Korea's Four Major Industries Face 'Carbon-Free Power' Shortage... 'Nuclear Power Should Be Included in Power Purchase Agreement System'

[Financial News] An analysis has emerged that even by the average carbon neutrality target year of 2042 for companies participating in RE100 (100% Renewable Energy), there will be a shortage of approximately 21.4 TWh (terawatt-hours) of carbon-free power in the four major energy-consuming industries (steel, petrochemicals, semiconductors, data centers) in Korea.
This is equivalent to half of the total power consumption of Seoul (45.8 TWh). If expanded to other industries, the carbon-free power shortage is expected to grow even larger.
The Korea Economic Association (Hankyung Association) announced this through a report titled 'Policy Tasks for Activating the Power Purchase Agreement System (PPA)' on the 14th. According to the report, demand for carbon-free power is increasing, especially in the four major industries of steel, petrochemicals, semiconductors, and data centers, which consume a lot of energy. Nevertheless, the rate at which the power demand of the four major industries can be met with carbon-free power (carbon-free power coverage rate) is only 53.4% this year. This is due to the limitation that the carbon-free power available to domestic companies is restricted to 'renewable energy'. Carbon-free power refers to electricity produced without emitting carbon.
The report projected that the carbon-free power coverage rate for the four major industries will be only 81.6% by 2038. If the demand for carbon-free power expands to all industries in the future, the coverage rate is expected to decrease further.
As the top priority to solve this issue, the Hankyung Association pointed to the activation of the Power Purchase Agreement (PPA) system. A power purchase agreement is a method where a company and a power generation business enter into a contract to supply power. It is used as a representative means of procuring carbon-free power, along with green premiums, as it allows companies to verify the energy source of the power they use.
The Hankyung Association argued that ancillary costs such as network usage fees and power base funds, which are paid when purchasing renewable energy, should be temporarily exempted or reduced to activate the PPA. If the PPA system is activated, the supply of carbon-free power sources will increase, ultimately contributing to alleviating the excess demand for carbon-free power.
They also argued that the disclosure cycle of the power emission factor, which is currently announced irregularly, should be set at least annually. They pointed out that delays in announcing the power emission factor could lead to an overestimation of companies' greenhouse gas emissions.
The Hankyung Association also proposed including currently operating nuclear power plants in the carbon-free power sources that can be procured through PPA, which is currently limited to renewable energy. They explained that if major countries like the United States and France include existing nuclear power plants in PPA, companies can autonomously choose power sources based on management decisions, which is expected to ease the excess demand for carbon-free power.
Lee Sang-ho, head of the Economic and Industrial Division of the Hankyung Association, emphasized, "The domestic key industries are facing a double burden of management crisis and the demand for carbon-free power use," and "It is urgent to create an institutional environment where our companies can efficiently procure carbon-free power." 
one1@fnnews.com Jeong Won-il Reporter