Thailand has been a net energy importer with growing energy demand, especially fossil fuel products, resulting in a steady increase in greenhouse gas emissions.
As an early mover in the region in implementing carbon pricing, the government started several voluntary carbon pricing instruments, such as the Thailand Voluntary Emission Reduction Program and the Thailand Carbon Offsetting Program in 2013.
The World Bank’s support targeted enhancing knowledge and capacity of the key government agencies through in-depth technical and analytical work, and by facilitating knowledge sharing with the other early mover countries/region, such as European Union , China, Japan, and India.
All key technical assistance and policy deliverables were well recognized including the legal framework for Emission Trading System, Energy Performance Certificate System, and the abatement plans for low carbon cities by the recipient agencies and targeted private sector and adopted by government entities for further implementation.
The Policy Committee of the Eastern Economic Corridor , a special economic zone made up of three provinces in eastern Thailand, also approved the framework of investment and development of clean energy for electricity generation for implementation in the EEC area.
The plan was postponed during the COVID-19 pandemic as the implementation of the pilot program during this unusual situation will distort the baseline energy consumption of industries from their business as usual.
Most municipalities integrated the plans into awareness-raising and information dissemination programs. The program was also successfully used as a platform to work in close collaboration with the Ministry of Interior to design and incorporate climate change performance indicators into the overall performance indicators of municipalities.
Thailand has been recognized among the PMR participating countries as one of the most advanced countries in the region following Japan, Korea, China and Singapore in terms of carbon pricing preparation and implementation.
The World Bank Group’s Partnership for Market Readiness Trust Fund , provided US$3 million in technical assistance to support the Royal Thai Government in its ongoing effort to reduce greenhouse gas emissions.
The Thailand Greenhouse Gas Management Organization intends to scale up and enhance the existing carbon offsetting program and crediting program with a view to introduce additional carbon pricing instruments, such as a mandatory Emission Trading System, after the approval of the Climate Change Act and other laws.
This apparently fits the global momentum of the Dow Jones Sustainability Indices which are a family of benchmarks for the investors to recognize that sustainable business practices are critical to generating long-term shareholder value, of which the internal carbon pricing is one of the criteria for the company’s sustainability scores, of which three out of the six participating flagship companies – PTT Global Chemical, Siam Cement Group, and IRPC – also got listed in the Dow Jones Sustainability Indices.
“With the support from the PMR, the legal framework for greenhouse gas emissions reporting and the Emissions Trading System provides an important building block for the consideration of an establishment of a carbon pricing instrument in Thailand.
World Bank Group published this content on 15 November 2021 and is solely responsible for the information contained therein.