Power

Power sector in 2030

Coal (43%), gas (25%), and nuclear (25%) comprise the largest shares of South Korea’s power sector. To be on a 1.5°C compatible pathway, South Korea would need to phase out coal by around 2030, gas between 2039-2047, and increase the share of renewables in power generation. The latter’s share in the power mix could reach between 27% to 44% by 2030.

Similar studies based on comparable Paris Agreement compatible pathways show a penetration of renewables up to 48% by 2030 and coal phased out by 2029.¹^,² Higher shares could avoid reliance on nuclear energy, LNG, and/or carbon capture and storage, technologies which have decreasing social acceptance, risks of carbon lock-in, and are unproven and costly compared with renewables.³

The government acknowledges that, due to steadily decreasing investment costs for wind and solar, a renewable based power system will be an economically viable option by 2030. However, they see the intermittency and volatility issues associated with wind and solar electricity generation as a significant roadblock.⁴ The recently released 9^th Basic Plan for Power Supply and Demand has coal, LNG, and renewables making up 15%, 31%, and 40% of the planned 193 GW of installed capacity in 2034.[71] LNG capacity will increase from 2019 levels of 40 GW to 59 GW by 2034 (although its share of the total will decrease) and 29 GW of coal capacity would still be online in that year (compared to 37 GW in 2019).⁵ The plan implies that coal would be phased out 25 years later than what a Paris Agreement compatible pathway would require.⁶ With regards to LNG, while the government may see this as a bridging fuel, studies have shown that it risks carbon lock-in and stranded assets.⁷^,⁸^,⁹ Moreover, government planning relies on fossil fuels with carbon capture, utilisation, and storage (CCUS) technologies as a supplementary source of power, in spite of high investments costs and so far unproven technologies.¹⁰

With regards to market-based mitigation approaches, South Korea’s ETS covers the power sector.¹¹ Critically, however, the country’s power dispatch mechanism does not currently account for carbon pricing, which significantly impedes the ETS’ ability to reduce emissions in this sector.¹²^,¹³

Towards a fully decarbonised power sector

To be on a 1.5°C compatible pathway would require the power sector to reach zero CO₂ emissions per kilowatt-hour by around 2040. This would be driven by a phase-out of coal by 2030 and gas between 2039 and 2047 latest. At the same time, renewable energy generation would increase rapidly, reaching up to 44% by 2030 and making up 64-96% of the power mix in 2050.

The transition from coal to renewables will have positive impact on health and employment. A recent analysis has shown that a planned unit level phase-out of coal power plants, resulting in 4.2 GW of capacity retired annually out to 2030, would lead to substantial health benefits over the planned coal schedule proposed by the government.¹⁴^,¹⁵ The unit level coal phase-out could also lead to significant job creation.¹⁶^,¹⁷

South Korea's power mix

terawatt-hour per year

Scaling

Relative
Absolute

Dimension

Capacity
Generation

In the 100%RE scenario, non-energy fossil fuel demand is not included.

Graph description

Power energy mix composition in generation (TWh) and capacities (GW) for the years 2030, 2040 and 2050 based on selected IPCC SR1.5 global least costs pathways and a 100% renewable energy pathway. Selected countries include the Stated Policies Scenario from the IEA's World Energy Outlook 2021.

Methodology
- Downscaling power energy mix
Data References
- Historical energy consumption : IEA WEB 2021

Graph description

Emissions and carbon intensity of the power sector in selected 1.5°C compatible pathways.

Methodology
- Downscaling power carbon intensity
Data References
- Historical energy consumption : IEA WEB 2021
- Historical energy emissions : IEA GHG emissions from Energy database 2021

Investments

Yearly investment requirements in renewable energy

Across the set of 1.5°C pathways that we have analysed, annual investments in renewable energy excluding BECCS increase in South Korea to be on the order of USD 2 to 78 billion by 2030 and 4 to 103 billion by 2040 depending on the scenario considered. . The ‘high energy demand, low CDR reliance’ pathway shows a particularly high increase in renewable capacity investments, which could be driven by an increase of electrification of end-use sectors and rapidly growing energy demand. Other modelled pathways have relatively lower investments in renewables and rely to varying degrees on other technologies and measures such as energy efficiency and negative emissions technologies, of which the latter can require high up-front investments.

Demand shifting towards the power sector

The 1.5°C compatible pathways analysed here tend to show a strong increase in power generation and installed capacities across time. This is because end-use sectors (such as transport, buildings or industry) are increasingly electrified under 1.5°C compatible pathways, shifting energy demand to the power sector. Globally, the “high energy demand” pathway entails a particularly high degree of renewable energy-based electrification across the various sectors, and sees a considerable increase in renewable energy capacities over time.

Graph description

Annual investments required for variable and conventional renewables installed capacities excluding BECCS across time under 1.5°C compatible pathway.

Methodology
- Power Investments

Indicator	2019	2030	2040	2050	Decarbonised power sector by
Carbon intensity of power gCO₂/kWh	493	156 to 181	0 to 37	-109 to 0	2040 to 2045
Relative to reference year in %		-68 to -63%	-100 to -93%	-122 to -100%

Indicator	2019	2030	2040	2050	Year of phase-out
Share of unabated coal per cent	43	1 to 7	0 to 2	0 to 0
Share of unabated gas per cent	25	11 to 13	0 to 3	0 to 0	2039 to 2047
Share of renewable energy per cent	5	27 to 44	58 to 73	64 to 96
Share of unabated fossil fuel per cent	70	26 to 27	0 to 6	0 to 0

BECCS are the only Carbon Dioxide Removal (CDR) technologies considered in these benchmarks
All values are rounded

Kim, Y. G. & Lim, J. S. Treatment of indirect emissions from the power sector in Korean emissions trading system. Environ. Econ. Policy Stud. (2020) doi:10.1007/s10018-020-00282-7. ↩
According to a joint analysis between Climate Analytics and Solution for Our Climate (SFOC), South Korea must phase out coal by 2029. Note that the study based its analysis on the global model IEA Energy Technologies Perspectives Beyond 2 degrees Scenario (IEA ETP B2DS 2017) not assessed in this analysis. A recent analysis from SFOC, Chungnam National University, and the Carbon Tracker Initiative indicates a coal phase out by 2028. ↩
Costs of carbon capture and storage (CCS) in the power sector have remained stagnant over the last decade. CCS technologies in the power sector also have a non-trivial sustainability footprint in terms of increased water use, higher resource demands, a mining and production footprint, and in general do not address local air pollution concerns. The relative cost trend between CCS in the power sector and renewables means that CCS in the power sector is increasingly unlikely to be able to ever compete with renewable energy. ↩
Republic of Korea. 2050 Carbon Neutral Strategy of the Republic of Korea: Towards a sustainable and green society. (2020). ↩
MOTIE. The 9th Basic Plan for Power Supply and Demand Strategic Environmental Impact Assessment. (2020). ↩
Climate Analytics. Assessing the Health Benefits of a Paris-Aligned Coal Phaseout for South Korea. (2021). ↩
Republic of Korea. 2050 Carbon Neutral Strategy of the Republic of Korea: Towards a sustainable and green society. (2020). ↩
Ng, C. IEEFA: Accepting gas as sustainable will hurt South Korea’s green finance credentials. IEEFA (2021). ↩
Climate Analytics & Solutions for Our Climate. Employment opportunities from a coal-to-renewables transition in South Korea. (2021). ↩
Republic of Korea. 2050 Carbon Neutral Strategy of the Republic of Korea: Towards a sustainable and green society. (2020). ↩
The power sector received the largest allocation of allowances in the schemes initial year of operation, 2015.[^18] ↩
Amoruso, F. M., Sonn, M. H., Chu, S. & Schuetze, T. Sustainable building legislation and incentives in korea: A case-study-based comparison of building new and renovation. Sustain. 13 (2021). ↩
Accounting for carbon price in the dispatch order, known as environmental dispatch, has been listed in the 9^th Basic Plan for Power Supply and Demand as a potential management plan to limit the amount of power generated by coal generators.[^19]^,[^20] ↩
Climate Analytics. Assessing the Health Benefits of a Paris-Aligned Coal Phaseout for South Korea. (2021). ↩
The 1.5°C compatible coal plant decommissioning schedules presented in the study could halve the number of premature deaths linked to air pollution from South Korean coal plants within the next 5 years and save over 18,000 lives (over 12,000 lives within South Korea) until the end of their operation, when compared to the current policy plan of phasing out coal in 2054.[^21] ↩
IEA. Korea 2020. (2020). ↩
The study shows that following the 1.5°C compatible coal plant decommissioning schedules could create more than 62,000 more jobs per year on average from 2020 to 2025, and more than 92,000 jobs per year from 2025 to 2030, when compared to current policy plans.[^22] ↩

What is South Korea's pathway to limit global warming to 1.5°C?

Power sector in 2030

Towards a fully decarbonised power sector

South Korea's power mix

terawatt-hour per year

South Korea's power sector emissions and carbon intensity

MtCO₂/yr

Investments

Yearly investment requirements in renewable energy

Demand shifting towards the power sector

South Korea's renewable electricity investments

Billion USD / yr

1.5°C compatible power sector benchmarks

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