Thailand

TH-1:Energy Conservation Promotion (ENCON) Act

Policy Description

The Thailand Energy Conservation Promotion Act (ENCON Act) has been in place since 1992. It is a comprehensive piece of legislation, laying out the general scope, requirements and responsibilities for key energy consuming sectors. It defines governmental institutional and financial arrangements, governments’ responsibilities and the duties and requirements for entities within energy consuming sectors, including industry. It has links with all of Thailand’s key energy conservation policies and programs, such as Energy Conservation Promotion Program (ENCON Program, TH-2), Thailand’s 20-Year Energy Efficiency Development Plan (EEDP, TH-3) and Energy Conservation Promotion Fund (ENCON Fund, TH-6).

Description

The Thailand Energy Conservation Promotion Act (ENCON Act) has been in place since 1992 (*1). It is a comprehensive piece of legislation, laying out the general scope, requirements and responsibilities for key energy consuming sectors. It defines governmental institutional and financial arrangements, governments’ responsibilities and the duties and requirements for entities within energy consuming sectors, including industry. It has links with all of Thailand’s key energy conservation policies and programs, such as Energy Conservation Promotion Program (ENCON Program, TH-2), Thailand’s 20-Year Energy Efficiency Development Plan (EEDP, TH-3) and Energy Conservation Promotion Fund (ENCON Fund, TH-6).

The three main objectives of ENCON Act are (*2):

  • To supervise, promote and support entities in the energy consuming sectors (including industry and buildings) in conducting energy conservation measures
  • To promote and support the production and utilization of high energy efficiency equipment
  • To promote and support energy conservation by providing financial assistance to entities

Industry sector

For industrial plants, the ENCON Act is applied to so called “designated factories”, which as defined in “the Royal Decree on Designated Factories, B.E. 2540 (1997 ) (*3)”, are those industrial factories with an installed capacity no less than 1 MW or 1175 KVA, and an annual electricity consumption no less than 20 million MJ. As defined by the Act, the industry energy conservation measures include (Section 7, ENCON Act):

  • Improvement in combustion efficiency of fuels;
  • Prevention of energy loss;
  • Energy recycling (waste heat recovery and combined heat and power, CHP);
  • Fuel substitution;
  • More efficient use of electricity through improvements in power factors, reduction of the power demand during peak demand, use of appropriate equipment, and through other approaches;
  • The use of energy-efficient machinery or equipment as well as the use of operation control systems and materials that contribute to energy conservation; and
  • Other means of energy conservation as stipulated in the ministerial regulations.

The ENCON Act requires industrial plants to appoint energy managers; monitor, record and submit energy consumption information to the government; have third-party energy audits; set up reduction targets and prepare detailed implementation plans.

Program Implementation through ENCON Program

 

The Energy Conservation Promotion Program (ENCON Program) (TH-2) was established to implement the ENCON Act. It is a rolling five-year program of energy management and related activities, which is updated to reflect latest developments in government strategies, policies and priorities. Phase 3 (2005-2011) has ended and the new Phase 4 is under development. As indicated by the ENCON Act, the Department of Alternative Energy Development and Efficiency (DEDE) under the Ministry of Energy is the implementation agency for ENCON Program.

For more details of the ENCON Program refer to TH-2.

 

Financial Arrangement in ENCON Act

Financial assistance set by the ENCON Act is called the ENCON Fund (TH-6). It is used for supporting all the energy conservation programs, projects and activities in the course of implementing the ENCON Program. The Act defines the ENCON Fund’s organizational and institutional requirements. For more details of the ENCON Fund refer to TH-6.

 

Other issues

The ENCON Act identifies the penalties for entities that fail to comply with ENCON Act’s requirements, such as insufficient energy consumption reporting, inaccurate or manipulated data, failure to appoint energy management personnel, etc. The penalties include imprisonment of up to 3 months, and various levels of financial penalties from 5,000 to 150,000THB. More detailed information on penalties are listed in the ENCON Act (Section 9, ENCON Act ).

Policy Information Expand this section for information on the key features of the policy, such as its date of introduction, categorization, main objective(s) and linkages with other policies.

Policy Categorisation

Policy Instrument Type: Administrative

Position in the Pyramid

About Us

Participation: Mandatory

Period

Start Date: 1992

Policy Linkages

Supported By Energy Conservation (ENCON) Program Effort Defining
Supported By Energy Conservation Promotion Fund (ENCON Fund) Supporting Measure
Supported By Tax incentives Supporting Measure
Supported By ESCO Fund Supporting Measure
Supported By Energy Efficiency Revolving Fund (EERF) Supporting Measure
Complements Thailand 20-Year Energy Efficiency Development Plan (2011 - 2030) (EEDP) Effort Defining

Agencies Responsible

Ministry of Energy: Department of Alternative Energy Development and Efficiency (DEDE)

Primary Objective: Energy

Objective

­- To supervise, promote and support entities in the energy consuming sectors (including industry) in conducting energy conservation measures ­- To promote and support the production and utilization of high energy efficiency equipment ­- To promote and support energy conservation by providing financial assistance to entities.

Target Group

1) Industrial factories (2) Buildings (3) Producers or vendors of energy efficiency equipment, materials and equipment for energy conservation.

Driver of energy consumption or emissions affected by policy: Total Energy use / Specific energy consumption / Relative efficiency / Institutional capacity.

Implementation Information Expand this section for information on targets, monitoring, verification and enforcement regimes, and implementation requirements and tools.

Coverage

(1) factories with an installed capacity no less than 1MW or 1175 KVA and an annual electricity consumption of no less than 20 million MJ (2) buildings (3) machinery and equipment or materials.

Quantitative Target? no

Progress Monitored? yes

Verification Required? yes

Enforced? yes

Sanctions: - ENCON Act contains punishment clauses for those who violate or fail to comply with the requirements. - The penalties include imprisonment of up to 3 months, and various levels of financial penalties from 5,000 to 150,000THB

Requirements on the Target Group

  • The owner of a designated factory or building must conserve, audit and analyze energy usage in his factory/building, in accordance with the standards, criteria and procedures prescribed by the regulations.
  • The owner of the designated factory or building shall have following duties:
    • assign at least one full-time energy manager;
    • report and submit energy production, consumption and conservation data to the government;
    • track and monitor the facility/and equipment level energy consumption;
    • set energy conservation targets and plans;
    • conduct audits and operational analysis to monitor progress against the targets

Support by Government

  • Manuals and guidelines for designated factory owners to understand the various requirements in the ENCON Act regarding energy conservation implementation, such as target setting, planning, energy inspection, data collection and submission etc.
  • Subsidies for designated factories from the ENCON Fund (The subsidiary ended in 2005. Notification on end of energy conservation promotion fund subsidy for designated factory and designated building, (DEDE, 2005).

Implementation Toolbox

  • Criteria, procedures and schedules for establishing energy conservation targets, plans and audits for designated factories and buildings.
  • ENCON Act Manual for Designated Factories and Buildings
  • Manual for the Appointment of Personnel Responsible for Energy in Designated Factories and Buildings
  • Guidelines for writing an energy conservation plan, setting targets, undertaking inspection and analysing operations in compliance with the plan
  • Guidelines for organization of a data submission form and a data recording form for a designated factory.
  • Guidelines for the implementation of energy conservation as prescribed in the ENCON Act for Designated Factories and Buildings.

Complexity of Implementation

Government

Multi-government agencies are involved in the Act enforcement

Target Group

Factories, buildings and producers or vendors of energy efficiency equipment are targeted, and each target group has several requirements and guidelines to comply with under the Act

Impacts, Costs & Benefits Expand this section to find information on policy effectiveness and efficiency.

Impact Quantitative Estimate Qualitative Estimate
Estimated effect on energy consumption or emissions Not Available (*4) Not Available
Estimated costs/benefits for industry Not Available Not Available
Estimated cost for government Not Available Not Available

References & Footnotes

References

[1] APEC, 2011. Compendium of Energy Efficiency Policies of APEC Economies - Thailand. Tokyo. Available at: http://www.ieej.or.jp/aperc/CEEP/Thailand.pdf.

[2] APEC-EWG, 2010. Peer Review on Energy Efficiency in Thailand. Available at: http://www.ieej.or.jp/aperc/PREE.html

[3] Energy Conservation Promotion Act. Available at: http://www.unescap.org/esd/publications/energy/compend/ceccpart4chapter10.htm

[4] The Royal Decree on Designated Factory. Available at: http://www.jetro.go.jp/thailand/e_activity/pdf/econdec3.pdf

[5] Criteria, procedure and schedule for establishing energy conservation target and plan, audit and analysis on operation in compliance with energy conservation target and plan for designated factory and designated building. Available at: http://www.jetro.go.jp/thailand/e_activity/pdf/econminreg3.pdf

[6] Energy Conservation Laws, Regulations and Guidelines, Thailand Page, Japan External Trade Organization https://www.jetro.go.jp/thailand/e_survey/energylaw.html

[7] Manual Explanation of Energy Conservation Act B.E for Designated Factory and buildings. Available at: http://www2.dede.go.th/km_berc/downloads/menu4/%E0%B8%81%E0%B8%8E%E0%B8%AB%E0%B8%A1%E0%B8%B2%E0%B8%A2%E0%B8%9E%E0%B8%A5%E0%B8%B1%E0%B8%87%E0%B8%87%E0%B8%B2%E0%B8%99/english/13%20%E0%B8%84%E0%B8%B9%E0%B9%88%E0%B8%A1%E0%B8%B7%E0%B8%AD%E0%B8%84%E0%B8%B3%E0%B8%AD%E0%B8%98%E0%B8%B4%E0%B8%9A%E0%B8%B2%E0%B8%A2%20%E0%B8%9E.%E0%B8%A3.%E0%B8%9A.%E0%B8%AF.pdf

[8] Manual for the Appointment of Personnel Responsible for Energy in Designated factory and buildings. Available at: http://www2.dede.go.th/km_berc/downloads/menu4/%E0%B8%81%E0%B8%8E%E0%B8%AB%E0%B8%A1%E0%B8%B2%E0%B8%A2%E0%B8%9E%E0%B8%A5%E0%B8%B1%E0%B8%87%E0%B8%87%E0%B8%B2%E0%B8%99/english/14%20%E0%B8%84%E0%B8%B9%E0%B9%88%E0%B8%A1%E0%B8%B7%E0%B8%AD%E0%B8%81%E0%B8%B2%E0%B8%A3%E0%B9%81%E0%B8%95%E0%B9%88%E0%B8%87%E0%B8%95%E0%B8%B1%E0%B9%89%E0%B8%87%E0%B8%9C%E0%B8%B9%E0%B9%89%E0%B8%A3%E0%B8%B1%E0%B8%9A%E0%B8%9C%E0%B8%B4%E0%B8%94%E0%B8%8A%E0%B8%AD%E0%B8%9A%E0%B8%94%E0%B9%89%E0%B8%B2%E0%B8%99%E0%B8%9E%E0%B8%A5%E0%B8%B1%E0%B8%87%E0%B8%87%E0%B8%B2%E0%B8%99.pdf

[9] Guideline for Implementation of Energy Conservation for designated Buildings and designated Factory. Available at: http://www.jetro.go.jp/thailand/e_activity/pdf/econguide5.pdf

[10] Guideline for organizing a data submission form and a data recording form for a designated factory in accordance with Forms BorPorRor.1 and BorPorRor.2. Available at: http://www.jetro.go.jp/thailand/e_activity/pdf/econguide3.pdf

[11] Guideline for Writing a report on energy conservation target and plan and inspection and analysis on operation in compliance with energy conservation target and plan for designated factory https://www.jetro.go.jp/thailand/e_activity/pdf/econguide1.pdf

Footnotes

(*1) The official name of the Act is : Energy Conservation Promotion Act, B.E. 2535(1992), and it was amended in 2007.

(*2) Page 6, Manual Explanation of Energy Conservation Act for Designated Factory and Building, DEDE, Ministry of Energy

(*3) The Royal Decree on Designated Factories, B.E. 2540(1997 ), and the Royal Decree on Designated Buildings, B.E.2538 (1995) are two royal decrees defined the inclusion requirements to factories and buildings under compliance of ENCON Act.

(*4) As the ENCON Act is a law, the quantitative impacts are reflected in the ENCON Program implementation. Therefore, we did not include any impacts/or estimation; but will be introduced in the ENCON Program (TH-2)