30th LAWASIA Conference

Tokyo, Japan

South Korea’s Renewable Energy Policy

Under the New Climate Change Framework

September 20, 2017

Yonghee Yoon
Yulchon LLC
Copyright 2017 Yulchon LLC.
Contents

I. Background of Changes in Energy Policy of South Korea 3

II. South Korea’s Challenges Under the New Climate Change

Framework 12

III. South Korea’s Renewable Energy Promotion Policy 26

I. Background of Changes in
Energy Policy of South Korea
1. Key Factors Affecting Energy Policy In South Korea

• Need for transitioning to low-carbon energy structure required under global climate change
regulation.
– South Korea heavily depends on fossil fuels such as petroleum and coal.
 South Korea globally ranks 10th in energy consumption, 9th in petroleum consumption, and 5th in petroleum import.
 Use of fossil fuel results in pollution and global warming.
– 1997 Kyoto Protocol and 2015 Paris Agreement on Climate Change

• Public antipathy against air pollution from coal power plants is on the rise.
– Fine dust became a top-priority issue among the public.

• Threat to energy security requires diversification of energy sources

– South Korea meets 96% of energy demands with foreign sources.
– Fluctuation in global petroleum prices is a threat to energy security.

• Need for an alternative energy source to replace nuclear energy

– The Fukushima accident made the public extremely sensitive about safety risks of nuclear energy.
– The public are demanding a new energy source to replace nuclear energy.

Consensus is emerging in South Korea that expanding the proportion of renewable

energy is the only effective alternative.

4
2. South Korea’s Energy Supply Structure

• Primary energy supply by source

Million toe

Renewable
Nuclear
Hydro
LNG
Petroleum
Coal

Source: Korea Energy Agency (2017)

5
2. South Korea’s Energy Supply Structure (continued)

• Primary energy supply by source

[범주 이름] [범주 이름]

[범주 이름] [값] [범주 이름] [값]
[값] [값]
[범주 이름]
[범주 이름]
[값] Nuclear, 1
[값] Coal
2.1% Coal
[값] [범주 이름] [값]
[값]

[범주 이름] [범주 이름]

[값] [값]

1990 2015

Source: Korea Energy Agency (2017)

6
2. South Korea’s Energy Supply Structure (continued)

• South Korea meets 96% of energy demands with imports.

Million toe Reliance on import (%)

Import
Domestic Production
Reliance on Import (%)

Source: Korea Energy Agency (2017)

7
2. South Korea’s Energy Supply Structure (continued)

• While the supply of renewable energy is on the rise, it does not meet the level of developed countries.

Thousand toe Thousand toe

Primary energy
Renewable energy
Supply proportion (%)

Source: Korea Energy Agency (2017)

8
3. South Korea’s Position in GHG Emissions

[2012 GHG Emission] (Source: IEA 2014) Unit: Mt (Million ton)

8,251

5,074

1,954
1,659
1,223
775 587 Worldwide 16th
in Cumulative CO2e
(1900~2011)
China U.S. India Russia Japan Germany Korea

• Economic Size: 13th in GDP and 7th in exports.

• Hosting relevant international organization secretariats: Global Green Growth Institute (2010), Green
Climate Fund (2012)
• Producing leaders of relevant international organizations: Secretary-General of the UN (United Nations),
Chairman of the IPCC (Intergovernmental Panel on Climate Change)

9
3. South Korea’s Position in GHG Emissions (continued)
[South Korea Major GHG Emitters (2014)] (Source: GHG Inventory and Research Center)
Rank Company Sector Emissions (CO2e)
1 POSCO Steel 75,788,901

2 Korea South Eastern Power Power Generation 56,504,496

3 Korea East West Power Power Generation 38,383,445

4 Korea Midland Power Power Generation 37,503,486

5 Korea Southern Power Power Generation 36,079,816

6 Korea Western Power Power Generation 34,720,751

7 Hyundai Steel Steel 18,802,293

8 Hyundai Green Power Power Generation 12,164,959

9 Posco Energy Power Generation 12,006,785

10 Ssangyong Cement Cement 11,721,698

11 GS Caltex Oil Refinery 8,525,204

12 SK Energy Oil Refinery 7,736,031

13 LG Display Semiconductor, Display 7,536,745

14 S-Oil Oil Refinery 7,433,460

15 LG Chem Petrochem 7,063,768

16 Dongyang Cement Cement 6,855,924

17 Samsung Electronics Semiconductor, Display 6,775,019

• Power sector emissions account for approx. 35% of total GHG emissions, among which 77% is from coal power
generation.

10
II. South Korea’s Challenges
Under the New Climate Change Framework
1. South Korea’s Position Under the Kyoto Protocol Framework

• The 1992 United Nations Framework Convention on Climate Change (UNFCCC)

– The UNFCCC provides a framework to address global climate change, setting a long-term objective for the global
community.
– The UNFCCC was adopted on May 9, 1992, effective March 21, 1994; ratified by National Assembly of South
Korea in Dec. 1993.
– The purpose of the UNFCCC: “to stabilize GHG concentrations in the atmosphere to a level that would prevent
dangerous anthropogenic interference with the climate system.”
– Countries’ Duties under the UNFCCC
 All country parties: they shall produce and update statistics about GHG emissions, and legislate and enforce policies to
stabilize climate change.
 Annex I countries: parties included in Annex I of the UNFCCC (“Annex I countries,” developed countries) shall bear
the burden of the duty to reduce GHG emissions in light of their historical responsibilities. The purpose is to return
current GHG emission levels back to levels in 1990s.
 Annex II countries: especially, the countries that have achieved substantial economic growth (“Annex II countries”)
shall, in addition to the duty to reduce, bear the duty to financially and technologically support developing countries’
countermeasures for climate change.

12
1. South Korea’s Position Under the Kyoto Protocol Framework
(continued)

• Climate Change Regime Initiated by the Kyoto Protocol

– The Kyoto Protocol was adopted on Dec. 11, 1997, effective Feb. 16, 2005; ratified by the National Assembly of
South Korea in Oct. 2002.

• The details of the duty to reduce GHG emissions under the Kyoto Protocol
– The Kyoto Protocol provides a list of GHGs to be reduced (Annex A), countries that bear the duty and their
specific reduction amounts (Annex B).
– Annex I countries
 Only Annex I countries bear the duty to reduce.
 Specifically, during the first commitment period, they shall reduce, on average, 5.2% as compared to the percentage in
1990.
– Non Annex I countries
 Non Annex I countries (developing countries) do not bear such a duty, and only bear the general duties provided by the
UNFCCC.
 South Korea was designated as a developing country, and therefore had no official duty to reduce GHG emissions.

13
1. South Korea’s Position Under the Kyoto Protocol Framework
(continued)

• Introduction of the Market Mechanism of the Kyoto Protocol

– Introduced the market mechanism in order to meet the duty to reduce with better cost efficiency.
– Korea had no duty to participate in the following market mechanism, because Korea was designated as a
developing country that bears no duty to reduce.

System Provision Main Contents

Joint Implementation Article 6 If an Annex I country (Country A) invests in another Annex I

(JI) country (Country B) that reduces GHG emissions, a portion of the
reduced amount is recognized as a GHG emissions reduction by
Country A.

Clean Development Mechanism Article 12 If an Annex I country (Country A) invests in a Non Annex I
(CDM) country (Country C) and Country C reduces GHG emissions, a
portion of the reduced amount is recognized as a GHG emissions
reduction by Country A.

Emission Trading Article 17 The Kyoto Protocol imposes GHG emissions limits on the countries
(ET) that bear the duty to reduce (Annex I countries), and allows such
countries to trade the emission permits amongst each other.

14
2. Self-initiated Establishment of a 30% Reduction Target Against the
2020 BAU Emissions
• Under the Kyoto Protocol Framework, with COP 15, the Korean Government, on its own initiative,
established a target of “30% reduction against the 2020 BAU (Business As Usual) emissions” in Nov. 2009.

Unit: Mt CO2e

776

30% reduction
(- 233 Mt CO2e)
594
543

298

1990 2005 2020 Target

15
3. The Adoption of Diverse Policies for GHG Emissions Reduction

• In order to accomplish the 2020 reduction target, South Korea is actively enforcing diverse policies
for GHG emissions reduction, which includes the following:
– Emission Trading Scheme (“ETS”) under the Emission Trade Act (2015~)
 (i) Among the countries with no duty to reduce under Kyoto Protocol Framework, South Korea was the first
country to operate a national level emission trade market, starting in 2015.
 (ii) Business entities with an annual average GHG emissions of 125,000 tons or more, or business entities that
have a place of business with an annual average GHG emissions of 25,000 tons or more have participated (in
2014, emission permits have been allocated amongst 23 sectors, 525 business entities).
– The Target Management System for GHG and Energy (“TMS”) under the Framework Act on Low Carbon,
Green Growth (2010~)
 Among the business entities with high level of GHG production or high level of energy consumption, the
system imposes reduction targets for energy consumption and GHG production on the business entities that
were not the subject of Korean ETS (in Nov. 2015, about 315 small and medium-sized businesses were the
subject of the TMS).
 The system has been introduced to establish MRV (Monitoring, Reporting, and Verification) prior to the
introduction of Korean ETS.

16
4. The PACC Background

• The need for the Paris Agreement on Climate Change (the “PACC”) arose from the incomplete
success of the Kyoto Protocol.
• The Half Success of the Kyoto Protocol
– During the first commitment period (2008~2012), the Annex B countries reduced the GHG emissions by 22.6%
compared to the levels in 1990s (far exceeding the target reduction rate of 5.2%).
– 128 countries have carried out 8,000 CDM projects during the first commitment period, and successfully reduced
more than 1.5 Bt CO2e.

• The Shortcomings of the Kyoto Protocol

1) Lack of participation by various countries
(i) The U.S. did not participate at all, (ii) Canada withdrew from the Kyoto Protocol after the first commitment
period, (iii) Japan, Russia, and New Zealand expressed their decisions to withdraw from the second
commitment period (2013~2020), (iv) China, India, and many other countries that were designated as
developing countries had no duty to reduce under the Kyoto Protocol in the first place.
2) Uncertain sustainability
(i) the Doha Amendment, which sets the second commitment period of the Kyoto Protocol, was adopted a full
fifteen years after the ratification of the Kyoto Protocol, but has not been in effect until the present time, (ii)
repeatedly establishing a different commitment period and reduction target for each country is a very difficult
task that can also undermine legal stability.

17
4. The Regulatory Structure of the PACC

• The PACC, the Inception of the New Climate Change Framework

– The PACC has been negotiated under the 1992 UNFCCC.
– The PACC, approved by 195 countries, will take effect from 2020, replacing the existing Kyoto Protocol, under
which developed countries have binding emission reduction targets.

• Legal nature of the PACC

– A treaty under international law, which means legally binding
– There are no hard obligations on the Parties aside from some procedural points. The only aspects of the PACC
which compel a state party to action are those which relate to (i) obligations to share their NDCs at 5 year
intervals for inclusion in a public registry and (ii) for developed countries to provide climate finance to support
developing countries and report on that finance every two years.

• Goals of the PACC (Article 2, 4)

– Keep warming below “well below 2 degrees Celsius” (above pre-industrial levels)
– “Pursue efforts” to keep it below 1.5 degrees Celsius
– Peak global emissions as soon as possible

18
4. The Regulatory Structure of the PACC (continued)

• How to achieve the Goal of the PACC

– Bottom up submission of Nationally Determined Contributions (“NDC”) (Article 3 and 4)
 Each UNFCCC party(“the Party”) is required to submit updated NDC every 5 years, which is outlining the countries'
mitigation and adaptation measures to contribute to the Goal.
 The NDC will be made publically available, enabling civil society to review, analyze and encourage country
governments to comply with those commitments.
 NDC is not legally binding, which is different from the binding nature of reduction targets under the Kyoto Protocol.
 It is bottom up approach, unlike the top down approach under the Kyoto Protocol
– Review mechanism (Global Stocktake) (Article 14)
 Progress is made in five-year cycles.
 First, the Conference of the Parties review collective progress every 5 years (the 1st world review: 2023) and inform the
Parties. Then, each country submits updated NDC reflecting a “progression” and the “highest possible ambition”
– The Party’s discretion regarding how to fulfill its NDC (Article 6)
 Developing internal policy or regulation to achieve its mitigation and adaptation targets, such as the creation of
domestic market mechanisms
 Cooperating in meeting its NDC through the so-called "internationally transferred mitigation outcomes" (ITMOs)

19
4. The PACC Structure
Purpose (Art 2)
Mitigation – Adaptation – Financial flows

All Parties to take and communicate efforts towards L&D Sinks Mechanisms
purpose + “progression over time” (Art 3) (Art 8) (Art 5) (Art 6)

Mitigation Adaptation Finance Technology Capacity Transparency

(Art 4) (Art 7) (Art 9) (Art 10) Build.(Art 11) (Art 13)

Peaking + rapid Capacity + Fully realize Enhance capacity Trust +

Enhance tech and ability of confidence +
Informs actions and support

Informs actions and support

Objectives reductions resilience +
implementation development developing effective
+ balance vulnerabilities and transfer countries implementation

NDCs every 5 Provision and Information on

Cooperation + Strengthen
mobilization of mitigation, ada
years + cooperative Cooperation
planning support ptation and
”progression” action
Means (differentiated) support (partly
differentiated)
Biennial Regular
Long-term Adaptation information Support Expert review +
communication
strategies communication ex-ante innovation multilateral
of CB activities
(differentiated) consideration

Feed into stocktake

Stocktake every 5 years of collective progress towards purpose and long-term goals (Art 14)
Source: Ecological Institute, the Paris Agreement: Analysis, Assessment and outlook (2016)
20
4. The PACC Structure (continued)
• Comparison with the Kyoto Protocol

The Kyoto Protocol The PACC

Keep a global temperature rise this century

Reduction of GHG emissions Goal
well below 2°C

Not just mitigation, but also adaption,

Mostly focused on GHG emissions
Scope finance, loss and damage, and capacity
reduction (mitigation)
building, etc.

Responsible
Mostly developed countries All party countries
Countries

Methods to Set the

Top down approach Bottom up approach
Target

Punitive
Punishment for
(additional imposition for the next commitment Failures to Meet Non-punitive
period of the reduction amounts, i.e. 1.3 times Targets
the deficiency from the target amount)

Criteria to Set the

Not mentioned Principle of progression
Target

Continuous efforts to address climate

Uncertain sustainability after the end of
Sustainability change possible because commitment
each commitment period
periods have no specified end dates

Mostly by each country Actor Encourages participation by various actors

21
5. South Korea’s obligations under the PACC

• The PACC has equal force and authority as domestic laws do in South Korea
– Once the President ratifies the PACC after the Congressional approval, the PACC will have equal force as domestic
laws do in South Korea (Articles 6, 60, and 73 of the Constitution). Domestic process was finished on Nov. 3 2016
and the PACC took effect from Nov. 4 2016.

• Duty to report and periodically set reduction targets

– Unlike the Kyoto Protocol which imposes the duty to reduce only on developed countries, the PACC imposes on all
party countries the duty to periodically explain and report on reduction targets.
– Therefore, South Korea, according to the principle of progression (regression prevention principle), is required to
submit its NDC on each sector and resubmit it every 5 years.

• Whether South Korea, as a developed country, bears the duty to sponsor developing
countries(e.g., duty to financially sponsor developing countries)
– While the PACC distinguishes between developed country parties and developing country parties when it comes to
imposition of obligations and performance for mitigation, adaption, finance, etc., the PACC does not explicitly
define “developing/developed countries”, so it is uncertain as to which category South Korea falls into. There are
strong arguments that, based on many indicators such as GHG emissions and the size of its economy, South Korea
possesses the abilities of a developed country, and, therefore, should bear the corresponding duties of a developed
country. In light of these arguments, there can be significant international pressure on South Korea to actively
sponsor developing countries.

22
6. Countermeasures to Achieve Reduction Target Under the New
Climate Change Framework
Unit: Mt CO2e [South Korea’s Announcement of its NDC] 851
783

688
- 30% - 37% vs. BAU emissions
594 543 -1.3% 536

298

- 21.1% - 22.1% vs. 2012 emissions

- 3.0% - 4.3% vs. 2005 emissions

1990 2005 2012 2020 BAU 2020 Target 2030 BAU 2030 Target

• In light of the new climate change framework, South Korea announced in June 2015 that it would
reduce GHG emissions by 37% against 2030 BAU emissions.
– (i) Domestic Reductions (Reduction Within South Korea): 219 Mt CO2e (25.7% of the 37%, only the reduction
activities carried out in South Korea are available) ⇒ Expected 2030 domestic GHG emissions: 632 Mt CO2e [89 Mt
increase from expected 2020 domestic GHG emissions target (543 Mt)]
– (ii) International Offsets (Reduction Outside of South Korea): 96 Mt CO2e (11.3% of the 37%, the purchase of
international emission permits and the reduction activities carried out abroad are available)
23
6. Countermeasures to Achieve Reduction Target Under the New
Climate Change Framework (continued)
• In order to accomplish the 2030 reduction target, South Korea needs to adopt and enforce strong
and effective policies, including:

• 1) The need for an improved GHG emissions policy

– Improvement on the K-ETS: If the emission permit price is not decided by the principle of the supply and demand
of the market, the K-ETS may become less effective. Especially in South Korea, there is a substantial possibility
that (i) monopolization in such market, or (ii) governmental interference in the market, could distort the price
determination mechanism.
– The following alternatives are being proposed: (i) stimulating the K-ETS market by allowing third parties’ early
market participation, and (ii) measures to limit excessive governmental interference on the K-ETS market.

• 2) The need for introduction of a new policy for GHG emissions reduction
– There are strong arguments for the need for additional policies in order to accomplish the 2030 reduction target,
because the current policies that focus mainly on the K-ETS cannot adequately secure potential increase in future
reduction capacity.
– In this context, South Korea will aggressively push ahead with renewable energy policy that contributes to reducing
GHG emissions.

24
III. South Korea’s Renewable Energy Promotion
Policy
1. History of Proportioning Renewable Energy in South Korea
Period Description

1980s • Plans to develop renewable energy in 11 areas including solar

• 1987. 12. “Renewable Energy Technology Promotion Act” was formulated

1990s • 1997. 12. It was revised to “Act for Promoting Renewable Energy Development, Use, and
Distribution”

2000s • 2002. 3. “FIT (Feed-In Tariff)” was introduced (The above Act)
• 2004. 12. It was revised “Act for Promoting New and Renewable Energy Development, Use,
and Distribution (the “Renewable Energy Act”)
• 2006. 9. Base Energy Plan shall include greenhouse gas reduction targets (the Renewable
Energy Act)
• 2010. 4. “RPS (Renewable Portfolio System)” was introduced instead of FIT (the Renewable
Energy Act)

2010s • 2017. 8. New administration released renewable energy initiatives

‒ Tighter RPS target: mandatory RPS ratio will be adjusted to 28% by 2030 (current target is 10% by 2023)
‒ To introduce in limited scope FIT tailored for small-scale power suppliers.

26
2. Introduction of FIT in 2002

• Background
– Renewable energy emerged as early as the 1990s, but its distribution was not active because of its lack of
economic viability.
– The government introduced FIT in 2002 as a direct subsidy program to encourage and accelerate adoption of
renewable energy.

• Operating Mechanism of FIT

– FIT is a direct government subsidy program where the government pays the difference in the market price of the
renewable energy and the government’s list price for a fixed period of 15 or 20 years. (Renewable Energy Act
Article 17)
– The subsidy is financed from the electricity industry base fund. (charged as a percentage of an electricity bill)

• Achievement & Limitation

– As of April 2011, (i) from 2002, the government paid KRW 907 billion (approximately USD 900 million) in
subsidy to support generation of renewable energy power totaling 8,483GWh, and (ii) the number of recipients
was 2,121 plants with the total generation capacity of 1,039MW.
– However, as FIT is financed with the electricity industry base fund, excessive financing burdens became an issue.

27
3. The Regulatory Structure of RPS
• Background of Adopting RPS
– Despite FIT and other measures, production and supply of renewable energy grew only mildly in the 2000s.
As of 2009, the proportion of renewable energy supply stood at a mere 2.5% , which would make it difficult to
meet the 2030 target of 11%.
– To adopt a new policy paradigm to spur renewable energy adoption and promote related industry, it is determined
in 2008 to terminate FIT after 2011 and replace it with RPS in 2012.
– New FIT subsidies have not been provided since 2012, but the outstanding subsidies will be continued until the
designated period of 15 or 20 years (as late as 2031).

• Operating Mechanism of RPS

– Definition of RPS: RPS requires a power supplier with a capacity of 500MW or greater to generate certain
proportion of electricity from renewable sources. (Renewable Energy Act Article 12-5)
– Qualified suppliers: Power suppliers with a capacity of 500MW or greater. (18 entities as of 2017)
– Renewable Energy Proportion by Year
 Qualified suppliers should supply and distribute a certain amount of electricity from renewable sources annually. This
mandatory quota is calculated by multiplying the total amount of non-renewable energy produced by that supplier with
the multiplier rates below. (Renewable Energy Act Enforcement Decree Appendix 3)

Year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

Rate(%) 2.0 2.5 3.0 3.0 3.5 4.0 5.0 6.0 7.0 8.0 9.0 10.0

28
3. The Regulatory Structure of RPS (continued)

• Operating Mechanism of RPS

– Mandatory quota separately calculated for solar power
 To accommodate higher costs associated with solar power, mandatory quota is differently calculated for solar power.
(Renewable Energy Act Enforcement Decree Appendix 4)
– How to meet the mandatory quota
 Qualified supplier shall meet the quota by getting renewable electricity either by (i) self-production of renewable
electricity or (ii) purchase renewable electricity from a third-party renewable power supplier.
 In case of the latter, the purchase is carried out by purchasing REC (Renewable Energy Certificates) on the market at
market price.
 Qualified supplier can reflect the cost of fulfilling mandatory quota in its electricity price.
 Failure to meet the mandatory quota obligation may be punished by an administrative fine not exceeding 150% of the
average trading price of REC.
– Flexible mechanism
 To spread burdens from mandatory quota, qualified suppliers may carry over 20% of the mandatory quota of a certain
year to the next year.
– Different weighted values on REC were assigned to renewable energy certificates per source.
 The weighted value on REC is calculated based on cost of generation, contribution to greenhouse gas reduction, and
contribution to growth of renewable energy sector. Currently, weighted value on REC is set differently between solar
power and non-solar power. (See RPS Guidelines Appendix 2).

29
3. The Regulatory Structure of RPS (continued)
• Operating Mechanism

Government
Sets target, allocates mandatory quota, manages RECs

Facility Report Issues Sets Quota Meet Quota

certification generation RECs
volume

Power Supplier A
PPAs
Renewable Electricity Power Supplier B
Supplier A
Renewable Electricity Power Supplier C End Customers
Supplier B
Sell RECs
Renewable Electricity
Sells
Supplier C PPAs
Electricity
Grid connection
KEPCO
(delivery and
distribution)

Source: Kim’s Report (2008, p.132)

30
4. Achievement and Limitation of RPS in South Korea

• Achievement of RPS
– RPS implementation ratio: 64.7%(2012) → 67.2%(2013) → 78.1%(2014)
– From 2002 to 2015, renewable energy showed an annual growth of 12.1% on average. As of 2015, the
proportion of renewable energy reached 4.5%. While this growth is promising, the proportion falls short of that
of developed countries.
[Proportion of Renewable Energy ]

REA revised

FIT introduced

Kyoto
Protocol
New Climate
Introduced
Change Regime
introduced

REA
introduced
RPS introduced

Source: Korea Energy Agency (2016)

31
4. Achievement and Limitation of RPS in South Korea (continued)
• Limitation of RPS
– RPS does not provide incentives for small-scale power suppliers.
– RPS may produce bias towards certain energy sources with lower generation costs and easy transferability. For
example, power suppliers tended to prefer biomass in 2014 due to its ease of implementation.

[Renewable Energy Distribution by Source (2015)]

Fuel cell [값] Solar [값]

Wind [값]
Hydro [값]

Marine [값]
Geothermal
[값]

Biomass [값]
Waste
[값]

Source: Korea Energy Agency (2016)

32
4. Recommendations for Renewable Energy Promotion Policy

• Harmonize RPS with FIT

– To promote renewable energy generation among small-scale power suppliers (mostly solar), providing FIT in
limited scope to small-scale power suppliers should be considered.
– This will facilitate implementation of small-scale power projects by households and communities.
 For example, a municipal government or other public entity leads construction and management of small power plants,
and citizens contribute capitals and secure certain profits.
 This approach will be effective in addressing resident reception, which has been the greatest hurdle against renewable
energy power generation in South Korea.

• Easing Regulation on Renewable Energy Project

– Issue
 Energy polices are currently led by the national government, rather than municipalities.
 The national government and municipalities have different views and levels of enthusiasm over renewable energy
promotion policies.
 There have been cases of municipalities strengthening national guidelines with their municipal codes, leading to
disparities between municipalities.
– Recommendations
 When it comes to energy policy, it is reasonable to give more authority, roles, and discretion to municipalities.
 It is reasonable to place a legislation that prevents municipalities from unduly strengthening national guidelines or
otherwise deviating from uniform rules.

33
5. New President’s Energy Policies

“South Korea’s freshly inaugurated President Moon Jae-in

is expected to push forward renewable energy policies to
tackle concerns over pollution...”

“Moon is likely to scale down coal and nuclear power

dependency as pledged during his campaign. His camp had
said the government would no longer build nuclear reactors
and thermal power plants.”

“Moon said he would aim to raise the proportion of

electricity generated from renewable energy from 1.1
percent to 20 percent by 2030 -- nearly double the target of
11.7 percent proposed by the previous government.”

“Moon had also pledged to boost new registrations of

electric cars as a measure to reduce air pollution, while
aiming to ban diesel vehicle registrations by 2030.”

Source: http://www.koreaherald.com/view.php?ud=20170510000794
34
5. New Administration’s Energy Initiatives
Source: Government Press Release (2017. 8.)

• Goal: Paradigm Shift to Cleaner and Safer Future Energy

Energy policies to ensure stable and cheap energy supply centering on economic dispatch
⇒ Shift to balanced approach to take account of national safety and clean environment

i) Coal Power
– Early retirement of power plants (total 7 units) and improvement of environmental facilities to reduce pollutant
emissions in half by 2030
– Ban construction of new coal power plants, and change coal power plants under construction into clean LNG
power plants

ii) Nuclear Power

– Dependence on nuclear power will be gradually reduced with banning extension of remaining life of nuclear
power plants and revocation of plans to construction of new nuclear power plants.

iii) Renewable Energy

– Increase dependence on renewable power to 20% by 2030: transform renewable energy sources, channels, and
methods to ensure resident reception and economic viability.
 Source: Waste → Solar / Wind (true renewable)
 Channel: Private entity → Municipalities and residents
 Method: entity-based location → to be supplemented with comprehensive location planning
– [Reference] Previous targets
 2nd Energy Basic Plan (2013): 11% by 2035
 4th New and Renewable Energy Basic Plan (2014): 11% by 2035
35
 Thank you
Yonghee Yoon (yhyoon@yulchon.com)

Yulchon LLC Textile Center 12F, 518 Teheran-ro, Daechi-dong, Gangnam-gu, Seoul, Korea Tel: 02-528-5200 Fax: 02-528-5228 E-mail: mail@yulchon.com

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