Applied Geography formerly Rural Training Center, Thailand

2008 Jun 16 Fighting Rising Costs

Jun 16, 2008

The rapidly rising fuel costs quickly cascade into price increases in just about everything from clothing, pencils, to food. The Thai government has subsidies to help lessen the impact on the common people. But the money for these subsidies must come from somewhere. And in the long run, most experts agree that subsidies are a stop gap measure and not a real solution.

For example, currently the world market price for LPG (liquified propane gas) is about 40 THB/kg. In Thailand, the government subsidized price is about 18.13 THB/kg. Such a price disparity gives rise to a black market where LPG is bought at low cost in Thailand, and sold for higher profit in neighboring countries where LPG is not subsidized at the rate done in Thailand. In the end, the LPG subsidy program in Thailand doesn?’t have the full effect that was intended.

And if rising prices weren?’t bad enough, now the BOT (Bank of Thailand) is reporting the inflation may reach double digits. Starting from a low of 2-3%, inflation in recent months went from 5% to 7%. While Thai inflation is estimated to reach 10% in the not too distant future, it is still well below the ~ 25% inflation of Vietnam. So even if you were saving money, inflation reduces the value of your money even while it sits in the bank.

Most of us have no control over how much money we earn. We have more control what we spend. So here are some ways to keep the money in your hand longer.

Most people use LPG to cook and to heat water for bathing. Both of these functions can be done using free energy from the sun. Granted, there are cloudy days in Thailand, but reducing the use of LPG for cooking and heating water will save you money. And the solar cooking and water heating systems do not have to be expensive. A simple solar cooker can be made using an inexpensive car window shade. (See the article ?“Make a Low-Cost Emergency Solar Cooker?” in the PDF section of this website. It is available free in English, Thai, and Chinese.) A simple solar hot water bag system can be made using an old truck inner tube. A black bag system I used in China held 100 L of water. On a clear sunny day, the water was still hot at 2100 hrs at night. A family of 4 could bath using the hot water (mixed with cold water) from this bag. These systems work well on sunny days. For cloudy days, you might still need to rely on LPG or burning wood or charcoal. However, wood and charcoal are renewal fuels, where as LPG is more expensive and is non-renewable. Don?’t forget, the Thai government subsidy for LPG is not guaranteed to last forever, and it is not sustainable. In many cases, when government subsidies become too expensive to maintain, free market forces are brought into play. The immediate reality is often a very marked giant jump to fair market prices to levels that cannot be easily paid by the common people.

An alternative is a biogas digester. This requires more materials and cost, but has an added benefit of being an effective way to dispose of animal and human wastes and saves water, too. The wastes are broken down by bacteria producing sanitized composted slurry and methane gas. The gas can be used for both cooking and heating water (and other uses similar to LPG and NG---natural gas). The big added benefit is saving clean water to dispose of animal and human wastes and the cost of sanitary sewer construction and maintenance.

The alternate energy sources mentioned above do not reduce food crops used for making bio-fuels. Some of the price increases in food is the result of food crops being sold at higher prices to make bio-fuels. Sunlight is free. Animal and human wastes are readily available for energy conversion. And the cost savings in sanitary sewer construction and maintenance could be used to educate people to implement the alternative energy strategies.

The RTC-TH has plans to use oil from a non-food crop plant, Jatropha curcas, to run small farm machinery. (See the article on page 3 in the Summer 2007 Farm Update, in the PDF section of this website.) Small diesel engines are able to use unprocessed Jatropha oil in place of diesel fuel. This can also be called SVO (Straight Vegetable Oil) or PPO (Pure Plant Oil) biodiesel. This is another way to reduce spending money for fuel. The Jatropha grows in poor or marginal soils. These soils would not normally be used for crops anyway due to their low quality. This plant also does not require much water. It lives for about 50 years, so readily qualifies as a renewable resource.

For the long term, plans are being made to use Jatropha oil to run a Listeroid generator set up to produce electricity for the farm. In India, the same machinery, running on fossil diesel, is used to provide electricity for rural villages. There are records of these systems running 24/7 for 40 years with no break down. A farm, business, or village could grow its own non-food/renewable bio-fuel and greatly reduce its energy costs. Such a system would NOT take land away from food crops.

The current Thai economic conditions point out the importance of self-sufficiency and sustainability. Solar cooking and solar water heating may not give total energy independence, but it does reduce your fossil fuel dependency. The same applies to biogas and SVO/PPO biofuels. Another bonus is that these energy sources are renewable and can lead to sustainability.

Rising petroleum prices also cascade to rising synthetic chemical prices making already expensive fertilizers even more expensive. The fuel costs to get fertilizers from factory to farm, increasing fuel costs to run farm machinery, then to transport the crops to market all increase the prices for food and other goods.

Composting and biodigester slurry can help farmers to reduce off farm expenditures for expensive synthetic fertilizers. This is a major cost savings. These natural organic soil amendments also help farmers to avoid polluting ground water and water resources. Organically improved soil resists erosion and retains more moisture. These alternatives to synthetic chemicals lead farmers toward sustainability.

We cannot expect to find a single answer to the pressing problems we face in the economy, energy, or the environment. It is more realistic to think a multi-faceted, multi-prong approach using a combination of ?“answers?” adapted to the particular circumstances of your location. In this sense, we should be seeking solution alternatives. Individuals would then choose to implement the solution sets suitable to their needs.

There are existing specific alternatives that are environmentally sound and cost-effective. In many cases, the cost is mostly labor. The materials and some of the energy is basically free. By reducing off farm expenditures, farmers can offset some of the rising costs and the effect of inflation. These approaches help move them toward self-sufficiency and sustainability. The time to act is now. Waiting will only further reduce the dwindling funds available for the family.