Thailand Plans Higher Power Tariffs for Data Center Owners
(Bloomberg) -- Thailand will introduce a separate electricity tariff category for data centers requiring them to pay a higher rate, to prevent surging electricity demand from artificial intelligence and cloud computing from raising household bills.
The higher revenue from data centers will be used to pay for public electricity costs, such as streetlights, Deputy Interior Minister Polapee Suwunchwee told reporters after Wednesday’s meeting by the energy policy committee chaired by Prime Minister Anutin Charnvirakul.
The Energy Regulatory Commission will determine the rate for data centers as early as the August billing, the official said.
The plan comes as Thailand seeks to win billions of dollars of investment in AI infrastructure and hyper-scale data centers while limiting the impact of their rapidly rising electricity demand on its citizens. Alphabet Inc.’s Google, Amazon.com Inc., Microsoft Corp. and ByteDance Ltd.’s Tiktok are among tech giants investing in Thailand to tap rising demand for AI and cloud computing. On Wednesday, the Board of Investments said US semiconductor company Analog Devices Inc. plans to nearly double its workforce in Thailand and increase exports from the country.
Thailand’s move to make data centers pay more for electricity follows a widening trend globally. In the US, Portland General Electric raised power prices for data centers by about 30%, while large data centers in California may soon be required to pay surcharges to cover the cost of increased energy demand they generate under a bill aimed at helping offset the extra cost data centers impose on communities.
The committee also approved expanding the direct power purchase agreement framework to cover a broader range of industries seeking access to clean electricity, according to the energy ministry statement.
Previously focused on data centers, the program will now also cover other industrial users with demand for clean energy. The expanded framework will enable eligible businesses to procure renewable electricity directly from generators, helping them meet increasingly stringent international trade and sustainability standards that emphasize the use of clean energy.
The move is also intended to open Thailand’s clean electricity market and promote greater competition in the power sector, the ministry said.
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