Main objective of this study is to analyze the effects of bio-fuel investment on energy-crops of Thailand. The study consists of two parts. The first part is the descriptive analysis that demonstrates the necessity of using bio-fuel investment as a long-term insurance in the energy sector. The second part is quantitative analysis via the Social Accounting Matrix (SAM) which is used to quantitatively analyze the effects from changes in bio-fuel investment on energy-crops production and price. Furthermore, ethanol producers are interviewed for the qualitative analysis and for evaluating the quantitative results. The results from SAM show that a higher investment in ethanol production affects production quantity of all sectors due to the increase in demand of raw materials which mostly are the energy crops such as sugarcane and cassava. Then, the state of employment and utilization of capital in these sectors and consumption in household of the same sectors would increase, accordingly. The increase in demand of energy-crops also affects the cost of production in other sectors, especially, the sectors that use sugarcanes and cassavas as input factors. Other sectors that do not use sugarcanes and cassavas as input factors will have a small effect. The reason is that ethanol from sugarcanes and cassavas is used in a small proportion in petroleum and natural gas production sector. For the policy recommendations, the government should impose policies in securing the supply of energy-crops for domestic demand and reducing in export of energy-crops in the short term. In long-term, government should adopt energy-crops strategy for supporting demand of domestic industry by increasing yields of crops and increasing cultivated area.
