Thai climate ambitions face trade heat

Early last month, the US announced plans to impose a reciprocal tariff rate of 36% on goods originating from Thailand due to a trade deficit.

- Imran Arif

This set off alarm bells between Thai policymakers and export-oriented business sectors. So, efforts are underway to negotiate a deal that would safeguard Thailand's highly fruitful trade relationship with the US.

Yet, just how the renegotiated deal pans out might be counterproductive to Thailand's clean energy transition as per the 2024 Power Development Plan draft (PDP2024), which outlines the nation’s power development roadmap until 2037. Notably, Thailand’s negotiating team is mulling importing more liquefied natural gas (LNG) from the US over the next five years (an additional contract to an existing LNG import deal), a step which will impact the country’s energy ambitions.

As the government has stated it might amend PDP2024 to make the pathway towards Thailand’s clean energy transition clearer, it must then seriously consider whether increasing LNG imports is a viable bargaining chip.

REVISITING PDP2024

Last June, PDP2024 was put under a public hearing process. While the existing draft indeed underscores Thailand’s clean energy transition and puts it on a better path towards its net-zero targets, more can still be done to cement a proper follow-through.

Previously, Climate Finance Network Thailand (CFNT), in our “A Better Path is Possible: Critique and Suggestions to Draft PDP2024” report, noted that PDP2024 still heavily prioritises fossil fuels. Despite the laudable 51% renewables target, fossil fuels would still form a significant portion of Thailand’s energy mix by 2037, as the draft stipulates adding 6,300 megawatts of new gas-fired power plants. There is not enough emphasis given to developing renewable energy infrastructure, particularly readily available solar energy (more on that later). Instead, the PDP focuses on novel, unproven and expensive technologies such as steam methane reforming (SMR) and hydrogen-based fuels.