Support for Renewable Energy National Shareholder Project Begins... 90% Loan Support for Investment Funds

Village Residents Participate as Shareholders in Renewable Energy Power Plant... Sharing Power Generation Profits
Targeting Residents Registered for Over 1 Year Around 500kW Solar and 3kW Wind Power Plants
Quarterly Variable Interest Rate 1.75%... 20-Year Grace Period with Lump-Sum Repayment

[Asia Economy Reporter Moon Chaeseok] The Ministry of Trade, Industry and Energy announced on the 6th that it will open the Renewable Energy National Shareholder Project (National Shareholder Support Project) and start accepting loan applications from the 7th.

The National Shareholder Support Project is a new project with a budget of 36.5 billion KRW reflected through the supplementary budget this year.

◆Loan support of 90% of investment at 1.75% interest rate

This project provides long-term low-interest loans covering up to 90% of the investment amount (within 4% of the project cost) to residents near power plants who wish to participate in solar and wind power generation projects.

The interest rate applied is a quarterly variable rate of 1.75%. The loan period is based on a 20-year grace period with lump-sum repayment.

The support targets are residents registered for more than one year in towns, townships, and neighborhoods near solar power plants of 500kW or more and wind power plants of 3MW or more, or village enterprises consisting of five or more residents.

◆"Reducing initial project cost burden... Increasing renewable energy acceptance"

The Ministry of Trade, Industry and Energy has been operating a renewable energy resident participation system since 2017.

If the resident participation amount is '10% of equity capital and 2% or more of the total project cost,' a new and renewable energy certificate (REC) of 0.1 is granted; if it is '20% of equity capital and 4% or more of the total project cost,' an REC of 0.2 is granted.

Since the introduction of the resident participation system, a total of 22 projects (128MW) have been completed as participatory projects. Among 184 projects (24.2GW) promoted by public sector power generation operators, 71 projects (13.7%, approximately 57% by capacity) are planned as resident participation projects.

Based on this, the ministry explained that the resident participation system is gradually becoming active in the public sector. However, the initial capital burden still acts as an obstacle, so support is deemed necessary.

The average project cost per solar and wind power project promoted by public sector power generation operators is about 494 billion KRW. To induce local residents' participation (additional REC issuance), about 10 to 20 billion KRW is required.

An official from the ministry said, "The National Shareholder Support Project is a project that provides opportunities to residents who want to participate in renewable energy power generation projects," adding, "It will have a positive effect on increasing renewable energy acceptance in the future by sharing the profits of renewable energy power generation projects with local residents instead of the power generation operators monopolizing them."

Those wishing to apply should prepare the resident registration transcript of participating residents and the participation (investment) agreement between residents and power generation operators, and submit their applications through the Korea Energy Agency New and Renewable Energy Center website starting from the 7th.

This content was produced with the assistance of AI translation services.