"Energy Business Must Generate Internalization Synergy"… SK Ecoplant Building Wind and Hydrogen Value Chains

[Asking Carbon Neutrality] ②
Interview with Bae Seongjun, Vice President of SK Ecoplant
From Renewable Energy Generation to Energy Transport and Utilization
SK Ecoplant Building a Hydrogen Value Chain

Vice President Bae Seong-jun, Head of Energy Strategy at SK Ecoplant, is being interviewed by Asia Economy. Photo by Jo Yong-jun jun21@

"Offshore wind projects requiring trillion-won scale investments need the participation of large corporations. SK Ecoplant aims to maximize synergies in a 'self-contained' energy value chain encompassing production, distribution, and utilization?from renewable energy to green hydrogen (hydrogen produced from renewable energy)."

Baek Seong-jun, Vice President in charge of Energy Strategy at SK Ecoplant, recently stated this in an interview with Asia Economy. Alongside its core construction business, SK Ecoplant is aggressively advancing energy and environmental projects. Baek, a former Ministry of Industry official, joined SK Ecoplant in 2021 and is responsible for planning and executing overall energy business strategies. He emphasized the 'green hydrogen' value chain that SK Ecoplant is building, centered on offshore wind power. In 2021, SK Ecoplant announced its entry into the renewable energy sector by acquiring Samkang M&T (now SK Ocean Plant), a manufacturer of wind turbine substructures.

"SK Ecoplant has internalized many elements necessary to activate renewable energy sources such as hydrogen, offshore wind, and solar power, beyond simple plant EPC (engineering, procurement, and construction). Through joint ventures in fuel cells, acquisition of a wind turbine substructure manufacturer, and acquisition of renewable energy developers, we have secured core manufacturing capabilities for renewable energy equipment. Based on our existing engineering know-how, we are directly participating as a main player in global business development for offshore wind and green hydrogen."

In fact, SK Ecoplant is collaborating on the 'Sea Energy' project with global offshore wind developer Green Investment Group (GIG), Corio Generation, and energy company TotalEnergies. The Sea Energy project involves a 2.6GW floating and fixed offshore wind power project across five regions including Ulsan Metropolitan City and Jeonnam Province. Of this, 1.5GW is a 'floating' offshore wind farm, which includes the world's largest 'Ghost Whale Project.' Floating offshore wind farms can utilize abundant wind resources far out at sea, where winds are stronger and more consistent. One gigawatt (GW) is the amount of power a single nuclear reactor can produce; through its domestic offshore wind projects, SK Ecoplant aims to generate power equivalent to 2.6 nuclear reactors.

Vice President Baek stated, "By cooperating and linking with GIG, Corio, TotalEnergies, and others, we aim to showcase SK Ecoplant's competitiveness on the global stage, participate in global projects, and connect these efforts to future green hydrogen projects."

In other words, SK Ecoplant will participate in the entire process of producing renewable energy, generating hydrogen, converting it into ammonia for transport, and power generation. The specific process follows the sequence: floating body manufacturing and substructure manufacturing → offshore substations → water electrolysis (technology to extract hydrogen from water) → green ammonia conversion → offshore transport → fuel cells (electricity generation from hydrogen). In essence, SK Ecoplant is a company responsible for the 'life cycle of hydrogen.' Just as battery companies internalize value chains from raw materials to finished products to create synergy, the energy business also requires securing a value chain from renewable energy generation to energy transport and utilization.

Vice President Bae Seong-jun, Head of Energy Strategy at SK Ecoplant, is being interviewed by Asia Economy. Photo by Jo Yong-jun jun21@

This synergy in SK Ecoplant's wind and hydrogen value chain is fully embodied in Canada's 'New GeoHonic Project.' This project is a large-scale green hydrogen commercialization initiative that produces green hydrogen through wind power on Newfoundland Island in eastern Canada, converts it into green ammonia, and transports it to other continents such as Europe. Vice President Baek said, "We hold a 20% stake in the New GeoHonic Project and are a key operator. We take pride in participating as a principal entity in this global project where future energy flows between the North American and European continents."

While offshore wind development is necessary for decarbonization, there are issues with local community acceptance. Vice President Baek said, "Korea is surrounded by sea on three sides and has world-class shipbuilding and offshore plant technology and infrastructure, making it very advantageous for offshore wind development. However, the process of exchanging opinions and finding consensus with fishermen who have lived by the sea is always the most delicate and requires much consideration." He added, "We aim to expand opportunities for local residents to participate as shareholders through a resident participation business structure. Additional profits generated through resident participation structures should be shared, providing local residents with a long-term and stable source of income."

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