South Korean government releases draft of plans to increase renewable energy use

Posted on : 2017-12-26 14:10 KST Modified on : 2019-10-19 20:29 KST
Country aims to produce 20% of its power from renewable sources by 2030
‘Renewable Energy 3020‘ Goals for Provision of Facilities
‘Renewable Energy 3020‘ Goals for Provision of Facilities

On Dec. 20, South Korea’s Ministry of Trade, Industry and Energy released a draft of its “Renewable Energy 3020” implementation plan, in which it declared that it will increase renewable energy’s share of the energy mix from its current level of 7% to 20% by 2030 by providing 48.7GW in new generating capacity.

To achieve this goal, the Ministry intends to expand solar panels for personal use, in rural areas and at small business operators by 19.9GW, which would represent 40% of new capacity. The remaining 28.8GW will be supplied by large-scale projects at the six public generating companies. 95% of the new capacity will come in the form of clean energy, including solar and wind, as part of a plan to reorient the renewable energy ma

In order to improve this situation, the Ministry is planning to introduce a feed-in tariff system tailored to South Korea. This system will make it mandatory for the six public power generators to purchase energy produced by solar panels with a capacity of less than 100kW when owned by cooperatives or farmers or with a capacity of less than 30kW when opened by private business operators. The energy will be purchased at a fixed price for the next twenty years.

This partially incorporates requests by environmental and civic groups that have argued that the only way to grow the renewable energy market is by reinstating feed-in tariffs. In Germany and Japan, which have proactively adopted feed-in tariffs, renewable energy currently accounts for 29.3% and 15.9% of electricity being generated. The government also announced that it will encourage public power generators to work on large-scale projects by increasing the mandatory renewable energy supply rate from its current level of 5% to 28% in 2028.

In addition to this, various regulations that had limited the expansion of solar energy for personal use and on farmland will be relaxed. The government is planning to adjust the rules so that the Korea Electric Power Corporation (KEPCO) can provide cash reimbursement for leftover electricity generated by personal solar panels. Currently, the only option is to let the leftover electricity be carried forward into the next period.

Furthermore, changes are in store for a program that had only allowed the installation of solar panels on buildings completed prior to the end of 2015. And even inside agricultural promotion zones, where solar panel installation is banned, 20-year solar panel projects will be allowed on reclaimed land that has been damaged by ocean salt. To prevent rampant development by outsiders, a “planned site system” is being adopted by which local governments identify a site for a project and get the residents on board in advance.

The Ministry predicts that facility investment will cost about 100 trillion won (US$93 billion) altogether, including 51 trillion won(US$47.4 billion) from the public sector and 41 trillion won (US$38.1 billion) from the private sector. The Ministry estimates that the price of electricity will only rise by 1.3% through 2022 and by 10.9% through 2030 compared to this year, even when the cost of investing in new and renewable energy facilities is taken into consideration.

“Improving the compensation system will cause the cost of generation to rise. It’s necessary for our society to discuss the costs incurred by expanding eco-friendly clean energy,” said Lee Sang-hun, director of the Energy and Climate Institute.

“While it’s true that renewable energy facilities are rather expensive, an increasing supply will naturally cause the price to become more competitive,” a Ministry official said.

By Choi Ha-yan, staff reporter

Please direct questions or comments to [english@hani.co.kr]

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