Industry Trend Analysis - Renewables Forecasts Upwardly Revised As Investor Interest Rises - FEB 2018

BMI View: We have upwardly revised our renewables forecasts for Thailand this quarter, given the strong investor interest in the market, ongoing government support for the sector (particularly for solar) and improving business environment in the country. We expect renewables capacity to total over 13GW by 2026, accounting for around 10% of the total electricity generation mix.

We previously highlighted in our analysis that Thailand is emerging as an attractive destination for renewable energy investment and there is a relatively supportive renewables policy in place underpinning growth, which includes capacity targets, feed-in tariffs, tax incentives and energy production payments ( see ' Sluggish Power Demand, But Renewables Growth To Outperform ' , October 12 2017). In fact, the government altered its renewable energy roadmap at the end of 2017, increasing the solar capacity target from 6GW in 2036 to 17GW. We believe this was partly due to the success the country has already registered in its solar expansion; we estimate that solar capacity reached over 3GW by the end of 2017, already fulfilling 50% of the original target.

The high solar installation levels over 2017 and the ongoing support from the government, coupled with strengthening investor interest in the market ( GE announced in December that it plans to develop three 90MW wind projects in Central Thailand) has led us to upwardly revise our 10-year renewables forecasts. We expect renewables capacity to total 13.3GW by 2026, whereas we previously forecast capacity to total 9GW. Solar and biomass will make up the bulk of this capacity, and non-hydro renewables generation will contribute around 10% to the country's total electricity mix in 2027.

Thailand's Renewables Prospects Strengthening
Thailand - Renewables Capacity By Type
e/f = BMI estimate/forecast. Source: EIA, IRENA, BMI

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