The South Korean government plans to invest a combined KRW42 trillion ($36.4 billion; €32.8 billion) in developing domestic renewable energy projects by 2020.
Under the programme, 13GW of new renewable energy capacity will be built in the next five years to provide electricity equivalent to that of 26 coal plants, the country’s Ministry of Trade, Industry and Energy said in a press briefing, according to Korean news agency Yonhap.
Some KRW33 trillion will be spent on the development of renewable energy projects, with KRW4.5 trillion to be invested in energy storage systems and KRW2 trillion in eco-friendly power plants.
The goal will see the ministry raise its scheduled renewable portfolio standard to five percent in 2018 from an earlier target of 4.5 percent. The renewable portfolio standard is a regulation that requires electricity suppliers to produce a certain portion of electricity from renewable energy sources.
The ratio is expected to reach six percent in 2019 and seven percent in 2020, which is double this year’s 3.5 percent standard target.
Individuals will be allowed to sell the electricity provided by their own solar panels, while large commercial buildings could be equipped with 1MW of solar panels to save on their utility bills.
A detailed plan will be unveiled to allow renewable energy businesses, including energy storage system companies, to participate in the energy exchange market so as to attract more capital to the sector.
“The government will lift unnecessary regulations and increase government support to foster the renewable energy sector,” said Chae Hee-bong, deputy trade minister for energy and resource policies, during the press briefing. “It will also help those businesses explore overseas markets.”
Currently, state-owned Korea Electric Power Corporation is the only entity eligible to buy and distribute electricity in the country. It also generates around 83 percent of electricity in Korea through six wholly owned subsidiaries.
Last month, the Korean government proposed potential initial public offerings of minority stakes in the company's six power generation subsidiaries, as well as a gradual opening up of KEPCO’s retail electricity sales operations and Kogas’ liquefied natural gas import operations for wholesaling to the private sector.
The move could help KEPCO secure further funding sources to develop renewables, as well as boost the economy through the creation of new small- and medium-sized businesses in the sector.