Cablegate: Chiang Mai Energy Conservation Still in First Gear

This record is a partial extract of the original cable. The full text of the original cable is not available.



E.O. 12958: N/A

CHIANG MAI 00000171 001.2 OF 002

1. Summary: Residents of Chiang Mai Province spend heavily on energy, much of it on transportation. Despite efforts to encourage public sector energy conservation, promote bio-fuels and re-introduce public bus service, the local government seems unable to do much to reduce this economic burden. End summary

2. As fuel prices rise and the central government threatens drastic measures to curb energy use, Chiang Mai is beginning to take a look at its heavy spending on energy consumption, which
averages 27% of per capita income. Tipping its hat to Prime
Minister Thaskin Shinawatra's energy saving campaign, the city of Chiang Mai has hung a banner on the municipal office across from the Consulate urging citizens to "unite our energy in conserving energy."

3. Chiang Mai Mayor Boonlert Buranupakorn is also pushing ahead efforts to put new public buses on the streets in a city that has been without public transport for ten years. According to a Chiang Mai University study, transportation accounts for over 58% of total energy consumption in the province. With nearly one vehicle per resident, Chiang Mai has the highest number of vehicle registrations per capita in Thailand and is second only to much-larger Bangkok in total vehicles.

4. After repeated delays, buses are scheduled to appear on Chiang Mai streets in late July. The municipal government has reclaimed three out of nine concessions from the private red "song taews" (pickup trucks converted into taxis), and will run buses on two of the three routes. Although the buses reportedly will run on locally produced bio-diesel, the new public bus system is primarily touted as a partial solution to Chiang Mai's traffic and pollution problems; energy savings have not figured into the public promotion.

5. The hold up in Chiang Mai's attempt to re-introduce public bus service is particularly frustrating in light of the critical role that transportation plays in Chiang Mai's energy economy.
According to a "Study of Appropriate Mass Transit Network for Chiang Mai Urban Area" conducted by Chiang Mai University (CMU), the province has 1.2 million vehicles, including 750,000 motorcycles. The city's former public bus system, founded in 1972, lost money and eventually died due to competition from private transportation, mainly the heavily polluting three-wheel "tuk tuks" and and red song taews. Although growth in the rate of vehicle registrations has slowed over the past decade, in the last two years 140,000 new vehicles have been registered while population has remained constant.

6. Both the local and central authorities are touting bio-fuel production as one measure to address the high cost of transportation. On June 11, Prime Minister Thaksin presided over an opening ceremony in Sansai District for the first bio-diesel production plant in the country. According to the Ministry of Energy, this plant is the first of its kind in Asia and a prototype for future facilities throughout Thailand. The Sansai plant's 2000 liter/day output is widely used by the red song taew drivers, but remains only slightly cheaper, about ten cents per gallon, than regular diesel fuel. Grasping at the coat-tails of Thaksin, (who was recently quoted in the media as saying, "Save energy, or else!"), Chiang Mai Deputy Mayor Pitak Tantisak proudly told ConOff that Chiang Mai municipality plans to support bio-diesel production by collecting used cooking oil from market vendors for conversion to fuel at the Sansai Plant.
Despite much talk about this plan - also hyped as a way to save Chiang Mai consumers from eating bananas fried in old oil - the Deputy Mayor could not say when the program would start.

7. In addition to local government measures to reduce energy consumption, the Ministry of Energy promotes conservation through its Chiang Mai Regional Energy Office (REO), one of 12 such branches throughout the country. The Chiang Mai REO is focusing on local government offices, promoting conservation and the use of renewable energy. As part of this effort, the REO pioneered a website where each government office reports its energy consumption. The only one of its kind in Thailand, the website measured a mean decrease in public sector energy consumption of 10% in the last year.

8. Although encouraging, the success of the REO program hardly makes a dent in Chiang Mai's problem. Public sector energy consumption comprises a paltry 1.5% of total provincial consumption, according to a CMU study done at the request of the Ministry of Energy on the "Energy Status of Chiang Mai Province." CMU Professor Tanongkiat Kiatsiriroat, whose Institute for Science and Technology Research and Development conducted the study, complained that without more participation from the private sector, there would be little decrease in overall energy use.

9. Representatives from local businesses claim that they are indeed proactive on the energy issue. Chiang Mai Federation of Thai Industries (FTI) President Yuthapong Jiraprapapong said that Chiang Mai business owners are working hard to meet a 10%

CHIANG MAI 00000171 002.2 OF 002

reduction goal set by the National FTI and Deputy Prime Minister Somkid Jatusripitak last April, pointing out that businesses have to reduce energy use to protect their bottom line. Chiang Mai Chamber of Commerce President Narong Tananuwat lamented the lack of leadership from the Provincial government, saying that public campaigns to drive slowly, turn off air conditioners during lunch, and use one less light bulb per house are stop-gap measures that do nothing to help the overall energy situation.
Narong highlighted Chamber efforts to decrease energy use, including distributing pamphlets of energy saving tips to member businesses and lobbying the province to take the lead in providing public transportation.

10. Comment: Chiang Mai's efforts to reduce energy use are exceptionally modest in light of the daily headlines about rising oil prices. While support for bio-fuel production and the resurrection of the City's public transportation system are a step in the right direction, neither holds real promise.
Bio-fuels are unlikely to offer any cost advantage to consumers in the foreseeable future while the introduction of the new city bus service has been stymied for months by opposition from the red mini bus drivers. Even if the stalled buses finally get moving, the service is too limited and too late to induce Chiang Mai residents to give up their ingrained car and motorcycle habits. Any energy policy that does not take tougher conservation measures and that fails to address Chiang Mai's massive transportation sector is doomed to insignificance.


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