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[Task 4 1] Review of best practice in energy efficiency policies in residential sector and opportunities for Thailand

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1. Review of best practice in energy efficiency policies in residential sector and opportunities for Thailand Effective energy efficiency policy implementation targeting…
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  • 1. Review of best practice in energy efficiency policies in residential sector and opportunities for Thailand Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion Mr. Pan Piyasil 17 September 2015 International Dissemination Workshop Eastin Grand Hotel Sathorn, Bangkok Funded by UK Research Councils’ Energy Program, the department for International Development (DFID) and the Department for Energy and Climate Change (DECC), and managed by the Engineering and Physical Sciences Research Council (EPSRC)
  • 2. TOPIC 1 Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion Market failures: barriers to EE improvement Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion EE technologies adoptions and implementations Market failure or barriers • Many players involved • High transaction cost Appliance producers Wholesalers Retailers House owners Landlords & tenants Real-estate project developers Need EE policy to resolve
  • 3. TOPIC 1 Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion Market failures: barriers to EE improvement Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion Potential market failures 1. Energy market failures Environmental externalities Average-cost electricity pricing Energy security 2. Capital market failures Liquidity constraints 3. Innovation market failures Research and development (R&D) spillovers Learning-by-doing spillovers 4. Information problems Lack of information; asymmetric information Principal-agent problems Learning-by-doing Potential policy options Emission pricing (tax, cap-and trade) Real-time pricing; market pricing Energy taxation; strategic reserves Financing/loan program R&D tax credits; public funding Incentives for early market adoption Information programs Information programs Information programs Edited from Gillingham, K., Newell, R.G., and Palmer, K. (2009). Energy Efficiency Economics and Policy. Annual Review of Resource Economics, Annual Reviews, vol. 1(1), pages 597-620. (retrieved on July 2015)
  • 4. TOPIC 1 Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion Types of EE policy Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion 1. Regulatory measures 2. Financial or incentive based measures 3. Informational and capacity building measures 4. Voluntary agreements and partnerships
  • 5. TOPIC 1 Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion 1. Regulatory measure Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion • Minimum Energy Performance Standards [MEPS] (EU countries, Thailand, USA, Brazil, Australia, and New Zealand) • Top Runner Program (Japan) • Standard for new construction (Spain, Luxembourg, Denmark) • Building code (Germany and Denmark)
  • 6. TOPIC 1 Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion 2. Financial or incentive based measures Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion • Energy Efficient Mortgages Program (USA) • White Certificate (UK, Italy, France, etc.) • Weatherization Assistance Program (USA) • Subsidization to energy audit (Luxemburg)
  • 7. TOPIC 1 Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion 3. Informational and capacity building measures Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion • Household energy audit (Finland, Luxemburg) • Regional Energy Advice Center (Hungary) • Building Technology Program (USA)
  • 8. TOPIC 1 Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion 4. Voluntary agreements and partnerships Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion • Energy Efficiency Revolving Fund (Thailand) • Building America (USA) • Public-private partnership
  • 9. TOPIC 1 Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion 4. Voluntary agreements and partnerships Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion • Energy Efficiency Revolving Fund (Thailand) • Building America (USA) • Public-private partnership
  • 10. TOPIC 1 Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion EE barriers amongst low-income households in Thailand Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion • Low income consumers prefer cheap products over EE products (consumer behavior). Some consumers are aware of the importance of EE, but choose cheaper products anyway. Some are lack of purchasing power, and some only concern the initial price of products. • No.5 EE label has low effectiveness among low income consumers. Many low income consumers still do not know what the label represents. Moreover, the information on the label does not help them comparing the differences in energy conservation between EE products and normal ones.
  • 11. TOPIC 1 Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion EE barriers amongst retailers in Thailand Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion • Retailer shops are lack of knowledge and information on EE products. Employees in retailer shops cannot identify the difference between EE products and normal ones. Therefore, they cannot suggest consumers or promote EE products. • EE products are not distributed to low income areas. Small retailers, especially in rural areas, do not sell EE products because they cannot afford to stock many products, and they cannot sell EE products as mush as cheaper ones. Therefore, EE products are not widely distributed to low income households, and this creates availability problem.
  • 12. TOPIC 1 Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion MECON project results Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion Core elements of this presentation 1. Household survey amongst low-income households Face-to-face questionnaire survey on 1,660 low-income households 2. Market survey amongst retailers Interview with 348 retailers 3. Policy review & stakeholder consultations Organized in 2014 in all five countries
  • 13. TOPIC 1 Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion EE Barrier for low-income households in Thailand 1 Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion Low income consumers prefer cheap products over EE products Proposed policy Using additional means to promote No. 5 EE label Responsible organization Energy Policy and Planning Office Other involved stakeholders Energy Generating authority of Thailand (EGAT) Provincial Energy Authority (PEA) Metropolitan Energy Authority (MEA) PTT Universities Funding mechanism Energy Conservation Fund (ENCON Fund) Possible obstacles Initial cost of EE products may limit this implementation
  • 14. TOPIC 1 Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion EE Barrier for low-income households in Thailand 2 Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion No.5 EE label has low effectiveness among low income consumers Proposed policy No.5 EE label has low effectiveness among low income consumers. Responsible organization Energy Policy and Planning Office (EPPO) DEDE Other involved stakeholders Thailand Research Fund (TRF) Ministry of Education Ministry of Social Development and Human Security Funding mechanism Energy Conservation Fund (ENCON Fund) Thailand Research Fund (TRF) Possible obstacles Some decision makers might not approve funds because they do not see the importance of this kind of research.
  • 15. TOPIC 1 Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion EE Barrier for low-income households in Thailand 3 Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion EE products are not distributed to low-income areas. Proposed policy Standard Offer Program (SOP) Responsible organization Energy Policy and Planning Office (EPPO) DEDE Other involved stakeholders Ministry of Energy Energy Generating authority of Thailand (EGAT) Ministry of Commerce The Revenue Department Funding mechanism Energy Conservation Fund (ENCON Fund) Thailand Research Fund (TRF) Possible obstacles Some decision makers might not approve funds because they do not see the importance of this kind of research.
  • 16. TOPIC 1 Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion EE Barrier for low-income households in Thailand 4 Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion No.5 EE label has low effectiveness amongst low-income consumers. Proposed policy Rebate for low-income consumers Continuous transferring knowledge and information on EE label Responsible organization Energy Policy and Planning Office (EPPO) DEDE Other involved stakeholders Ministry of Energy Energy Generating authority of Thailand (EGAT) Ministry of Commerce The Revenue Department Funding mechanism Energy Conservation Fund (ENCON Fund) Thailand Research Fund (TRF) Possible obstacles Some decision makers might not approve funds because they do not see the importance of this kind of research.
  • 17. Effective energy efficiency policy implementation targeting “New Modern Energy CONsumers” in the Greater Mekong Subregion Thank you for listening Please visit our website at www.meconproject.com or contact us at panpiyasil@gmail.com
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