[AirUP, On Site] Total Investment of 2.4 Trillion KRW... From Coal Power to a Core Hub of the Hydrogen Economy

A bird's-eye view of the blue hydrogen plant to be built by Korea Midland Power at the Boryeong Power Plant.
[Photo by Korea Midland Power]

원본보기 아이콘

[Asia Economy Sejong=Reporter Lee Jun-hyung] Korea Midland Power's Boryeong Power Headquarters, located in Boryeong, Chungnam, is a large-scale power generation complex accounting for 3.5% of the country's total power generation capacity. It is recognized as the foundation of domestic coal-fired power standardization. The Boryeong Headquarters played a central role in coal-fired power, which was essential in the process of Korea's economic development, but it has reached a turning point due to carbon neutrality. This is because the share of coal-fired power had to be drastically reduced in line with the government's decarbonization policy.

The target to be achieved by the new government is also considerable. The Yoon Seok-yeol administration announced plans to reduce the share of coal and other thermal power generation from the existing 60% range to 40% during its term. Midland Power already closed Units 1 and 2 of the Boryeong thermal power plant early in 2020. Midland Power also plans to additionally shut down Units 5 and 6 by the end of 2025.

The ash disposal site, which has become idle, poses another issue. The ash disposal site is a facility that processes the residue left after burning coal to generate electricity. Since a large amount of ash is produced during coal power generation, ash disposal sites are considered essential facilities for thermal power plants. However, as the government closes coal power plants one by one for carbon neutrality, some ash disposal sites have also ceased operation. As more coal power plants are closed under the decarbonization policy, the number of nearby idle sites also increases accordingly.

Midland Power proposed a solution called the 'hydrogen plant.' The plan is to transform the idle thermal power plant sites into large-scale hydrogen production bases. Accordingly, Midland Power has partnered with SK E&S, which leads SK Group's hydrogen business, to build a blue hydrogen production plant at the northern ash disposal site of the Boryeong Headquarters, covering 623,000 square meters (approximately 188,000 pyeong). Blue hydrogen is hydrogen produced by extracting hydrogen from natural gas while capturing and storing carbon dioxide to reduce carbon emissions. It is the second most eco-friendly hydrogen production method after green hydrogen, which is produced using renewable energy.

If the hydrogen plant is established as planned by Midland Power, it will be able to produce 250,000 tons of hydrogen annually at the northern ash disposal site alone. This includes 200,000 tons of gaseous hydrogen and 50,000 tons of liquefied hydrogen, making it the largest blue hydrogen plant in the world. To reduce carbon emissions, the approximately 2 million tons of carbon dioxide generated annually during blue hydrogen production will be captured, liquefied, and transported to overseas depleted gas fields for storage.

Given the ambitious nature of the project, the investment cost is also substantial. Midland Power will invest about 2.4 trillion KRW in the blue hydrogen plant project with SK E&S starting this year. SK E&S will finance most of the project costs, and Midland Power plans to finalize the specific investment amount through board approval in the future. After the plant's completion, Midland Power will focus on equipment operation, maintenance, and hydrogen distribution.

원본보기 아이콘

The completion date is set for July 2025. Midland Power plans to establish a special purpose company (SPC) with SK E&S in October and begin groundbreaking as early as the end of this year. A Midland Power official stated, "We are currently in the process of obtaining permits for plant construction," and added, "SK E&S will additionally invest about 2.6 trillion KRW to build fuel cell facilities that utilize the hydrogen produced at the plant."

There is also anticipation that the Boryeong Headquarters blue hydrogen plant could become a new standard for utilizing idle sites at power plants nationwide. The government plans to close more than half of the 57 coal-fired power plants nationwide, specifically 34 units, without extending their lifespan by 2034. In this context, if Midland Power's blue hydrogen plant project succeeds, it could establish itself as a 'model answer' for utilizing idle power plant sites.

Midland Power's hydrogen business is not limited to the blue hydrogen plant. Last year, Midland Power partnered with Doosan Heavy Industries & Construction to develop a hydrogen-only turbine. The hydrogen-only turbine generates electricity solely from hydrogen instead of liquefied natural gas (LNG). The carbon emissions during the power generation process are virtually zero. Midland Power plans to build an 80MW hydrogen-only turbine in Dangjin, Chungnam, by 2027.

Kim Ho-bin, CEO of Midland Power, said, "Our goal is to increase the share of renewable energy power generation to 30% by 2030," and added, "We will spare no support to enhance hydrogen utilization technology."

© The Asia Business Daily(www.asiae.co.kr). All rights reserved.