S Korea to shut up to 16 coal-fired power plants for December-February

Seoul — South Korea will close down up to 16 coal-fired power plants for three months from December, out of its 60 coal power plants in total, to help reduce air pollution, a potential boot for LNG demand and imports, the energy ministry said on Nov. 26.

"A total of 9 to 16 coal-fired power plants will be shut from Dec. 1 to Feb. 28 as part of efforts to reduce fine dust emissions in the winter period," the Ministry of Trade, Industry and Energy said in a statement.

"The scope of the shutdown -- from 9 to 16 –- will be determined on the basis electricity demand over the peak winter season," a ministry official said.

The ministry refused to provide a list of the coal power plants to be shut, but the ministry official said aged, more polluting plants will be the first to be taken offline.

All of the other coal power plants will operate at no higher than 80% capacity from December to February, the ministry statement said.

"The government will try to idle coal power plants as many as possible on the condition of stable electricity supply," the official said.

South Korea's winter electricity demand is expected to peak at around 87,600 megawatts (MW) in the third week of January, which can further increase to 90,400 MW if the country suffers a cold snap, according to the ministry statement.

The country's electricity supply is expected to meet demand with a power surplus of more than 10,557 MW from December through February despite the shutdown of the coal-fired power plants, it said.

"The government is expected to close more coal-fired power plants in March next year when the country's electricity demand is likely to slow down in the spring season to cut back on fine dust emissions," the ministry official said.

South Korea has experienced the highest level of fine dust over the winter and spring seasons.

"The coal power plant closure from December to February next year is expected to reduce the country's coal-related fine dust emissions by 43%, or 2,289 metric tons, compared with two years earlier," the ministry statement said.

LNG DEMAND

The ministry official said the country will be ready to raise operating ratio of natural gas-fired power plants to avoid any electricity supply disruptions, which can boost the country's LNG demand and imports.

State-owned Korea Gas Corp.'s LNG sales in October rose 7.2% year on year to 2.292 million mt, driven by stronger demand for power production due to shutdown of some nuclear reactors.

Kogas did not disclose how much LNG it sold for the first ten months this year, but S&P Global Platts calculations based on Kogas' previous reports showed it sold 24.789 million mt over January-October, down 5.8% from 26.317 million mt in the same period last year.

On the stronger LNG demand, South Korea's LNG imports rose 21% year on year to the highest level in eight months, at 3.85 million mt in October.

Over January-October, South Korea imported 32.16 million mt, down 0.1% from 32.18 million mt in the same period of 2019.

CARBON NEUTRALITY

The measure to idle coal-fired power plants is in line with President Moon Jae-in's drive to reduce coal consumption so as to reduce greenhouse gas and fine dust emissions.

On Oct. 28, President declared that the country will achieve carbon neutrality by 2050 by replacing coal-fired power generation with renewable sources and internal combustion engines vehicles with hydrogen-powered and battery-based electric vehicles.

As part of efforts to achieve a "carbon-neutrality" by 2050, South Korea will spend Won 73.4 trillion ($66.4 billion) over the next five years, focusing on expanding the country's power generation capacity of solar panels and wind turbines to 26.3 GW in 2020 and 42.7 GW in 2025, up from 12.7 GW last year.