Events Recap

South Korea RE100 Localised Policy Messages Launch Event

On March 15, 2023, at the Glad Hotel Yeouido, Korea Sustainability Investing Forum (KoSIF), together with Climate Group and Solutions for Our Climate, held the ‘South Korea RE100 Localised Policy Messages Launch Event'. RE100 is a business-led initiative bringing together companies around the world that have committed to using 100% renewable electricity. The RE100 Korea Policy Messages comprise six messages designed to help RE100 member companies achieve their goal of using 100% renewable electricity. They were developed through a comprehensive process of discussion with a wide range of domestic stakeholders, with the aim of offering solutions suited to the Korean context. The ‘South Korea RE100 Localised Policy Messages Launch Event' was held to officially launch the RE100 Korea Policy Messages endorsed by RE100 member companies, and to create a venue in which experts from business, government, academia and civil society can work together in support of Korea's energy transition.

Karl Chun Seung Yang, Executive Director of the KoSIF, said in his opening remarks that "the RE100 initiative is becoming the most effective corporate strategy for tackling the climate problem," and stressed that "for a country as dependent on exports as Korea, creating the conditions for companies to use more renewable electricity is an extremely urgent task, both for the national economy and for the realization of carbon neutrality."

In the keynote presentation, Oliver Wilson, RE100 Co-lead at the Climate Group, presented the South Korea RE100 Localised Policy Messages. He explained that it set out six messages that build on the global RE100 policy messages while reflecting circumstances in Korea, and that, through a comprehensive process of gathering views from a wide range of stakeholders, they identify and reflect the obstacles companies commonly encounter and what the Korean electricity market requires.

Two presentations related to the RE100 Korea Policy Messages followed. First, Eunbyeol Jo, Researcher at Solutions for Our Climate, spoke on 'Renewable Energy Supply and Target.' Noting that the high cost of renewable electricity generation is cited as the single biggest obstacle to implementing RE100, and that solar and wind account for only 4.7% of domestic power generation, she stressed that "what is needed to bring the cost of renewable generation down sharply is wider deployment of renewable energy." Comparing permitting procedures and cases for solar and wind power in Korea and abroad, she explained the need to secure a potential of roughly 235 GW of solar and 20.8 GW of permitted offshore wind projects, through measures such as easing municipal solar setback regulations through legislative amendments, and expanding offshore wind projects and simplifying permitting by introducing a public-led site selection system.

Next, Seung-jin Kang, Professor at Tech University of Korea, gave a presentation on 'Measures to Promote Renewable Energy PPAs.' Explaining Korea's PPA system and structure, he noted that under the current PPA rules, the participation of renewable energy suppliers in the electricity market is limited, and that corporate buyers face the difficulty of having to purchase any shortfall at high SMP rates. He also proposed measures to promote PPAs in ways that can accommodate the variability of renewable energy, including improving the electricity market by allowing renewable generators to take part in the bidding market, providing resident-participation incentives to lower PPA costs, revising grid usage charges, and supporting relief from the financing burden created by the high-risk weights applied to renewable energy project finance.

The panel discussion that followed was chaired by Sangbok Lee , Deputy Editor-in-Chief of E2NEWS, on the theme of 'Renewable Energy Targets and Supply, and Measures to Promote PPAs.'

Byungchin Ahn, Head of the New Electricity Business Department at the Korea Power Exchange, said that changes are planned to allow renewable energy generators to sell surplus electricity beyond their PPAs on the market, and that systems are being designed so that renewable energy can compete on equal terms with fossil fuel generation, including a renewable generation forecasting scheme and a pilot project for a renewable energy bidding market.

Kanghoon Park, Head of the RE100 Management Team at the Korea Energy Agency, said that while there is debate over whether domestic renewable energy supply is currently insufficient, he agrees on the need to expand renewable energy deployment through indirect government measures such as regulatory improvements and support. He explained that the agency plans to use more than 95% of this year's green premium proceeds, and that an RE100 loan program and PPA-related guarantee products are also being planned.

Gyujong Choi, Head of the Green Energy Support Center at the Korea Chamber of Commerce and Industry, said that as companies have little choice but to increase their use of renewable energy, it is necessary to address the imbalance between the private and public sectors in renewable energy, provide incentives, use resources efficiently, and reconsider KEPCO's PPA tariff.

Seyun Jung, Manager at Hyundai Wia, said that from a buyer's perspective the company is reviewing internally when to enter PPA contracts considering the recently proposed PPA tariff, and that renewable energy prices could fall if government support helps to activate the renewable energy market.

Taehwan Yoon, CEO of Root Energy, said that expanding renewable energy in Korea calls for policy measures to resolve the competition between the RE100 corporate demand market and the RPS market, as well as improvements to the mismatch between renewable energy supply and demand that take additionality into account.

Chinpyo Park, Partner at Bae, Kim & Lee LLC, explained the need for a phased overhaul of the rules on wind power permitting, transparency in the process of determining PPA tariffs, and structural improvements to the electricity market and the power industry.

Closing the panel discussion, chair Sangbok Lee said that, as the saying goes, those who do not change themselves end up being dragged along by change from outside, and expressed hope for the day when Korea, too, quickly meets global standards on renewable energy.