THAI 2008 ENERGY DEMAND TO JUMP

Like many other economies in Asia and the rest of the developing world, Thailand’s energy consumption is going up with its GDP but its oil consumption is dropping as it develops New Energy infrastructure such as ethanol, biodiesel and compressed natural gas (CNG) retail distribution centers and consumers discover these fuels are available at competitive prices.

The Thai government contributed to this transition with 2 crucial decisions: (1) to let the market decide the price of oil instead of subsidizing it and (2) to promote alternative fuels.

One other factoid of interest: In anticipation of regional droughts, the Thai government has moved to sharply cut dependence on hydropower imports (by 19.5%) in 2008.

All sectors of the Thai enconomy are expected to expand energy use in 2008. (click to enlarge)

Energy demand to rise 4.2%, oil set to drop; GDP growth to drive 2008 consumption
Yuthana Praiwan, December 29, 2007 (Bangkok Post)

WHO
Thai National Economic and Social Development Board; Viraphol Jirapraditkul, director-general, Thai Energy Policy and Planning Office (EPPO)

WHAT
Thai energy consumption is expected to rise at the same pace as its GDP in the coming year. New Energy fuels like ethanol, biodiesel and CNG will account for part of the growth, replacing some oil consumption.

Thailand will move away from fossil fuels in 2008 - but they will still make up the vast bulk of energy consumption. (click to enlarge)

WHEN
2007: 1.605 million barrels of oil equivalent/day (boed) consumed
2008 predicted consumption: 1.673 million boe/d
2007 oil consumption: 662,000 barrels/day
2008 oil consumption: 659,000 barrels/day

WHERE
The article describes only Thailand’s predicted energy consumption but it is a pattern seen throughout the developing economies in Asia.

WHY
- Overall Thai energy consumption is projected to rise 4.2% in 2008.
- Thai GDP is expected to grow 4 to 5% in 2008.
- Natural gas consumption is expected to rise 6.8% in 2008.
- Coal consumption is projected to rise 1.4%, partially offsetting a 20% drop in fuel oil consumption by Thai industry.
- Oil consumption will drop 0.5% and be replaced by a near tripling of ethanol. Natural gas for transport, especially CNG, will triple. Biodiesel use will jump 500%. As a result, gasoline and diesel use will fall off but GDP growth will spur increased air travel so jet fuel use will rise.

Energy consumption goes up with GDP. (click to enlarge)

QUOTES
From the EPPO report: “Oil consumption has dropped for three consecutive years, from 2.3% in 2005 and 2006 to 1.6% in 2007.”