South

Korean Energy Outlook:

Demand, Supply, & Policy

October 12, 2015

Colorado Springs
 South Korea
13th Largest Economy

5th in Asia-Pacic aHer
China, Japan, India,
and Australia

GDP is only $40 billion
less than Australia,
but over $520 billion
greater than next
largest in the Asia
Pacic (Indonesia)
Source: US Energy InformaTon AdministraTon
 Koreas Recent Energy Policies
Has acknowledged the need to reduce emissions
and increase eciency since 1987
As early as 1989, legislaTve debate about
requiring uTliTes and manufacturers to scrub
emissions
Energy sector was the only part of the economy
not liberalized in 1993 aHer the transiTon to
democracy
Price controls were nally eliminated on all fuels
in 1998
 Koreas Recent Energy Policies
In 1997, the Ten Year NaTonal Plan for Energy set
2006 as the deadline to develop new technology
to diversify energy mix
solar thermal, solar photovoltaic, wind, hydro, fuel
cells, coal liquefac0on and gasica0on, Tdal, waste
gasica0on, geothermal, etc.
In 1999, alternaTve energies only accounted for
1.3% of all of Koreas energy supply, of which
96% was waste and biomass
gasicaTon of municipal solid waste since 2001
 Koreas Recent Energy Policies
Had a feed-in tari system to promote
alternaTves and renewables from 2005-2012
Replaced with Renewable Porfolio Standards
in 2012 due to persistent low adopTon of
alternaTves by uTliTes
Began an Emissions Trading Scheme in
January 2015 (2nd largest globally aHer EU)
covers 525 business enTTes from 23 sectors
TargeTng a 37% emissions reducTon below
BAU by 2030
 Koreas Energy Mix
Oil consumpTon
was 66% of total
at peak in mid-90s
Rise in coal, gas &
nuclear accounts
for oils decline
Nuclear capacity
goal of 43% of all
electricity by 2029
 Koreas Energy Mix
Higher emissions
targets resulted in 4
fewer coal plants
planned (2521)
Coal projected as
32.3% of total 2029
energy consumpTon
Natural gas projected
as 24.8% in 2029
 Koreas Electricity GeneraTon by Fuel,
40 000
2000-2015
35 000

30 000

25 000

20 000

15 000

10 000

5 000

0
Jan-00
Oct-00
Jul-01
Apr-02
Jan-03
Oct-03
Jul-04
Apr-05
Jan-06
Oct-06
Jul-07
Apr-08
Jan-09
Oct-09
Jul-10
Apr-11
Jan-12
Oct-12
Jul-13
Apr-14
Jan-15
Source: InternaTonal Energy Agency, Monthly Electricity StaTsTcs, Revised Historical Data - June 2015.
 Coal
Has ~139MMst of
recoverable coal
(mostly anthracite)
60% used for electricity
producTon, 40% by
industry and
manufacturing
Imports from Australia
(42%), Indonesia (28%),
Russia (14%), Canada
(10%), US (3%), China
(2%)
GE supplied systems
for Koreas 1st
gasicaTon plant,
Taean IGCC
 Natural Gas
Negligible domesTc & oshore
reserves
Price is nearly 1/3 of what it
was 18 months ago
2nd largest importer of LNG
globally
KOGAS is eecTve monopoly on
imports, sales, & distribuTon
Imports from Qatar (35%),
Indonesia (14%), Oman (10%),
Malaysia (10%), Nigeria (9%),
Yemen (8%)
Contracts in place for imports
from Sabine Pass (2017, 20 yrs)
and Freeport (2019, onake)
 Future Demand
Electricity demand expected to increase 2.2%
annually to 2029, reaching 657 TWh/yr
Export market slowdown & aging populaTon may
reduce demand in coming years
4 nuclear plants under construcTon, 8 more
planned
21 coal plants called for in govt energy plan must
apply best available technology
Govt has commired to invest in Coal to Liquid
and Carbon Capture pilot plants, but no CCS
requirement for new coal plants