Thailand’s New Power Plan Raises Gas Capacity Despite LNG Shock, Drawing Criticism

Thailand’s draft power plan would add 9.1 GW of gas-fired capacity by 2037, equivalent to nearly 30% of its current gas fleet. The planned expansion has drawn criticism from analysts and civil society groups, who say the country should be reducing its exposure to imported LNG after this year’s price shock.

The draft Power Development Plan 2026-2050 (PDP 2026), opened for public consultation on Sept. 8, is Thailand’s first power plan to extend through its 2050 net zero target. It would add about 50.9 GW of capacity between 2026 and 2037, led by 24.3 GW of solar and 14.5 GW of battery storage. 

The plan sets out four scenarios for 2038 to 2050. Three reach net zero through different combinations of carbon capture, renewables and nuclear power, while a lower-cost Base Case does not meet the target. But all four follow the same capacity pathway through 2037, including the 9.,100 GMW of new gas, up from 6.,300 GMW in the 2024 draft, and 540 MW of refurbished coal capacity.

In a review of the plan published on Tuesday, Climate Finance Network Thailand (CFNT) found that gas demand would exceed the level the plan itself identifies as an LNG import risk by the early 2030s under every scenario. Thailand’s LNG imports have nearly doubled since 2021, the review said, citing data from the Energy Policy and Planning Office (EPPO).

Sarinee Achavanuntakul, founder and director of CFNT, told Energy Tracker Asia that adding gas capacity was unlikely to help Thailand meet its NDC 3.0 commitments or lower electricity prices as the country becomes increasingly dependent on imported LNG. Thailand’s NDC 3.0, its third national climate pledge under the Paris Agreement, brings forward the country’s net -zero target by 15 years to 2050.

Energy Minister Akanat Promphan said on Sept. 19 that new gas capacity would be aligned with available domestic and regional supply, while the government would seek to reduce its reliance on spot-market LNG.

Clean Energy Expansion Comes With Market Reforms

About 16 to 17 GW of older gas plants are due to retire in the plan’s first decade, according to local media. While the draft would add 9.1 GW of new gas capacity over the same period, CFNT argues that the new plants are not necessary.

Sarinee said a combination of rooftop solar, battery storage and demand-side measures could replace all of the planned additions by 2037.

The government has begun expanding distributed solar outside the PDP. It raised the residential net-billing quota from 100 MW to 500 MW in April and is preparing a rooftop solar loan scheme for up to 1.5 million households. Rooftop systems currently account for 3.6 GW of Thailand’s roughly 11.8 GW of installed solar capacity, according to the Institute for Energy Economics and Financial Analysis (IEEFA).

Under the draft, clean energy would supply about 49% of Thailand’s electricity by 2037. The plan would also introduce third-party access to the grid and expand Direct Power Purchase Agreements (Direct PPAs), allowing renewable generators to sell electricity directly to industrial users.

Gulf Development, one of Thailand’s largest private power producers with both gas-fired and renewable assets, said Direct PPAs could create significant opportunities but called for clearer rules and investment in smart grid infrastructure to support direct electricity trading. Gulf Development also called for third-party access charges to be transparent and applied consistently across market participants.

Gas Financing Hinges on Final Power Plan

Whether the proposed gas plants attract financing will depend largely on whether they remain in the final PDP, Sarinee said. Banks typically commit financing only once a power purchase agreement is signed or close to signing, making the planning and approval stage critical to which projects ultimately move forward.

Once approved, however, the new gas plants would likely face few financing barriers. Take-or-pay contracts provide long-term revenues backed by the state, while Thai banks have not excluded gas-fired power from their ESG or credit policies, even as several major banks have stopped financing coal-fired power.

Much of the financial risk would instead fall on electricity consumers. Thailand’s tariff system passes generation and fuel costs on to households and businesses, meaning LNG price swings can ultimately feed through to electricity bills, CFNT noted.

The opposition People’s Party has also criticized the draft for failing to disclose the cost assumptions behind the proposed gas plants. Energy officials said at the September hearing that the plan would be finalized within one to two months.