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27 May 2008


New Energy-Saving Ideas: Consumer Practicality Should be Considered (Business Brief No.2179)

The recent meeting of the Council of Economic Ministers on May 26, 2008, attended by many related agencies, e.g., central government officials from the Finance and Commerce ministries, plus the Bank of Thailand, National Economic and Social Development Board, Bureau of the Budget, Office of the Securities and Exchange Commission, etc., held discussions on the problems incurred by skyrocketing oil prices and sought to propose new energy-saving measures that will be submitted to the Cabinet for consideration on May 27. Among the measures mentioned were an excise tax cut on E85-fueled cars, encouraging motorists to switch to NGV (natural gas for vehicles), setting air-conditioner temperatures at 26 degrees Celsius in public buildings, using car pools, highway speed limits being strictly enforced at 90 kilometers per hour, and fixing the gross refinery margin (GRM) at not more than THB1/liter on diesel fuel.

In summary, the government's new energy-saving initiatives may be helpful. To see the initiatives be fully effective, however, the practicality for consumers in using alternative fuels as part of the government's strenuous campaigning, i.e., NGV and E85 bio-fuel, should be focused upon with greater clarity. Meanwhile, what should also be done urgently is to instill an energy-saving attitude and a responsible consciousness into the minds of the general public; they should also avoid price mechanism intervention. The latter may somewhat ease consumers' burden over the short-term, but is not an effective solution for energy-efficiency over the long-term.

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