Thai power costs push factories towards energy efficiency

Manufacturers are reassessing energy use as electricity, steam, and fuel costs weigh more heavily on industrial operating expenses.

Thai manufacturers are increasing their focus on energy efficiency as electricity tariffs remain at 3.95 baht per kilowatt-hour through December and energy costs continue to pressure industrial operations.

Kamon Pornchaichanakit, Managing Director of Flottweg Thailand, said the strongest savings can come from improving energy-intensive processes rather than simply replacing equipment.

In mechanical separation, a 1% increase in dry solids can reduce the energy required for thermal drying by roughly eight to 10 times, whilst recirculation systems can lower machine energy consumption by around 20%.

High-volume industries such as brewing, palm oil, fruit ingredients, and wastewater treatment have some of the strongest cases for efficiency upgrades because they consume large amounts of energy, steam and chemicals.

Upfront investment remains a barrier, however. Pornchaichanakit said manufacturers often focus on machinery prices rather than the operating savings that can follow from lower energy and resource consumption.

That cost calculation is becoming more important as energy accounts for a significant share of industrial expenses. Pornchaichanakit estimated that energy can represent around 60% of operating costs in some applications.

He added that Thailand introduced support in 2025 for manufacturers looking to replace mechanical separation units, encouraging some companies to consider future upgrades.

The outlook into 2027 could strengthen the case further. Pornchaichanakit said manufacturers are increasingly concerned about rising energy prices and unpredictable raw material costs.

“When they can reduce the energy consumption, they can reduce the OPEX,” he said. “That means they can be competitive in the market.”

For Thai industrial users, the issue is therefore shifting from equipment cost alone towards whether energy savings can justify capital spending and help protect competitiveness as operating expenses rise.