Oct. 2012

New and Renewable Energy Status & Policies of Korea

New and Renewable Energy Status & Policies of Korea

Energy Status in KoreaEnergy Status in Korea

ContentsContents

ⅠⅠ

Achievements to DateAchievements to DateⅡⅡ

ⅢⅢ National NRE ProgramsNational NRE Programs

Energy Status in KoreaEnergy Status in KoreaⅠⅠ

8th biggest energy consumer in the world(262.6Mtoe) Source:KEEI

5th biggest importer, 68.7 billion USD (accounting for 56% of all energy import) Source:KEEI

Energy Consumption Energy Consumption

Crude Oil ImportCrude Oil Import

CO2 Emission CO2 Emission 7th biggest Emitter in the world, 590MtoeSource:European Commission’s Joint Research Center & PBL Netherlands Environmental Assessment Agency, 2012

Energy Status

121.6 billion USD(Energy)

179 billion USD(Car(82) + Semi-conductor(49) +

Shipbuilding(48))

NRE StatusNRE Status

RE : 8 Sources-PV, Solar Thermal, Wind, Waste, Bio(LFG, Bio-Fuels), Hydro, Geothermal, Marine

New Energy : 3 Sources - Fuel-cell, Hydrogen, Coal Liquefaction or Gasification

RE : 8 Sources-PV, Solar Thermal, Wind, Waste, Bio(LFG, Bio-Fuels), Hydro, Geothermal, Marine

New Energy : 3 Sources - Fuel-cell, Hydrogen, Coal Liquefaction or Gasification

Waste, Hydro account for the

most proportion

82.5%

Waste, Hydro account for the

most proportion

82.5%Hydro11.6%

Hydro11.6%

Bio11%

Wind2.6%

PV2.4%

Fuel Cell0.6%

Bio11%

Wind2.6%

PV2.4%

Fuel Cell0.6%

< Breakdown of NRE share (2010) >< Breakdown of NRE share (2010) >NRE Share in TPES (%)

’06 ’07 ’08 ’09 ’10

Waste70.9%

Waste70.9%

National NRE Supply Target : 11% by 2030

Annual Growth Rate : Annual Growth Rate : 7.0% (`06~`10)

Prospect for each NRE SourcesProspect for each NRE Sources’ ’ Growth Rate by 2030Growth Rate by 2030

PV(15%), Wind(18%), Bio(15%) PV(15%), Wind(18%), Bio(15%) Waste(4%),

Hydro(2%)

Increase Decrease

Ⅱ Achievements to DateAchievements to Date

Strong government

support

Strong government

support

Active Participation by SMEs &

Large Conglomerates

Active Participation by SMEs &

Large Conglomerates

Establishment of industrial ecosystem

Establishment of industrial ecosystem

•Building the value chain & business system based on collaboration between SMEs & large conglomerates

•Building the value chain & business system based on collaboration between SMEs & large conglomerates

Regarded as a main source of SMEs’ growth & Job Creation & the new profitable area of large conglomerates Regarded as a main source of SMEs’ growth & Job Creation & the new profitable area of large conglomerates

No. ofmanufacturers

No. ofmanufacturers

No. of employees

No. of employees

Sales(bil.USD)

Sales(bil.USD)

Exports(100mil. USD)

Exports(100mil. USD)

’07’07 ’09’09 ’10’10 ’07’07 ’09’09 ’10’10 ’07’07 ’09’09 ’10’10 ’07’07 ’09’09 ’10’10

101101193193

3,6613,661

10,39510,395

1.241.24

4.744.74

6.26.2

26.726.7

2122122.1 times2.1 times 3.7 times3.7 times 6.5 times6.5 times 7.3 times7.3 times13,65113,651 8.078.07 45.345.3

AchievementsAchievements

PVPVExisting

industrial ecosystem

Existing industrial ecosystem

Foster the Second semiconductor industry based on the mutual development of large and small companies and job creation

Foster the Second semiconductor industry based on the mutual development of large and small companies and job creation

New era of GW scale power production by an integrated production system from Poly silicon to systemNew era of GW scale power production by an integrated production system from Poly silicon to system

Increasing exports in all areas such as materials and modules including Equipment and turnkey ordersIncreasing exports in all areas such as materials and modules including Equipment and turnkey orders

Poly silicon(tons)

Poly silicon(tons)

Ingot/Wafers(MW)

Ingot/Wafers(MW)

Cells(MW)Cells(MW)

’07’07 ’09’09 ’10’10 ’07’07 ’09’09 ’10’10 ’07’07 ’09’09 ’10’10 ’07’07 ’09’09 ’10’10

Modules

(MW)

Modules

(MW)

ExportsExports Equipment ExportEquipment Export

Large-scaled Plant ExportLarge-scaled Plant Export

Jusung Engineering (130mil.USD to China),Toptech(14.5mil.USD to China)

Jusung Engineering (130mil.USD to China),Toptech(14.5mil.USD to China)

Samsung C&T Corp.(500MW Canada, 130MW US)

SDN(45MW Bulgaria)

Hyundai Heavy Industries Co.(175MW US)

Samsung C&T Corp.(500MW Canada, 130MW US)

SDN(45MW Bulgaria)

Hyundai Heavy Industries Co.(175MW US) ’04’04 ’07’07 ’10’10

(unit: Million USD)(unit: Million USD)

00

17,10017,10031,60031,600

200200

1,0001,000

1,9151,915

3636

921921

1,8311,831

173173

1,1401,140

2,9082,908

66142142

3,7443,744

’09’09

1,7231,723

WindWindModel sector for SME-LE to co-prosper

Model sector for SME-LE to co-prosper

Industrial structure building with collaboration between SMEs for components& large enterprises for finished goodsIndustrial structure building with collaboration between SMEs for components& large enterprises for finished goods

Trends towards increasing exports of wind power system as well as tower & machined partsTrends towards increasing exports of wind power system as well as tower & machined parts

A high potential of becomingthe leading group combined with key industries

A high potential of becomingthe leading group combined with key industries

Growing up asthe 2nd shipbuilding industry

Growing up asthe 2nd shipbuilding industry

’04’04 ’07’07 ’10’10

(unit : million USD)(unit : million USD)ExportsExports

CategoryCategory Major companiesMajor companies

PartsParts

BladeBlade

TowerTower

ComponentComponent

SystemSystem

KM, Deck, Doha Industry, GwangdongFRP, HwashinFRPKM, Deck, Doha Industry, GwangdongFRP, HwashinFRP

DongkukS&C, Unison, CS wind, Speco, Win&PDongkukS&C, Unison, CS wind, Speco, Win&P

Taewoong, Pyungsan, YonghyunBM, Hyunjin Materials, Unison, MyscoTaewoong, Pyungsan, YonghyunBM, Hyunjin Materials, Unison, Mysco

Doosan, Hyundai, Hyosung, STX,Samsung heavy industries, DSMEDoosan, Hyundai, Hyosung, STX,Samsung heavy industries, DSME

5858

475475

788788 Wind Power ExportWind Power Export

Hyundai Heavy Industries

(Pakistan, 49.5MW, 1.65*30)

STX(The Netherlands, 50MW, 2*25)

Unison(Sri Lanka, 9.7MW, 750kW*13)

Hyundai Heavy Industries

(Pakistan, 49.5MW, 1.65*30)

STX(The Netherlands, 50MW, 2*25)

Unison(Sri Lanka, 9.7MW, 750kW*13)

National NRE ProgramsNational NRE ProgramsⅢ

Target : To Realize National Target, 11% of NRE Share in TPES, Launched in 2012

RPS (Renewable Portfolio Standards, 2012)RPS (Renewable Portfolio Standards, 2012)

FIT ( Feed in Tariff, 2002 ~ 2011)FIT ( Feed in Tariff, 2002 ~ 2011)

Projects for Large-scaled Market

NRE Plants : 2,108 Power Generation : 10,129GWh, Supported Budget : 1,141bil KRW (951mil USD)

13 Mandatory Power Companies with Capacity of More Than 500MW Power Plants13 Mandatory Power Companies with Capacity of More Than 500MW Power Plants

0.5%p ↑ 1.0%p ↑

Obligatory NRE Production Ratio in their total Power Generation

Year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022~Mandatory Ratio 2.0% 2.5 % 3.0 % 3.5 % 4.0 % 5.0 % 6.0 % 7.0 % 8.0 % 9.0 % 10.0 %

(Unit : thou TOE)(Unit : thou TOE)

Responsible for 50% of TargetedNRE Supply Amount By 2020Responsible for 50% of TargetedNRE Supply Amount By 2020 Inducing Market Investment of 48bil USDInducing Market Investment of 48bil USD

2012 2012 2015 2015 20202020

Reduction 16mil tons of CO2 Annually Reduction 16mil tons of CO2 Annually

(Reference) 2020 NRE Supply Target : 17,520 thou TOE(Reference) 2020 NRE Supply Target : 17,520 thou TOE

Obligated new buildings of public institutions with the floor area exceeding 3,000

㎡ to use more than 5% of total construction expenses to install NRE systems

Mandatory Use for Public Buildings (2004~2011)Mandatory Use for Public Buildings (2004~2011)

Mandatory Use and Design with NRE of more than 10% of total energy load for

new, renovated and expanded public buildings over 1,000 ㎡

Revision of Obligation Program for Public Buildings (2012~)Revision of Obligation Program for Public Buildings (2012~)

Projects for Large-scaled Market

Public Institutions : State administrative bodies, Local autonomous entities and State-run companies

Subsidize part of the installation costs of NRE facilities to enhance NRE deployment and to relieve end-user’s cost burden (Factories, Individual Buildings, Schools)

Expanded former ‘100,000 solar roof program’ to promote residential NRE deployment

Support various NRE deployment projects by local governments for public buildings, social service facilities and remote area’s residents, etc.

Corporation tax deduction : 10% of total investment in NRE

Provide low-interest loan

Subsidy & Loan Programs

General Subsidy Program (1993~ )General Subsidy Program (1993~ )

1 Million Green Homes Program (2009~ )1 Million Green Homes Program (2009~ )

Local NRE Deployment Program (1996~ )Local NRE Deployment Program (1996~ )

Loan & Tax Deduction Program (1983~ ) Loan & Tax Deduction Program (1983~ )

Aiming to disseminate 1 million green homes by 2020

Focusing on PV, fuel cell, wind and bio-energy

Solar-thermal water heating system

PV power system

BIPV Geothermal heating &Fuel-cell system

&Wood Pellet Boiler

Heat recovery & Ventilation System

Automatic window system

Enhanced external insulation Door Insulation

LED lights

1 Million Green Homes Showcase

93% of heating Cost Reduction 50% of Cooling Cost Reduction

New & Renewable Energy (Active)Energy Efficiency Improvements (Passive)

Building 1 Million Green Homes by 2020

Remodeling of Existing NRE Attached Houses

Goal : Achieving Green Life by Deploying 1 Million Houses with NRE Facilities

Attached NRE Facilities : PV, Solar-Heating, Geothermal, Fuel Cell, Small Wind, Wood Pellet

Promotion period : 2009 ~ 2020

1 Million Green Homes

1 Million Green Homes Program1 Million Green Homes Program

To Secure ‘Track Record’

2012 : Development of 5MW Offshore Wind Generators

2013 : Building a 100MW Demonstration Complex (5MW × 20)

- South-west Coast Area

1st Phase(~2014) : 100MW Demonstration Complex

2nd Phase(~2016) : 900MW Pilot Complex

3rd Phase(~2019) : 1.5GW Large Scaled Wind Farm

• ‘Offshore Wind Promotion Committee’ under Operation

Roadmap to become World’s top-3 position in international wind market (Nov, 2010)“Technology Development – Demonstration – Expansion international Market Share”

- 7.5bil USD Will be Invested in the Project in Partnership with Private Sector - Enhance the Installation Capacity up to 7.7GW with Local Governments after 2019

Scaling up the Capacity of Wind Complex by total 2.5GW (5MW × 500) by 2019

Offshore Wind Project

Wind Energy Top-3 RoadmapWind Energy Top-3 Roadmap

Vision 2015Vision 2015

The target to be the world’s top 5 nation in NRE marketThe target to be the world’s top 5 nation in NRE market

International market share : PV 15%, Wind 15%International market share : PV 15%, Wind 15%

SaleSale ExportExport EmploymentEmployment PrivateInvestment

PrivateInvestment

’09 ’12 ’15 ’09 ’12 ’15 ’09 ’12 ’15 ’09 ’12 ’15

(unit : bilUSD) (unit : bilUSD) (unit : 1,000 employees) (unt : 0.1bilUSD)

3.33.3

16.716.7

41.741.7

22

1111

3737

992727

110110

2.62.6

4.84.8

7.27.2

Invest 33 bil.USD (private 28, government 5) by 2015Invest 33 bil.USD (private 28, government 5) by 2015

Thank you very much!Thank you very much!kcg@kemco.or.krChang-goo Kim,

Director of NRE Promotion DepartmentNew and Renewable Energy Center(NREC) of

Korea Energy Management Corporation(KEMCO)

kcg@kemco.or.krChang-goo Kim,

Director of NRE Promotion DepartmentNew and Renewable Energy Center(NREC) of

Korea Energy Management Corporation(KEMCO)