BANGKOK -- Thailand's rapidly growing number of small independent solar power producers will be asked to pay extra charges to help contain the impact of blockchain-enabled competition on the state-owned utility, in new regulations being drafted by the energy regulator.
The new rules are urgently needed to give Electricity Generating Authority of Thailand time to adapt to an expected explosion in independent power generation -- including from households with rooftop solar panels -- made possible by blockchain technology, Energy Regulatory Commission member Viraphol Jirapraditkul told the Nikkei Asian Review.
Blockchain, the data distribution method behind cryptocurrencies like bitcoin, is a shared digital ledger that records transactions between users and cannot be altered without changing all other entries. Just as it has been used to decentralize finance, blockchain will enable households connected to microgrids to conduct peer-to-peer transactions, buying and selling surplus electricity to each other -- instead of through EGAT.
Viraphol cited the disruptive effect of the technology on the state utility, which will have to focus on maintenance and security of the national power grid while reducing its own revenue-making generation activity.
"The number of household solar rooftop power generators is increasing rapidly. That's why the ERC needs to develop regulation that is fair for everybody," he said. The proposed fee would cover the costs incurred by the utility of maintaining and securing the grid.
But some worry that charging independent energy providers will burden the fledgling market for rooftop solar power with extra costs. Viraphol declined to comment on the level of the fee and when it will be imposed.
A growing number of listed companies are using blockchain to help homeowners profit from their own rooftop solar systems, in effect cutting EGAT and other agents out of the market.
BCPG, a subsidiary of state-owned oil refiner Bangchak, recently joined forces with real estate developer Sansiri to offer blockchain-linked solar power system in Bangkok. Their rooftop panels can produce 635 kW of power to be used by a local shopping mall and nearby community.
"This is the first solar power system with blockchain technology ever in ASEAN, and it is our pilot project," said Uthai Uthaisangsuk, a senior executive at Sansiri, one of the country's biggest property groups. The executive added that with BCPG's cooperation, Sansiri expects to expand the service to 20 projects over the next few years.
Banpu Infinergy, a subsidiary of coal miner Banpu that installs rooftop solar panels, is also developing its own blockchain platform to tap into rising demand.
The Thai government has for several years encouraged the development of solar farms a guarantee to buy the power they generate at above-market prices. Renewable energy accounted for 9,943 megawatts, or about 15% of total power consumption in the country, in April 2018 against 8,865 MW in 2015.
Households with rooftop power generating systems accounted for 130 MW, and this is expected to rise by 100 MW by the end of this year.
Other Southeast Asian countries are also experimenting with blockchain in the energy sector. Singapore startup Electrify is using the technology to develop a peer-to-peer energy trading market, according to USAid, America's development assistance agency.