Jeju, Jeonnam, Busan, and Gyeonggi Designated as 'Distributed Energy Special Zones'... On-Site Power Production and Direct Sales Allowed

Four regions-Jeju, Jeonnam, Busan (Gangseo), and Gyeonggi (Uiwang)-have been selected as the final “Distributed Energy Special Zones.” In these areas, power generation companies will be allowed to sell electricity produced on-site directly to consumers, bypassing the power market.

The Ministry of Climate, Energy and Environment announced on November 5 that it held the 36th Energy Committee meeting, presided over by Minister Kim Seonghwan, where it reviewed and approved both the “Designation Plan for Distributed Energy Specialized Regions” and the “7th Basic Plan for Rationalizing Energy Use.”

The Energy Committee selected four locations-Jeju, Jeonnam, Busan Gangseo, and Gyeonggi Uiwang-from among seven nationwide candidates as the final distributed energy special zones. These zones operate on a local production and consumption system, generating energy near demand centers rather than relying on long-distance transmission networks. This is based on the “Special Act on the Promotion of Distributed Energy.”

Yonhap News Agency

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Jeju, which was selected this time, is recognized as an ideal testbed for distributed energy systems due to its abundant renewable energy resources and innovative systems such as the renewable energy bidding system and real-time market. The ministry plans to use surplus renewable energy in Jeju to promote projects such as “P2H” (converting electricity to thermal energy using heat pumps), “Virtual Power Plants (VPP),” and “V2G” (using electric vehicle batteries as energy storage systems to participate in the electricity market).

In Busan, the plan is to install large-scale energy storage systems (ESS) and use them across various consumers-including industrial complexes, ports, and data centers-to reduce electricity costs. In Gyeonggi Province, a demonstration project will utilize a microgrid that connects solar power, ESS, and electric vehicle charging stations within a park, allowing stored electricity to be used for charging electric vehicles and generating revenue.

The Energy Committee decided to continue deliberations at the next meeting for three regions-Ulsan, Chungnam (Seosan), and Gyeongbuk (Pohang)-which were put on hold in this round of selection. In addition, the committee confirmed its goal to reverse the trend of final energy consumption by 2029 and to improve the “energy intensity” by 8.7% compared to last year by the same year, based on the “7th Basic Plan for Rationalizing Energy Use.”

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