Annual Report 2013 - Energy · Annual Report 2013 Korea Energy Management Corporation. In 2012, the value of energy import was $184.8 billion which consisted of 35% of total value

E N E R G Y E F F I C I E N C YCL IMATE CHANGE RESPONSENEW AND RENEWABLE ENERGYCOMMUNICATION & COOPERATION


Annual Report 2013

Annual Report 2013

Contents

04 KEMCO 2013 at a Glance

06 A message from the CEO

I. Introduction

08 KEMCO Brief and History

10 KEMCO Workscope

11 Organizational Structure

12 Mission and Vision

14 Energy Supply and Demand in South Korea

17 Sustainable Energy and Climate Change Mitigation Policies

II. Energy Efficiency

Industrial Energy Efficiency

24 Industry Energy Efficiency

24 Energy Management System(EnMS)

26 Financial Assistance for Investment in Energy Efficiency

27 Promotion of Energy Service Company(ESCO)

Building Energy Efficiency

29 Building Energy Efficiency Labeling and Certification

29 Building Codes / Building Design Criteria for Energy Saving

30 Performance Evaluation of Eco-friendly Homes

31 Energy Saving Guidelines in Public Institutions

Transport Energy Efficiency

33 Vehicle Fuel Efficiency and Labeling

33 Average Fuel Efficiency(AFE)for Automobile Company

34 Tire Efficiency Standards and Labeling

Products Energy Efficiency

35 Energy Standards and Labeling

37 High-efficiency Equipment Certification

38 Standby Power Reduction Certification

39 Incentives for End-Users of High-efficiency Electric Products

Integrated Energy Demand Management

40 Demand Side Management(DSM) in Energy Utilities

41 Promotion of Integrated Energy Supply

44 Energy Use Consultation for SOC Development

III. Climate Change Response

GHG Mitigation in Industry and Buildings

48 GHG and Energy Target Management Scheme

49 Korea Voluntary Emission Reduction(KVER)

51 Carbon Neutral Program

51 Validation and Verification of GHG Emission Reduction

53 Energy and GHG Audit

IV. New and Renewable Energy(NRE) Deployment

NRE Installation Subsidy

58 General Installation Subsidy

59 Financial Assistance for NRE

Home Subsidy Program

60 Home Subsidy

61 Registration of NRE Facility Installation Company

NRE Facilities Certification

62 NRE Facility Standardization

62 Certification of Qualified NRE Facility

64 Certification of NRE Buildings

65 Fundamental Construction of Offshore Wind Power

65 Renewable Obligation in Public Institutions

66 Regional Deployment Subsidy

RPS Supply Certification

67 Renewable Portfolio Standard

68 Feed-in Tariffs for NRE

V. Communication and Cooperation

Statistics and Analysis

72 Reporting System of Energy Intensive Business Entities

75 Development of Country-specific(Korea) Emission Factor

Public Relations and Capacity Building

76 Public Relations for Energy Conservation

77 Regional Activities

78 Energy and Climate Change Education and Training

International Cooperation and Project Development

80 International Cooperation on Energy Efficiency

83 International Project Development for GHG Reduction

85 NRE Multilateral and Bilateral cooperation

Public Relations

and Capacity Buildings


International Cooperation and Project

Development

332 bilion KRW, 315ktoe

86ktoe

37,869 households12/26 items

3.6TWh



Communication and Cooperation

Home Subsidy


Renewable Portfolio Standards(RPS) Supply Certification

New and Renewable Energy(NRE) Deployment

332 bilion KRW, 315ktoe

24.2 MtCO2e

46

8 bilion KR

W,

10

2ktoe

158 ktCO2e

101 products, 2,417ktoe

449ktoe

GHG and Energy Target Management Scheme

Climate Change Response


Korea Voluntary Emission Reduction(KVER)




5.7 % , 102ktoe

Energy Efficiency

N. B. ktoe = 1,000 toe(ton of oil equivalent)

MtCO2e = Million ton of CO2 equivalent

596 ktoe

Energy and GHG Audit 292 ktCO2e

Validation and Verification of GHG Emission Reduction

Introduction

A Message from the CEO

KEMCO has endeavored to overcome numerous national challenges, such as the

recent power-shortage problems, high oil prices, and climate change issues, while

delivering on our commitment to transform the nation into a low-carbon, energy-

efficient society.

Stepping into a new era of hope, we will seek a fundamental solution to energy

issues by shifting our energy policies from supply side to demand side.

To this end, we will disseminate high-efficiency appliances such as LED lights, find

new ways to use ICT (Information and Communication Technology) to save energy,

and improve the people’s quality of life while promoting the growth of the energy

industry.

Since its establishment in 1980, KEMCO has been at the center of the

transformation into a new energy era. We will continue to build upon our progress

and deliver ground-breaking innovations while listening to the opinions of the people.

All members of KEMCO firmly believe that our integrity, pride, and humility in our

duties will open a “Happy Energy Era for All”. We will dedicate ourselves to fulfilling

our social responsibilities by supporting small and medium enterprises, fostering

industries, creating jobs, and promoting energy welfare.

KEMCO looks forward to your continued support, love, and encouragement that

allow us to maintain our position as the best energy management institution,

ushering in a happier and healthier life for the world.

Dr. BYUN, Jong-RipPresident and CEOKorea Energy Management Corporation

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Annual Report 2013Korea Energy Management Corporation

A M

essage fro

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e CEO

KEMCO Brief and History

Date of establishment

July 4, 1980

Legal basis

Article 45 of the Energy Use Rationalization Act

Characteristics

Public institution by law

Major function and role

- Efficiency improvement and safety management of energy-using machinery, equipment or materials

- Investigation, research, promotion and education of energy management

- Technical consultancy services on energy efficiency

- Support for the ICT-based energy demand management

- Support for the dissemination of combined heat and power(CHP)

- Support for the GHG mitigation activities in the industry

- Deployment and promotion of the NRE

Number of emplyees

493 as of 2013

Operating budget

KRW 64,793 millon(USD 66million) as of 2013

Organization

4 Executive Directors, 17 Divisions, 1 Affiliate,

12 Regional Headquarters

1979.12

Promulgation of the Energy Use Rationalization Act

Promulgation of the Alternative Energy Development Act

1987.12

Establishment of Korea Energy Management Corporation

1980.7

Introduction

Establishment of New and Renewable Energy Center affiliated under KEMCO

Planning the Vehicle Efficiency Enhancement Center

Designated by UNFCCC asCDM Operational Entity

2005.11

2003.2

2014.1

KEMCO Openedthe GHG Registration Office

2005.7

Designated as a Cooperation Organization for Renewable Standards Development

2009.7

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KEM

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Brief an

d H

istory

KEMCO Workscope

• Statistics and Analysis

• Public Relations and Capacity Building

• International Cooperation and Project Development


Energy Efficiency

• Sectoral(industry, building, transport) Energy Efficiency

• Appliances Sector Efficiency

• Combined heat and power(CHP) deployment

• Energy and GHG Audit


• GHG and Energy Target Management Scheme

• Korea Voluntary Emission Reduction(KVER)

• Validation and Verification of GHG Emission Reduction

New Renewable Energy(NRE) Deployment

• NRE Deployment and Subsidization

• NRE Facilities Certification

• Operation of Renewable Portfolio Standards(RPS) System

Introduction

KEM

CO

Wo

rkscop

e | Org

anizatio

nal Stru

cture

President

StandingAuditor

Audit & Inspection Division

GHG Certification Office

Global Strategy Division

12 Regional Headquarters

Regional Cooperation Division

Public Relations Division

Planning & Budget Division

General Administration Division

Strategy & Management

Executive Director

Combined Heat and Power Division

Building & Transportation Energy Management Division

Industrial Energy Management Division

Demand Side Management Policy Division

Demand Side

Management Executive Director

Energy Consulting Division

Financial Support Division

Energy Efficiency DivisionEnergy Efficiency Promotion Executive Director

Renewable Portfolio Standard Division

New & Renewable Energy Dissemination Division

New & Renewable Energy Promotion Division

New & Renewable Energy Policy Division

New & Renewable

Energy Center

(Affiliate)

Capacity Building & Training Division

Statistics Analysis Division

Climate Response Division

Office Relocation Unit

Security & Emergency Unit

Climate Response Executive Director

Organizational Structure

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We bring happiness to the people and enhance the national economy by raising energy value into the public

KEMCO raises the recognition of energy value through energy efficiency upgrade and

renewable energy deployment.

KEMCO makes every effort enhancing national economy and welfare by creating highly

value-added businesses and green jobs in energy industry.

Mission and Vision

Core Values

Speciality

Ethicality

Responsibility

Mission

Introduction

Missio

n an

d V

ision

By way of converging current energy demand management upon future new and

renewable energy, KEMCO develops new growth engine for sustainable development

and high-efficient global society.

“Present” means traditional energy use paradigms, and "Future" means new and

renewable energy promotions.

Management Directions

Lively KEMCO

Interactive KEMCO

Challenging KEMCO

Vision

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In 2012, the value of energy import was $184.8 billion which consisted of 35% of total

value of import($519.5 billion). This corresponds to the value of major export items

including petroleum products, semiconductor, car and ship. Furthermore, Korea’s energy

supply is vulnerable to environmental changes and international energy crises, because of

its high dependence on energy imports and low implementation of new and renewable

energy systems, which account for just 3.2% of domestically-produced energy.

* Value of export by items(2012, $100 million): petroleum products(561), semiconductor(504), car(472), etc(combined total

for all exports: $193.5 billion)

[Key Indicators of Domestic Energy Supply]

2009 2010 2011 2012 Growth rate(%)

Energy import(billion $) 91.1 121.7 172.5 184.8 7.1%p

Energy/total import 28.2% 28.6% 32.9% 35.6% 1%p

Import dependency 96.5% 96.5% 96.5% 96% 0.5%p

Dependence on oil(Dependence on the middle east)

30.2%(84.5%)

27.9%(81.8%)

25.9%(87.1%)

25.6%(85.0%)

0.3%p(2.1%p)

Korea’s domestic energy-intensity is higher than other major countries as its industrial

structure is made up of mostly energy-intensive industries such as oil, steel, and cement,

which require large quantities of raw materials. The energy intensity level required to

produce major items is a level equivalent to other developed countries. The transformation

of the industrial structure and improvement of energy intensity are important factors in

enhancing domestic energy efficiency.

• Ratio of energy-intensive industries(2011): Korea 41.7%, Japan 27.0%, US 17.7%

• Ratio of raw materials(naphtha, etc.)(2011): Korea 24.9%, Japan 12.0%, US 8.8%

National Energy-Supply and Demand

Domestic Energy-Efficiency Levels in South Korea

1. Energy Supply and Demand in South Korea

Introduction

As of the end of 2012, the NRE supply totals 8,851ktoe, which makes up 3.18% of the

total primary energy consumption of 278,698ktoe.

Of the total supply of NRE, waste energy contributed the largest proportion with 67.8%,

followed by bio-energy with 15.1% and hydro with 9.2% as well as other types of energy,

such as photovoltaic(PV) with 7.9%.

NRE power generation accounted for 19,498GWh(3.66%) of the total power generation of

532,191GWh in 2012. Of the total power generated by NRE, waste energy contributed the

largest proportion with 60.2%, followed by hydro with 19.8%, PV with 5.7%, and wind

with 5.3%. For PV, power generation rose nearly four times, from 284,315MWh in 2008

to 1,103,227MWh in 2012, while wind more than doubled, from 436,034MWh in 2008 to

912,760MWh in 2012.

New and Renewable Energy Status

[Domestic Energy-Intensity level]

Trend in Energy-Intensity by CountryEnergy-Intensity by country(2011)

Total energy basic unit(2005, constant)Total energy basic unit(PPP)

(TOE/thousand$)

Japan Germany U.S.

0.4

0.3

0.2

0.1

0

0.09 0.10

0.24

0.16

0.11 0.11

0.19 0.16

Korea

<Source: Energy Balances of OECD countries 2013(IEA)>

NRE Share of Supply(2012) NRE Share of Power Generation(2012)

Waste67.77%

Bio 15.08%

Hydro9.21%

Other 7.94%

Solar PV 2.68%

Wind 2.10%

Marine 1.11%

Fuel cell 0.93%

Geothermal 0.74%

Solar Thermal 0.30%

Waste67.77%

Hydro19.81%

Other 9.07%

Solar PV5.86%

Wind 4.68%

Marine 2.39%

Fuel Cell 2.00%

Bio3.27%

<Source: Energy Balances of OECD countries 2013(IEA)>

1980 1990 2000 2011

Korea

U.S.

OECD

Germany

Japan

0.4

0.3

0.2

0.1

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Energ

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Sou

th K

orea

Status of CO2 Emissions by Sector

In 2011, Korea’s total green house gas emissions amounted to 697 millions tons of CO2.

Compared to the year before(2010), this represents an increase of 4.2%.

The energy sector was responsible for 85.7% of national CO2 emissions, and the industrial

sector took up about 9.1%.

295.7

81.5%

6.8%

11.6%

11.4%

8.2%

80.3%

9.1%

5.3%

85.7%

511.3697.7

1990 2000 2011

Transport 14.2%

Residential/Commercial

9.8%

EnergySectorEmissions

etc1.3%

Industry 30.6%

PowerGeneration

30.6%

EnergyIndustrial ProcessAgriculture, Waste

TransportResidential / CommercialPower GenerationIndustry

<Source: 2013 National Greenhouse Gas Inventory Report of Korea>

Introduction

In July 2011, pursuant to Article 25 of the Enforcement Decree of the Framework Act

on Low Carbon, Green Growth, the Korean government announced its goal to reduce

greenhouse gas(GHG) emissions by 30 percent from expected BAU levels by 2020.

* BAU(Business as Usual): Amount of estimated greenhouse gas emissions under the assumption that the trend in such

reduction policies will continue into the future.

The reduction in GHG emissions will be achieved across seven sectors: transport(34.3%),

buildings(26.9%), conversion of energy and electric power(26.7%), public(25.0%),

industry(18.5%), waste(12.3%) and agriculture and fisheries(5.2%). The government plans

to (1) operate a market-friendly GHG reduction system, (2) promote development in science

and technology, (3) generate jobs and new markets by creating new related businesses, and

(4) start a movement to reduce GHG emissions in the daily lives of the people.

2. Sustainable Energy and Climate Change Mitigation Policies

[GHG Emissions Reduction Goal by Sector]

Transport

Buildings

Transformation

Public / Others

Industry

Waste

Agriculture /Fisheries

Nationwide

0 10 20 30

34.3

26.9

26.7

25.0

18.5

12.3

5.2

30.0

2005 Industry Transformation Buildings Transport Public / Others

Waste Agriculture / Fisheries

2020 Business As

Usual(BAU)

2020GHG

EmissionsGoal

-30%

(MtCO2e)

569.0

81.3

64.9

1.51.74.634.245.0

776.1

543.0

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Sustain

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By operating the carbon emission trading system and controlling energy demand, the

government will lower the cost of reducing GHG emissions as much as possible, and by

maintaining the free allocation system of emission credits to sensitive industries*, it will try

and ease the burden on industry.

* Sensitive industries: Highly export-dependent industries with relatively high production costs(ie. petrochemicals, cement

manufacturing, etc.)

It will also provide support through education and consultation to strengthen the capacity

of small and medium-sized enterprises(SMEs), together with various types of industrial

support, such as tax credits for GHG emission reducing technology and financial subsidies.

The government finalized the Second National Energy Basic Plan, which incorporates

its energy policy vision for 2035, in order to achieve early conversion to a highly energy

efficient economic structure, pursue a policy of controlled energy demand, and breakaway

from the past demand-driven supply.

During the period of this plan(2011~2035), total primary energy supply will increase by an

annual average of 1.3%.

• The planned energy mix will provide not only to enable reliable energy supply and

demand, but also to low the country’s dependency on oil and coal and higher the

proportion of clean fuel, such as town gas and new and renewable energy, in order to

respond to climate change, which continues to be a global issue.

Energy sources 2011 2035 Note

Electric power 19.0% 27.2% Control to levels of advanced countries

Oil + Coal 65.8% 52.0% Lower dependency on fossil fuels

Town gas 11.5% 15.4% Increase supply with shale gas

Thermal energy, etc. 3.6% 5.5% Including photovoltaic power, geothermal power, and bio fuels

The target of the plan is to reduce the final energy consumption and electricty demand by

13% and 15% respectively from the BAU scenario by 2035

The government will pursue an energy policy focused on controlling demand so that energy

efficiency can be enhanced in a creative and voluntary manner in the daily lives of the

2035 Energy Vision

Introduction

As a top instrument of national energy policy, the Basic Plan for Rational Energy Utilization

has been revised every 5-years to promote energy efficiency improvements.

The government tries to introduce the advanced regulation and incentive programs to

upgrade energy efficiency policy.

It is high time to set up and tune a smart management basis for reducing energy and GHG

in a way of adopting standardized Energy Management Systems.

Currently there are growing interests in the measures of ICT application such as, Factory

EMS, Building EMS, ESS (Electricity Storage System), LED Lighting, Smart Plug and Smart

Meter.

Energy Efficiency and Conservation Policy

[The 4th Basic Plan for Rational Energy Utilization 2008~2012]

Industry

• Mandatory energy audits for energy-intensive industries• GHG and energy target agreements and operation of EnMS• Support low-interest loans and corporate tax reductions of 10% for the energy efficiency installations

Transport

• Strengthen the fuel efficiency standards for light-duty vehicles and introduction of tire efficiency rating system• Promoting PHEVs and deploying electric vehicles• Expand to use the public traffic system and modal shift measures

Buildings and

Appliances

• Reinforce stringent building codes, promote the energy efficiency buildings certification, smart meters, district cogeneration system• Energy efficiency standards and labeling, rebates for EE products, Phase-out of low-efficient appliances (i.e. incandescent lamps)

people and overall industrial and economic activities.

The proportion of new and renewable energy will be increased to 11% of total energy by

2035 with a focus on the supply of natural energy sources instead of waste.

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IntegratedMarket

RHO(Heat)

RFS(Transport)

RPS(Electricity)

(2012)

Mutual Transaction of Certificates

- Supply 11% of NRE Sources by 2035 -

Mutual Transaction of Certificates

(2016) (2015)

Reinforced Existing Policy

• Installation Subsidy

• NRF Facilities Certification

• Green Home Deployment

• RPS

The Fourth Basic Plan for technology development, application, and deployment of new

and renewable energy is being launched in the first quarter of 2014. The Fourth Basic

Plan aims at facilitating the NRE industry to create a new growth engine for the Korean

economy. NRE deployment targets are set to increase the NRE proportion of the primary

energy mix to 11.0% by 2035. The fundamental directions of the plan are to develop

market competitiveness in the industry, nurture the social acceptance of sustainable energy

sources, enhance technology development for business creation, and expand infrastructure

in order to improve consumer convenience.

New and Renewable Energy Policy

%11NRE will be increased by 2035

Introduction

• The government will expand the mandatory system to use new and renewable energy,

thereby driving the creation of new related markets.

• In 2012, Korea has implemented the RPS(Renewable Portfolio Standard) system that

obligates thirteen major power producers to meet certain portion of power from new

and renewable energy sources. In addition, Korea will adopt an obligatory system for

Renewable Heat Obligation(RHO) and Renewable Fuel Standards.

- The government will pursue the integration of trading markets for new and renewable

energy certificates for power, heating, and transport, while taking into consideration

equity in photovoltaic and non- photovoltaic markets, and increase market size.

• It will provide greater support to the supply of photovoltaic and wind power and energy

storage systems(ESS).

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24 Industry Energy Efficiency

24 Energy Management System(EnMS)

26 Financial Assistance for Investment in Energy Efficiency

27 Promotion of Energy Service Company(ESCO)


29 Building Energy Efficiency Labeling and Certification

29 Building Codes /Building Design Criteria for Energy Saving

30 Performance Evaluation of Eco-friendly Homes

31 Energy Saving Guidelines in Public Institutions


33 Vehicle Fuel Efficiency and Labeling

33 Average Fuel Efficiency(AFE) for Automobile Company

34 Tire Efficiency Standards and Labeling


35 Energy Standards and Labeling

37 High-efficiency Equipment Certification

38 Standby Power Reduction Certification

39 Incentives for End-Users of High-efficiency Electric Products


40 Demand Side Management(DSM) in Energy Utilities

41π Promotion of Integrated Energy Supply

44 Energy Use Consultation for SOC Development

Energy Efficiency

Energy Efficiency

1. Industrial Energy Efficiency

In order to achieve energy saving potentials in industry, KEMCO has developed diverse

energy efficiency programs. Also, mandatory reporting of annual energy use and energy

audits held every five years have been applied to energy intensive industries that consume

more than 2,000 toe per annum. Energy saving opportunities discovered through energy

audits can be eligible for low interest loans or ESCO(Energy Service Company) projects that

plan to implement energy efficient facilities or activities. Energy intensive industries have

been required to set up the next year’s targets for GHG and energy reductions since 2012.

Also, an energy management system has been implemented to check efficiency progress,

with the support of SMEs-being a priority.

KEMCO, with the Ministry of Trade, Industry and Energy has been supporting the

implementation of Energy Management System(EnMS) for industrial energy consumers,

especially in energy intensive industries, and commercial buildings since 2007. An Energy

Management System(EnMS), is an energy-management standard, that is expected

to increase energy efficiency, reduce costs, and improve energy performance, while

continuously and systematically reducing GHG emissions in the industrial sectors.

Industry Energy Efficiency

Energy Management System(EnMS)

Banks

MOTIE

ESCOs,Auditors

KEMCO

Budget Approval,Inspection

Request &ServiceApplication

Lending

ProgramSubsidy,TechnologicalSupport

StatusReport,

ParticipationProposal

Capacity BuildingAssistance

LoanPermission

Report

Registration

Target Managed Companies SMEs

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Ind

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ISO 50001 and the equivalent national standard

The Korean national standard for EnMS, KS A 4000:2007 was created in December 2007.

It was than replaced with KS A ISO 50001:2011 in October 2011 following the adoption

of the international standard ISO 50001:2011 in June 2011. The national standards were

developed by the Korean Agency for Technology and Standards(KATS) with support from

KEMCO and technical experts. ISO 50001, or the equivalent energy management standard,

covers energy management activities, practices, and processes based on the PDCA(Plan-

Do-Check-Act) cycle.

Training courses and technical information

KEMCO has developed two types of EnMS training courses with private sector partners.

One training course is designed for EnMS auditors, and the other is for working-level

staff in companies. It has been providing those two training courses since 2008. The main

subjects covered in the EnMS training courses are certification audit processes, including

EnMS requirements and standards; how to conduct an energy review and set targets;

methods of managing energy efficiency of facilities; data reliability and measuring systems;

the ISO management system; and GHG emissions calculations and auditing skills for

certification. The EnMS website(http://www. kemco.or.kr/EMS) provides information on

related seminars and instructional materials for the public.

KEMCO ran EnMS pilot certification from 2008 to 2011. Twenty companies, including

Samsung Corning Precision Materials, LG Electronics, Hyundai Motors, and Incheon

International Airport, and three commercial buildings participated in this pilot program. By

2011, 13 of the participants were certified by KEMCO and the program was completed in

early 2012. The audit process was developed and operated on the basis of ISO/IEC 17021.

The auditing team consists of experts in the fields of energy assessment, ISO management

system, and monitoring and measuring systems. The KEMCO runs ISO management

system with three companies in 2013.

KEMCO is actively participating in international collaboration through the Global Superior

Energy Performance Partnership(GSEP), and other international programs, in order to

develop sound certification schemes and technical tools to support Energy Management

System. Through such international collaboration, thorough examinations can be made

of measurement and verification protocols, program criteria, energy performance

requirements, and benchmarks for energy efficiency. It also continuously provides support

tools and training courses to industrial energy consumers and commercial building owners.

Energy Efficiency

Financial Assistance for Investment in Energy Efficiency

GSEP is one of the eleven ongoing Clean Energy Ministerial(CEM) initiatives. Its objective is

to significantly cut global energy use by:

• promoting continuous improvements in the energy efficiency of industrial facilities and

commercial buildings

• promoting public private partnerships(PPP) for specific technologies or in energy-intensive

sectors

Among the six working groups within GSEP, the Energy Management Working Group(EMWG)

for EnMS is tasked with facilitating international dialogue to share strategies and best

practices in order to:

(a) help participating governments shape their energy policies;

(b) increase consistency of certification programs among participating nations;

(c) leverage resources to continuously spread energy management systems and improve the

energy efficiency of industrial facilities and buildings.

Financial Assistance for Energy Efficient Facilities

Investment in energy efficient facilities and R&D on energy-conservation technologies

requires significant amounts of funds and may not benefit manufacturers in the short-term.

Furthermore, small and medium enterprises might lack access to bank credit. Recognizing

this, the government provides preferential long-term loans and/or various tax incentives to

encourage voluntary participation in energy efficiency and conservation investments.

The Korean government has provided long-term and low-interest rate loans through the

“Rational Energy Utilization Fund”, along with tax incentives, for investments in energy

efficiency and conservation. KEMCO is in charge of managing and monitoring the fund.

Types of Projects Eligible for Loans

The Rational Energy Utilization Fund provides long-term and low-interest rate loans to

support various types of projects, which include the replacement of obsolete boilers,

investment in heat-pumps, LED lighting systems, waste heat recovery systems, and ESCO

for industrial factories and large buildings.

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[Energy Efficiency Loan Summary 2013]

Project Limit Period Amount

ESCO Investment 30 Amortization over 7 years with a 3-year grace period 120.0

Target Management for GHGs & Energy 15Amortization over 5 years with a

3-year grace period

80

Installation of energy-saving facilities 1

132.5High-efficiency equipment production line0.5

DSM facilities

Total 332.5

The fund is mainly supplied by the government’s budget called “Special Accounts for

Energy and Resources”. In recent years, demand for the fund has been growing rapidly

because of high oil prices, with KEMCO providing KRW 332.5 billion in 2013.

The loans do not cover VATs or the cost of land purchases or construction question not

related to GHG reduction or energy conservation. Loan coverage for large enterprises

is up to 80% of required funds per application, and up to 100% for small and medium

enterprises.

Tax Incentives

The government provides tax incentives for energy efficiency investments. The following

cases of retrofits and installations of facilities and equipment qualified for 10% income tax

credits until December 31, 2013.

The ESCO(Energy Service Company) Program was introduced in Korea in order to extend

energy conservation polices measures, led by the government, to the private sector. Major

project areas of ESCOs include investment in energy-efficient facilities, and maintenance

services and energy management monitoring for such facilities. The ESCO program started

with the registration of four companies in 1992, but the number of registered ESCOs

grew to 223 by 2013. ESCOs focus mainly on high efficiency lighting, waste heat recovery,

heating and cooling systems, and process improvement.

Most ESCO investment projects have taken Shared Savings Contracts. Under the Shared

Savings Contract, ESCOs invest in energy-saving facilities on behalf of an energy consumer

who is unable to replace or improve the existing facilities with more energy efficient ones

due to technical or financial difficulties. ESCOs bear the entire financial burden necessary

for facility investment and provide professional services for energy conservation facilities.

Promotion of Energy Service Company(ESCO)

Ind

ustrial En

ergy Efficien

cy

Energy Efficiency

The reimbursement of investments made by ESCOs comes from the energy cost savings.

The combination of the advantages of the Shared Savings Model with those of the

Guaranteed Savings Model was introduced as a New Shared Savings Model in February

2011.

During the introduction stage of the ESCO program from 1993 to 1997, the average

annual investment amounted to KRW 3.7 billion. Thanks to strong government support,

annual investment has been increasing since 1998. In 2013, the government had supported

KRW 309.7 billion.

Investment by ESCOs had been limited to combined heat and power(CHP) facilities and

high efficiency lighting systems until 1997, but from 1998 it diversified to include such areas

as waste heat recovery facilities, cooling and heating systems, and process improvement.

The government’s provision of low interest loans has produced a steady increase in ESCO

investment. In an attempt to ease the burden on ESCOs, the government also introduced

financial support programs, such as mortgages and factoring systems, and provides tax

credits for energy consumers and ESCOs, who install energy-saving facilities under the

Restriction of Special Taxation Act.

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The Building Energy Efficiency Labeling and Certification encourages energy-efficiency

in new apartment and office buildings. The program was launched for new apartment

buildings in 2001 and has been expanded to include new office buildings. Finally, this

program was applied to all types of buildings, including existing buildings, in 2013. A total

of 1,113 apartment complexes, 797,660 households, and 400 office buildings have been

certified as highly energy-efficient from 2001 to 2013. The government offers incentives

for certified buildings, such as easing building regulations and reducing acquisition and

property taxes.

[Summary of Building Energy Efficiency Labeling Certification 2008-2013]

The Ministry of Land, Infrastructure, and Transport(MLIT) developed Korea's building energy

codes. Local government officials ensure that the codes are followed as part of the building

permit process for new buildings. In order to obtain a building permit, the property owner

must fill out an energy-saving worksheet and submit it to the local government office.

The worksheet must be signed by three licensed professionals: an architect, a mechanical

engineer, and an electrical engineer. The energy-saving worksheet is reviewed by an energy

specialized agency* at the request of the permit authority.

* Designated energy specialized agencies: Korea Energy Management Corporation, Korea Infrastructure Safety Corporation,

Korea Institute of Education Environment, and Korea Appraisal Board

2. Building Energy Efficiency

Building Energy Efficiency Labeling and Certification

Building Codes/ Building Design Criteria for Energy Conservation

400

107

360

257,357

63

42,977

127

98,702

83

72,852

141

105,982

212

144,416

69

132 92

2009 2010 20112008 2012 2013 Total

1,113

797,660

Residential buildings

No. of apt complexes

No. of households

Non-residential buildings

Bu

ildin

g En

ergy Efficien

cy

Energy Efficiency

[Building Permit process]

Fill out and submit an energy-saving

worksheet

Property owner

Self Review or request of the

permit authority

Local government

office

Review of energy-saving

worksheet

Energy specialized agencies

Permit approval

Local government

office

[Building Criteria for Energy Conservation]

Building type Application categories

Non-Residence*Large size(3000㎡ and larger)

Small size(500㎡ ~ 3000㎡)

Residence**

Housing type 1(500㎡ and larger): housing with individual / central / district heating system

Housing type 2(Housing type 1 + 500㎡ and larger): housing with central air conditioning system

* Residence: Apartment / Condominium building

* Non-Residence: Hotel / Hospital / Dormitory / Institute / Office Building / Retail store / Theater / Religious building etc.

The design standards are divided into four main sections: “construction design”, “machinery

design”, “electric facility design” and “renewable energy facility design”. Each section

defines “mandatory items” and “recommended items”. Each building must satisfy all

mandatory items and get at least 65 points on the Energy Performance Index(EPI) for the

recommended items(74 points on the EPI for public buildings).

The Performance Evaluation of Eco-friendly Homes was developed by the Ministry of Land,

Infrastructure, and Transport. This is a mandatory regulation for the construction of eco-

friendly homes. Eco-friendly housing construction based upon performance standards and

construction standards must the design requirements. The regulation more strictly controls

the construction of side walls, exterior wall and windows. Also, it contains mandatory

elements covering: airtight windows and doors, high efficiency appliances(highest energy

efficiency rating), automatic energy management systems, and so on.

Performance Evaluation of Eco-friendly Homes

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AreaOver 60m2 Below 60m2

Performance standard Reducing total energy consumption by 30% or more

U-value of windows: 1.2 W/㎡ or belowU-value of walls: 0.25 W/㎡ or below

COP of boiler: 87% or more

Construction standard(Mid-land, direct to outside)

Reducing total energy consumption by 25% or more

Review standard

These standards have been enforced since 2009. Five agencies(KEMCO, LH, KICT, KISTEC,

and KAB) determine whether the standard has been applied. They reviewed a total of 1,144

apartment complexes and 532,101 households from 2009 to 2013.

[Summary of Standards and Performance of Eco-friendly Homes 2009-2013]

Section 2009 2010 2011 2012 2013 Total

No. of apartment complexes 73 239 342 301 189 1,144

No of households 58,503 114,428 138,104 138,929 82,137 532,101

Although energy consumption in the public sector is relatively low(2.3%), public institutions

have taken the lead in efforts to save energy nationwide.

[Final Energy Consumption by Sector in 2012]

Energy Conservation Regulation for Public Organizations and Institutions

Bu

ildin

g En

ergy Efficien

cy

Industry128.2(61.6%)

Transportation37.2(17.9%)

Construction397.9(18.2%)

Public, Etc.4.9(2.3%)

Total

(208.1)

million of toe, %

Energy Efficiency

According to the “Regulation for Rational Energy Use in Public Institutions,” all institutions

should promote energy conservation by means of:

• Mandatory acquisition of the building energy efficiency certificates for new buildings

• Conduct mandatory energy audits and actively promote ESCO program

• Mandate installation of new and renewable facilites and adoption of high-efficiency

appliances, 1st grade energy efficiency labeled product

[Mandate use of LED lightings by yearly rate]

• Conform with reference temperature in air conditioning zone

• Mandate use of Energy Boy labeled products

• Perchase mandatory of light-duty and eco-friendly vehicles and run a Car-Free Day system

to save transportation energy

2014 2015 20172013Section 2020

30%

40% 50%

45% 60%

60% 80%

100%

100%

New Building

(rate)

Existing Building

(rate)

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The Average Fuel Efficiency requires vehicle manufacturers to comply with the standard

fuel efficiency set by the Korean government. If the manufacturers fail to meet the AFE

standard, the Korean government can fine on them based on Energy use Rationalization

Act to improve their fuel efficiency. The AFE standard is shown below.

The average fuel efficiency of passenger cars sold in 2012 was 14.16km/l, increased by

Average Fuel Efficiency(AFE) for AutomobileCompany

3. Transport Energy Efficiency

The Fuel Efficiency and Labeling promotes the development of fuel efficient vehicles and

encourages consumers to purchase them by providing information on fuel efficiency and

grade.

The program covers light-duty vehicles, vans with a capacity of 15 passengers or less, and

small trucks with total weight of less than 3.5 tons. Vehicle manufacturers attach labels

to vehicles with information on fuel efficiency and grade on the back or side windows,

to ensure that consumers are better informed about the fuel efficiency of vehicles.

Furthermore, manufacturers are required to indicate the vehicle’s fuel efficiency and grade,

when they advertise in newspapers, magazines, and on websites.

Since 2012, fuel efficiency values for both city driving and highway driving have been

indicated with combined fuel efficiency. The fuel efficiency grading system applies uniform

criteria that do not depend on the size of the car. The most efficient vehicles are labeled

Grade1 and the least efficient vehicles are rated Grade5. CO2 emissions(g/km) are also

indicated so that consumers can environmental integrity when buying a vehicle.

[Fuel Efficiency Labels]

Vehicle Fuel Efficiency and Labeling

Transp

ort En

ergy Efficien

cy

Energy Efficiency

5.6% from 2011. This rise in fuel efficiency was due to the increased sales of sub-compact

and compact cars, resulting from increases in oil prices and continuous technological

advancements.

[AFE Standard]

0 5 10 15 20

2012 to 2015 All Vehicle

17km/l, 140g/km(CO2)

[Annual Fuel Efficiency]

2005 20092006 20102007 20112008 2012

13

14

12

11

10

KEMCO and Ministry of Trade, Industry, and Energy established the criteria for fuel efficiency

and greenhouse gas emissions and plan to phase in standards for fuel efficiency(17km/l),

and CO2 emissions(140g/km) by 2015 as well as create standards for after 2016.

Tire accounts for 4% to 7% of automotive fuel consumption. Therefore, energy efficiency

standards and measures for tires are necessary to effectively reduce energy consumption in

the transportation sector.

KEMCO is implementing the Tire Efficiency Standards and Labeling so that we can promote

the development, sales, and purchase of low-rolling resistance tires. Under this program,

tire manufacturers are required to indicate the efficiency of their tires. KEMCO is also

conducting market research and providing consumers with information on tire efficiency.

Indicating the tire efficiency used to be voluntary for tire manufacturers and importers from

2011, but since December, 2012, they have been required to indicate tire-efficiency. From

(km/l)

Tire Efficiency Standards and Labeling

14.16 5.6km/l, %

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Korea’s Energy Efficiency Programs for the promotion of energy-efficient products consist

of the Energy Standards and Labeling, the High-efficiency Equipment Certification and the

E-stanby.

Under the mandatory Energy Standards and Labeling Program, manufacturers and

importers report the energy efficiency of target products to KEMCO and attach an Energy

Efficiency Grade Label(indicating a grade from 1 to 5) on their products. Products that

fail to meet the required Minimum Energy Performance Standards(MEPS) cannot be sold

in Korea. KEMCO applies the Energy Efficiency Grade Label to 24 items and the Energy

Efficiency Label to 11 items, including ballasts for fluorescent lamps, three-phase induction

motors, adapters and chargers, transformers, electric fan heaters, electric stoves, electric

heating pads, electrically heated water mattresses, electric heating boards, electric beds,

and electric radiators.

4. Product Energy Efficiency

Energy Standards and Labeling

June 1, 2014, the program will be expanded to cover tires on small trucks as well. Prod

uct En

ergy Efficien

cy

Energy Efficiency

No. Products EE Label Grade Label

1 Refrigerators ◦ ◦

2 Freezers ◦ ◦

3 Kimchi Refrigerators ◦ ◦

4 Air Conditioners ◦ ◦

5 Washing Machines ◦ ◦

6 Drum Washing Machines ◦ ◦

7 Dish Washers ◦ ◦

8 Dish Driers ◦ ◦

9 Hot and Cold Water Dispensers ◦ ◦

10 Rice Cookers ◦ ◦

11 Vacuum Cleaners ◦ ◦

12 Electric Fans ◦ ◦

13 Air Cleaners ◦ ◦

14 Incandescent Lamps ◦ ◦

15 Fluorescent Lamps ◦ ◦

16 Ballasts for Fluorescent Lamps ◦

17 Compact Fluorescent Lamps ◦ ◦

18 Three-Phase Induction Motors ◦

No. Products EE Label Grade Label

1 Domestic Gas Boilers ◦ ◦

2 Adapters and Chargers ◦

3 Electric Driven Heat Pumps ◦ ◦

4 Commercial Refrigerators ◦ ◦

5 Gas Water Heaters ◦ ◦

6 Transformers ◦

7 Window Sets ◦ ◦

8 Television Sets ◦ ◦

9 Electric Fan Heaters ◦

10 Electric Stoves ◦

11 Multi Heat Pump Systems ◦ ◦

12 Dehumidifiers ◦ ◦

13 Electric Heating Pads ◦

14 Electrically Heated Water Mattresses ◦

15 Electrical Heating Boards ◦

16 Electric Beds ◦

17 Electric Radiators ◦

[Target Products of the Energy Standards and Labeling]

Energy Efficiency Grade Label Energy Efficiency Label

Improving the Energy Efficiency Grade Label and Indicating CO2 Emissions and

Annual Energy Expenses

KEMCO developed new labels in 2007 to satisfy consumers’ needs and integrate

temporary labels, and they were adopted in 2008. The new labels are designed to be more

aesthetically pleasing as well as more consumer-friendly.

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High-efficiency Equipment Certification

Prod

uct En

ergy Efficien

cy

Energy-efficiency grade labels not only indicates energy consumption and energy efficiency

values, but also contribute to raising the energy efficiency of households and industrial

equipment. In particular, the labels will pave the way for the government to establish policy

guidelines and strategies as it joins various international efforts, such as GHG emissions

trading.

[Products Indicate CO2 Emissions and Energy Cost]

Type Target products Date

Displaying CO2 Emissions

(29 products)

Automobiles From 1 Aug. 2008

Refrigerators, Kimchi Refrigerators, Washing Machines, Drum Washing Machines, Dish Dryers, Vacuum Cleaners, Electric Fans, Air Cleaners, Incandescent Lamps, Compact Fluorescent Lamps

From 1 Jul. 2009

Freezers, Air-Conditioners, Dish Washers, Electrical Cooler and Heater for Drinking-Water Storages, Rice Cookers, Fluorescent Lamps, Three-Phase Induction Motors, Commercial Refrigerators

From 1 Jan. 2010

Electric Fan Heaters, Electric Stoves From 15 Dec. 2011

Electric Heating Pads, Electrically Heated Water Mats, Electric Heating Boards, Electric Beds, Electric Radiators From 27 Dec. 2011

Multi Heat Pump Systems From 1 Apr. 2012

Television Sets, Dehumidifiers From 1 Jul. 2012

Displaying Energy Cost

(24 products)

Refrigerators, Freezers, Kimchi Refrigerators, Air-Conditioners, Washing Machines, Horizontal Drum Washing Machines, Dish Washers, Dish Dryers, Rice Cookers, Vacuum Cleaners, Electric Fans, Air Cleaners, Commercial Refrigerators

From 1 Jul. 2010

Electric Fan Heaters, Electric Stoves From 15 Dec. 2011

Electric Heating Pads, Electrically Heated Water Mattresses, Electrical Heating Boards, Electric Beds, Electric Radiators From 27 Dec. 2011

Electrical Cooler And Heater For Drinking-Water Storages, Three-Phase Induction Motors From 1 Jan. 2012

Television Sets, Dehumidifiers From 1 Jul. 2012

The High-Efficiency Equipment Certification is a voluntary program operated by MOTIE and

KEMCO and mandated by the Rational Energy Utilization Act, and the Regulation on the

Promotion and Dissemination of High-efficiency Equipment.

The purpose of the High-efficiency Equipment Certification is to single out products

that perform above certain standards. Certified products may bear the High-efficiency

Equipment Label after acquiring High-Efficiency Equipment certificates issued by KEMCO.

Energy Efficiency

[Target Products of the High-efficiency Equipment Certification]

Classification Items Identification

High-efficiency Equipment

Certification (45 items)

· Sensor lighting equipment· Heat recovery ventilators· Industrial gas boilers· Pumps· Centrifugal screw water coolers· Uninterruptible power supply systems· Electronic bllasts for metal halide lamps· Electronic ballasts for natrium lamps· Inverters· Auto thermostatic valves for heating· LED ttaffic lights· Multi-function type switchgear systems· Direct-fired absorption chiller-heaters· Single-phase induction motors· Ventilation fans· Centrifugal blowers· Motor pumps for aeration· Metal-halide lamps· Reflectors for HID lamps· Oil boilers· Industrial oil boilers· Regenerative burner· Turbo blower· LED guard lighting equipments

· Thermo hygrostat· LED lamps(internal converter)· LED lamps(external converter)· General LED lighting equipments· LED guard lighting equipments· LED sensor lighting equipments· Converters for LED lighting modules· PLS equipments· Doors· UCD lamp· LED street lights· LED floodlight· LED tunnel luminaires· Tublar LED lamps using external converter· Gas heat pump· Energy storage systems· Demand controllers· LED module for channel letter signs· Adhesive films for glazings· Gas vaccum boilers· LED lamps for Fluorescent Lamp Retrofit-Internal comverter type

High-efficiency Equipment Label

High-efficiency Equipment Certificate

The e-standby aims to promote the widespread use of energy-saving products that reduce

standby power consumption. The products that meet the energy-saving standards

presented by the government are allowed to bear the Energy Saving Label(“Energy Boy”).

This Certification is intended for 22 office appliances and home electronic appliances.

Energy Saving Label Standby Warning Label

Standby Power Reduction Certification

Mandatory Standby Power Warning Labels

The e-standby program's “1W limitation” has been in effect since 2005, with the “Standby

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Incentives for End-users of High-efficiency Electric Products

Power Warning Label” becoming a part of The e-standby program on August 28, 2008. Every

domestic manufacturer and importer of products covered by the Standby Warning Label

Program must report their products’ standby power usage to KEMCO after product testing

and attach the Standby Power Warning Label on products that fail to meet the standards.

In order to support to the high-efficiency electric product market, KEMCO manages many

kinds of incentires to end-uses.

High-efficiency Electric Products

KEPCO(Korea Electric Power Corporation) offers three kinds of incentives to end-users.

These programs cover high-efficiency electric products LED lighting, inverters, electric

transformers, and coolers). Registration and application for the incentives can be made at

the homepage of KEPCO(www.kepco.co.kr/dsm).

Incentives for End-users of High-efficiency Lighting(LED) for vulnerable social group

In order to promote the installation of high-efficiency lighting, local governments provides

rebates to low-income and social welfare facilities that use low-efficiency lighting. KEMCO

evaluates this program and manages it.

Load management Products

In order to be stable electric power supply, various companies (KEPCO, KOGAS, KEMCO)

offers incentive to end-users. This program covers demand controller, ice storage system,

gas cooling, etc.

Building a Foundation of Electric Efficiency Infra Structure

KEMCO coordinates and handles electric efficiency infrastructure to set road-map of

incentive program and direction efficiently from 2014.

Prod

uct En

ergy Efficien

cy

Energy Efficiency

[DSM Investment Budget of Energy Suppliers]

39,352

1,284,225

146,800

94,488

8,114

105,820

88,535

6,516

111,296

84,674

84,025

102,103

91,027

127,567

20092007 20102008 2011 Total

KEPCO

KOGAS

KDHC

Total

644,907

599,966

8,5415,605

4,855

249,402200,871

227,135191,733

200,825

(Unit: KRW 100million)

Under the Rational Energy Utilization Act, energy suppliers designated by Presidential

Decree* shall establish and implement annual demand-side management investment plans

to increase energy efficiency in production, transformation, transportation, storage and

usage of energy and reduce demand and greenhouse gas emissions. Energy utilities shall

submit their demand-side management investment plans, as well as any modifications of

the plans, to the Ministery of Trade, Industry, and Energy.

* Energy suppliers designated by Presidential Decree: Korea Electric Power Corporation, Korea Gas Corporation, Korea

District Heat Corporation

[History of Energy Utility DSM]

Date History

Jan. 1995Energy Utility DSM investment plan first established(Rational Energy Utilization Act) - KEPCO(electricity),KOGAS(gas),KDHC(heat) were appointed to establish DSM investment plans

Jun. 2001 Electricity DSM began to be conducted separately by Electricity Industry Basis Fund

Sep. 2002 KEPCO was excluded from DSM investment plans after privatization

Aug. 2008 KEPCO was re-designated as an entity to establish DSM investment plans

5. Integrated Energy Demand Management

Demand-side Management(DSM) in Energy Utilities

KEMCO, which assists in the administration of energy utility DSM, evaluates reports on

plans and results of energy utility DSM, and organizes the DSM committee. KEMCO

continuously to encourage energy utilities to invest in DSM programs.

Integrated Energy Systems(IES)

Industrial Complex Integrated Energy(formerly known as “Industrial Complex Combined

Heat and Power”) was first introduced at the Ulsan petro-chemical industrial complex in

1972. The District Heating and Cooling(DHC) system was first introduced to Korea in 1983

in the Mokdong district of Seoul.

• Unlike relatively small DHC projects in other countries, the Mokdong Project provides

services to a massive residential area, attaining huge economies of scale.

Integrated Energy Supply Business

An integrated energy supply business is a combined heat and power(CHP) or large-scale

heat generation facility equipped with co-generation equipment or pollution-prevention

facilities that supplies generated energy(heat or heat/electricity) to multiple users such as

apartment buildings, business and commercial facilities and industrial complexes.

• The main focus of the IES project is the public interest rather than profitability.

• After obtaining government permission and completing registration, any business can

participate as an IES supplier.

Integrated Energy Supply(IES) business can be divided into:

• District Heating and Cooling(DHC) Energy Supply

• Industrial Complex Integrated Energy Supply

• Community Energy Systems(CES)

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Integ

rated En

ergy D

eman

d M

anag

emen

t

Promotion of Integrated Energy Supply

[Structure of Energy Suppliers DSM Program]

Ministry of Trade, Industry

and Energy

KEMCO(Project

Management, Evaluation,

etc)

KEPCO

KOGAS(Whole sale)

KDHC

Electricity

Gas

Meat

Third Party

Energy Efficiency

Integrated Energy Supply Process

Reviewing Integrated Energy Supply Technology and Operating Committees

Benefits of Integrated Energy Supply

The benefits of IES are as follows:

• Energy conservation: Compared with existing methods(heat-only boiler, steam power

generation), the co-generation system reduces energy consumption by improving energy

utilization efficiency up to 30%.

• Air pollutant(SOx, NOx, and dust) and CO2 emissions reduction: IES helps protect the

environment by reducing fuel use and installing anti-pollution facilities.

Reviewing Engineering

Plans

Technology Advisory

Committee

Advisory Committee for

DistrictSelection

ReviewingIES Project

Plans

Selecting an Operating

Agent

Feasibility Study for

Integrated Energy Supply

Project

26When Using Intergrated Energy Supply

CO2 Reduction %

30Air pollutants Reduction %

[Enviromented Benefits of Integrated Energy Supply]

Air pollutantsReduction 30%

SOX 36,900

SOX 25,178

NOX 54,729NOX 40,248

Dust 6,007 Dust 3,069

Existing Methods CHP

CO2 7,773,122

CO2 5,770,712

Existing Methods CHP

CO2 Reduction26%

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Status of Integrated Energy Supply

As of the end of 2012, 30 district heating businesses were providing heating services

to 2.22million households in 55 districts, representing approximately 14.5% of total

households. This project is different from those in other countries where a small number

of suppliers provide services to massive areas. As of the end of 2012, 25 companies were

suppling heat and power to 27 industrial complexes.

[Distribution of Integrated Energy to Households]

2500

2000

1500

1000

500

0

2000 20011998 20021999 2003 2004 2005 2006 2007 2008 2009 2010 2011

Households(Thousand)

Integ

rated En

ergy D

eman

d M

anag

emen

t

With the Integrated Energy Supply Project implemented on a massive scale, the heating

and cooling needs of residential areas has been addressed in an environmentally friendly

way. In addition, manufacturers in industrial complexes have been able to increase their

competitiveness by lowering production costs.

To promote IES, diverse measures have been taken, including the abolition of fuel

regulations for IES, diversifying business by utilizing heat produced from the incineration of

waste, and the expansion of the direct sale of electricity.

Energy Efficiency

Consultation Subject Categories

• Business: Total of eight-business categories, including urban development, industrial

complex development, energy development, railroad construction development, harbor

construction development, airport construction and development, tourism complex

construction development, development facilitation

• Facility: Buildings and facilities(e.g. plants) over a certain size

Request review

If incompleted

Recommendation or Request

Complete Plan

A Project Superintendent

Request Supplementation

Submit Plan

MOTIE

Pre-Review and Evaluation

KEMCO (Evaluation Committee)

Submit Action Plan and Related Document for

Facility Design

MOTIE

Perform Post Management

KEMCO

Notification of Consultation Results

Public or Private Project Superintendent

Start Construction

[Consultation Procedure]

Energy UseConsultation for SOC Development

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Achievements of the Consultation System

Achievements in 2013

- 115 consultations were completed(86 new applications, 29 modifications of existing ones)

in four business categories

[Achievements of the Consultation System]

ClassificationLand development Energy

development Social infrastructure FacilityTotal

Urban Tourism Industry Energy Railroad Harbor Airport Facility

Completed consultation(no. case) 21 4 37 6 3 5 0 39 115

Planned amountof energy use

(1,000 toe/year)2,749 32 7,190 2,836 32 12 0 2,760 15,612

Savings potential(1,000 toe/year) 904 9 1,009 251 4 1 0 184 2,364

Expected savings(%) 32.9 28.1 14.0 8.9 12.5 8.3 0 6.7 15.1

* Categories have been changed as of 2012 as follows

- Land development: Urban, Tourism, Industrial complex

- Energy development: Energy

- Social infrastructure: Railroad, Harbor, Airport

- Facility: Facility(Buildings and Plants, etc.)

[Achievements of Energy Use Plans 1993~2013]

YearClassification

1993~2005

2006 2007 2008 2009 2010 2011 2012 2013 Total

Completed consultation(no. case) 426 67 97 91 102 129 118 128 115 1273

Planned amountof energy use

(1,000 toe/year)59,860 10,882 13,170 9,859 11,890 19,813 24,108 26,870 15,612 192,063

Savings potential(1,000 toe/year) 6,132 1,265 2,042 1,440 1,942 3,513 3,051 2,624 2,364 24,373

Expected savings(%) 9.1 11.6 15.5 14.6 16.3 17.7 12.7 9.8 15.1 12.7

Integ

rated En

ergy D

eman

d M

anag

emen

t


48 GHG and Energy Target Management Scheme

49 Korea Voluntary Emission Reduction(KVER)

51 Carbon Neutral Program

51 Validation and Verification of GHG Emission Reduction

53 Energy and GHG Audit



Industry and Power generation Sectors

The GHG(Greenhouse Gas) and Energy Target Management Scheme(“Target Management

Scheme”) was introduced in January 2011 with the enactment of the Framework Act on

Low Carbon, Green Growth in order to achieve the national target of a 30% reduction of

GHG emissions from the BAU(Business as Usual) scenario by 2020.

First, enterprises which emit GHG and consume energy above the standard levels are

subject to the government’s “Target Management Scheme”. Under the Scheme, the

government and subject entities set combined targets for the reduction of GHG emissions and

energy conservation. Finally, the government imposes a fine if the subject enterprise fails to

achieve its target.

In 2013, the total number of subject entities expected to achieve their targets for 2015 in

the industrial and power generation sectors was 475.

In September 2013, KEMCO’s government negotiator agreed on targets with the 426

controlled entities in the industrial and power generation sectors, which were designated

in 2012. The combined target allowances of controlled entities for 2014 are 578 millions of

tons of CO2 emissions and 7,674 thousands of TJ of energy use.

millions of tons of CO2

thousands of TJ

426

578

7,674

Subject entities of the Industry and power generation sector in 2013

emission use allowances in the Industry and power generation sector in 2013

energy use allowances in the Industry and power generation sector in 2014

GHG and Energy Target Management Scheme


[Result of 2014 Targets in the Industrial and Power Generation Sectors]

Target

estimation(7,884)

estimation(7,674)

210(2.74%)

Target

estimation(593.8)

estimation(578.1)

15.7(2.64%)

GHG(millions of tons of CO2) Energy(thousands of TJ)

GH

G M

itigatio

n in

Ind

ustry an

d B

uild

ing

sK

EM

CO


48

49

[Criteria for Designating Subject Entities]

by Dec 31, 2011 from Jan 1, 2012 from Jan 1, 2014

Corporation Business unit Corporation Business unit Corporation Business unit

GHG(tCO2) 125,000 25,000 87,500 20,000 50,000 15,000

Energy(TJ) 500 100 350 90 200 80

* The energy specialized agencies: Korea Energy Management Corporation, Korea Infrastructure Safety Corporation, Korea

Institute of Education Environment, Korea Appraisal Board

Building Sectors

Ministry of Land, Infrastructure and Transport manages the Building Energy Target Setting(BETS),

a joint program involving the government and building owners.

The purpose of BETS is to reduce energy consumption and mitigate greenhouse gas emissions,

with 51 companies having been designated under the program’s management.

Buildings that emit GHG or consume energy above a certain level are mandated to participate,

and they must submit their specific plans to meet energy-conservation and GHG emissions

reduction targets.

Under this program, building owners set their own targets and try to achieve them. The

government will assist in their efforts to achieve the targets by providing incentives and

imposing penalties.

Korean Voluntary Emissions Reduction(KVER)

[Framework of the Korean Emissions Reduction Registry Program]

MOTIE

GHG Registration Center(KEMCO)

Reduction ProjectImplementor(Company)

Verification Body of

Reduction Project

Request for Certification of Reduction Project

PDD, Vaildation, Monitoring Report Verification

Application for Registration of Reduction Project

Registration and Management of GHG Emission records Issuance of Emission Reduction Credit

Support the drafting of PDDand Pre-review of Validation of Reduction Project

GHG-SpecializedConsulting Institution

(If necessary)

51Subject entities of the Building Sector in 2013

millions of tons of CO24,119Emmision use allowances in the Building Sector in 2013


Eligibility Criteria

• Reduction amount: more than 100 tCO2 GHG emissions annually

• Project start date: should fall within one year from the date of registration request

• Eligible projects :

- GHG reduction projects through improved energy efficiency

- Renewable energy projects

- Other GHG emission-reduction projects approved by the government

Incentives

The government subsidizes project development:

- PDD(Project Design Document) completion, including methodology development: USD 2,500 to

USD 4,200 per project

- Verification cost for SME applicants: USD 2,500 per year

- The government also purchases KCERs(1KCER = 1tCO2 reduction) from certified projects to promote

company participation and voluntary GHG emissions reduction efforts

- Purchase price: variable(about USD 10/tCO2 in 2012)

- After purchasing KCERs, the ownership of project credits is passed onto the government

Status of KVER

As of December 2013, 470 projects were registered with the program in areas such

as energy efficiency improvement, new and renewable energy, and industrial process

innovation. Each registered project can create annual carbon credits for seven years. So

far, 980 projects have passed the annual monitoring and verification processes and been

certified, and KCERs equal to about 14 million tCO2 have been issued.

[Status of Projects under KVER]

Year 2008 2009 2010 2011 2012 2013 Total

Registration

Number of Registered Projects 86 66 44 24 75 72 470

Expected Emission Reduction(tCO2)

1,262,922 1,269,228 483,544 463,691 130,228 54,860 5,722,765

Certification

Number of Certified Projects 88 161 204 226 172 91 980

Certified Quantity(tCO2)

1,927,043 2,720,353 3,199,545 3,333,095 2,396,963 173,352 14,691,658

Government Purchase

Purchase Unit Price(KRW) 4,677 4,863 5,163 4,719 12,092 11,286 5,196

Purchase Quantity 1,576,959 2,229,080 2,224,277 439,837 145,072 171,139 7,726,966

470The number of registered KVER projects

millions of tons of CO2980The number of certified KVER projects

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The Carbon Neutral Program was introduced in 2008 to raise public awareness and

encourage voluntary participation in GHG mitigation activities. Everyone, including

individuals, organizations, and businesses, can join and participate in the program. Those

who wish to participate may submit an application form to the Korea Energy Management

Corporation (zeroco2.kemco.or.kr) and then, as part of the program, are encouraged to take

steps to reduce GHG emissions in their daily lives, by turning off lights when not needed,

keeping the thermostat set at an appropriate level, and using public transportation, among

others. Carbon offset activities, including forestation projects and new and renewable energy

implementation, are also options to achieve carbon mitigation. After completing their carbon

offset activities, program participants may submit reports of their results to KEMCO, which

will then review the results and issue certificates to confirm their participation in the program.

Two Types of Carbon Offset Activities

Carbon Neutral Program

[The Carbon Neutral Program Status and Progress]

2008 2009 2010 2011 2012 2013 Total

Number of certificates issued 30 53 351 1,074 1,347 7,192 10,047

Equivalent reduction in CO2(tCO2) 3,965 3,325 9,981 6,093 20,376 42,900 86,640

Investment in carbon sink projects 15,000 KRW/tCO2

Investment in NRE systems15,000 KRW/tCO2

Validation and Verification of GHG Emission Reduction

CDM Certification Service

CDM(Clean Development Mechanism), established under Article 12 of the Kyoto Protocol,

allows GHG reduction projects in non-Annex I parties to create Certified Emission

Reductions(CERs), which can be used towards the implementation of GHG reduction

commitments of Annex I parties under the Kyoto Protocol.

KEMCO has been accredited as a DOE(Designated Operational Entity) by the UNFCCC since

2005, and established the GHG Certification Office in January 2006 as an independent unit


<Source: UNFCCC website(http://cdm.unfccc.int) Feb. 4, 2014>

14 32814

90

7

115 3

13 13 10

23

1 49

20092006 20102007 20112008 2012 2013 Total

15 3

13

Validation

Verification

Total

69

21

Validation

CDM Operational Entity(GHG Certification Office)

CDM Operational Entity(GHG Certification Office)

MonitoringProject Activity Verification CERs IssuanceMaking

The PDD

[Validation and Verification of GHG Emission Reduction]

with full control over the operation of the validation and verification systems in order to

ensure the reliability and impartiality of the CDM project validation and verification services.

With over 30 years of successful consultations for a wide range of industrial facilities,

KEMCO is ready to play a leading role in providing certification services to GHG projects

around the world, such as CDM, GS, VCS, KVER, and GHG Inventory.

To proceed with the CDM project, a Project Design Document(PDD) should be completed in

accordance with the form and criteria given in the CDM Executive Board(CDM-EB) template.

Then, the PDD must be submitted to a DOE(such as the KEMCO GHG Certification Office)

for validation. If it is confirmed that the project meets the CDM registration requirements,

the KEMCO GHG Certification Office can request the CDM Executive Board to proceed

with the project registration.

CDM projects registered by the CDM-EB are eligible to request the issuance of CERs

by submitting a monitoring report to the KEMCO GHG Certification Office. When the

verification process is successfully completed, the KEMCO GHG Certification Office can

make a request to the Executive Board for the issuance of CERs. Below is the number of

validation and verification cases conducted by KEMCO.

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Based on its accumulated experience and achievements, KEMCO is planning to extend the

scope of its certification services to cover voluntary carbon markets, such as the Voluntary

Carbon Standard(VCS) and Gold Standard(GS). Also, KEMCO will continue training regional

experts and investment analysts for CDM projects to improve the certification process.

[Validation of Mongolia CDM project] [Verification of KVER project]

[Approval and Certification Companies with Levels /GHG Inventory Investigation]

10984

31

46 49

21 5 6

6 7

23 26

2009 20102007 20112008 2012 Total

Approval/Certification Results 155

Investigation Results

(no. of companies)

Energy-intensive companies whose annual energy consumption is over 2,000 TOE are

required to submit energy audit reports to KEMCO, pursuant to Article 32 of the Rational

Energy Utilization Act.

Small businesses consuming less than 10,000 TOE of energy annually will have 70% of

their energy audit fees subsidized by the government.

An energy audit is an essential tool in the effective control of energy costs. The audit

includes detailed evaluations of a firm’s energy efficiency, technical and economical analyses

of its energy facilities, and recommendations for energy conservation measures, which

include changes in operating practices or equipment, in order to reduce energy costs.

Energy and GHG Audit


MOTIE

KEMCO

EIC EAC 2 Application

1Notice

3 Audit contract & Notice of schedule

4 Field Audit

5 Documentation

and Report

6 Post-audit Activities

Report

Report

3

• MOTIE : Ministry of Trade, Industry, and Energy

• KEMCO: Korea Energy Management Corporation

• EIC: Energy-Intensive Company

• EAC: Energy Audit Company

KEMCO notifies energy-intensive companies that are subject to energy audits of the application requirements by the end of August prior to the year the audit is to be undertaken.

STEP 1

Notification

A company subject to an energy audit must file for audit to an energy audit company one month before the end of its audit period.

STEP 2

Application

Three days prior to the commencement of inspections, the audit company notifies the applicant company of the audit schedule, scope of work.

STEP 3

Audit Contract & Schedule Notification

The audit company inspects the facilities, processes, and operating conditions of the company to determine energy-loss factors and areas for improvement.

STEP 4

Field Audit

The audit company submits a report on areas for improvement and a feasibility study to the company.

STEP 5

Documentation and Report

The audit company provides the applicant company with technical advice and support to implement its proposals.

STEP 6

Post-Audit Activities

Energy Audit Workflow

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subject563were carried out audit by energyaudit agencies

times32.5Cost-effectiveness of energy audit(Energy savings potential/Aduit fees)

317,711,000of energy saving potential

USD

Energy Audit by Energy Audit Companies

There are 93 agencies operating in Korea, including KEMCO, which are qualified to conduct

energy audits. Each of them has energy professionals and engineers with extensive expertise

and experience.

Energy Audit Activities in 2013

The energy audit agencies carried out audits on 563 subjects in 2013. The results demonstrated

an energy saving potential of 435,600 TOE/year(3.7% of total energy consumption). While

energy audit fees paid to energy audit agencies were about USD 9,769,000 in 2013, the

energy saving potential amounted to about USD 317,711,000, or 32.5 times the audit fees.

The estimated total investment costs required for improvements are USD 628,101,000 with a

two year payback period. As the CO2 reduction potential was 1,054,179 tCO2/year, the national

energy audit program is expected to help Korea comply with the stipulations of the UNFCCC.

Key indicators Total Units

Total Energy Consumption of EIC in 2013 11,691,392 TOE/yr

Energy Saving Potential 435,600 TOE/yr

Savings Rate 3.7 %

Saving Cost Potential 341,476 KRW mil./yr

Investment Cost 675,083 KRW mil.

Payback Period 2.0 yr

CO2 Reduction Potential 1,054,179 tCO2/yr

Number of Improvements 4,095 No. of Cases

Results by Industry

The chemical engineering industry demonstrated the largest energy saving potential, at 153,926

TOE/year. The second largest potential was seen in the metal working industry at 147,265 TOE/year.

175,000 450,000

150,000350,000

400,000

125,000 300,000

Pote

ntia

l Ene

rgy

Savi

ng(to

e/y)

Potential Energy Saving(toe/y)Potential CO2 Saving(toe/y)

Building Metal Misc Fiber Food Ceramic Paper Chemical

Pote

ntia

l CO

2 Red

uctio

n(tC

O2/

y)

100,000 250,000

200,00075,000

150,00050,000

100,000

25,000 50,000

0 0

27,77258,864

266,342

24,04618,197

102,188 102,344

90,453

417,720

118,489

11,7788,927

35,233 43,993

44,481

148,128


58 General Installation Subsidy

59 Financial Assistance for NRE

Home Subsidy Program

60 Home Subsidy

61 Registration of NRE Facility Installation Company


62 NRE Facility Standardization

62 Certification of Qualified NRE Facility

64 Certification of NRE Buildings

65 Fundamental Construction of Offshore Wind Power

65 Renewable Obligation in Public Institutions

66 Regional Deployment Subsidy

RPS Supply Certification

67 Renewable Portfolio Standard

68 Feed-in Tariffs for NRE

New and Renewable Energy Deployment


1. NRE Installation Subsidy

The Korean government provides subsidy to accelerate NRE(New and Renewable Energy)

deployment. Subsidies aim to create the initial market for new technologies and systems

developed domestically and establish and accelerate the deployment of infrastructure for

commercialized technologies and equipment. These subsidies can be classified into two

categories: demonstration project subsidies and general business subsidies.

The demonstration project subsidy has been designed to help technologies and systems

that have been proven through demonstration projects to penetrate the initial market and

strengthen their competitiveness. Those who wish to install NRE systems could receive

subsidies of up to 80% of the installation costs through a review process.

The general business subsidy seeks to stimulate the market for NRE systems that have

already been commercialized. The government provides a subsidy of up to 50% of the

installation costs for these commercialized systems.

The government plans to focus its support on solar PVs, windmills, and fuel cells. Since

these areas will drive future growth, the government plans to increase the energy supplied

by NRE sources to 11% of the total primary energy supply by 2035. The government also

plans to continue financial support in market-friendly areas such as solar thermal and

geothermal energy. The total subsidies provided from 1993 to 2013 amount to about KRW

217 billion. The scale of government subsidies and the status of installed systems can be

summarized as follows:

General Installation Subsidy

26,639 13,930 13,990 19,804 19,993101,313 21,193

2009 2010~2007 20112008 2012 2013 Total

216,862

[Government Subsidy](Unit: Million KRW)

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[Status of Installed NRE Systems in 2013]

Renewable Source Total capacity No. of Systems

3,606kW 190

8,461m2 166

11,023kW 39

3.003m2

170kW

12

11

PV Power System

Solar Thermal Heating System

Geothermal System

Solar Thermal Heating/Air-Conditioning System

Fuel Cell

[PV Power System in Gosung Rest Area]

[Solar Thermal Heating System in Iksan]

The government provides long-term and low-interest loans for consumers and manufacturers

of NRE systems that have been completely commercialized. The objective of the program

is to expand NRE system deployment as well as to promote the commercialization of large-

scale facilities.

[Status of Loans Provided]

Category 1983 ~2007 2008 2009 2010 2011 2012 2013 Total

Installation loans 736,239 179,269 125,039 85,685 105,906 86,340 81,206 1,399,684

Operation loans 4,436 1,071 5,301 5,655 5,894 3,000 3,000 28,357

Total 740,675 180,340 130,340 91,340 111,800 89,340 84,206 1,428,041

Financial Assistance for NRE

(Unit: Million KRW)


Installation loans are provided when customers install NRE systems, while operation

loans are provided to the manufacturer of NRE facilities or to operators and managers of

such facilities. Loans are provided for up to 90% of the total cost(up to 50% for large

corporations). Additionally, about 10% of total investment in the installation of NRE

systems can be deducted from income tax or corporate income tax.

In an effort to encourage NRE deployment, the government has launched programs to

provide subsidies for the installation of NRE systems in the residential sector. After the

successful completion of overall feasibility studies, the Home Subsidy was launched in 2004.

[Status of Home Subsidy]

Classification ~2007 2008 2009 2010 2011 2012 2013 Total

PV

Number of houses 14,498 9,142 14,895 26,364 28,990 45,530 25,409 164,828

Subsidy(Million KRW) 119,981 48,942 58,996 59,661 49,993 54,969 26,071 418,613

Solarthermal

Number of houses 150 879 3,648 1,075 5,397 7,209 2,959 21,317


Geothermal

Number of houses - - 292 1,411 923 1,348 1,893 5,867

Subsidy(Million KRW) - - 3,868 11,371 11,743 17,594 23,024 67,600

Fuel cell

Number of houses - - - 957 292 249 234 1,732

Subsidy(Million KRW) - - - 9,760 11,991 8,228 8,010 37,989

Others* Subsidy(Million KRW) - - 358 15 - 327 - 700

Total

Number of houses - - 1,117 798 - 44 - 1,959


* Others: small wind, bio, etc.

2. Home Subsidy Program

Home Subsidy

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The basic plan for the Home Subsidy is focused on installing NRE facilities in houses and

fostering the NRE industry in the long term. The government provides support for a certain

portion of the installation costs. Until 2009, the main target was houses equipped with PVs.

However, since 2010, the Home Subsidy has focused on a variety of sources, such as PVs,

solar thermal and geothermal systems, and fuel cells.

[Residential Houses with NRE facilities]

The Registered NRE Installer Program was introduced to nurture NRE installation companies

and facilitate the deployment of renewable energy systems. The applicant installers submit

their applications to the KEMCO NRE Center online, and after reviewing the application,

the NRE Center issues the certificate to applicant installers online.

[Registration Criteria]

Capital & Personnel QualificationField

Solar

100 million+≥

two technically qualified people

Wind

Geothermal

Others(Fuel Cell, Hydrogen, Bio,

Waste, Hydro, Ocean Energy, LGCC)

Machinery, Electric, Architecture

Machinery, Metal, Chemical, Ceramic, Architecture, Energy, Environment

Machinery, Electric, Civil engineering, Architecture, Energy, Environment

Machinery, Metal, Chemical, Ceramic, Electric, Civil engineering, Architecture, Energy, Environment

Registration of NRE Facility Installation Company


The main purpose of the NRE Standardization is to apply international standards to Korean

technical standards and compete for the preoccupancy of standards in the international

market.

As a Co-operating Organization for Standards Development(COSD), KEMCO is organizing

a Technical Committee(TC) and Working Group(WG) to apply IEC/ISO standards to Korean

standards in the fields of solar energy, solar photovoltaic energy, wind power, and fuel cells.

KEMCO manages a total of 106 Korean standards in designated fields: solar photovoltaic

energy(70), solar energy(20), wind energy(11), and fuel cells(5).

Fixed PeriodStandardField

Solar energy(ISO/TC180) 20

70

11

5

Solar photovoltaic energy systems(IEC/TC82)

Wind turbines(IEC/TC88)

Fuel cell technologies(IEC/TC105)

2009. 7. 31 ~ 2015. 6. 3

2011. 5. 2 ~ 2015. 6. 3

The certification scheme for NRE systems has been designed to guarantee the quality of

systems manufactured domestically or imported and enhance their reliability for consumers,

thereby encouraging wider deployment of NRE systems. Its aim is to promote the

commercialization of technologies that have been developed and establish the necessary

infrastructure for further deployment through performance evaluations and standardization.

The certification scheme is currently applied to 26 items in six areas, including solar thermal,

PVs, wind power, bio, geothermal, and fuel cell systems. In 2013, a total 1,136 models

have been certified.

Certification of Qualified NRE Facility

NRE Facility Standardization

3. NRE Facilities Certification

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63[Technologies Included under the Certification System]

System

Solar Thermal

· Flat-plate solar collectors

· Fixed-concentrating solar collectors

· Evacuated-tube solar collectors

· Natural circulation solar water heaters

· Forced circulation solar water heaters

· Evacuated-tube integrated solar water heaters

Solar PV

· Grid-connected photovoltaic inverters(less than 10kW)

· Stand-alone photovoltaic inverters(less than 10kW)

· Grid-connected photovoltaic inverters(over 10kW, less than 250kW)

· Stand-alone photovoltaic inverters(over 10kW, less than 250kW)

· Crystalline photovoltaic modules

· Thin film photovoltaic modules

· Solar cells

· Daylight collecting systems

· Photovoltaic combiner boxes

Wind Power

· Small wind-turbine generating systems

· Large wind-turbine generating systems

· Inverters for small wind-turbine generating systems

Geothermal

· Water-water geothermal heat pump units

· Water-air geothermal heat pump units

· Water-air geothermal multi heat pump units

Bio · Wood-pellet water heat boiler(less than 58.14kw)

Fuel Cell · Polymer electrolyte membrane fuel cell(PEMFC) systems

Others

· Batteries

· Charge controllers

· Monitoring units

The New and Renewable Energy Center(NREC) was accredited as a product certification

body by the Korea Accreditation System(KAS) in 2007 and, in 2008, as a National Certifying

Body(NCB) by the Worldwide System for Conformity Testing and Certification of Electro-

technical Equipment and Components(IECEE) for photovoltaic parts.

For the standardization of NRE systems, NREC was designated as a Co-operating

Organization for Standards Development(COSD) by the Korea Agency for Technology and

Standards(KATS) in 2009.

[Certification Procedure for NRE systems]

General Evaluation

· Certification Body

Facilities Evaluation

(Performance Inspection)

· Performance Inspection Body

Certification Issuance

· Certification Body

Application forCertification

· Manufacturers · Importers

NR

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n


KEMCO certifies newly constructed buildings in the private sector by their new and

renewable energy supply levels so as to encourage the introduction of new and renewable

energy facilities.

[Standards for Certification of Buildings Using New and Renewable Energy Systems]

Level New and Renewable Energy Supply Ratio(%) Note

1 Over 20% New and Renewable Energy Supply Ratio 2 15% ~ 20%

=

New and Renewable Energy Production

×100Total Energy Consumption

3 10% ~ 15%

4 5% ~ 10%

5 3% ~ 5%

Certification is applied to buildings with a total floor area of over 1000m2 for business

use under the enforcement ordinance of the Building Act(excluding buildings under the

compulsory installation for public institutions).

[Building Certification System Procedure]

*MOTIE(Ministry of Trade, Industry, and Energy), MOLIT(Ministry of Land, Infrastructure, and Transport)

Certification of NRE Buildings

Application Submitted

Application Received

Evaluation

On-site Confirmation

Evaluation Report

CertificateIssued

Certification Results

Announced

Review Reportx

Certification Confirmed

Certificate Received

Applicant(Owner of building)

Certifying Body(KICT, KIER)

Assistance and Management

(KEMCO)MOTIE/MOLIT*

Building Certification

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In June 2012, the Korean government designated Gun-san, in the south-west of Korea,

as a harbor to support the development and industrialization of export for wind power

technology. The construction of support facilities in Gun-san port will be completed by

2016. After completion, these facilities will support the construction of a 100MW offshore

wind demonstration complex and a 400MW dissemination complex.

The Public Institutions Renewable Obligation aims to create new markets for new and

renewable energy in the public sector by requiring new public buildings with more than

1,000m2 of floor space to invest more than 10% of their expected energy costs in new and

renewable energy facilities.

Between 2004 and 2013, public institutions submitted 2,985 installation plans. Most of the

investment has been in geothermal, photovoltaic, and solar energy. In September 2008,

the program grew to include school buildings. In March 2009, its scope expanded further

to include the renovation and expansion of buildings. Since 2011, this program has been

implemented with a standard that requires more than 10% of the total energy load to be

generated by NRE systems. Also, it has contributed to the expansion of the NRE market by

strengthening the standard of floor space from 3,000m2 to 1,000m2 in 2012.

[Status of Mandatory Use of NRE Systems in Public Buildings]

Year

No. of installation

plans (total)

Investment expenses for NRE systems Production of NRE systems

No. of installation

plans

Construction expenses

(A)

Investment expenses for NRE

systems(B)

Investment ratio

of NRE systems

(B/A)

No. of installation

plans

Expected energy

consumption(C)

Production of

NRE systems(D)

Investment ratio of NRE

systems(D/C)

2004 32 32 227,140 16,169 7.12 - - - -2005 115 115 911,700 53,693 5.89 - - - -2006 123 123 1,260,114 67,803 5.38 - - - -2007 107 107 1,062,661 55,343 5.21 - - - -2008 146 146 1,124,989 64,650 5.75 - - - -2009 391 391 3,938,493 233,718 5.93 - - - -2010 386 386 4,039,038 251,936 6.24 - - - -2011 307 112 1,456,468 86,850 5.96 195 1,744,663,581 212,496,854 12.182012 595 - 595 3,212,689,475 377,251,829 11.742013 783 - 783 3,522,049,183 444,338,881 12,61Total 2,985 1,412 14,020,603 830,162 5.92 1,573 8,479,402,239 1,034,087,564 12,20

* Policy change(2011): Depending on the cost of construction(more than 5%) → Depending on energy consumption(more

than 10%)

Fundamental Construction of Offshore Wind Power

Renewable Obligation in Public Institutions

(Unit: Million KRW, kWh/yr, %)

NR

E Facilities Certificatio

n


In an effort to improve the state of energy supply and demand and facilitate the

development of regional economies by supplying region-specific NRE systems, the

government has been promoting its Regional Deployment Subsidy, which supports various

projects carried out by local governments.

Started in 1996, this program supported both new and renewable and energy conservation

efforts until 2005. However, these two areas were divided in 2006 in accordance with

the Act on the Promotion of the Development, Utilization, and Dissemination of New and

Renewable Energy.

Until 2010, depending on the support ratio of the government subsidy and the nature of

the project, subsidies could be categorized as for either infrastructure construction or NRE

system installation.

But, since 2011, the government has been using the Regional Deployment Subsidy to

support only the installation of NRE systems.

[Status of Regional Deployment Subsidy]

Regional Deployment Subsidy

2008 2009 2010 2011 2012 2013

69,000178,652 69,00071,766 37,00070,000

Total

PV 312,879

59,512

12,407

669

57,513

99,940

14,035

7,414

17,031

Hydro

Wind

Fuel cell

Solar thermal

Geothermal

Bio

Waste

Etc*

*Building infrastructure, etc.

(Unit: Million KRW)

40,497

35,646

1,425

19,606

73,384

2,985

1,223

30,481

1,800

2,340

16,667

9,093

2,525

39,807

8,488

954

5,152

5,769

4,825

815

39,571

8,328

4,909

6,597

3,848

2,450

2,962

95

240

48,607

3,000

325

150

7,000

6,254

1,250

2,414

27,934

2,250

2,454

279

2,491

1,592

8,860 4,1903,886

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The RPS(Renewable Portfolio Standard) is a system that requires power producers to supply

a certain amount of power from new and renewable energy sources.

A total of 13 companies, including the Korea Water Resources Corporation, Korea District

Heating Corporation, and electricity generators with a capacity of more than 500MW(NRE

power plants excluded), are required to follow the standard.

[Annual RPS Target in the Primary Energy Supply]

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

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

For PV, additional quotas will be mandated for four years(2012-2015) to promote the

scheme in its early stage.

[Additional Quota for PV]

Year 2012 2013 2014 2015

New(MW) 220 330 330 320

Accumulated(MW) 220 550 880 1,200

*RPS Operation Mechanism

Companies required to comply with the standard must implement the scheme by installing

renewable energy power plants or purchasing a Renewable Energy Certificate(REC)

from renewable energy producers. If these companies do not meet the RPS targets, they

must pay a penalty, which will be less than 150/100 of the average REC price. Also,

the government will adjust the electricity charges to deal with the additional costs of

implementing the RPS.

4. RPS Supply Certification

Renewable Portfolio Standard

RPS Su

pp

ly Certificatio

n


The government compensates the difference between the electricity cost of NRE with

that of fossil fuel power generation to promote the production and use of NRE. Such

compensation is referred to as a feed-in tariff(FIT). The standard prices for NRE, initially

formulated in 2002, have been modified several times.

FIT has emerged as the basis of an attractive new business model in renewable energy

generation and opened a window of opportunity for NRE investment. Substantial

performances were achieved in fields such as PV and wind power. Annual total volume of

PV dissemination, for example, was just over 200kW before 2004. However, after the FIT

system was announced and recognized by investors, PV installation increased dramatically

and reached about 500MW by 2011.

The new RPS(Renewable Portfolio Standard) system was introduced in 2012 to replace FIT.

Obligators

NREInstallation Operator

KEMCOElectricity

Seller(KEPCO, KPX)

8 Calculate REC Price

7 Sell REC

1 Impose RPS targets

6 Issue REC

9 Verify duty p

erformance

2 Confirm installation

5 Request REC

Issuance

6 Issue REC 2 Apply for confirming

installment

5 Request REC Issuance

3 Sell electricity 4 Confirm generation

3 Sell electricity

4 Confirm generation

Feed-in Tariffs for NRE

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Power Source Capacity forapplication Classification

Standard Price(KRW/kWh) RemarksFixed

PriceFluctuating

Price

Wind Power Over 10kW - 107.29 - Decremental rate : 2%

Hydro power Under 5MWNon-typical

TypicalUnder 1MW

Over 1MW 86.04 SMP+15

94.64 SMP+20

Over 1MW 66.18 SMP+5

Under 1MW 72.80 SMP+10

Waste energy(including RDF) Under 20MW - - SMP+ 5

Fossil fuel use: under 30% Bio

energy

LFG Under 50MWOver 20MW 68.07 SMP+ 5

Under 20MW 74.99 SMP+10

Biogas Under 50MWOver 150kW 72.73 SMP+10

Under 150kW 85.71 SMP+15

Biomass Under 50MW Ligneous bio 68.99 SMP+ 5

Oceanenergy

Tidal Power Over 50MW

Tidal rangeover 8.5m

Embankment 62.81 -

No embankment 76.63 -

Tidal range under8.5m

Embankment 75.59 -

No embankment 90.50 -

Fuel Cell Over 200kW Using biogas 227.49 - Decremental rate

: 3%Using other fuels 274.06 -

*SMP: System Marginal Price

*If a government subsidy makes up more than 30% of the total price paid, then the FIT program cannot be accessed.

* The decremental rates will be applied to wind power from 2009 and to fuel cell energy from 2008, starting on October

11 of each year.

[Standard Prices of PV Power Source]

Site Guaranteed period

Under30kW

30kW-Under 200kW

200kW-Under 1MW

1MW-Under 3MW Over 3MW

2010

Typical15 566.95 541.42 510.77 485.23 408.62

20 514.34 491.17 463.37 440.20 370.70

Roof type15 606.64 579.32 546.52 - -

20 550.34 525.55 495.81 - -

2011

Typical15 484.52 462.69 436.50 414.68 349.20

20 439.56 419.76 396.00 376.20 316.80

Roof type15 532.97 508.96 480.15 - -

20 483.52 461.74 435.60 - -

(KRW/kWh)

RPS Su

pp

ly Certificatio

n


72 Reporting System of Energy Intensive Business Entities

75 Development of Country-specific(Korea) Emission Factor

Public Relations and Capacity Building

76 Public Relations for Energy Conservation

77 Regional Activities

78 Energy and Climate Change Education and Training

International Cooperation and Project Development

80 International Cooperation on Energy Efficiency

83 International Project Development for GHG Reduction

85 NRE Multilateral and Bilateral cooperation



1. Statistics and Analysis

The Report on the amount of energy use is for those companies that consume over a

certain amount of energy(more than 2,000 toe) and must be submitted by January 31 each

year.

KEMCO is collecting a wide variety of data from these reports, such as data on annual

energy consumption, facility details, energy conservation, type of buildings, and energy

consumption by products. Based on this data, we can predict national energy consumption

trends and develop policies related to energy efficiency.

The status of energy-intensive companies and their energy consumption details are as

follows:

Reporting System for Energy Intensive Business Entities

[Energy Consumption by Sector]

(ktoe)40,000

35,000

30,000

25,000

20,000

15,000

10,000

5,000

0

Food Textile Paper Wood Chemical Ceramic Steel ETC

200020112012

(ktoe)

600

500

400

300

200

100

0

Common Use

Public Apartment Hotel Hospital University Telephone Office

Laboratory Department Store

ETC

200020112012

700

1,118

321

111

429

242269

304

47

122

309

81

1,000 1,723

21,111

5,262

34,303

15,044

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Statistics and

An

alysis

KEMCO has developed a national statistical database(DB) system, especially containing

data on energy consumption and GHG emissions, to aid in investigations on the amount

of energy used and GHG emissions produced in various sectors(industry, households, etc.).

Based on this system, we have identified the main sources of energy consumption and their

reduction potential.

We post the results of our data analysis on NETIS(National Emission Total Information

System), showing energy consumption behavior and GHG emission types.

First Project Second Project Third Project

Establishment of administrative information DB

Establishment of statistics DB(Initial stage)

Establishment of statistics DB(Completion stage)

2005 2006 2007 2008 2009 2010 2011 20132012 2014

Industrial Sector

(Mining and Manufacturing)

Household and Commercial

Transportation

Large investigations

(110,000)


(100,000)


(120,000)


(70,000)


(45,000)


(150,000)


(150,000)

Large investigations(150,000) (150,000) (120,000)


[Establishment of Energy and GHG- related DB ]

[Analysis of Energy and GHG Mitigation Effects]

First step(2011)

Cement, Non-Ferrous Metals, Motor Vehicles,

Vessels, Mining, Oil Refining

Second step(2012)

Industry and power generation

Third step(2013)

Construction and Transportation

APPLICATION

Development of Energy and

Climate–related Policy

OUTPUT

GHG Reduction Potential

Cost Effect On Tech

PROCESS

Energy Technology

SystemAnalysis

INPUT

Energy Technology DB • Energy consumption • GHG mitigation

option, etc.

Statistics on National GHG and

Perspective of Energy Consumption

An accurate grasp and analysis of energy consumption and GHG emissions is a prerequisite

to responding to climate change. KEMCO has conducted much research on energy

consumption, GHG emissions from energy production and industrial processes, and

technologies emitting or mitigating GHG emissions. As a result, KEMCO has established

and analyzed a comprehensive database related to energy, GHG reduction potential, and

cost effect on each technology.

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The IPCC(Intergovernmental Panel on Climate Change) published its 2006 Guideline for the

National Inventory Report. They recommend developing more precise emission factors for

each country, even though they have suggested default emission factors in their Guideline.

By building an accurate and reliable national statistical database since 2007, KEMCO

has developed and managed country-specific(Korea) emission factors, including all CO2-

producing combustion processes and non-CO2 emission factors for the energy and

industrial sectors.

Development of Country-specific (Korea) Emission Factors

EnergyConsumption

Integrated Management System of Country Specific Emission Factor in Energy & Industry Sector

Agriculture

Calorie/Emission Factor by Fuel Type(Coal, Oil, Gas)Management and System Improvement

2012~ 2014~2013~ 2015~

Energy Industries

OtherSectors

Manufacturingindustries and construction

3-yearscycle

OtherProduct

Manufacture and Use

ElectronicsMineral

MetalChemical

3-yearscycle

NI R

Waste

Forestry

Integrated Management System of Specific Emission Factor in Energy & Industry

Sector Country

Making more accurate and reliable NIR

Industrial Processand Production Use

Fuel Type

Statistics and

An

alysis


2. Public Relations and Capacity Building

The Energy Diet

Started in July 2012, The Energy Diet is a new type of energy conservation/social contribution

campaign in which the donor sets his/her own energy saving goal and donates the saved

energy to the socially disadvantaged. To enable all Korean citizens to participate, the

campaign is divided into individual and team sectors. Participation is carried out online,

through which participating members are able to keep track of how much household

energy they have saved and to practice energy conservation in their everyday lives. The

donation fund that is accumulated by The Energy Diet from January until November 2013

will be donated in full to those who do not have access to plentiful energy supplies through

support for heating bills, distribution of LED lights and repair of heating facilities.

Energy Conservation Competition

The Energy Conservation Competition is conducted each year to gather creative ideas

from private citizens and to designate issues that are able to actually be placed into effect.

Winning ideas and works(essays, posters, UCC videos, etc.) are utilized in actual publicity-

related activities by various mass media outlets and online channels. Most of all, the

Energy Conservation Competition is significant because it is a program that aims to induce

voluntary participation in energy conservation efforts.

Publicity in Public Relations(PR)

To manage public's perception of energy, KEMCO carries out diverse activities of attracting

the media attention and gaining visibility with the public using newspaper, radio and TV.

KEMCO produces feature articles and contributes special columns on Energy Efficiency,

Saving Energy, Climate Change, and New & Renewable energy. And it also helps

broadcasters and journalists to make interviews for special knowledge area.

Promotion on New Media

SNS(social network service) outlets based on Internet, mobile and tablet PC environments

are currently in the spotlight. In accordance with this trend, we are focusing on viral

marketing, in which netizens promote SNS-tailored content through their personal SNS(i.

e., Twitter, Facebook) accounts. SNS is being utilized as a window by people to freely

Public Relations for Energy Conservation

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communicate with one another about energy and climate change issues.

Energy Conservation Exhibition

• Energy Korea 2013(Exhibition)

Energy Korea is a unique exhibition that aims to promote the marketing of energy-efficient

products and the exchange of the latest energy saving technologies. Energy Korea 2013

was held in conjunction with the international renewable energy exhibition Renewable

Energy 2013. Energy Korea 2013 attracted exhibits from 154 energy-related companies

and drew about 21,085 visitors. Four countries and 81 foreign companies participated in

the exhibition, promoting the export of domestic products through export consultation

sessions.

• Energy Conservation Exhibition Center

KEMCO established several exhibition centers dedicated to the subject of energy

conservation, climate change mitigation, and the efficient use of energy resources. They

feature a variety of exhibits, such as high-efficient energy products(appliances), green

home model houses, and scale models of new and renewable energy systems. The Energy

Conservation Exhibition Center(Green Energy Experience Hall) is located next to the

KEMCO head office in Suji-gu, Yongin-si, Gyeonggi-do, and sees about 60,000 visitors

annually.

Regional Energy Efficiency Activities

To implement the Regional Energy Efficiency Plan of the Energy Act, KEMCO has promoted

a regional energy efficiency program with the help of 12 regional authorities in South

Korea. The regional program has focused on searching the potential of other programs

by way of expanding capacity building, performing feasibility studies, and carrying out

demonstration projects.

The Ministry of Trade, Industry, and Energy supports the program by providing 50% of

the planned costs each year and evaluating the proposals from local authorities. In 2013,

the government provided KRW 35.4 billion from the budget to 245 projects in 12 regions.

Major projects included the propagation of information on electricity supply and demand

and energy efficiency measures and practices covering various energy use sites, such as

homes, schools, public and commercial buildings, and industry.

Pub

lic Relatio

ns an

d C

apacity B

uild

ing

Regional Activities


Education and Training

KEMCO provides extensive professional education and training programs for energy

managers in construction, industry and the public sector as well as future generation

educational programs for young people, the energy consumers of the future.

The company makes a point of sharing its 30 years of accumulated experience and know-

how with developing countries seeking green growth, offering global education programs

tailored to the needs of the government employees, public organization representatives and

experts of those nations.

KEMCO will continue to cultivate energy and climate change experts by consistently

developing education and training programs in cooperation with relevant organizations.

[Major Professional Education Program]

Program Name Subjects of Education

Legal education for energy managers

Energy managers of business sites that have an annual energy consumption level of at least 2,000 TOE

Education to foster technical human resources

in the energy field

A 3-day professional development program focused on teaching the structure and operation method of boilers and pressure devices, boiler operation basics, and fuel and combustion management. Those who complete the program earn operator certification in small-scale boiler, pressure device or gas boiler operation

Training of local energy officials

A training program focused on educating local energy officials on local energy planning guidelines and energy conservation policies

Professional development courses for industrial sector

managers

The courses offered include those for GHG certification for engineers with subject matter covering climate change, industrial energy/building GHG management, and energy supply efficiency management

Future Generation Education

KEMCO offers various youth educational programs aimed at raising awareness of

responsible energy consumption and the dangers of climate change among the younger

generation. Accordingly, it operates the Korea Society of Energy and Climate Change

Education which works toward ensuring that current environmental research results are

added to public school textbooks.

Future generation education is currently offered at a total of around 800 elementary,

middle and high schools. Moreover, KEMCO operates 33 policy research schools, and has

designated 1,731 schools as “Save Energy Save Earth (SESE)” institutions. KEMCO provides

SESE schools with financial support, educational material, program outlines and other

necessary materials.

Energy and Climate Change Education and Training

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SESE

SESE, or “Save Energy Save Earth,” is an autonomously conducted afterschool program

where in youth learn about energy conservation and promote the use of new and renewable

energy at school, in their communities, and at home. It includes the “Energy Watchman”

program, under which youth search for better ways to protect the Earth and the environment.

As of 2013, there were approximately 1,300 SESE programs in existence with around

23,000 participants. SESE is an energy conservation program open to all youth interested in

the environment(www.sese.or.kr).

Cultural and intellectual content on energy conservation

To aid the understanding of students and the general public on energy issues, KEMCO

develops and distributes a variety of content on creative capacity programs, animation, and

webtoons.

Overseas training

KEMCO actively seeks out partnerships with international bodies, governments and

businesses as a key aspect of its conservation activities. The company shares its energy

policy and system operation experiences as well as its advanced technology with developing

countries to assist in their efforts for green growth.

[Overseas training for outstanding leaders]

[Energy watchman activities]

[Energy conservation campaign]

[Energy Camp]

[Energy conservation webtoon]

[Creative capacity programs]

[Energy ConservationPPT]

[Children’s animation on energy conservation]

Pub

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apacity B

uild

ing


3. International Cooperation and Project Development

KEMCO participates in five major international societies in order to enhance the energy

efficiency of appliances: KEMCO is also active in international cooperation activities for the

development of Energy Standards and Labeling.

IEA 4E

The Implementing Agreement of the IEA(International Energy Agency) for a Cooperative

Program on Efficient Electrical End-Use Equipment(4E) was approved by the IEA Governing

Board in 2008. The 4E implementation agreement focuses on equipment that contributes

most to the total end-use electricity consumption, including technologies with fast growing

global or regional market shares, and standby consumption. Under the 4E framework,

International Cooperation on Energy Efficiency

KEMCO’s offset training program, conducted overseas in conjunction with HGI, is perhaps

its most significant educational accomplishment. The program has been adapted and

applied in the Middle East, where it is now compulsory for Middle Eastern companies that

have won large construction contracts to reinvest a certain proportion of their profits into

the infrastructure development of their country (i.e. capability strengthening, job creation,

etc.).

Moreover, as a cooperative project with ICA (International Copper Alliance), KEMCO carried

out energy efficiency training in Indonesia for related Indonesian government employees.

The company also invited policymakers and relevant employees from its key partner

countries in the most underdeveloped areas of Africa and Asia to Korea for joint training.

[Offset training (Kuwait)] [Joint training with ICA] [Korea-developing nation joint training session]

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a number of research projects(annexes) were developed, including mapping and

benchmarking, standby power, set-top boxes, motor systems, lighting, and others.

In cooperation with the IEA 4E, the Ministry of Trade, Industry and Energy and KEMCO are

participating in the main annex, mapping and benchmarking(M&B). The overall goal of the

mapping and benchmarking annex is to provide policy makers with a single source of

knowledge on product performance and associated policy tools employed by economies across

the world, thus enabling more informed policy making at the national and regional levels.

IEA DSM

The Demand-Side Management Technologies of the IEA, also known as IEA DSM, was

launched in 1993. As of 2014, IEA DSM consists of 15 countries and develops a variety

of strategies for reducing energy demand. Korea has attended the meetings since May

1994 and officially became a member in March 2002. IEA DSM has been conducting 24

international joint research projects, called “TASK”, since its establishment. Korea is taking

part in ten tasks, with six tasks underway as of 2014.

IPEEC

IPEEC(International Partnership for Energy Efficiency Cooperation) is an international

partnership for energy efficiency cooperation that includes the G8(USA, UK, France,

Germany, Italy, Canada, Japan, Russia) plus six other countries, China, India, Brazil, Mexico,

Korea, and Australia.

Intern

ation

al Co

op

eration

and

Project D

evelop

men

tAnnex Leader Participant Countries

Mapping and Benchmarking UK

Standby Power Australia

Motor Systems Switzerland

Solid State Lighting(SSL) Sweden

USA, Canada, Australia, France, Netherlands, Denmark, Switzerland, Austria, Sweden, Korea, South Africa, Japan

UK, Netherland, Switzerland, Canada, Korea, Austria, Denmark, Sweden, USA, Australia

Denmark, Australia, Netherlands, USA, Austria

UK, Netherlands, France, Denmark, Austria, USA, Japan, China, Korea, Sweden

[IEA 4E Annex]


Under IPEEC, seven international projects are currently being carried out. Korea is

participating in three programs, including Super-Efficient Equipment and Appliance

Deployment(SEAD) and the Global Superior Energy Performance Partnership(GSEP).

[IPEEC Tasks]

TASKS Leading country

Assessment of EE Financing Mechanisms(AEEFM) India

Energy Management Action Network(EMAK) Japan

Global Superior Energy Performance Partnership(GSEP) USA, Japan

Improving Policies through Energy Efficiency Indicators(IPEEI) France

Policies for Energy Provider Delivery of Energy Efficiency(PEPDEE) UK

Super-Efficient Equipment and Appliance Deployment(SEAD) USA

Worldwide Energy Efficiency Action through Capacity Building and Training(WEACT) Italy

IPEEC SEAD

SEAD(Super-Efficient Equipment and Appliance Development System) is a government-led

global market transformation initiative that was proposed as a task under IPEEC by the

United States.

Its major activities include high-level policy exchange, analysis and forecast of global trends,

establishment of implementation plans for certain products, and the provision of country

analysis report and assistance. Its target products include TVs and LED lighting equipment.

APEC EGEE&C

The APEC EWG(Asia-Pacific Economic Cooperation - Energy Working Group) is a voluntary,

regional-based forum operating under the APEC umbrella. It helps further the APEC goal

of facilitating energy trade and investment, and ensures that energy contributes to the

economic, social, and environmental enhancement of the APEC community.

The EWG has four expert groups, each focusing on a specific energy area. They provide a

forum for fostering cooperation between research and technical specialists within APEC

economies. The EGEE&C(Expert Group on Energy Efficiency & Conservation) is an expert

group within the EWG that promotes energy conservation and the application of energy

efficiency practices and technologies through various cooperative activities.

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International Project Development for GHG Reduction

KEMCO has developed collaborative projects with major developing countries to improve

mutual climate change response and explore new business opportunities. The projects

promote networks for the transfer of policy information and technology in order to

encourage GHG reduction in developing countries with high GHG reduction potential

and friendly diplomatic relations with South Korea. KEMCO is cooperating with major

developing countries in Asia, Africa, and South America on regional climate change

response, focused on mutual project development and capacity building.

[International Project Development with Developing Countries]

[KEMCO's Regional Cooperation Activities with Developing Countries]권역별 개발도상국 협력사업 추진현황(KEMCO)

China

Vietnam

Indonesia

Sri Lanka

TanzaniaPeru

Chile

PhilippinesADB

Uzbekistan IIC, IFC(WB)

: South-East Asia

: South-West Asia

: Central Asia(inc. MENA)

: South America

: Africa

: Priority Country

: MOU Country

: MOU International Organization

Intern

ation

al Co

op

eration

and

Project D

evelop

men

t

Country Major Activities in 2013

Sri Lanka(Southwest Asia) Capacity building for energy efficiency policies

Indonesia, Philippines(Southeast Asia)

F/S to identify energy efficiency potential and capacity building e.g. Investigating ESCO role and activities, renovation of installed power plants

Mongolia, Uzbekistan(Central Asia)

Identified energy efficiency potential and capacity building e.g. Enhancing energy efficiency in industrial sector

Tanzania(Africa) Conducted pilot energy audit for gas-fired power plant in Tanzania e.g. Established industrial energy management standards

Peru, Chile,Guatemala

(South America)

Conducted energy audit for ten companies in Guatemala textile industry e.g. Developed 46 energy efficiency measures(saving potential of 8,522 toe/yr)


Addressing international climate change issues led by the UNFCCC, KEMCO has developed

cooperative programs with international organizations(UNIDO, ACE, etc.) and multilateral

development banks(WB, ADB, IIC etc.), with cooperation directions guided by MOTIE.

KEMCO has developed joint projects that will lead co-financing investment activities

aimed at climate change mitigation and focused on energy efficiency improvements and

renewable energy developments.

In 2013, KEMCO participated in the World Bank project for improving energy efficiency

in the textile industry and led a technology transfer workshop with domestic experts in

Guatemala. The IFC and KEMCO began collaborating to identify the energy and resource

efficiency potential of priority industries in Jordan, Pakistan, and Egypt, which will lead to

sharing recommendations on how to implement appropriate energy efficiency policies.

Also, an investigation of opportunities to change clean energy development in the Asian

region was launched and discussed with ADB officials through open dialogues.

In addition, KEMCO and UNIDO co-hosted the UNIDO-MOTIE(KEMCO) Joint International

Conference, "Towards Sustainable Industrial Development: Green Industry and Energy

Efficiency," in order to inform Korean companies of opportunities to engage in projects that

aim to establish a foundation for green industry.

Furthermore, KEMCO has organized two workshops under the ASEAN+3 NAMA

Cooperative. The first workshop was held in Korea, in July, and focused on the utilization of

ODA funds in Korea and MDBs for ASEAN CDM and NAMA projects as well as information

sharing on NAMA business opportunities between ASEAN and Korea. The second workshop

was held in Korea, in October, and covered MRV methodologies of Korea and KVER/NAMAs

MRV. The participants also attended the Korea Energy Show to discuss new technologies

related to energy efficiency and new and renewable energy with Korean companies.

In 2013, KEMCO organized a training course for government officials in Nepal and

Mozambique to introduce Korea’s NAMA and share information on energy efficiency and

climate change mitigation policies of each country.

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NRE Multilateral and Bilateral Cooperation

Multilateral Cooperation

The NREC(New and Renewable Energy Center) has actively taken part in the international

community's efforts to expand new and renewable energy use worldwide.

The NREC has carried out related activities with international organizations as follows:

• IEA/REWP: International Energy Agency/Renewable Energy Working Group

* SolarPACES, PVPS, Bioenergy, Wind, HIA, Geo-thermal

* Korea Institute of Geoscience and Mineral Resources(KIGAM) has been participating in Geo-thermal IA as an alternative

member from Korea

• IPHE: International Partnership for Hydrogen and Fuel Cells in the Economy

• APEC EGNRET: Asia-Pacific Economic Cooperation-Expert Group on New and Renewable

Energy Technology

• IRENA: International Renewable Energy Agency

With the IEA, Korea has joined six implementing agreements on Geothermal, Hydrogen,

PVPS, Wind, Bioenergy, and SolarPACES, which are being operated under REWP. Also,

Korea has been actively participating in PVPS Tasks 1 and 8, Wind Tasks 11 and 27, and

Bioenergy Tasks 37 and 39. The NREC has played the important role of absorbing valuable

policy and technology information and sharing it with key stakeholders, including policy

makers, industries, and universities.

[NREC’s Activities in the IEA 2013]

Activities

REWP Participation in ExCo 63 & 64

SolarPACES Participation in ExCo 84 & 85

PVPS Participation in ExCo 41 & 42/Task 1,8

Bioenergy Participation in ExCo 71 & 72/Task 37,39

Hydrogen(HIA) Participation in ExCo 68 & 69

Wind Participation in ExCo 71 & 72/Task 11,27,30

*Geo thermal implementing agreement is in charge of Korea institute of Geoscience and Mineral Resources

Also, the NREC has participated in various cooperative activities in partnership with

APEC and the IPHE, through which they pursued technical breakthroughs and developed

countermeasures to expand the dissemination of new and renewable energy within the

Asia Pacific region.

As a response to the growing global demand for the promotion of renewable energy,

the International Renewable Energy Agency(IRENA) was founded in 2009 as a crucial

agency in the renewable energy field. Making valuable contributions to IRENA, the

Intern

ation

al Co

op

eration

and

Project D

evelop

men

t


[IRENA Third Assembly Meeting(January 2013, Abu Dhabi)]

Bilateral Cooperation

The NREC has maintained close relations with its counterpart organizations overseas

to exchange information and develop collaborative programs. In order to promote our

programs, the NREC not only organizes joint seminars, business matchmaking events,

cooperation agreements, and intergovernmental collaboration committees, but also carries

out joint research projects. Our main counterpart countries are Germany, Indonesia, the

United Kingdom, and the UAE.

A joint-seminar is regularly held to build relations with those countries by exchanging

current key policies and technological information in various areas, such as PV, solar

thermal, and wind energy. Regarding follow up actions for these partnerships, this would

be a great opportunity for the related parties of all nations to identify mutually beneficial

areas in the field of NRE.

[Korea-Germany New & Renewable Energy Forum(June 2013, Germany)]

[Korea-Indonesia New & Renewable Energy Working Group(April 2013, Indonesia)]

Korean government has been taking on key roles since its foundation, with the goal of

disseminating renewable energy on a global scale. Currently, Korea is making a dedicated

effort to improve its international reputation in the field of renewable energy. The NREC has

been Korea’s technical focal point for IRENA since 2009, and has played a key role in the

development of work programs and other issues.

• IRENA Third Assembly(January 2013, UAE)

IRENA Fifth Council Meeting(June 2013, UAE)

IRENA Sixth Council Meeting(November 2013, UAE)

• APEC EGNRET(April 2013, Vietnam; October 2013, China)

• IPHE(20th Steering Committee, November 2013, Japan)

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APEC Asia-Pacific Economic Cooperation

CERs Certified Emission Reductions

ESCO Energy Service Company

ESS Energy Storage System

GSEP Global Superior Energy Performance Partnership

ICT Information and Communications Technology

IPCC Intergovernmental Panel on Climate Change

IEA International Energy Agency

IRENA International Renewable Energy Policies

KVER Korean Voluntary Emissions Reduction

MOLIT Ministry of Land, Infrastructure and Transport

MOTIE Ministry of Trade, Industry, and Energy

NETIS National Emission Total Information System

NRE New and Renewable Energy

REC Renewable Energy Certificate

RHO Renewable Heat Obligation

RPS Renewable Portfolio Standard

ABBREVIATIONS

Intern

ation

al Co

op

eration

and

Project D

evelop

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t

Seoul Headquarter#301, 3, Gongwon-ro, Guro-gu, Seoul, 152-842 Rep. of KOREA

Tel. +82-2-862-5201~2 / Fax. +82-2-862-5203

Busan, Ulsan Headquarter#1105, 10, Myeongnyun-ro, Yeonje-gu, Busan, 611-713 Rep. of KOREA

Tel. +82-51-503-7740~1 / Fax. +82-51-503-7742

Incheon HeadquarterYWCA Bldg., Incheon 8, Jeonggak-ro, Nam-gu, Incheon, 405-835

Rep. of KOREA

Tel. +82-32-432-7031 / Fax. +82-32-432-7030

Chungbuk Headquarter16, Jungheong-ro, Sangdang-gu, Cheongju-si, Chungcheongbuk-do, 360-810

Rep. of KOREA

Tel. +82-43-296-0363~4 / Fax. 296-036

Gwangju, Jeonnam Headquarter123, Cheomdangwagi-ro, Buk-gu, Gwangju, 500-712 Rep. of KOREA

Tel. +82-62-602-0050 / Fax. +82-62-223-2362

Daejeon, Chungnam Headquarter3F, 71-68, Sinilseo-ro 68, Daedeok-gu, Daejeon, 306-230, Rep. of KOREA

Tel. +82-42-525-0365 / Fax. +82-42-523-3441

Gyeonggi Headquarter388, Poeun-daero, Suji-gu, Yongin-si, Gyeonggi-do, 448-994 Rep. of KOREA

Tel. +82-31-260-4114 / Fax. +82-31-260-4628

Daegu, Gyeongbuk Headquarter52, Seongseogongdan-ro, Dalseo-gu, Daegu, 704-801 Rep. of KOREA

Tel. +82-53-751-0366, +82-53-580-7902 / Fax. +82-53-751-0555

Jeonbuk Headquarter2F(Main Bld.), 164, Palgwajeong-ro, Deokjin-gu, Jeonju-si, Jeollabuk-do, 561-736

Rep. of KOREA

Tel. +82-63-212-7082 / Fax. +82-63-212-9082

Gyeongnam Headquarter362, Woni-daero, Uichang-gu, Changwon-si, Gyeongsangnam-do, 641-966

Rep. of KOREA

Tel. +82-55-212-1147~9 / Fax. +82-55-212-1151

Gangwon Headquarter2F, 2357, Gyeongchun-ro, Chuncheon-si, Gangwon-do, 200-938 Rep. of KOREA

Tel. +82-33-248-8414 / Fax. +82-33-256-3914

Jeju Island Headquarter5F, 17, Yeonbuk-ro, Jeju-si, Jeju-do, 690-802 Rep. of KOREA

Tel. +82-64-746-4697 / Fax. +82-64-747-2682

Regional Headquarters of KEMCO

Published by KEMCO Division of Global Strategy

Publisher BYUN, Jong-Rip

388 Poeundaero, Suji-Gu, Yongin City, Gyeonggi-Do, 448-994, Rep. of Korea

www.kemco.or.kr

Designed by designCREPAS

KEMCO Annual Report 2013

©KEMCO April 2014. All right reserved.

This report is a eco-friendly paper with soy-based ink.


#388 Poeundaero, Suji-Gu, Yongin City, Gyeonggi-Do, 448-994, Republic of Korea www.kemco.or.kr


Documents

Annual Report 2013 - Energy · Annual Report 2013 Korea Energy Management Corporation. In 2012, the value of energy import was $184.8 billion which consisted of 35% of total value