BMI's Executive Summary

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The new Thailand Power Report from BMI forecasts that the country will account for 2.0% of Asia/Pacific regional power generation by 2011, with an increasing generation surplus that provides a theoretical export capability. BMI's Asia/Pacific power generation estimate for 2006 is 6,167 terawatt hours (twh), representing an increase of 7% over the previous year. We are forecasting an increase in regional generation to 9,041twh by 2011, representing a rise of 46.6%.

Asia/Pacific thermal power generation in 2006 is estimated by BMI at 4,644twh, accounting for 69.9% of the total electricity supplied in the region. Our forecast for 2011 is 6,455twh, implying 39% growth that raises the market share of thermal generation to 71% - in spite of environmental concerns that should be promoting renewables, hydro-electricity and nuclear generation. Thailand's thermal generation in 2006 is estimated at 123twh, or 2.6% of the regional total. By 2011, the country is expected to account for an unchanged 2.6% of thermal generation.

For Thailand, oil is the dominant fuel, accounting for an estimated 49.3% of 2006 PED, followed by gas at 32.7%, coal at 15% and hydro-electricity with a sub-5.0% share of PED. Regional energy demand is forecast to reach 5,258mn toe by 2011, representing 47% growth over the period. Thailand's estimated 2006 market share of 2.5% is set to fall to 2.1% by 2011. Thailand's estimated 6twh of hydro-electric demand last year is forecast to reach 8twh by 2011, with its share of the Asia/Pacific hydro market falling from 0.8% to 0.5% over the period.

Thailand's overall business environment can be considered fairly unattractive in a regional context, in spite of a low level of long-term economic risk and decent progress in electricity market deregulation, privatisation and the creation of a competitive framework. It fares badly in the area of long-term political risk. Thailand has a reasonably low level of energy import dependency, but only moderate growth prospects for power generation and overall energy demand. In the BMI Business Environment Ranking matrix, Thailand receives a composite score of 24, which ranks the country equal eighth out of 11 states included in the Asia/Pacific region, alongside Taiwan.

BMI is forecasting Thai real GDP growth averaging 4.5% per annum between 2006 and 2011, with this year's forecast being 4.4%. Population is expected to expand from 64.8mn to 67.3n over the period, with GDP per capita and electricity consumption per capita forecast to increase significantly (by 42% and 31% respectively). The country's power consumption is expected to increase from an estimated 134twh last year to 182twh by the end of the forecast period, requiring some power imports during periods of peak demand, assuming 5.4% annual growth in generating capacity.