SK E&S-BASF Sign Direct Power Purchase Agreement for Renewable Energy

From 2025, Renewable Energy Electricity Supply to BASF for the Next 20 Years

SK E&S is signing a renewable energy Power Purchase Agreement (PPA) with global chemical company BASF to achieve carbon neutrality goals. A PPA refers to a contract where an electricity supplier and a company requiring electricity purchase directly trade power.

On the 18th of last month, Lim Si-jong, Head of Business at SK E&S (right), and Song Jun, CEO of BASF Korea (left), took a commemorative photo after signing a transaction agreement at the SK Seorin Building in Jongno-gu, Seoul. Photo by SK E&S

Renewable energy PPAs are considered the most efficient means for 'RE100' as companies directly purchase and use electricity generated from renewable energy, thereby substantially contributing to the expansion of renewable energy and reduction of greenhouse gases.

SK E&S announced that it signed a transaction agreement for the 'Renewable Energy Power Purchase Agreement (PPA)' with BASF on the 18th of last month at the SK Seorin Building in Jongno-gu, Seoul. The signing ceremony was attended by SK E&S Business General Manager Im Si-jong, BASF Korea CEO Song Jun, and key stakeholders.

Through this contract, BASF plans to replace about 16% of the electricity needed at its Korean business sites with renewable energy by 2025. This is expected to achieve a greenhouse gas reduction effect totaling 900,000 tons by 2045. BASF is currently working on replacing fossil fuels with renewable energy sources such as solar and wind power as one of its various strategies to achieve Net Zero by 2050, and this contract signing was realized as part of those efforts.

SK E&S, the largest private renewable energy operator, signed Korea's first PPA with Amorepacific in March last year, followed by a PPA with SK Specialty, a subsidiary of SK Materials, in August of the same year. SK E&S operates and develops renewable energy projects exceeding approximately 3GW domestically and internationally and plans to expand this to 7GW by 2025.

Im Si-jong, Business General Manager of SK E&S, stated, "We have achieved the milestone of signing a renewable energy PPA based on close cooperation with BASF, the world's largest chemical company," adding, "We plan to continuously expand collaboration with domestic and foreign-invested companies pursuing 'RE100' in line with global efforts toward carbon neutrality."

Song Jun, CEO of BASF Korea, said, "Through the renewable energy direct power purchase agreement with SK E&S, we have been able to increase the use of renewable energy at BASF's business sites in Korea," and added, "In accordance with global policies, BASF will operate all domestic business sites in an environmentally friendly manner, convert existing production processes into eco-friendly processes with zero greenhouse gas emissions through renewable energy and new technologies, and realize the 2050 climate neutrality goal."

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