Wednesday, 14 August 2013

Thailand plans to raise biodiesel output target to 7.3 mil liters/d by 2021

Thailand is planning to revise upwards its biodiesel production target to 7.3 million liters/d by 2021, compared with an earlier target of 5.9 million liters/d, under its Alternative Energy Development Plan (2012-2021), a source at the Energy Policy & Planning Office told Platts Tuesday.

Thailand's current biodiesel production is about 2.8 million liters/d, said the source.

The Energy Policy & Planning Office comes under the purview of Thailand's Ministry of Energy.

Plans to increase the country's biodiesel production target -- which has to be approved by parliament -- comes as the energy ministry announced last week its target to roll out B10 biodiesel -- a blend of 10% palm-oil based biodiesel and 90% diesel -- nationwide by 2019.

Thailand currently has a B5 biodiesel mandate in place, where diesel sold at the pump is blended with 5% palm methyl ester. The government is aiming to roll out a B7 mandate in January next year.

"We've sent clear signals to car makers and oil traders in Thailand that we'll proceed with higher biofuel content in the coming years," Energy Minister Pongsak Raktapongpaisal said at an energy forum last Thursday, according to a report by the Bangkok Post August 9.

Plans to raise the biodiesel production target also comes after the government last month said it was reducing its production target for advanced biofuels to 3 million liters/d by 2021, from an earlier target of 25 million liters/d.

When asked if the two were linked, the source at the Energy Policy & Planning Office said: "I would not link it that way. The advanced biofuel target was reduced due to high production cost."

The 25 million liters/d of advanced biofuels was to come from jatropha, seaweed, wood, biomass and biohydrofined diesel.

"While we work on making these advanced biofuels commercially viable, we have some 800,000 hectares of land to grow palm trees. This is separate from land for growing food, so there is a lot of potential to produce biodiesel and reduce our fuel imports," she said.

Thailand's palm oil plantations, totaling some 0.65 million hectares currently, are situated in the south and east of the country because of the less mountainous terrain.

The country's 13 biodiesel refineries have a combined production capacity of 5.4 million liters/d, but have been operating at around 50% of capacity in recent years due to farming inefficiencies, government and industry sources have told Platts.

"This will change as the country gears up for the higher biofuel mandate," said the source.

The Alternative Energy Development Plan ( 2012-2021), which was approved by Thai parliament in December 2011, sets out how Thailand can produce more than three times more energy from renewable sources, providing as much as 25% of the nation's total energy needs by 2021. By switching to renewables, the plan estimates Thailand can generate energy savings of 14,500 kilotonnes of oil equivalent/year, amounting to cost savings of Baht 272 billion ($8.7 billion)/year.