Thailand Readies Direct Power Purchase Scheme for Data Centers

Thailand's energy authorities are intensifying efforts to finalise considerations for the country's pilot direct power purchase agreement (PPA) scheme, which is expected to support the rapid growth of data centres and cloud service businesses. An energy official who requested anonymity said the second phase of the direct PPA scheme is being prepared, though major issues with the first phase must be resolved. The project is designed to allow private renewable energy producers to sell clean electricity directly to large corporate buyers through the state-operated transmission system, bypassing restrictions on peer-to-peer power trading. The timeline for implementation of the initial phase has not been announced. The Energy Ministry is weighing several critical factors, including setting clear targets for data centres relocating to Thailand and assessing the broader economic and environmental impacts, the official said. Initially planned for the Eastern Economic Corridor (EEC), the scheme with a power generation capacity of 2 gigawatts is expected to extend to other regions. The Energy Regulatory Commission emphasised that expansion will depend on the availability of renewable energy generation and transmission infrastructure. The rollout reflects the government's ambition to attract foreign data centre investors before opening access to other industries such as electronics, printed circuit boards and electric vehicles, all of which require clean energy to operate efficiently. Data centres are known for their heavy consumption of electricity and water, particularly for cooling systems. The official said new data centres will bring structures tied to artificial intelligence and digital industries, which will share resources with other industrial sectors. This makes it crucial to balance investment burdens between government transmission infrastructure and private sector electricity production, while safeguarding long-term energy security and ensuring fair energy prices across sectors, noted the official. Energy Minister Akanat Promphan recently noted demand for electricity from digital and data centres in the EEC alone is projected to reach nearly 10GW. The government is prioritising measures to enhance power supply security to meet this surge. Finance Minister Ekniti Nitithanprapas, who also chairs the Board of Investment, established a panel on energy management to support data centre investment. Analysts believe the direct PPA scheme will benefit several major energy companies. Gulf Development Plc, Thailand's largest energy firm by market value, is well-positioned with its renewable energy portfolio and partnerships in technology and data centres. Global Power Synergy Plc, the power generation arm of PTT Plc, is expected to gain from its focus on clean energy and battery innovations. Gunkul Engineering Plc, specialising in solar energy, could secure direct PPAs with mid-sized and large data centre operators. Other major players such as B.Grimm Power, Electricity Generating Plc, WHA Utilities and Power and BCPG -- a subsidiary of Bangchak Corporation Plc -- are also likely to benefit.