SK Signs Largest Domestic Renewable Energy Direct Purchase Agreement of '537GWh'

Photo by Jinhyung Kang aymsdream@

SK Group is signing the largest renewable energy direct Power Purchase Agreement (PPA) in South Korea to achieve Net Zero (carbon neutrality) ahead of schedule.

On the 24th, SK Group announced that SK Telecom, SK Siltron, SK Materials, and six other affiliates, along with SK E&S, recently signed a transaction agreement for a renewable energy direct PPA.

A renewable energy direct PPA allows companies to directly purchase electricity generated from renewable energy, thereby substantially contributing to the expansion of renewable energy and the reduction of greenhouse gases. It is recognized as a key means to achieve Net Zero and RE100 (100% renewable energy) commitments.

The direct PPA involves nine affiliates: SK Telecom, SK Siltron, SKC, SK C&C, SK Materials, SK Biopharm, SK Gas, SK Broadband, and SK Bioscience. The total capacity is 537 gigawatt-hours (GWh) per year, the largest scale in the country, enough electricity to power approximately 190,000 households for one year. Among them, SK Materials, which was the first SK affiliate to sign a PPA of 65 GWh with SK E&S in August last year, signed the largest amount of 171 GWh in this PPA. Multiple suppliers participated, and SK E&S was selected through competitive bidding for price competitiveness and supply stability.

The nine companies will receive renewable energy power generated by SK E&S’s solar power plants for 20 years starting in 2026, supplying their major business sites and data centers. This will reduce a cumulative 5 million tons of greenhouse gases, equivalent to planting about 20 million pine trees.

SK Group has set a challenging goal to achieve Net Zero ahead of the global carbon neutrality target year of 2050 and has been investing in carbon reduction and expanding renewable energy.

Chairman Chey Tae-won of SK has also made ESG a new axis of corporate management and has ordered the group to accelerate Net Zero efforts. At the 2021 CEO seminar, Chairman Chey emphasized, “SK Group must contribute to reducing 200 million tons of carbon, about 1% of the global carbon reduction target of 21 billion tons by 2030,” and added, “With a mission to lead future low-carbon eco-friendly businesses, SK should achieve ‘carbon footprint zero’ around 2035, when cumulative emissions and reductions offset each other.”

This direct PPA signing was also promoted by forming a joint task force among affiliates in line with the group’s Net Zero strategy. In addition to direct PPA, SK Group plans to achieve Net Zero early by utilizing next-generation eco-friendly technologies such as ▲ internalizing CCUS technology ▲ developing carbon storage sites ▲ producing blue ammonia and co-firing power generation ▲ ammonia and hydrogen fuel cell businesses.

An SK official said, “This largest domestic PPA signing demonstrates SK Group’s commitment and sincerity toward Net Zero,” and added, “We will continue to be a leading company actively contributing to overcoming the climate crisis through expanding renewable energy, investing in carbon reduction, and expanding eco-friendly businesses.”

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