Thailand aims to slash electricity costs by more than 25% by next year to emerge as a hub for data centres and artificial intelligence infrastructure, according to Thaksin Shinawatra, the de facto leader of the governing Pheu Thai Party.
The government headed by his daughter Paetongtarn Shinawatra plans to bring down the electricity tariff to about 2.70 baht per unit from 4.15 baht now, Thaksin told a forum to mark the 50th anniversary of MFC Asset Management on Friday evening.
He did not elaborate on how the government would slash the rate, which is currently subsidised by state utilities.
Energy regulators say they have very little room to manoeuvre as a portion of the power tariff must be set aside to reimburse the Electricity Generating Authority of Thailand (Egat), PTT and gas shippers for helping subsidise costs.
The Energy Regulatory Commission has been polling the public about three possible scenarios for power tariffs during the May-August period. It proposes rates ranging from 4.15 to 5.16 baht per unit, depending on how much would be set aside for reimbursing Egat and others.
Thailand has secured billions of dollars in investment commitments from tech majors including Amazon.com, Google, TikTok and Alibaba to build projects for large data centres and cloud services. Building on that success would depend on the country’s ability to offer clean and cheap energy, Thaksin said.
“We want to be competitive in data centres and AI,” Thaksin said, adding that he has been talking to many people who want to invest in Thailand in these areas. “So we need to have more green energy that’s not too expensive.”
While Thaksin does not hold any official position in his daughter’s administration, the two-time premier is viewed by most as shaping the government’s major policy initiatives.
Thaksin said the country’s ability to slash electricity costs to between 0.7 and 2.1 baht per unit — a level seen as ideal by some investors — is limited by its reliance on fossil fuel and natural gas imports for power generation.
Nevertheless, he said it was possible to bring the rate down to 2.50 baht step by step.
Thaksin said his dream was to convert an area in Bangkok to house data centres of every country in the world, followed by an AI hub.
The return of a civilian government in 2023 after a decade of military-backed rule resulted in foreign companies ramping up investment in electric vehicles, advanced electronics manufacturing and diverse tech services. Investment pledges from foreign and domestic companies totalled 1.14 trillion baht last year, the highest in a decade.
