[Exclusive] First Introduction of "DC" to National Power Grid... KEPCO Invests 28.2 Billion Won [Solving the AI Power Crunch with DC] 1

KEPCO to replace 6-km section of existing AC line between Naju and Wanggok
Launching 30-MW-class MVDC demonstration this year
Prebuilt DC infrastructure lowers barriers to private-sector entry

Hanwha, LS and LG accelerate private-sector shift

Korea Electric Power Corporation (KEPCO) is introducing direct-current (DC) distribution lines into the country's existing alternating-current (AC)-centered power grid. The company will expand DC distribution, which has primarily been used inside factories and buildings, to the actual power grid and test whether the same lines can deliver more electricity. With power demand surging due to factors such as AI data centers, KEPCO is working not only to expand power plants and transmission networks but also to secure technologies that can increase the capacity of existing grids.

According to reporting by The Asia Business Daily on October 19, KEPCO is investing a total of KRW 28.2 billion in a demonstration project that will convert an approximately 6-kilometer section of existing AC lines between Naju Substation and Wangok Substation to medium-voltage direct current (MVDC), starting this year. The company plans to install power conversion equipment and other facilities to supply 30 MW of electricity and verify capacity and reliability under actual operating conditions. It is the first project in South Korea to convert an existing power grid to DC.

DC distribution supplies electricity in direct-current form to facilities such as factories and buildings. It can make better use of existing lines and reduce losses during power conversion, making it a potential way to meet rising demand from data centers and industrial facilities. The demonstration project is intended to verify the benefits of DC distribution and lay the groundwork for companies to invest in equipment and technology.

Twice the Power Over the Same Lines...Supporting Companies' Adoption of DC

The MVDC used in this project occupies a voltage range between low-voltage direct current (LVDC), used in buildings and household appliances, and high-voltage direct current (HVDC), used for long-distance transmission. It is used to supply relatively large amounts of electricity to industrial complexes and regional power grids.

The core goal of the demonstration is to double the amount of power that can be transmitted over the same lines. If this benefit is confirmed in actual operation, power supply can be increased while reducing the need to build additional lines. The project will serve as a test of whether DC technology proven at individual facilities can be applied to regional power grids.

The project will also test the ability to control the direction and volume of power flows. Converters, which are power conversion devices installed in DC distribution networks, will be used to redirect electricity concentrated in a particular section to nearby parts of the grid with spare capacity.

In the Honam region, where renewable energy sources such as solar power generate large amounts of electricity, this capability is expected to help ease line congestion and reduce the need for output curtailment. Output curtailment is a measure that reduces generation when the power grid cannot take in all the electricity produced. The plan is to use DC grids not only to generate more electricity but also to send electricity already generated to where it is needed.

Alongside the demonstration, KEPCO is preparing a business model to lower the cost of DC adoption for companies. Under the "shared DC infrastructure first-build model," KEPCO will build shared infrastructure, including power conversion equipment, in advance for use by tenant companies. The model is scheduled to be introduced for the first time at Naju Innovation Industrial Complex in 2027.

Until now, companies seeking to adopt DC equipment have had to install expensive power conversion equipment and resolve grid connection issues. With shared infrastructure in place, companies will face less need to shoulder these costs and challenges individually. After establishing an institutional framework for DC supply by revising the detailed rules for its terms of supply, KEPCO plans to create conditions that will also enable small and midsize companies to participate.

KEPCO is also pursuing projects to supply DC power to individual sites. One example is a data center being built by Hanwha's Construction Division in Yeongdeungpo-gu, Seoul. KEPCO is conducting detailed design work on a 1 MW DC supply system to provide power to the facility. Construction of the data center is about 15% complete, with rock breaking and removal work underway. The target date for completion and the start of DC power supply is May 2028.

From Factories to Data Centers...Securing DC Technology and Standards

While supply capacity is being tested on the power grid, efficiency in electricity use is being assessed at manufacturing sites. The LS ELECTRIC Cheonan DC Factory, involving KEPCO, LS ELECTRIC, and LG Electronics, is a key demonstration site.

Opened in July 2026, the factory converts 1 MW of the AC power supplied by KEPCO to DC on-site and uses it for production equipment, heating and cooling systems, lighting, and other facilities. This means that some equipment has been converted to DC out of the factory's total power capacity of 12 MW. The factory is collecting operating data with the goal of improving energy efficiency by more than 10% by converting production equipment and related infrastructure to DC.

Last month, in September 2026, a system connecting a large-capacity energy storage system (ESS) completed its final inspection and began operating. Solar power and ESSs inherently generate or store DC. Connecting them to the factory's DC grid can reduce the steps of converting the power to AC and then back to DC. This setup reduces unnecessary power losses from generation and storage through to consumption.

The equipment that has so far shown the greatest power savings is a key performance testing machine on the "G2" production line for next-generation power conversion systems (PCS). The company says the savings were significant because DC was applied to equipment that accounts for a large share of the factory's power consumption, reducing the number of conversion steps.

Based on operating data from individual types of equipment, KEPCO and the participating companies plan to develop a standard model for supplying DC power to industrial complexes and factories in conjunction with renewable energy, and to apply it first in areas such as the Honam region. The next step is to develop specific implementation methods so that the savings demonstrated at individual factories can be replicated at other sites.

Operating experience gained at factories is now informing the development of DC distribution technology for data centers. LS ELECTRIC has signed a memorandum of understanding (MOU) with LG Uplus on "the joint development of power infrastructure for AI data centers and verification of DC distribution technology (PoC)," and has begun testing using power data from an actual data center. It is also pursuing DC distribution technology collaboration with GS Engineering & Construction to improve power efficiency at high-power, high-density AI data centers.

LS ELECTRIC is reviewing potential supply opportunities for next-generation DC infrastructure and discussing design approaches with global big tech companies. The company plans to prepare for entry into the North American market by drawing on its experience in factory-level demonstrations and its existing power equipment business capabilities, which include more than 300 UL certifications.

In its existing power equipment business, LS ELECTRIC is expanding data center orders in North America. It recently increased the value of a contract to supply 38-kilovolt high-voltage distribution systems to a North American big tech company from about KRW 106.4 billion to about KRW 230.9 billion, and also signed an additional contract worth KRW 181.2 billion to supply 345-kilovolt ultra-high-voltage transformers. These contracts are not for DC distribution, but they are helping the company broaden its data center customer base and supply experience.

An LS ELECTRIC representative said, "Orders for power distribution solutions for AI data centers are increasing every year," adding, "We expect to leverage the technology and supply experience we have built up in our existing distribution business as the next-generation DC distribution market takes off."

For DC distribution to spread beyond individual demonstration projects, standards and certification systems are also needed to ensure that equipment from multiple companies can be connected reliably. KEPCO plans to establish a fast-track process that advances standards and certification from the outset of projects, and to develop a "global research complex specializing in DC technology" centered in Naju. LS ELECTRIC, LS Cable, HD Hyundai Electric, Hyosung Heavy Industries, LG Electronics, and other companies are expected to participate in an initiative linking technology development with demonstration and commercialization.

KEPCO is also pursuing the application of DC at the Naju data center and the company's Gyeonggi Headquarters building. It plans to identify projects that directly connect large-scale renewable energy complexes, including those in Saemangeum, with DC power consumers. KEPCO aims to expand the scope of DC distribution by verifying the ability to transmit power on Naju's actual grid and assessing how to use it efficiently at factories and data centers.

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