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S Korea to increase LNG-based power capacity by 43% to 59.1 GW in 2034

  • Author
  • Charles Lee
  • Editor
  • Manish Parashar
  • Commodity
  • Coal Electric Power Natural Gas

Seoul — South Korea will increase the capacity of LNG-based power plants by 43% to 59.1 GW in 2034 from 41.3 GW in 2020 while reducing coal-fired power plants and nuclear reactors under its long-term energy transition blueprint, the energy ministry said Dec. 29.

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The long-term Basic Plan for Power Supply 2020-34 outlines the closure of 30 aging coal-fired power plants, or half of its 60 coal-fired power stations currently under operation, by 2034 as part of efforts to reduce air pollution.

Of the 30, 24 plants with a combined capacity of 12.7 GW will be converted into natural gas–fired power plants, which would boost the country's LNG demand and imports, the blueprint said.

LNG-based power plants would have a capacity of 43.3 GW in 2022 and 55. 5GW in 2030, and 59.1 GW in 2034, it said.

The basic blueprint drawn up by the Ministry of Trade, Industry and Energy, or MOTIE, outlines the country's energy roadmap for the next 15 years. The blueprint comes out every two years.

"Coal-fired power plants whose 30-year operational life cycles will expire by 2034, and as a result, 30 coal power plants with a combined capacity of 15.3 GW will retire by then," a senior official at the MOTIE said.

A total of seven new coal-fired power plants with a combined capacity of 7.3 GW will be built by 2034 under existing permissions, but the total capacity of coal-fired power plants would be reduced to 29 GW in 2034 from 35.8 GW in 2020 after decreasing to 38.3 GW in 2022 and 32.6 GW in 2030, the official said.

"In order to make up for an electricity shortage that will result from the planned closures of the coal power plants, 24 of them with a combined capacity of 12.7 GW will be converted into LNG-fired ones," the official said.

As a result, the portion of coal in the country's power generation capacity mix will be lowered to 15% by 2034 from 28.1% in 2020.

The capacity of LNG-fired power plants would increase 17.8 GW by 2034, but its share in power production mix would edge down to 30.6% compared with 32.3% in 2022 due to the country's increasing power supply and sharp rise in renewable sources.

The long-term plan estimates that South Korea's power demand would reach 102.5 GW in 2034 from 90.3 GW in 2020, with its annualized growth rate coming at 1%.

Renewables in 2034

Renewable sources would account for 40.3% of the power mix capacity in 2034, up from 15.8% in 2020 on the back of increased investments in solar and wind power plants.

The new plan is part of President Moon Jae-in's efforts to lower the country's heavy reliance on coal and nuclear by raising power production from renewables and LNG.

"Under the new power mix plan, the country's LNG demand is expected to rise in a steady manner," the MOTIE official said.

South Korea's LNG demand has been on the decrease since early last year with the restart of some major nuclear reactors shut long for maintenance and safety checks.

State-owned Korea Gas Corp., or Kogas, which has a monopoly in domestic natural gas sales, sold 33.597 million mt of LNG in 2019, down 7.2% from 36.219 million mt in 2018, which was up 12.6% from 32.16 million mt in 2017.

Over January-November this year, Kogas' LNG sales are estimated at 27.831 million mt, down 5.3% from 29.385 million mt in the same period last year, according to S&P Global Platts calculations based on Kogas' reports.