Thailand's Solar Energy Boosts Foreign Investments

Thailand is a booming tourist economy, but while the country sees more than it's fair share of visitors from China, Russia, and western countries, it receives less than it's share of profits, especially as many tourists visit in hopes of a budget vacation, making them less of a boon to the economy. Tourist travel is up by around 19% since last year, but with growing outrage over tourists, and uncertain political stability, tourism isn't a reliable way to boost the economy. 

While Thailand's government is pushing to reduce visa restrictions in order to make it easier for tourists to visit, another growth area is bringing foreign investment in, and moving it directly into the economic sector. This boom, which is part of Thailand's move away from a dependency on natural gas, is solar energy.

In October of 2014, the Thai Prime Minister chaired the National Energy Policy Council, where a new program was endorsed to support the growth of solar and other natural energy sources in the country. Part of this program includes dropped costs of solar panels, subsidies for companies investing in solar power (about $0.2 per kilowatt hour paid out over 25 years), and a program promoting the introduction of solar power. Which according to solarcompared.co.uk is already full steam ahead in the UK, with an estimated 700,000 residential installs in the last 5 years alone.

Thailand is already well on its way to going green, with huge investments in biomass and solar, and statistics suggest that the country will have more solar power than all of Southeast Asia by December 2015.

For residential housing, rooftop solar panels provide a huge boost for income and reduction of bills. Recent drops in the prices of solar panels have changed prices from an average of $5/W in 2010, to $0.5/W in 2014, for around a 90% cost savings. While Thailand does not yet have a metering system for feeding unused energy back to an electric company, the country averages about 9 hours of sunshine a day, and, even during the rainy season, days typically start off sunny. This unique combination makes Thailand a perfect location for solar power, making for around 1,200-1,5000 megawatts of connected solar power so far this year. This growth has been spurred on by investments of around 90 billion baht, or roughly $2.7 million, primarily from foreign investors.

While foreign investors are pouring money into commercial solar farms and companies, residential solar rooftops could help locals immensely, by reducing bills and dependency on natural gas, therefore allowing Thailand to import less. Reduced prices of solar panels, combined with rising costs of natural gas, mean that solar panels typically pay themselves off within 4-5 years, and that could drop as the costs of natural gas continue to rise.

This high boom in solar energy combined low initial costs have attracted the attention of multiple outside companies, with investors from Japan, the U.S.A., and China investing heavily in companies like Gunkul Engineering PCL, Superblook, Energy Absolute, and more.

By 2020, that could lead to some (relatively modest by Western standards) 250,000 homes powered by solar, or about 9% of Thailand's total energy production. Solar investments are also attractive to foreign investors because they represent a low-risk and low-maintenance investment.

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