"13 Trillion Investment in Renewable Energy"... Government Puts Brakes on KHNP's 'Solar Drive'

Government Adjusts Korea Hydro & Nuclear Power's Renewable Energy Targets Considering Supply Conditions
Last Year, a 13 Trillion Won Investment Plan for Renewables Was Set... Likely to Be Significantly Revised
Renewable Energy Corruption and Allegations Revealed... Saemangeum Sold to Chinese Company

Former President Moon Jae-in Touring Floating Solar Power Facilities
(Gunsan=Yonhap News) Photo by Hwang Kwang-mo = Former President Moon Jae-in is touring the floating solar power facilities at the Usuji floating solar power site in Gunsan City, Jeollabuk-do, after the 'Saemangeum Renewable Energy Vision Declaration Ceremony' held on October 30, 2018. 2018.10.30
hkmpooh@yna.co.kr
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[Asia Economy Sejong=Reporters Junhyung Lee, Hyunji Kwon] The government has decided to put the brakes on Korea Hydro & Nuclear Power’s (KHNP) ‘renewable energy drive.’ This decision comes from the assessment that the renewable energy targets set under the previous administration have low feasibility. There are also speculations that the ‘KHNP-type New Deal’ may be abolished.

According to materials submitted by the Ministry of Trade, Industry and Energy (MOTIE) to Koo Ja-geun, a member of the People Power Party, on the 7th, MOTIE has confirmed plans to revise KHNP’s renewable energy roadmap as early as this year. MOTIE intends to adjust KHNP’s own renewable energy targets in accordance with the ‘10th Basic Plan for Electricity Supply and Demand’ to be established by the end of this year. The Basic Plan for Electricity Supply and Demand is a mid- to long-term plan spanning 15 years for the country’s overall power facilities and power source composition, formulated every two years. A MOTIE official stated, “We plan to adjust KHNP’s renewable energy targets to a reasonable level,” adding, “We will consider factors such as feasibility and local community acceptance.”

13 Trillion Won Investment in Renewables... Industry Minister Calls Targets Excessive

Originally, KHNP planned to invest 13 trillion won in renewable energy projects by 2034. Last July, KHNP established the ‘2034 Mid- to Long-term Management Strategy Plan’ and envisioned securing 6.1 GW of solar power generation facilities by investing 4.7 trillion won. This scale is 4.5 times the generation capacity of Shin Hanul Unit 1, a 1.4 GW plant scheduled to start operation within the year. Additionally, KHNP planned to invest 7.2 trillion won in wind power to build 4.2 GW of facilities.

However, MOTIE judges KHNP’s targets to be unrealistic. Expanding the deployment of solar and wind power requires consideration not only of local community acceptance but also of power grid stability. Increasing the proportion of renewable energy, which has variable output, without restraint could lead to large-scale blackouts caused by power grid overload. On October 4, at a National Assembly audit, MOTIE Minister Lee Chang-yang also pointed out, “The renewable energy targets set by the previous government were excessive,” adding, “The pace is difficult to achieve.”

The government’s decision to significantly lower renewable energy targets during the formulation of the 10th Basic Plan for Electricity Supply and Demand is for this reason. According to the draft of the 10th Basic Plan announced by MOTIE in August, the share of renewable energy in power generation by 2030 has been reduced by 8.7 percentage points from 30.2% to 21.5%. Conversely, the share of nuclear power has increased by 8.9 percentage points from 23.9% to 32.8%.

Saemangeum Project Rights Sold to China... Allegations of Unfair Gains

Corruption and suspicions related to renewable energy are also emerging one after another. The Saemangeum renewable energy project, a key task of the Moon Jae-in administration, is a representative case. During this year’s National Assembly audit, it was revealed that the offshore wind power project rights in Saemangeum are being transferred to a Chinese company. There are also allegations that a professor at a national university obtained unfair gains by using insider information during the sale process.

The ruling party’s backlash is intensifying. The People Power Party has labeled the Saemangeum wind power-related suspicions as the ‘Saemangeum Gate’ and demanded a thorough investigation. On the 6th, People Power Party members of the National Assembly’s Industry, Trade, Energy, Small and Medium Enterprises Committee issued a statement saying, “The wind of Saemangeum has blown for a corrupt cartel, and it is at risk of becoming a resource that opens the future for a Chinese company,” adding, “If the shares are transferred, there is concern that about 50 billion won annually in electricity fees paid by Korean citizens will be leaked to China.”

Given this situation, there is speculation that the ‘KHNP-type New Deal’ may be abolished. KHNP is still pursuing the ‘KHNP-type New Deal Comprehensive Plan,’ established in December 2020 as part of the Korean New Deal. The core of the KHNP-type New Deal is to significantly expand renewable energy projects, such as increasing solar power capacity from 71 MW in 2020 to 3,742 MW by 2025.

However, KHNP shows a difference in stance with MOTIE. A KHNP official said, “The KHNP-type New Deal is an ongoing matter,” adding, “There are no plans to revise the renewable energy targets.”

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