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Thailand: Second round of renewable energy auctions set to launch in Thailand

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In brief

On Friday, 20 September 2024, the Energy Regulatory Commission (ERC) issued the Regulations for the Purchase of Electricity from Renewable Energy Sources under a Feed-in-Tariff (FiT) Scheme Commissioning between 2022-2030 for Power Plants with No Fuel Costs B.E. 2565 (2022) (Additional) B.E. 2567 (2024) (“2024 RE Waitlist Regulations“), setting out the requirements, terms and conditions for private sector participation in the upcoming 2024 RE Waitlist Scheme (as defined below). This comes after the ERC released a brief set of guidelines for the 2024 RE Waitlist Scheme and carried out a public hearing of the same late last month.

In more detail

Back in 2022, the ERC launched the “big lot” renewable energy procurement round with a total target purchasing capacity of 5,203 MW under a feed-in-tariff (FiT) scheme pursuant to the Regulations for the Purchase of Electricity from Renewable Energy Sources under a Feed-in-Tariff (FiT) Scheme Commissioning between 2022-2030 for Power Plants with No Fuel Costs B.E. 2565 (2022) (“2022 RE Big Lot Scheme“). Due to the resounding success of the 2022 RE Big Lot Scheme and the high number of qualified but ultimately unsuccessful private sector applicants from that round, Thai policymakers sought to increase the purchasing quota for state utilities to create more opportunities for unsuccessful applicants to be reconsidered for participation in the procurement scheme.

Accordingly in March 2023, the National Energy Policy Committee (NEPC) resolved to approve the opening of additional quotas for purchasing electricity from renewable energy projects under a FiT scheme. The additional quotas will be split into two phases, as follows:

  • Phase 1: This quota will be opened only to applicants that had previously submitted a bid under the 2022 RE Big Lot Scheme for wind and ground-mounted solar energy generation projects and had passed the minimum qualifications and technical readiness criteria but failed to achieve a high enough technical score to be awarded a power purchase agreement (PPA) (“2024 RE Waitlist Scheme“).
  • Phase 2: This quota will be opened after the procurement process under the 2024 RE Waitlist Scheme has been completed and the purchasing capacity under such scheme has been duly allocated, and will be available for projects using the following technologies (in order of priority): (i) biogas (wastewater/waste); (ii) wind; (iii) ground-mounted solar; and (iv) waste-to-energy. Eligible applicants for the phase 2 quota include both (A) unsuccessful participants under the 2024 RE Waitlist Scheme and (B) participants that had submitted application packages in the 2022 RE Big Lot Scheme but failed to pass either the minimum qualifications or the minimum technical readiness criteria.

What’s new in this round

Many of the key elements of the previous procurement round continue to apply to this new round. According to the 2024 RE Waitlist Regulations, key elements of the new tender are as follows:

  1. Purchasing Targets:
  • State distribution utilities will purchase electricity generated from small power producers (SPPs) or very small power producers (VSPPs) utilizing (i) wind energy (as the first priority) and (ii) ground-mounted solar energy (as the second priority).
  • Total target purchasing capacity is 2,180 MW (600 MW for wind and 1,580 MW for ground-mounted solar).
  • PPAs will be awarded on a “non-firm” basis with a term of 20-25 years.
  1. FiT Rates:

FiT rates for the awarded projects under the 2024 RE Waitlist Scheme will be the same as in the 2022 RE Big Lot Round (recapped below):

Type of power plantsFiT (THB per unit)Term of FiT
FiTfFiTvFiT
Wind3.1014–3.101425 years
Ground-mounted Solar2.1679–2.167925 years
  1. Participant Qualifications:
  • Eligible participants must be those that had qualified and passed the minimum technical readiness criteria under the 2022 RE Big Lot Scheme but failed to achieve a high enough technical score to be awarded a PPA (“Eligible Participants“).
  • The 2024 RE Waitlist Regulations adopt the same qualification criteria for Eligible Participants as those under the 2022 RE Big Lot Scheme. As such, the foreign shareholding restrictions and restriction on transfer of shares under the first scheme will continue to apply. You can visit our earlier article outlining these criteria and conditions here.
  • Eligible Participants who wish to participate in the 2024 RE Waitlist Scheme will not be required to submit new electricity sale proposals or application packages but instead will only be required to submit a written notification (“Notice to Participate“) to the ERC of their intention to participate in the 2024 RE Waitlist Scheme.
  • Upon receipt of the Notice to Participate from Eligible Participants within the prescribed timeframe, the ERC will reconsider their technical scoring and select successful Eligible Participants based on their existing electricity sale proposals and application packages submitted under the 2022 RE Big Lot Scheme.
  • The ERC has discretion to increase the proposed contracted capacity under the Eligible Participants’ existing electricity sale proposals submitted under the 2022 RE Big Lot Scheme to the extent that such Eligible Participants had previously consented to an adjustment of such contracted capacity.

What’s next?

We anticipate that the ERC will shortly announce a formal invitation for proposals (RFP) prescribing further details and procedures with respect to the 2024 RE Waitlist Scheme, including the deadline for submitting the Notices to Participate. We will keep you posted on this development as it comes.

Don’t miss out on this golden opportunity!

The 2024 RE Waitlist Scheme is an eagerly-awaited second chance for disappointed players that were unsuccessful under the previous procurement round to reset their game in the ever-competitive Thai renewables market. Investors looking to partner with Eligible Participants for the 2024 RE Waitlist Scheme are highly encouraged to seek professional legal advice to verify that their proposed investment structure will not result in any stumbling blocks or cause any Eligible Participant to be disqualified from the running. Let our team of legal experts on the ground guide and assist you in this process, to ensure smooth sailing throughout this new bidding round.

Please don’t hesitate to reach out to us should you have any questions or need any assistance.

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Chavapol joined Baker McKenzie in April 2007. He is currently active in the Banking & Finance Practice Group where he focuses on project development and project finance. He has been involved with numerous matters related to major projects, public private partnership projects and banking & finance, including providing legal advice and recommendations on laws and regulations pertaining to the development of power projects and infrastructure projects as well as the establishment of an infrastructure fund in Thailand.

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Permsak Krairiksh joined Baker McKenzie Bangkok’s Financial Services Practice Group in 2004 and became a partner in 2008. His practice focus includes project finance and development, banking and finance, and aircraft financing and leasing.

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Napas joined Baker McKenzie in June 2011 as a member of the Financial Services Division and became partner in 2023.
With her multiculural background growing up in USA, Hong Kong and Indonesia and her law degrees from both the UK and Thailand, she is highly skilled and experienced in representing both international and domestic project owners, potential acquirers, sponsors and syndicated lenders on a wide range of international and cross-border projects.
Prior to joining Baker McKenzie, Napas was an associate with a leading city firm where she practiced commercial law and alternative dispute resolution for nearly two years. Before embarking on a career in law, Napas worked in the finance industry as an associate consultant in corporate advisory services for Baker Tilly (Thailand) Ltd.

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Viroj Piyawattanametha is a partner in the Firm's Bangkok office. He joined Baker McKenzie in 2000 after several years of practice with another law firm, and became a partner in 2006. He has extensive experience in matters related to project financing, debt and equity capital markets, and major projects.

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Ornsiri Samarnmitr joined Baker McKenzie in 2004 and became a partner in 2015. She is currently active in the Corporate & Commercial, Mergers & Acquisitions, Natural Resources (Oil and Gas & Mining) practice groups.

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Sawanee A. Sethsathira is the head of Bangkok's Energy, Mining and Infrastructure Group and Projects Practice and brings to the team more than 35 years of leadership, client dedication, and extensive experience in the project development and finance of energy and infrastructure projects in Thailand. She is the go-to partner for all complex energy projects, PPP and infrastructure project issues throughout the project life-cycle, and is especially known for her adept negotiating skills and dealing with government authorities. She is the architect of innovative structuring and the think-tank in dealing with complex projects and legal issues. With Baker McKenzie since 1983 and a partner since 1989, Ms. Sethsathira has acquired in-depth knowledge from advising on numerous large-scale, first-of-its-kind power, O&G, petrochemical and infrastructure projects in Thailand. She previously practiced in the Firm’s Sydney and Melbourne offices. She is also a visiting lecturer for commercial lending law at the Chulalongkorn University Faculty of Law.

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Tatcha joined Baker McKenzie in 2014 and is a partner in the Financial Services Practice Group where her primary focus is in the Energy & Infrastructure Practice Group and Energy, Mining & Infrastructure (EMI) Industry Group. She also gained experience during her internship at the Bangkok office in 2012.

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Vit Vatanayothin, a member of the Firm’s Financial Services Division, works mainly on banking and finance law. Mr. Vatanayothin is fluent in all aspects of financial transactions. He joined Baker McKenzie in 1991 and became a partner in 2000.

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Hongrat Jungwanitchakun is an Associate in Baker McKenzie, Bangkok office.

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