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Title : Early review of energy pricing structure high on Araks agenda

New Energy Minister Arak Cholata-nont plans an early revision of the overall energy price structure.

Speaking upon taking office yesterday, he said his urgent tasks included revising the pricing structure before February 16, which is the date the second round of fuel price hikes is due to take place. The first round took place this month.

Arak said the ministry would conduct a study of the actual cost of natural gas for vehicles (NGV), liquefied petroleum gas (LPG) and other energy prices, as well as the trend in crude-oil prices.

He added that he could not, therefore, yet say whether the price of NGV and LPG for the transport sector would be raised further on February 16.

He did say the ministry would quickly complete the study of the overall price structure and present the findings for consideration by the National Energy Policy Council, which is chaired by the prime minister.

He added that he had to listen to people's opinions before recommending any changes in the structure, as the public was a major stakeholder in the ministry's policies.

He gave an assurance that one policy that would definitely be continued was the ministry's provision of discount coupons worth Bt2,000 to aid flood victims. The second round of coupon distribution will take place from February 10 to 20.

The minister said he would also study the pros and cons of the planned cancellation of 91-octane petrol on the market this coming October, adding that there was still time to consider the appropriateness of implementing such a measure, which had been proposed by his predecessor.


Oil fund

He will also study the structure and objectives of the Oil Fund to decide whether it needs to borrow to continue its subsidisation of energy prices.

Although the fund has a negative cash flow of Bt15 billion, it has to continue subsidising LPG and NGV prices, he added.

The ministry will also conduct a study of the actual cost of diesel, which is retailed at Bt30 per litre. If the actual cost is higher than Bt30, its price should be floated, he said.

The minister said that regarding electricity policy, his ministry would examine the remaining fuel reserve for electricity generation and consider the pros and cons of coal-fired power plants.

While the country might need nuclear power plants in the far future if the supply of other kinds of fuel proves insufficient, the Energy Ministry should not push for their establishment if there is strong public opposition to such a move, he said.

Regarding the Finance Ministry's idea to sell 2 per cent of PTT to the Vayupak Fund, he said the Energy Ministry had to study the issue carefully before taking a position.

Meanwhile, most economists surveyed by Bangkok University Poll recently thought the government's energy policy has performed poorly.

The university's research centre surveyed 72 economists at 32 leading organisations from January 17-24 on the government's performance in the past five months in terms of its energy policy.

When asked to evaluate the government's performance in terms of energy policy implementation in the past five months, 62.5 per cent of respondents said it was very |poor, while 13.9 per cent said it was good.

Two-thirds of respondents agreed with the hike of the NGV price to bring it in line with the market mechanism and actual cost, while 23.6 per cent disagreed. But 41.7 per cent of the respondents believed the hike of the NGV price is aimed at serving the business sector, while 33.3 per cent believed that the hike is aimed at creating fairness for both businesses and consumers.

Two-thirds of respondents said Thailand's finished oil product market was an oligopoly, while 22.2 per cent said it was a monopoly. When asked whether adjustments to the retail prices of finished oil products were done fairly, 44.4 per cent said they were not, as consumers de not know the clear reason for each price adjustment, while 23.6 per cent of respondents said the adjustments were fair.

Post date : 02/02/2012  Post by : Administrator
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