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$42.8 billion for the world’s largest offshore wind farm. Up in the Nordic countries? No, down in South Korea!
The wind farm off the coast of the Shinan district to reduce fossil fuel emissions and costs
The world's largest offshore wind farm will be erected off the coast of the south-western tip of the Korean peninsula, in South Korea's Shinan district: a $42.8 billion project for 8.2 GW of power. This is one of the many projects launched by the South Korean government to become a zero-emissions country by 2050. In South Korea, in fact, industry has been growing uninterruptedly since the ‘60s, leading it to become an energy-intensive nation: it is among the top 10 in the world for energy use, two-thirds of which is produced from fossil fuels. Renewable energy in this country carries little weight, as demonstrated by the fact that, in 2019, it accounted for only 6.5% of the total energy produced in the country.
However, South Korea has decided to make more sustainable choices, with the Green New Deal that was recently introduced by the government and with President Moon Jae-in’s goal to obtain more than 20% of the country’s energy demand from renewable sources by 2030. South Korea’s green shift is inarguably driven by excellent intentions, but there is also another reason behind it. South Korea is a country of scarce energy resources and spends $73 billion a year in fossil fuel imports. Therefore, underlying its determination to reduce emissions is also the necessity to cut import costs and become more energy-independent.
This is definitely a tough challenge because the country is already harnessing most of its hydroelectric resources, plus its climate and the topography of the environment are inadequate for large onshore wind or solar installations. That is why South Korea is looking for other ways to achieve its energy and climate goals.
Under this scenario, the South Korean government sees offshore wind as a good opportunity. Out in the open sea, the wind is strong, blowing at a good steady speed. In addition, there is more space to install turbines that are larger and more efficient than onshore turbines.
This strategy has a good chance but is facing several obstacles. At the top of the list we find the opposition of local residents, who are worried about the protection of their territory: the government has already made concessions, allowing the community to acquire a 30% share in local projects for development of renewable energy sources. Another problem is tied to the cost of wind power, which in South Korea is currently among the highest in the world at $220 per MWh. Moreover, the ambitious green projects launched by the South Korean government rely on the contribution of many private companies (more than 20 companies are involved in the offshore wind farm off the coast of the Shinan district), something that could lead to a change in plans over time, for example, due to issues having to do with granting of permits and authorisations or cost calculations. The South Korean government and the stakeholders involved must overcome these difficulties before they can go ahead with the project.
Until a short time ago, the Nordic countries of the European Union dominated the world’s offshore wind industry thanks to generous government subsidies and incentives and the features of the northern seas, whose waters, strangely, are not very deep.
But something is changing. South Korea is not the only country in the world that is betting on wind power. Last year, China installed a record number of offshore wind turbines, becoming the world’s wind capacity leader, but the Biden administration, too, has announced that it will be focusing on wind in the U.S. east coast.
The wind energy market outlook is positive, as shown by research done by BloombergNEF. A record was reached last year with the installation of 96.3 GW of power from wind turbines worldwide.
But IEA, the International Energy Agency, has estimated that at least 160 GW of wind power must be installed by 2025 to meet the goals of the Paris Agreement. A difficult – but not impossible – challenge.
However, South Korea has decided to make more sustainable choices, with the Green New Deal that was recently introduced by the government and with President Moon Jae-in’s goal to obtain more than 20% of the country’s energy demand from renewable sources by 2030. South Korea’s green shift is inarguably driven by excellent intentions, but there is also another reason behind it. South Korea is a country of scarce energy resources and spends $73 billion a year in fossil fuel imports. Therefore, underlying its determination to reduce emissions is also the necessity to cut import costs and become more energy-independent.
This is definitely a tough challenge because the country is already harnessing most of its hydroelectric resources, plus its climate and the topography of the environment are inadequate for large onshore wind or solar installations. That is why South Korea is looking for other ways to achieve its energy and climate goals.
Under this scenario, the South Korean government sees offshore wind as a good opportunity. Out in the open sea, the wind is strong, blowing at a good steady speed. In addition, there is more space to install turbines that are larger and more efficient than onshore turbines.
This strategy has a good chance but is facing several obstacles. At the top of the list we find the opposition of local residents, who are worried about the protection of their territory: the government has already made concessions, allowing the community to acquire a 30% share in local projects for development of renewable energy sources. Another problem is tied to the cost of wind power, which in South Korea is currently among the highest in the world at $220 per MWh. Moreover, the ambitious green projects launched by the South Korean government rely on the contribution of many private companies (more than 20 companies are involved in the offshore wind farm off the coast of the Shinan district), something that could lead to a change in plans over time, for example, due to issues having to do with granting of permits and authorisations or cost calculations. The South Korean government and the stakeholders involved must overcome these difficulties before they can go ahead with the project.
Until a short time ago, the Nordic countries of the European Union dominated the world’s offshore wind industry thanks to generous government subsidies and incentives and the features of the northern seas, whose waters, strangely, are not very deep.
But something is changing. South Korea is not the only country in the world that is betting on wind power. Last year, China installed a record number of offshore wind turbines, becoming the world’s wind capacity leader, but the Biden administration, too, has announced that it will be focusing on wind in the U.S. east coast.
The wind energy market outlook is positive, as shown by research done by BloombergNEF. A record was reached last year with the installation of 96.3 GW of power from wind turbines worldwide.
But IEA, the International Energy Agency, has estimated that at least 160 GW of wind power must be installed by 2025 to meet the goals of the Paris Agreement. A difficult – but not impossible – challenge.
