Expanding Renewable Energy Share to Over 20% by 2030... "Breaking Away from Fossil Fuel Dependence"

Ministry of Climate, Energy and Environment Presents "Energy Transition Promotion Plan" at Cabinet Meeting
Electrification and Decarbonization Across All Sectors
Coal Power Plants to Be Phased Out by 2040; Some to Remain Operable in Crisis

The government has announced plans to fundamentally overhaul the nation's energy system by reducing its dependence on fossil fuels and transitioning to an electricity-based system centered on renewables, with the goal of increasing the share of renewable energy generation to over 20% by 2030. Coal-fired power plants will be phased out by 2040, though some plants with remaining operational life will be kept ready for activation in case of an energy crisis.

On April 6, Minister of Climate, Energy and Environment Kim Seonghwan reported these initiatives, outlined in the "Energy Transition Promotion Plan," during a cabinet meeting.

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With the recent Middle East conflict rendering traditional energy security strategies, such as diversifying crude oil imports, ineffective, it has become necessary to establish a new energy security framework that can significantly reduce dependence on imported energy by expanding domestically produced sources like renewables. Additionally, surging electricity demand—driven by the proliferation of artificial intelligence (AI) data centers, the spread of physical AI, and increased investment in advanced strategic industries—demands comprehensive preparation. In response, the Ministry of Climate, Energy and Environment plans to implement "three core policy directions and ten key tasks" to fundamentally transform the energy system around renewables.

◆ Supplying 100 GW of renewables by 2030 and phased coal plant closures by 2040 = First, the government aims to achieve its target of supplying 100 GW of renewable energy by 2030 ahead of schedule, thereby increasing the share of renewables in power generation to over 20%. To promote solar energy, all available approaches will be mobilized, such as "sunlight income villages," rooftop installations in industrial complexes, agrivoltaics, floating solar, border areas, and the "RE100" initiative for public institutions to use 100% renewable energy. For wind power, efforts will focus on pre-approved sites, shortening the total project timeline through integrated permitting, and overhauling the wind turbine safety inspection system.

A roadmap will be established to phase out the 60 currently operating coal-fired power plants by 2040. Special legislation will be enacted for affected regions, with measures to foster alternative industries and support a just transition. However, for the 21 plants with remaining lifespan after 2040, plans will be developed to operate some of them in case of an energy crisis.

Heat energy, currently centered on gas, will be converted to renewable sources. Although heat energy accounts for 48% of final energy consumption, there has been no national-level management plan until now. A Heat Energy Management Act will be legislated to systematically manage this sector. Air-source and water-source heat pumps will be prioritized for regions without city gas, and district heating utilizing liquefied natural gas (LNG) will transition to renewable-based heating.

◆ Full-scale development of green industries and electrification of industrial processes = The government will also focus on building the energy industry ecosystem and developing green industries in earnest. This will involve R&D for core technologies, demonstration projects, and tax incentives for solar cells and modules, wind turbines, battery energy storage systems (BESS), wires, transformers, and water electrolysis equipment. A state-run energy technology holding company will be established, and regional energy special zones will be developed as bases for energy venture startups and unicorn growth.

Electrification and decarbonization of industrial processes and feedstocks will also be promoted. A 300,000-ton hydrogen-based steelmaking demonstration facility will be completed by 2028, with plans for expansion and commercialization after 2037, laying the groundwork for South Korea to become a global leader in green steel. In the petrochemical sector, transitioning to electric naphtha cracking centers (NCC) and improving process efficiency will support higher value-added products. For hard-to-abate sectors, carbon reduction will be pursued using green hydrogen, pink hydrogen, and "carbon capture, utilization, and storage (CCUS)" technologies.

Electrification will be promoted for all mobile power sources. The government aims to achieve its goal of having 40% of new vehicle sales in 2030 be electric or hydrogen vehicles ahead of schedule; this includes early conversion to electric vehicles for police cars, liquefied petroleum gas (LPG) taxis, rental cars, and corporate fleets. Additionally, construction and agricultural machinery, ships, and two-wheelers will be targeted for AI integration and electrification to bolster industrial competitiveness.

Financial and fiscal support will also be strengthened to underpin energy industry growth. The government will activate green finance through loans, interest support, and guarantees to encourage corporate investment. It will also expand funding for climate response initiatives, such as revenues from paid carbon emissions allowances, to support corporate decarbonization investments and green industry growth. The Ministry of Climate, Energy and Environment will develop an implementation plan to gradually convert subsidies previously allocated to fossil fuels for transport and heating into subsidies for renewables.

An electric meter is installed in a commercial building in Seoul. Photo by Kang Jin-hyung

◆ Complete overhaul of electricity rates and power market systems = The government will also promote balanced regional development through the energy transition. The national power grid will be thoroughly revamped into a distributed, bidirectional network. Flexible resources such as energy storage systems (ESS) and pumped-storage hydropower will be significantly expanded, and the grid will shift toward a decentralized system where production, storage, and consumption are optimized within each region. Inevitable regional supply-demand imbalances will be addressed by building flexible transmission lines, such as the West Coast subsea transmission network (HVDC), and enabling flexible connections. Beginning in the second half of this year, the government will conduct pilot projects and expand the "energy self-sufficient distributed special zone" model, which utilizes resources like biogas, wood chips, and solar power at the village level.

Electricity rates and power market systems will be fully overhauled to align with the renewable-centric energy transition. A regional rate system will be introduced, taking into account transmission costs, self-sufficiency, and balanced national development. Time-of-use rates to disperse power demand will gradually be implemented starting in April. The Renewable Portfolio Standard (RPS) will be converted into a long-term fixed-price contract market to drive down generation costs.

In particular, the government aims to actively realize "energy income" for 10 million citizens. The spread of "sunlight and wind income villages" will be promoted nationwide. Local residents will be encouraged to invest in high-voltage transmission projects, thereby increasing public acceptance and boosting incomes. The government will also work to strengthen the leading role of local governments in the energy transition process.

Minister Kim Seonghwan of the Ministry of Climate, Energy and Environment stated, "We will swiftly implement the People’s Sovereignty Government’s Energy Transition Promotion Plan so that our country is not shaken by external shocks such as the Middle East conflict. Through this, we will not only achieve energy self-reliance, but also secure both carbon neutrality and future industrial competitiveness, positioning Korea as one of the top three global green manufacturing powerhouses. We will also enable more citizens to participate in sunlight, wind, grid, and income villages and realize energy income."

This content was produced with the assistance of AI translation services.