Modelling the promotion of biomass use: A case study of Thailand

Abstract

This study develops a computable general equilibrium model of the Thailand economy which features several energy-specific enhancements. The model is used to simulate a number of potential policies to achieve the Thai government's biomass-generated electricity targets contained in its 15-year renewable energy development plan. Examples of simulations conducted with the model include increasing biomass-based electricity purchased from small and very small power producers and increasing other agricultural residue use in electricity generation. The results indicate that implementation of all of the biomass-based electricity promotion policies is likely to achieve the short-run target and reduce somewhat the importation of fuels. However, the policy causes a huge increase in prices of biomass. The sugarcane-based sectors are big winners, while the cassava-based sectors are big losers. The losses can, however, be partly mitigated by promoting other agricultural residue use in electricity generation.