Thailand, like many other countries, is finding the development of renewable sources of energy a complex challenge. However, this study has shown that good economic management combined with targeted incentives could allow micro-hydro schemes to make a viable contribution to the nation’s sustainable development. The study looked at pricing and policy in two small dam projects in the Doi Saket District of Chiangmai. As in many of Thailand’s 70-plus micro-hydro schemes, electricity delivery problems have led to local demand for connections to the national energy grid – placing the future of micro-hydro in some doubt. The researchers analyzed whether the pricing structures used by the projects’ managers could be modified to improve the efficiency of water use and power supply. They also investigated the feasibility of different project development options. The study’s main conclusion was that with adequate backing, micro-hydro projects could continue to exist alongside the developing grid system. Moreover, they found that such a joint system could supply many other benefits to the communities served, including a vital contribution to forest preservation.
Surrogate Pricing For Water: The Case For Micro Hydro-electricity Cooperatives in Northern Thailand