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South Korea’s Renewable Energy Odyssey: A Failed Attempt at Carbon-Neutral Growth Without Nuclear Energy

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Great Power Competition and Middle Power Strategies

Part of the book series: The Political Economy of the Asia Pacific ((PEAP))

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Abstract

In an increasingly competitive geo-economic and geo-energy landscape in the Indo-Pacific, South Korea’s Moon Jae-in government (May 2017–May 2022) attempted to achieve energy security and safety at the same time by accelerating renewables while phasing out nuclear energy. During his tenure, President Moon pushed forward his ambitious plan to promote renewable energy and energy transition. He set the 20 percent target for renewable energy’s share by 2030, thus marking a sudden departure from his predecessors’ cautious and conservative approach to renewables. Concurrently, his government launched a controversial policy to phase out nuclear power over a period of four decades. South Korea’s pro-renewables and anti-nuclear energy policy has been determined not by science but by ideology, riddled with political and financial scandals. In a dramatic turn of event, the new Yoon Suk-yeol government has promised to reverse Moon’s nuclear-free promises, reflecting the dire need to address energy trilemma challenges and meet geo-economic goals. This chapter concludes that the direction of South Korea’s carbon-neutral energy policy is right in the context of global campaign for clean energy and climate action, but its energy transition needs to be depoliticized and its speed adjusted.

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Notes

  1. 1.

    Rokke (2021)

  2. 2.

    World Energy Council (2016)

  3. 3.

    South Korea has signed the Paris Agreement of the United Nations Framework Convention on Climate Change (UNFCCC) and pledged to reduce emissions 37 percent below business-as-usual (BAU) levels by 2030. In March 2021, President Moon Jae-in announced his plan to further bolster South Korea’s target of cutting emissions by more than 24 percent by 2030 from the 2017 level.

  4. 4.

    Energy mix refers to a government’s policy for balancing and diversifying the sources of energy. It typically involves setting goals for the percentage of energy to be produced from different sources, such as fossil fuels, renewable energy, and nuclear power, and implementing measures to achieve those goals in a reliable, affordable, and sustainable manner. As to South Korea, the Third Energy Basic Plan (2019–2040) set the renewable energy target even higher at up to 35 percent by 2040 while leaving the target of nuclear energy ambiguous. According to the Carbon Neutrality Vision and Strategy for Industry and Energy released in December 2021, renewables would take up about 70.8 percent of South Korea’s power generation capacity by 2050 (The Ministry of Industry, Trade, and Energy 2021).

  5. 5.

    Park and Koo (2018)

  6. 6.

    The so-called green subsidies are not compatible with the World Trade Organization (WTO)‘s Subsidies and Countervailing Measures (SCM) Agreement if they distort the market mechanism and cause unfair discrimination against foreign firms (Rubini 2012; Lewis 2014; Lee 2016a, b; Chung 2018; Park and Koo 2018).

  7. 7.

    First introduced in 2002, the program attracted high expectations as South Korea’s flagship renewable energy supply project. However, support for new projects abruptly ended at the end of 2011, as the government’s Electric Power Industry Infrastructure Fund ran out much faster than expected. Aside from rent-seeking behaviors and lack of transparency, the negative impact of solar panels and wind turbines on the environment brought the program to an early retirement to be replaced by the RPS in 2012 (Koo 2013: 2).

  8. 8.

    Park and Koo (2018)

  9. 9.

    Lolla and Graham (2021)

  10. 10.

    One PJ is equal to 278 gigawatt-hours of electricity or 28 million liters of petrol.

  11. 11.

    Kim (2019)

  12. 12.

    Most notably, the Democratic Party, the then-largest opposition party, declared in its new party platform: “Ecological democracy is a new value we must pursue, and creating green jobs is our immediate task. From the perspective of sustainability and human peace, we aim for a zero-nuclear power generation in the long term, while strengthening measures for nuclear safety in the short term. We strive to develop renewable energy and take the lead in environmental preservation at the global level” (Nocut News 2014).

  13. 13.

    Lee (2016a, b)

  14. 14.

    Jang (2017)

  15. 15.

    Koo (2013); Lee (2014); Ham (2018)

  16. 16.

    Lee (2014); Lim and Jo (2017)

  17. 17.

    MOTIE (2017)

  18. 18.

    A subsidy takes a variety of different forms, including grants, loans, equity infusion, loan guarantees, tax credits, and goods or services, other than general infrastructure (WTO SCM Agreement Article 1.1). The 2030 Implementation Plan offered financial incentives to large-scale renewable energy projects, R&D funds, and industrial clusters for innovative renewable companies. More specifically, the government promised a RPS mechanism with weighted REC system and a Korean-style FIT model with generous government loans and tax incentives. These subsidies can be highly contentious under the WTO. South Korea’s Moon administration was not alone here. The US Biden administration’s Inflation Reduction Act of 2022 has been similarly accused of creating distortions as a result of the subsidies it offers. In its ruling on the Canada-Renewable Energy/Canada-FIT Program (WT/DS412⋅DS426/R), the WTO’s Dispute Settlement Body has indicated that measures to promote renewable energy sectors are subject to prohibited subsidies, especially when government subsidies confer benefits in existing markets (Park and Koo 2018: 70–71).

  19. 19.

    As of 2016, renewables consisted of solar (38 percent), wind (8 percent), biomass (16 percent), and waste (25 percent). The negative consequences of burning biomaterials and waste were evident (Panwar et al. 2011). The Moon administration attempted to change the composition to 57 percent solar, 28 percent wind, 5 percent biomass, and 6 percent waste by 2030 (Kwak 2018: 27).

  20. 20.

    MOTIE (2017)

  21. 21.

    Yoo (2015); Federation of Korean Industries 2016; Hyundai Research Institute 2018; International Renewable Energy Agency 2021)

  22. 22.

    Kim (2016); Ann (2018); Asan Institute for Policy (2018); Jung (2018)

  23. 23.

    During the same period, hydropower capacity increased by 1.6 percent, wind capacity by 25 percent, and biomass by 100 percent (https://ihsmarkit.com/research-analysis/south-korean-quest-for-solar-unimpeded-by-coronavirus-.html)

  24. 24.

    Kirk (2020)

  25. 25.

    Park and Koo (2018)

  26. 26.

    Moon’s renewable energy policy was closely tied to local and regional engagement policy. Compared to their traditional counterparts, renewable energy sources including wind, solar, and biomass require more land, and their environmental impact has been controversial both biologically and environmentally (Seager et al. 2009). For 1 GW of electricity to be generated by solar and wind power, 33 million m2 and 165 million m2 of land are required. In contrast, nuclear energy production requires 363,000 m2 of land for the same amount of electricity (Asan Institute for Policy 2018). As a result, renewables have posed a significant challenge to local residents, deeply polarizing local neighborhoods over renewables installation.

  27. 27.

    Hahm (2017); MOTIE (2017); KNREC (2018)

  28. 28.

    WTO SCM Agreement Article 1.1 stipulates: a subsidy is “deemed to exist if there is a financial contribution by a government or any public body within the territory of a Member” or if “there is any form of income or price support in the sense of Article 16 of GATT (Subsidies)” and “if a benefit is thereby conferred.” If a subsidy is found to be “specific to an enterprise or industry or group of enterprises or industries” (Article 2.1) and cause “adverse effects to the interests of other Members” such as “(a) injury to the domestic industry of another Member; (b) nullification or impairment of benefits accruing directly or indirectly to other Members; (c) serious prejudice to the interest of another Member” (Article 5), it is considered “actionable.” Prohibited subsidies (Articles 3 and 4) are exempted from the specificity test, but a positive decision on the existence of a subsidy is a prerequisite.

  29. 29.

    Lee (2018)

  30. 30.

    According to a government investigation report released in September 2022, more than $189 million of taxpayer money was wasted during the former Moon administration in the form of direct payments or loans to fraudulent or manipulated renewable projects at least in 12 municipalities. The amount accounted for more than 12 percent of the total fund mobilized to assist renewable energy projects in local provinces. The fraudulent and manipulated cases mostly involved solar projects, such as “loans extended to install fake agricultural facilities under the solar power facilities so as to abide by the law that farmland must be cultivated, contracts with unregistered solar power generation companies and exaggerated tax invoices for solar projects” (Nam 2022).

  31. 31.

    https://sdco.or.kr/portal/eng/main/main.do

  32. 32.

    Katona (2021)

  33. 33.

    Lee and Mathis (2021)

  34. 34.

    Lee and Kim (2020)

  35. 35.

    Koo (2013)

  36. 36.

    Kong and Lee (2017); Park (2017); Yoon (2017)

  37. 37.

    It is a public knowledge in South Korea that a doomsday film entitled “Pandora: We Knew This Day Would Come” influenced his nuclear-free fantasy. In the 2016 film directed by Park Jeong-woo, a magnitude 6.1 earthquake caused the explosion of an old nuclear power plant in a small village leading to a nation-wide chaos while evoking memories of the 2011 Fukushima meltdown. Reportedly, Moon shed a tear while publicly watching the movie in Busan, his political hometown, and told his supporters: “Even if the probability of a nuclear accident is only one in a million, if there is a possibility of an accident, we must prevent it. There are 3.4 million people living within a 30 km radius of the Kori region, where nuclear power is the most concentrated in the world. It will be a total disaster if any nuclear accident takes place in its neighborhood. For Busan citizens, it’s like living with a bomb that will explode at your bedside. We should get rid of Pandora’s box itself rather than hopelessly trying to leave it unopened” (Kim 2016; Kong and Lee 2017).

  38. 38.

    Jang (2017); Kong and Lee (2017)

  39. 39.

    A national Gallup poll conducted in September 2017 showed the public was evenly divided with about 40 percent in favor of nuclear constructions to continue and the same proportion wanting suspension (Kong and Lee 2017).

  40. 40.

    Chung (2018, 2020)

  41. 41.

    Yonhap News (2017)

  42. 42.

    Nuclear Engineering International (2020)

  43. 43.

    Aside from the shutdown of Wolsong 1, the construction of units 3 and 4 of the Shin Hanul nuclear power plant in Ulsan was postponed, and plans for other new nuclear power plants were also scrapped (Song and Lee 2022).

  44. 44.

    Yonhap News (2020)

  45. 45.

    Yonhap News (2021); Korea JoongAng Daily (2022)

  46. 46.

    Lee (2022a, b)

  47. 47.

    Oh (2022)

  48. 48.

    Choi (2022); Lee (2022a, b); Song and Lee (2022)

  49. 49.

    At the previous meeting held in Abu Dhabi, UAE in 2017, the Korean government voiced the exact opposite. Moon Mi-ok, the then-science and technology adviser at the presidential office, resonated President Moon’s nuclear phase-out policy: “Over the next 60 years, we are pursuing an energy transition policy that will gradually reduce our dependence on nuclear power and increase the proportion of renewable energy” (Yoo 2022).

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Authors and Affiliations

  1. Seoul National University, Seoul, South Korea

    Min Gyo Koo

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  1. Berkeley APEC Study Center, University of California, Berkeley, Berkeley, CA, USA

    Vinod K. Aggarwal

  2. Berkeley APEC Study Center, University of California, Berkeley, Berkeley, CA, USA

    Margaret A. T. Kenney

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Koo, M.G. (2023). South Korea’s Renewable Energy Odyssey: A Failed Attempt at Carbon-Neutral Growth Without Nuclear Energy. In: Aggarwal, V.K., Kenney, M.A.T. (eds) Great Power Competition and Middle Power Strategies. The Political Economy of the Asia Pacific. Springer, Cham. https://doi.org/10.1007/978-3-031-38024-2_10

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