumers below cost to avoid public backlash over rising prices. The difference didn’t disappear; it accumulated as EVN debt monthly, forcing the government to choose between a big price hike or subsidizing with tax money. Either way, the public bears the cost, just postponed."
Currently, Vietnam is shifting from fixed feed-in tariffs—at the root of the problem—to competitive auctions where clean energy producers bid the lowest price to win contracts, rather than the government setting prices unilaterally. This approach, used by India today, has reduced solar prices from 9.72 cents per kWh in 2014 to only 3.04 cents in 2024, a 68% drop over ten years. This is due not only to technological improvements but also market competition pushing prices toward true costs. Vietnam is also expanding Direct Power Purchase Agreements (DPPA) to allow the private sector to trade renewable electricity directly, alongside accelerating investments in transmission networks and energy storage systems.
Meanwhile, Thailand is still debating whether to allow the private sector to sell electricity back to the grid. Certainly, we have opportunities to attract investments similar to Vietnam’s and develop related electricity industries, but clear, concrete policies are needed—not just global stage promises. If implemented, the system must reflect true costs from the start, not be fixed later when debts accumulate beyond control, as happened with EVN in Vietnam. Our system has been built on monopolies; long-term Power Purchase Agreements (PPA) with Take-or-Pay clauses bind the state to pay old power plants even as renewable energy prices fall annually, passing these costs on to end consumers.
Pachara further revealed that the government is planning or implementing programs aimed at promoting efficient energy use and supporting the transition from fossil fuel dependence to renewable and alternative energy technologies across government, private sector, communities, and the public, under the 200 billion baht loan limit of the recently enacted decree. He emphasized that
first, the energy market should be opened, not blocked, by seriously unlocking DPPA and rooftop solar. Investments will follow without state budgets if the government signals clear and correct policies.
Second, the energy procurement system should be changed. Instead of renewing old PPA contracts, competitive bidding should be introduced so prices reflect the current true cost of renewable energy.
Third, transmission lines should be separated from producers. As long as major producers control the transmission grid, genuine competition cannot occur. This is the fundamental reform every successful country has implemented.
Opposition to reform often cites technical complexity and energy security risks—reasons sufficient to delay for another term. But Vietnam’s experience proves developing countries can restructure their energy sectors within a few years if there is clear political will.
"Thailand still has time, although the window narrows each year. Countries with clean energy at stable prices and open markets attract high-quality investment. Those protecting old structures will only face rising electricity prices, investors relocating, and citizens bearing heavier burdens annually. There are only two paths, and time moves on without waiting. I urge the government to succeed in fulfilling the goals set forth in the annex of this Loan Decree."