Climate, Energy and Environment Ministry says parliament passes seven bills

The Climate, Energy and Environment Ministry said that parliament passed seven amendments to laws to support the renewable-energy transition and power-grid construction. The ministry said the measures establish a basis for a renewable-energy transition, which it called an urgent national task for the development of advanced industries including artificial intelligence, climate-crisis response and energy-security goals.

One revision will let public-interest renewable projects of 1 megawatt or less with resident participation receive priority grid connections when undertaken near national backbone power networks. The ministry said insufficient grid capacity in some regions had made resident-participation projects difficult and that the legal basis would enable public-interest projects, including Sunlight Income Villages, to proceed quickly.

The legislation will replace the renewable portfolio standard, or RPS, with a government-run competitive-bidding contract market. Introduced in 2012, RPS requires power producers above a certain scale to supply a portion of their generation from renewable energy, either through direct generation or by purchasing external renewable-generation performance. The regime helped expand renewable deployment but had limits in lowering generation costs and fostering domestic industry.

From next year, new renewable-energy facilities will no longer receive renewable energy certificates, or RECs, and will instead compete by generation source for contracts within announced capacity and ceiling prices. Korea Electric Power Corp. will buy successful bidders' electricity under long-term fixed-price contracts. The ministry said the contracts will give successful projects stable revenue, lower financing costs and improve their ability to raise funds.

Transition measures preserve REC issuance for existing operators and allow a separate market for small facilities. The REC spot market will be phased out on Dec. 31, 2029, after a three-year grace period. Public power companies will be required to install a set capacity of renewable-energy facilities.