The Provincial Electricity Authority (PEA) has earmarked Bt1 billion annually to spend on alternative-energy projects.
To be undertaken by subsidiary PEA Encom International, the first project will generate power from wood scraps at 100 operating sites belonging to the Forest Industry Organisation, which will cost Bt8 billion over several years.
PEA deputy governor Numchai Lowattanatakul, acting managing director of the subsidiary, said the first project under this scheme would be tabled for Cabinet approval this year.
Within two years, the project to generate power from used palm oil, in cooperation with farmers' cooperatives in Krabi province, should also be kicked off.
Meanwhile, PEA Encom International has been approached to take a 20-per-cent equity participation in four pilot biomass power projects in the North using German technology, costing Bt80 million each.
Numchai said feasibility studies to invest in small hydropower projects in Laos and Bhutan were also underway.
Yesterday, the PEA signed a memorandum of understanding to invest in a small hydropower project in cooperation with the Royal Irrigation Department and Kasetsart University.
Encouraging investment in alternative-energy projects is a major part of the government's goal of increasing commercial energy from renewable sources to 20 per cent by 2022, said PEA governor Adisorn Kiatchokewiwat.
Under the alternative-energy development plan, renewable capacity will rise sharply to 5,608 megawatts in 2022, from 1,750MW now. At present, 90 per cent of Thailand's power comes from natural gas, coal and lignite.
Construction-engineering firm Demco has also been drawn into the industry. It will invest Bt2.7 billion to Bt3 billion in a 30MW solar-power plant and seven wind-power plants, for a combined cost of about Bt10 billion.
The company is awaiting Electricity Generating Authority of Thailand agreement for the power supply.
In line with the government's push, the Asian Development Bank (ADB) recently approved a US$70-million (Bt2.27 billion) loan to a solar-power plant in Lop Buri province. The developer, Natural Energy Development, is a joint venture between CLP Holdings, Japan's Mitsubishi and Electricity Generating.
In addition to the loan, the ADB will provide a $2-million grant from its Clean Energy Financing Partnership Facility to cover any contingency costs arising from the use of highly complex, innovative thin-film photovoltaic technology on a large scale. Typically, such technology has been used only in smaller plants.
Thin-film photovoltaic technology uses thin-film semiconductors, which are cheaper to produce than other types of photovoltaic cells.
Thin films also work better in countries like Thailand that have higher average temperatures but where clouds create diffuse rather than concentrated light.