- Korea needs major investment in renewables, storage, grids and market reform to meet rising electricity demand and hit its 2050 net-zero target.
- Strengthening the Emissions Trading System and clarifying the hydrogen policy will improve competitiveness and accelerate decarbonisation.
The International Energy Agency (IEA) states that faster deployment of renewable energy and targeted market reforms could strengthen Korea’s energy system and accelerate emissions reductions. A new IEA Energy Policy Review highlights the country’s long-term climate ambitions and policy foundations.
Korea’s 2021 Carbon Neutrality Act sets a legally binding goal to reach net zero emissions by 2050 and a 2030 milestone. The IEA says the country has reduced greenhouse gas emissions slightly since 2018 while sustaining economic growth, but coal still supplies over a quarter of electricity. Rising demand from buildings, transport, industry, semiconductors, and data centres will require more low- and zero-emission power, grid upgrades, and market reforms to attract investment.
Renewables nearly doubled in Korea’s electricity mix over five years, but remain the lowest among IEA members due to limited land, forests, and public opposition. Additionally, the IEA recommends stronger national planning, increased public engagement, and expanded energy storage to integrate renewables effectively. Korea also aims to scale low-emissions hydrogen across transport, buildings, power, and industry but needs clearer policy and infrastructure rules.
The IEA recommends reforms to Korea’s Emissions Trading System to enhance prices and market liquidity. Institutional changes, including the establishment of the new Ministry of Climate, Energy, and Environment and the creation of an independent energy regulator, could enhance coordination, transparency, and consumer protection.
The report notes that Korea’s industrial and technological strengths offer opportunities to align energy transition with economic growth, export potential, and international decarbonisation goals. The IEA regularly reviews the energy of its member countries to guide reforms and share best practices.