Approximately one hundred Korean firms are expected to invest a cumulative KRW 4.5 trillion ($4.03 billion) in renewable energy this year, up 23% from 2010, according to the Ministry of Knowledge Economy. Wind power will receive at least KRW 530 million of this.
The government aims to focus investment in renewable energy technologies that can leverage the country's construction, shipbuilding and other engineering and manufacturing capabilities. By 2015, South Korea plans to invest KRW 40 trillion in renewable energy technologies in a combined push by public and private sectors.
To help establish an offshore wind power supply chain, in November the government announced plans for a 2.5GW project in the Yellow Sea. The facility is to be built in three stages. In the first phase turbines produced by domestic manufacturers will be put to the test. The pilot phase, to be built by 2013, will total 100MW and use 20 5MW turbines. Suppliers have not been identified yet. A further 1GW will come online by 2016 and the rest by 2019.
The entire project is expected to cost roughly $8.2 billion, with Korean industrial firms footing most of the bill. In 2012, the introduction of a Renewable Portfolio Standard to replace the feed-in tariff will encourage state-run Korea Electric Power Corporation (Kepco) and its subsidiaries to focus investments in the wind farm and in other large renewable energy projects.
Improving data collection
In January, Kepco finished construction of a 115-metre meteorological and oceanographic tower close to the 2.5GW Yellow Sea offshore wind project. This will provide more accurate measurements above and below the water than it is possible to obtain by satellite. The data will be used to help ensure the performance and efficiency of the wind farm.
Several chaebols - Korea's largest industrial conglomerates - are developing multi-megawatt turbines suitable for offshore wind power production. They include Samsung, Hyundai, STX, Doosan and Unison. Hyundai, Samsung and STX are expected to develop 5MW turbines by 2012.
Kwan Jeong, head of Seoul-based renewable energy consultancy Dass Solutions, which advises large Korean industrial companies, says: "Offshore wind power projects are seen by chaebols as appropriate for deployment of their financial and engineering capabilities, as they are sizeable and repeatable."
Caitlin Pollock, a senior analyst of Asia wind energy at IHS Emerging Energy Research, talks up Korea's budding prospects: "One advantage that Korea has, compared with China and other countries, is that Korean companies are not pure players but have true global presence, with distribution networks already in place."
Last year, Korean industrial firms visited European locations, including the UK, to assess potential export markets for offshore wind and other large-scale renewable-energy technologies.
Manufacturers in South Korea, a country that imports most of its fossil fuels such as oil and gas, are projected to export $9 billion of renewable-energy products in 2011. According to a ministry statement, this represents a growth of 91% from 2010. By 2015, the country's renewable energy exports are projected to reach $40 billion.