South Korea to Allow Consumers Sign PPAs with RE Producers

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  South Korea will now allow power consumers to sign bilateral PPAs with independent renewable energy producers.

• This move comes as the country aims to achieve 100 per cent clean energy transition by 2050.
• The Korea Electric Power Corp (Kepco) which formerly collects all electricity generated can now act as an intermediary between generators and consumers.

South Korea’s Ministry of Trade, Industry and Energy (MOTIE) will allow power consumers to purchase electricity from renewable energy generators via power purchase agreements (PPAs).

According to MOTIE, industrial and general electricity consumers can participate in the K-RE100 system by registering at the state-run Korea Energy Agency. The agency stated that renewable energy can be bought via third-party power purchase agreement[s] (PPA), renewable energy certificates (REC), or via self-generation.

Currently, Korean consumers buy electricity exclusively from the national utility Korea Electric Power Corp (Kepco), which is the sole purchaser of all energy generated from power generators and independent power producers. With the new policy, Kepco will now act as an intermediary between the seller and the buyer. According to the Korea Times “The revision allows renewable power companies whose generation capacity exceeds 1 MW to sign a trilateral supply agreement with Kepco and the consumer so that Kepco can relay the power transaction.”

The K-RE100 initiative focuses on increasing renewable energy share in the country’s electricity mix to 100 per cent by 2050. The government has stated that the new rules will be effected early this year.