Korea is the 32nd largest country in the world by both area and population, with a population of over 50 million people. The most recent economic reports have predicted a 5% growth rate for the country in the next five years.
Investment in the country’s solar energy sector increased by 41% in 2018 to €2.2 billion, and the number of installations grew by 28% compared to the previous year. There has also been a significant increase in the number of homeowners installing solar power systems, with last year’s total of 1.3 million systems more than doubling that of 2016. The popularity of solar energy in Korea is evident.
Korea Is A Land Of Gigawatts
Korea enjoys one of the highest electricity tariffs in the world, at 4.3 cents/kWh, which rises to 7.2 cents/kWh during peak periods. This has helped drive investment in the country’s renewable energy sector and created plenty of opportunities for power purchasers and producers. One of the largest electricity consumers in Korea is the government, which accounts for about 500 megawatts (MW) of its total electricity consumption. This is equivalent to about 5% of the entire country’s generating capacity. The government has committed to reducing this percentage to below 3% by 2045.
The government is also the largest single investor in the country’s solar energy sector, accounting for 23% of all government backed solar projects globally. Across the industry, there are plenty of opportunities for individuals and businesses to get in on the act, too. The majority of the country’s solar farms are owned by individuals or private firms, with about 65% of all systems installed under this category. The remaining 35% are located on businesses’ properties and hold significant investments from leading multinational energy conglomerates such as Chevron and Shell. This is leading to an increase in partnerships between governments, investors, and energy producers.
Solar Is A Competitive Fuel In Korea
While the Korean government has provided significant backing to the renewable energy industry via national strategy and policy, the private sector has responded with innovative financing solutions, competitive pricing, and improved installation techniques.
In March 2019, the government of Korea announced a tariff decrease for solar power, which lowered the cost of photovoltaic electricity by 7.2% compared to the previous year. This was followed by a 10% decrease in April, and 11.1% in May. The government is also considering a 20% reduction in electricity tariffs for small and mid-sized enterprises (SMEs) by 2021.
Additionally, as the cost of solar electricity has decreased, competitive pricing has become an important factor in attracting new customers. Leading residential solar power provider in Korea, Sunseed, for example, offers a solar panel lease with a fixed monthly cost of £16 per month, plus a one-off setup cost of £40. This is cheaper than most traditional electricity supply contracts, and is designed to appeal to customers on a budget. With this type of attractive leasing solution, coupled with tariff reductions and Government support, the market potential for residential solar in Korea is significant.
Most Households Are Now Home To Solar
Korea is a household name when it comes to sustainable energy, due to its highly advanced and efficient grid infrastructure, high electricity tariffs, and emphasis on renewable energy. As noted, the market for home solar power in Korea has seen significant growth in recent years, with about 800,000 households currently generating their own electricity and reducing their dependence on fossil fuels. This is a trend the country’s government and energy producers are keen to promote, and have made home solar power one of their key growth industries.
The market for home solar power in Korea is largely driven by government policy, with cheap loans and favourable tariffs available to support and encourage residential solar installations. The majority of the country’s solar farms are located in the Gyeonggi region, with the most popular project being the Gyeonggi Solar Power Plant, which has a production capacity of 69.55 MW and covers an area of 13.2 hectares.
This type of centralized solar power plant offers several advantages to the residential market, including reduced costs due to large-scale operation (as opposed to distributed generation), increased security of supply, and environmental benefits. In 2018, the government of Korea funded about 70% of all solar energy projects, with the remainder being privately funded. This is expected to rise to about 80% in the next five years.
Energy Storage Is A Key Trend In Korea
Energy storage is one of the most popular and innovative facets of the residential solar power market in Korea. Different forms of energy storage, such as batteries and flywheels, are used by residential customers to ensure they have continuous and uninterrupted power supplies when the sun doesn’t shine or the wind doesn’t blow. These devices store electricity generated during the day when demand is high, and/or when the sun is shining, and/or the wind is blowing, and allow the customer to draw power at any time, rather than having to rely on the fluctuating load profile of the mains electricity supply.
The most popular residential energy storage device in Korea is the Tesla Powerwall, a residential energy storage system that enables customers to store energy generated by solar panels on the roof. Similar devices also exist from a range of leading energy companies, offering a reliable, safe, and sustainable power supply for customers.
Solar Power Sets The Industry Standard In Korea
On a global scale, Korea is home to one of the most innovative and advanced solar energy markets. The country operates one of the world’s largest national grids, which is connected to major electricity consumers such as factories and commercial buildings. This enables power purchasers and producers to offer customers a reliable, eco-friendly, and cost-effective option for their energy needs.
The majority of the country’s solar farms operate at a capacity of 10 kW or above, with the largest installation, the Kyungpook National Forest, having a capacity of 100 kW. As a result, the grid operator is able to provide electricity to approximately 250,000 customers across the country. This system is managed and operated by Koridol, the National Council for Resources and Energy. The council also promotes renewable energy and energy efficiency across various industries and sectors, via government contracts and public procurement, standards setting, and capacity building. This support and facilitation has enabled the country’s solar energy industry to achieve industry-leading market penetration, with over 830,000 households and businesses now enjoying the benefits of solar energy, compared to about 300,000 five years ago.
The government has also played a crucial role in establishing the standards for solar farms in the country, via a set of national quality criteria for solar farms. These include things such as the size of the system, the efficiency of the solar panels, and the cleanliness of the site. The most recent and most stringent of these quality criteria, which apply to new installations, require that solar farms be at least 3 hectares in size and generate at least 1.5MW of electricity. These standards are gradually being implemented by government agencies, energy producers, and service providers to ensure that the market stays fresh and that new technology can continually be integrated into the system.
Korea Voted One Of The Cleanest Countries
Korea was named after the country’s abundant flora and fauna, including its red pine trees and bonsai. The island country is well known for its eco-friendly, high-quality products, and has long been committed to sustainable development and the maintenance of natural resources. In 2019, the country was ranked 4th in the world for environmental quality, with its capital Seoul being ranked 16th in the world’s most liveable cities.
Globally, the environment is a hot topic, and the world is gradually taking a hard look at its impact. In light of this, products manufactured in and exported from Korea are guaranteed to be environmentally sound, due to the country’s many resources, skilled employees, and advanced manufacturing techniques.
Korea Is One Of The Most Open Countries
Korea is one of the most open countries when it comes to business, with over 300 million euros worth of contracts exchanged on a daily basis and plenty of opportunities for individuals and businesses to grow and prosper. From a legal standpoint, the country’s markets are highly competitive, with the national competition authority (Dongbang District Court) regularly intervening to break up monopolies and establish price floors and prevent anti-competitive behaviour.