With Thailand having committed to the UN Sustainable Development Goals (SDGs) to just how these will be reached.
The UN Sustainable Development Goals (SDGs) are part of the country’s 20-Year National Strategy. The private sector has an important role to play while Norwegian firms possess the knowledge and experience to be a capable partner. Meanwhile, the Eastern Economic Corridor (EEC) is uniquely positioned to bring everything together. There are many obstacles that need to be overcome if Thailand is to reach key environmental targets over the next few decades. Some businesses in the private sector are advancing these efforts even if there remains some uncertainty regarding how some goals will be achieved.
“The world is moving towards sustainable development and the business sector must move with it. A lot of mechanisms are being introduced but we still don’t know just how we are going to reach environmental goals, such as net-zero emissions, in Thailand,” Bangchak President and CEO, Mr Chaiwat Kovavisarach, stated. “People often talk about the social aspects of sustainability, but it is important for the financial side to be self-sufficient as well.”
The oil and gas company has diversified beyond its core business into biofuels, renewable energy, and other areas under what it calls Greenovation. Mr Chaiwat admits it would have been easy to carry on with what it was doing, but Bangchak felt it necessary to be proactive and leave their comfort zone. “Typically, businesses prefer to do what they have always done and don’t like leaving what they know. And with the old economy and methods still providing good returns, there has been little need to change. We wanted to move on and bring ourselves out of this comfort zone,” Mr Chaiwat says.
Even with firms like Bangchak investing in renewable energy, Thailand as a whole hasn’t fully been able to get out of its comfort zone when it comes to power production. The country continues to invest in gas-fired power stations while also flirting with coal, two areas that make it more difficult to reach certain sustainability goals. “With Thailand investing in gas power stations, there will be a need to recover this investment. It is something that can put renewables at a disadvantage. Some renewable energy, especially solar, is decentralised. This means a bottom-up approach is possible,” Dr Per Christer Lund, Technology Counsellor at Innovation Norway, says. “More importantly, Thailand must move away from coal entirely to support its decarbonisation goals.”
One potential solution is liquified natural gas (LNG). Dr Lund points out that floating LNG (FLNG), a process where natural gas is produced, liquefied, and stored at sea, would be better aligned with Thailand’s environmental ambitions than coal or gas. FLNG is only a transitional solution, however. The future is in renewables where investments, such as those Bangchak have made, are already contributing to energy production in Thailand. Currently, solar has the largest impact with room for it to grow further. “Nearly 25 percent of energy capacity in Thailand will be solar by 2036. Many Norwegian companies are already active in the country supplying equipment while others are now looking at future prospects,” Dr Lund reports. “Floating solar is coming big time. There are so many resources in Thailand for it as well as a number of benefits. There are also Norwegian companies, like Ocean Sun, who can assist.”
The Eastern Economic Corridor (EEC) project is leading sustainable development efforts on several fronts, including the promotion of investment in the Bio-Circular-Green (BCG) economy. This economic model aims to support growth by achieving the United Nations’ SDGs, including net-zero emissions. “The concept of sustainable development has been adopted in the EEC specifically for its mission of investment promotion. The EEC has set the target of becoming the first industrial sector in Thailand to be at net-zero emissions. We will focus on reducing carbon emission and encouraging new investment in green and circular projects,” Dr Luxmon Attapich, Deputy Secretary General, EEC Office of Thailand, details.
She continues, “The BCG economy has been laid out as a main priority in Thailand’s development policy as well as a cornerstone for the EEC project. The EEC Office has established guidelines for driving the green and circular economy in three areas: improving energy efficiency; enhancing resource and waste management; and creating a favourable ecosystem.” The BCG platform was launched out of the need for an interconnected and integrated approach to support green businesses and advance technology and innovation in Thailand. Dr Luxmon states this will allow the EEC to strengthen assistance for targeted industries, such as advanced agriculture and biotechnology; digital; next-generation automotive; and decarbonisation, through the adoption of automation and digital technologies.
Additionally, the EEC has widened the scope of things that fall under the BCG umbrella which will allow officials to engage a wider range of stakeholders. Dr Luxmon believes contributions and engagement from this group are necessary to create an ecosystem that is capable of supporting green industries. The EEC is already collaborating with international partners in some areas. For example, it has teamed up with the City of Osaka on biogas and biowaste and the United Nations Industrial Development Organisation on electric vehicles and battery management. Additionally, the EEC Office is working on the Total Waste Management Project in Rayong. This waste-to-energy pilot project is a collaboration between local government agencies and a private-sector company.
“The BCG platform is large and inclusive. So, the business opportunities for Norwegian companies are endless in related industries and supply chains they are interested in,” Dr Luxmon says. “Together with the support of the EEC Office and its regulatory sandbox feature, investors will be able to invest in new technologies and pursue innovative business models that utilise disruptive technologies without prohibitive regulatory constraints. Incentive packages are being developed for targeted technologies and their use cases.” Dr Luxmon adds the EEC’s challenge now is striking the right balance between economic and environmental benefits by using renewable resources to produce food, energy and industrial products sustainably.
The focus on the BCG economy in the EEC is a key pillar of Thailand reaching the UN SDGs. However, initiatives beyond this are needed to accomplish some goals, such as those related to decarbonisation. Bangchak formed the Carbon Markets Club alongside 10 other leading organisations in 2021 to raise awareness and promote carbon credit trading through the Thailand Voluntary Emissions Reduction Program launched by the Thailand Greenhouse Gas Management Organisation and the Renewable Energy Certificate by the Electricity Generating Authority of Thailand. The key to growing the program is support and clarity.
“We hope the government sees what is happening and takes more serious measures. Carbon trading systems can be a big help. But everyone must work together, and the private sector can play an important part,” Mr Chaiwat notes. “A Cap and Trade system will see big industries, like oil and gas, petrochemical, cement, and others, help accelerate transition to clean energy. Also, it is possible for a carbon credit system to be regional or even global if there is a single standard. Right now, we don’t have one.”
In the EEC, work has begun on establishing an emissions trading system for the industrial sector. The Thailand Greenhouse Gas Management Organisation (TGO) and the Federation of Thai Industries are collaborating to develop carbon credit trading platform which will be piloted in the EEC area. There is also the possibility for carbon capture and storage (CCS) in Thailand with Dr Lund pointing out the country has the known capacity to store carbon for an estimated 50 years with a potential for further exploration. And it’s not just Thailand that could be a part of this. A regional project could even be viable with incentivisation.
Dr Lund cites Longship, the Norwegian Government’s cross-border, open-source CCS project, and the Northern Lights transport and storage project as an example of what is achievable in terms of decarbonisation on a larger scale. “Norway has the knowledge and technology to be a partner on a local or regional CCS project. A scheme similar to Longship could be really helpful in leading decarbonisation efforts in all of Asia, including Thailand,” Dr Lund proclaims. “For this to work, there needs to be value in getting rid of CO2. Businesses will jump on the opportunity once this is established.”
- Thailand committed to the U.N. Sustainable Development Goals as part of the 20-Year National Strategy.
- Nearly 25 percent of energy capacity in Thailand will be solar by 2036.
- The EEC is taking steps to become the first industrial sector in Thailand to be at net-zero emissions.
- Several incentives are in place to encourage investment in the BCG economy throughout the EEC.
- Bangchak has moved beyond oil and gas and has invested in biofuels and renewable energy among other areas.
- The Carbon Markets Club, a carbon credit trading group, was launched by Bangchak and 10 other companies.
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