JSCCIB opposes pool gas scheme, citing economic and social risks

JSCCIB director-general Sutee Satanasathaporn submitted a formal letter to Prime Minister Paetongtarn Shinawatra on Friday, urging the government to reconsider the initiative. The JSCCIB comprises the Thai Chamber of Commerce, the Federation of Thai Industries, and the Thai Bankers’ Association.

The committee criticised the scheme, initiated by Energy Minister Pirapan Salirathavibhaga, as unfair to all sectors. It called on the Prime Minister to review the plan ahead of discussion by the National Energy Policy Committee on May 6.

According to the JSCCIB, the Energy Ministry aims to restructure natural gas pricing to reduce electricity generation costs. However, the revised approach would move away from uniform pricing across sectors and instead shift the full burden of imported LNG costs onto the industrial sector.

“This change would increase natural gas costs for the industrial sector by approximately 60%, raising production costs by around 30 billion baht per year,” the committee warned. “This will have a knock-on effect on employment, potentially impacting over 1.9 million workers, while also reducing the sector’s competitiveness.”

The committee further cautioned that the scheme would lead to higher living costs due to rising prices of essential goods, driven by increased production costs. There are concerns the scheme may raise household debt and slow domestic investment, potentially impacting loan approvals by financial institutions.

Investor interest in Thai-based projects may also decline, with a possible shift of investment to neighbouring countries. This would negatively impact the country's overall competitiveness and economic growth, especially given the industrial sector's key role in generating high value-added output.

To avoid such negative repercussions for businesses and the industrial sector, the JSCCIB proposed the following recommendations:

• Conduct a comprehensive feasibility study on energy price restructuring to ensure a balanced impact across all stakeholders throughout the supply chain. This should include efforts to address the root causes of Thailand’s current energy structure in a sustainable and appropriate manner.
• Implement a single pool gas price across all sectors as a baseline. In addition, introduce regulatory mechanisms specifically for the industrial sector, such as price structure formulas based on controlled usage volumes, or a floor price system for LNG trading.
• Ensure fair and appropriate access to natural gas from the Gulf of Thailand for the industrial sector. As a domestic resource, natural gas should be considered a fundamental right available to all citizens and sectors.
• Promote national energy-saving campaigns to reduce costs, while providing targeted support for vulnerable households.