17/03/2008 (The Bangkok Post) - The Energy Ministry will draft a new national biofuel plan with a significant focus on alternative energy sources as oil prices are expected to continue to increase.

Energy minister Poonpirom Liptapanlop said the strategic plan would focus on increasing the use of alternative fuels as much as possible to help mitigate the impact of soaring global oil prices.

Energy departments located in each province would also be directed by the minister to research and develop small power-generating units to contribute to their electricity grids, and to improve both local power demand and supply forecasts.

All data provided by the department will be used for drafting the national plan.

For example, the minister said, a province heavily reliant on agriculture should have some farm products processed for use in small biomass-fuelled power plants.

Apart from household usage, local power output could supply small industries in each province.

''Not only biomass, but mini-hydro plants [should be considered] for provinces that have natural water resources,'' Lt Gen Poonpirom told the Bangkok Post.

''It is also apart of my plan to have local people participate in the energy sector,'' she said. ''I don't think it's a good idea to just talk about such big plans and never let local people know what we have done to them, even though we want them to share local resources with the whole country.''

However, she admitted that reforming the approach to energy policy would take time. One reason is that the ministry currently has energy offices only in larger provinces and needs to open more.

''I don't think it will take place soon, it needs time to finish each process, but I hope I can make it in my term,'' she said.

Recently, Lt Gen Poonpirom set up the National Biofuel Development Committee to oversee the alternative fuel development plan. Its first task will be to focus on ethanol and crude palm oil, which are now available on a commercial scale for blending in gasohol and biodiesel.

However, without a solid plan, supply and demand of raw materials can get out of balance, leading to problems such as the current surplus of ethanol and shortage of crude palm oil.

Lt Gen Poonpirom will chair the new committee, with members from the Energy, Commerce, Finance and Agriculture ministries. She said it would be critical to obtain accurate information from the relevant parties to ensure all problems could be anticipated before any decisions were made.

The minister also defended her decision to revive fuel subsidies, insisting they would only be for a short time and would not affect the balance sheets of the national oil and conservation funds.

''I don't want to distort the structure of the industry, so I decided to use [subsidies] for just a short period, at a time when government megaprojects do not yet need to use money,'' she said.

She also said the subsidies would be targeted at sectors most seriously affected by high oil prices, such as the fishery industry.