PRESS RELEASE
South Korea’s coal phase-out falls far behind OECD, according to study
South Korea projected to have the third-largest coal generation capacity among OECD countries in 2030, after the United States and Japan
April 10, 2023 – The South Korean government’s continued reliance on coal power beyond 2030 will have dire consequences for the country’s ability to reduce emissions and meet its carbon neutrality goal, according to Global Energy Monitor’s ninth annual survey of the coal plant pipeline.
South Korea is projected to have the third-biggest coal capacity among OECD nations in 2030, according to Global Energy Monitor. The report finds that according to the latest electricity plan, Korea will have 41 coal units operating in 2030 with a total capacity of 31.7 GW. This is only 7.4 GW less than the current operating capacity of 39.1 GW, or a 19% reduction, and completely out of line with the world’s efforts to transition away from fossil fuels on time.
The global coal power capacity, excluding China, has been falling since 2018 as existing plants are being retired and planned projects cancelled. In the past five years, the OECD’s projected coal capacity in 2030 fell by 29%. However, South Korea is bucking this trend, with its coal capacity remaining steady and not retiring a single plant in 2022. According to a 2021 report, South Korea needs to retire 4.2GW of coal capacity each year to align with the Paris Agreement.
“It is deeply troubling that South Korea is choosing to fuel the climate crisis by continuing to rely on coal power after 2030 as part of its energy policy,” said Jinsun Lee, the head of Climate Finance at Seoul-based Solutions for Our Climate. “Coal harms the planet and the people living on it, not to mention financially unwise. The country’s biggest utility is suffering a historical loss due to the spike in fossil fuel prices, and this will ultimately hurt taxpayers. It’s time to transition toward an energy future that is both environmentally and financially sustainable.”
In 2022, KEPCO suffered over 32.6 trillion KRW (US$25 billion) deficit, around 30% of which was directly attributable to coal power. Rather than making efforts to transition away from fossil fuels, the utility has been relying heavily on debt financing to cover its losses, issuing $27 billion in bonds last year. Pressure is now on the National Pension Service, which announced in 2021 an exit from coal power, but is continuing to purchase KEPCO bonds despite the utility’s lack of Paris-aligned energy transition plan.
While the amount of operating and planned coal power plants fell globally in 2022, the pace of retirements needs to move four and half times faster – and new coal plants must stop being built – in order to put the world on track to phase out coal power by 2040, as required to meet the goals of the Paris climate agreement.
To stay on track, all existing coal plants must be retired by 2030 in the world’s richest countries, and by 2040 everywhere, and there is no room for any new coal plants to come online. While newly proposed coal power capacity has declined significantly, the world is not retiring existing coal plants fast enough.
Phasing out operating coal power by 2040 would require an average of 117 GW of retirements per year, or four and a half times the capacity retired last year. An average of 60 GW must come offline in OECD countries each year to meet their 2030 coal phaseout deadline, and for non-OECD countries, 91 GW each year for their 2040 deadline. Accounting for coal plants under construction and in consideration (537 GW) would require even steeper cuts.
“The transition away from existing and new coal isn’t happening fast enough to avoid climate chaos,” said Flora Champenois, lead author of the report and project manager for Global Energy Monitor’s Global Coal Plant Tracker. “At a time when developed countries should be helping the rest of the world both end new coal plant construction and begin their coal transitions in earnest, many – including South Korea – are instead planning to operate their coal plants at home far beyond the deadlines required by climate science.”
ENDS.
Global Energy Monitor (GEM) develops and shares information on energy projects in support of the worldwide movement for clean energy. By studying the evolving international energy landscape, and creating databases, reports, and interactive tools that enhance understanding, GEM seeks to build an open guide to the world’s energy system. For more information, visit www.globalenergymonitor.org.
Solutions for Our Climate (SFOC) is a South Korea-based group that advocates for stronger climate policies and reforms in power regulations. SFOC is led by legal, economic, financial, and environmental experts with experience in energy and climate policy and works closely with policymakers.
For media inquiries, please reach out to:
Euijin Kim, Solutions for Our Climate, euijin.kim@forourclimate.org
Flora Champenois, Global Energy Monitor, flora.champenois@globalenergymonitor.org
Share this insights