The Energy Regulatory Commission (ERC) is considering reducing electricity bills towards the end of the year if PTT Plc, a national oil and gas conglomerate, fulfills fines amounting to 4.7 billion baht collected from gas suppliers who failed to meet gas purchase contract requirements.
The fines are part of government measures aimed at lowering electricity costs, as shared by an anonymous Energy Ministry source.
In a recent announcement, PTT disclosed charging a gas supplier 4.3 billion baht due to a gas shortfall, which was obligated by a contract. PTT was mandated to transfer these funds to authorities to help mitigate power tariffs used in calculating electricity bills.
Given PTT’s state ownership, the government holds the authority to allocate these fines. Energy Minister Pirapan Salirathavibhaga instructed the ERC to investigate for additional fines related to gas shortfalls, as part of initiatives to alleviate electricity expenses.
Reportedly, the regulator identified gas shortfalls totaling 4.7 billion baht from 2013 to 2020. A dedicated panel is set to convene on Monday to deliberate on payment specifics.
Mr. Pirapan advocates for PTT to contribute the 4.7 billion baht to the government in a bid to reduce electricity prices, as per the source.
ERC estimates that the 4.7 billion baht injection could potentially lower the power tariff by 0.078 baht per kilowatt-hour.
In case PTT disputes the shortfall report or fine amounts, it has the option to challenge the findings.
PTT directed the 4.3 billion baht fine to the government in January, aiding in stabilizing power prices from January to April when the tariff stood at 4.18 baht per unit.
For May to August, the ERC retained the power tariff at the same rate and will later determine the pricing for the year’s final four months.
Collaboratively, PTT and the regulator are exploring strategies to enhance LNG import, a crucial power generation fuel, through long-term agreements to mitigate spot market price fluctuations. Recent spot market LNG prices experienced a $0.2 decline per million British thermal units (BTU) to $9.6 per million BTU.
These price reductions are attributed to factors such as the temporary closure of gas-fired power plants in Taiwan due to an earthquake, and substantial LNG reserves in Asia and Europe, as highlighted by Veerapat Kiatfuengfoo, director-general of the Energy Policy and Planning Office.
