Rooftop Solar Reform Could Help Thailand Cut LNG Imports

BANGKOK, August 28, 2026 — Reforming Thailand’s rooftop solar policies could significantly reduce the country’s dependence on imported liquefied natural gas (LNG), according to a new report by the Institute for Energy Economics and Financial Analysis (IEEFA).

As domestic natural gas production declines, Thailand has become increasingly reliant on imported LNG, leaving its economy more exposed to global fuel price volatility and supply disruptions. Among ASEAN economies, Thailand has the highest dependence on oil and gas imports, with these imports accounting for more than 10% of GDP.

The report comes as Thailand seeks to reduce its reliance on imported gas and accelerate its transition to renewable energy. The government plans to increase the share of clean energy in electricity generation to 60% by 2050, double its previous target, as it seeks to build a more resilient power system. An updated 25-year Power Development Plan is expected to be released in October.

Rising fuel costs have also placed financial pressure on state-owned utility Electricity Generating Authority of Thailand (EGAT). According to IEEFA, EGAT had accumulated approximately THB 36 billion (US$1 billion) in losses from previous energy crises as of March, highlighting the financial risks associated with continued fossil fuel dependence.

“Thailand has significant solar potential, but weak financial incentives and policy uncertainty have constrained rooftop solar deployment.”

— Haneea Isaad, Energy Finance Specialist at IEEFA

Rooftop Solar Growth Remains Constrained

Solar power has accounted for the majority of Thailand’s renewable energy capacity additions since 2018. However, most installations have been ground-mounted, while rooftop solar remains relatively limited.

As of early 2026, rooftop solar accounted for approximately 3.6 GW of capacity, representing less than one-third of Thailand’s total installed solar capacity.

IEEFA identifies four major barriers to further rooftop solar adoption: high installation costs, low buyback rates, restrictive capacity quotas and policy uncertainty.

Rooftop solar systems in Thailand cost approximately US$936/kW, nearly 50% higher than in regional markets such as Pakistan, Malaysia and Vietnam.

Meanwhile, under the country’s Solar for the People initiative, the current buyback rate for surplus solar electricity is approximately THB 2.20/kWh (US$0.07/kWh), below average retail electricity tariffs of around THB 3.88/kWh (US$0.12/kWh).

As a result, residential rooftop solar installations typically have a six- to seven-year payback period, reducing the financial incentive for households to invest.

Capacity restrictions have also limited market growth. The original 90 MW residential quota, introduced in 2019, was reached six years ahead of schedule in 2024. Although the overall programme cap has since been increased to 500 MW, further restrictions on electricity exports could continue to discourage adoption.

Lessons from Pakistan’s Solar Boom

IEEFA points to Pakistan as an example of how supportive policies can accelerate rooftop solar deployment.

Since 2018, Pakistan has deployed approximately 38 GW of solar capacity, supported by the removal of trade barriers, the absence of strict capacity caps and attractive electricity buyback rates.

Combined with falling solar module prices and high electricity tariffs, these conditions helped reduce rooftop solar payback periods to less than two years.

However, Pakistan’s rapid solar expansion has also created challenges for the wider power system. As more consumers generate their own electricity, utilities face declining revenues while continuing to bear the fixed costs associated with maintaining the electricity grid.

IEEFA therefore recommends that Thailand learn from both the benefits and challenges of Pakistan’s experience.

Policy Reform Could Accelerate Solar + Storage

IEEFA recommends that Thailand transition from its current net billing framework toward net metering, allowing consumers to offset their electricity consumption at retail electricity rates.

The report estimates that such reforms could potentially reduce rooftop solar payback periods to as little as 4.5 years.

IEEFA also recommends:

• Increasing rooftop solar buyback rates;

• Streamlining tax incentives for households and businesses;

• Removing restrictive capacity quotas;

• Improving the overall regulatory framework;

• Accelerating the deployment of solar-plus-battery energy storage systems (BESS).

  
  

According to IEEFA, removing regulatory and financial barriers could significantly expand rooftop solar adoption in Thailand, while supporting the development of a domestic solar installation and services industry.

For Thailand, stronger consumer-led solar deployment could not only reduce electricity costs and increase energy independence, but also help lower the country’s exposure to imported LNG and strengthen the resilience of its power system.