Detail

Thailand

Biofuels

Biodiesel

01/05/2019

Renewable energy

Biofuel policy

Presided over the commercial launch of B10 and B20 (i.e. transport diesel containing respectively 10 and 20 percent of palm oil methyl ester), and announced plans to raise the country’s mandatory blending rate from the prevailing 7 percent to 10 percent. The envisaged shift is aimed at absorbing surplus palm oil production, thereby supporting prices of fresh palm nuts and crude palm oil.

In May, government officials presided over the commercial launch of B10 and B20 biodiesel, i.e. transport diesel containing, respectively, 10 and 20 percent of palm oil methyl ester. The Government’s declared policy is to promote B10 as the country’s main diesel fuel, replacing the current B7 mix by 2021 – in a bid to absorb surplus palm oil production and bolster local prices of fresh palm nuts and crude palm oil (see also MPPU May’18 & May’19). The Energy Ministry anticipated that – combined with increased palm oil uptake by state-owned power generating companies – the higher fuel blends will raise domestic uptake of for fuel/energy production to 2.5 tonnes annually, compared to the current level of 1.5 million tonnes. Reportedly, to incentivize consumers to shift to B10 and B20, the new blends will be sold at a discount to both conventional diesel and B7 blends, thanks to adjustments in the country’s excise tax structure.