Energy activists ciritcise Thai gov’t attempt to phase out Autogas

After removing subsidies for LPG at the end of last year, by aligning the regulated price of LPG with global market prices, Thai government plans to discontinue Autogas altogether. For this the Thai government of Prime Minister Prayut Chan-o-cha is planning to – in addition of the removal of subsidy – to further increase the excise duty. Further actions foresee discontinuing the sales of Autogas equipment.

The energy activists took to the street in protest defending the interests of about 1.5 million Autogas drivers who would suffer considerably, should this plan really come true. Rungchai Janthasing, a member of the People’s Network for Energy Reform, said his group is urging Prime Minister Prayut Chan-o-cha to rethink plans to raise the excise tax on LPG and phase out use of Autogas in two years.

That would affect private motorists who drive about 1.5 million LPG-fuelled cars as well as raise costs for public-transport operators who use the liquefied gas, he said.

Mr Rungchai suggested the government instead increase the excise tax on LPG used by petrochemical companies because, he argued, they were the largest consumers of LPG.

The number of retrofits has already dropped 50% for the first half of 2015 compared to the same period in the previous year. One company even reported a decline of over 75%.

The shrinking revenue in the retrofit business is in line with a substantial drop of the number of cars receiving an Autogas registration to 2,000-3,000 units per month compared to 8,000-10,000 units only a month before. The sharp decline in the number of conversions has been attributed to the government’s policy to stop the installation of car gas tanks in the next 1-2 years rather than the previous price aligning.

The main justification to phase out Autogas was based on claims of LPG being intrinsically unsafe. This, of course, needs to be put into perspective, as countries with higher LPG vehicle populations don’t necessarily show a higher level of accidents, as long as Autogas systems are serviced and inspected correctly. Other countries, especially top Autogas consumers such as Turkey, Korea, Italy and Japan have a very good safety track record.