Announcement of Support Strategy for Innovative Companies in 6 Green New Deal Sectors Including Solar Power Operation and Management
Promotion of New Deal Fund Sub-Fund Formation and Encouragement of Innovative Company Listings
Joint R&D between Innovative Companies and Public Enterprises... Support for Expanding Track Records
Minister Sung Yun-mo of the Ministry of Trade, Industry and Energy announcing the implementation strategy at the Smart Green Industrial Complex Reporting Conference held at Taerim Industry in Changwon, Gyeongnam on the afternoon of the 17th. (Image source=Yonhap News)
[Asia Economy Reporter Moon Chaeseok] The government announced that it will discover and support 4,000 innovative companies in six promising energy sectors, including solar power operation and management (O&M), to establish an innovative ecosystem for the green industry. This is to realize the Green New Deal policy, which aims to increase solar and wind power generation capacity to 42.7GW by 2025.
The Ministry of Trade, Industry and Energy stated on the 22nd that it will hold a briefing session chaired by Minister Sung Yun-mo at Soul Energy in Euljiro, Seoul, starting at 2 p.m., to announce the 'Energy Innovation Company Support Strategy.'
The briefing will be attended by representatives from eight innovative companies including Soul Energy, corporations such as Korea Electric Power Corporation and SK Gas, and institutions including the Korea Energy Technology Evaluation Institute, Korea Exchange, and Korea Energy Agency.
◆ Expansion to 4,000 Innovative Companies by 2025... Creation of 60,000 Jobs
The Ministry plans to double the number of energy innovation companies from 2,029 last year to 4,000 by 2025. It aims to create 60,000 new jobs. If successful, employment will increase from 35,000 last year to 95,000 in 2025.
The government will focus support on six promising sectors: solar power O&M, distributed power virtual power plants, wind power support services, electric vehicle battery services, new energy industry materials/components/equipment, and building energy efficiency management.
Regarding sector-specific development plans, an efficiency index considering solar radiation, equipment capacity, and temperature will be developed to foster solar power O&M.
To enhance expertise in solar power O&M, a standard manual will be established, and related R&D budgets will increase from 8.8 billion KRW this year to 30 billion KRW by 2025.
To activate the distributed power virtual power plant market, a plus demand reduction request (DR) will be introduced. This is the opposite concept of demand reduction, increasing demand during peak renewable energy generation periods.
A renewable energy generation forecasting system will be introduced to minimize grid avoidance costs. R&D budgets for virtual power plant (VPP) operation, management, and security will expand from 18.7 billion KRW this year to 40 billion KRW by 2025.
450 billion KRW will be invested by 2025 in a jointly led large-scale offshore wind support project. It will support O&M demonstration and specialization linked with existing wind farms and energy industry convergence complexes. Wind industry R&D budgets will increase from 30 billion KRW this year to 50 billion KRW by 2025.
◆ Strengthening Solar and Wind Management... Enhanced R&D Support for Electric Vehicle Batteries
Performance evaluation and classification systems for electric vehicle batteries will be secured, and a data platform will be established.
First, in cooperation with battery reuse and recycling centers, a performance evaluation and classification system for used batteries will be developed. To this end, 6.9 billion KRW will be invested to conduct a demonstration project in Jeju from this year through 2022.
An electric vehicle parts data platform will be established at the Electronics and Telecommunications Research Institute. Demonstration exemption projects will be discovered and supported. R&D budgets related to electric vehicle batteries will increase from 9.5 billion KRW this year to 20 billion KRW by 2025.
In four major sectors?solar power, wind power, secondary batteries, and smart devices?a 'materials, parts, and equipment cooperation model' linked with demand companies will be discovered. Joint research among companies will be activated, and 'demand-linked R&D' will be expanded to connect R&D with purchasing and procurement.
Specifically, R&D will increase for equipment such as solar process equipment and intelligent inverters, wind floating bodies and offshore wind plants, next-generation secondary batteries, and intelligent power meters (AMI).
A standard for Building Energy Management Systems (BEMS) will be established, and a data analysis pilot project will be promoted. The BEMS standard is a KS standard that measures energy-saving effects.
The operational performance of BEMS already deployed in public buildings will be analyzed. Development of high value-added products such as smart sensors and analysis/management software will also be expanded. To this end, building efficiency R&D budgets will increase from 22.5 billion KRW this year to 45 billion KRW by 2025.
◆ Promotion of New Deal Fund Sub-Fund Formation and Listing Inducement... Securing Track Records with Public Enterprises
The core of the three major support strategies for energy innovation companies announced by the Ministry is to form a Korean-style New Deal Fund sub-fund to promote private investment and to secure track records of innovative companies by jointly conducting R&D with public enterprises.
They plan to promote the formation of a 'New and Renewable Energy Ecosystem Fund' (tentative name) and prepare 'investment target guidelines' to induce investment. Investment by large corporations and venture capital (VC) will be activated through the 'Energy New Industry Cooperation Forum' and others.
To assist innovative companies in listing on the securities market, the Korea Energy Technology Evaluation Institute will be added as a specialized institution for technology-special listing. Development of technology and corporate value evaluation models for the new energy industry will also be pursued.
A 'joint participation-type R&D' will be newly established to promote R&D with public enterprises so that innovative companies with technological capabilities can secure track records. 'Innovation procurement-linked R&D,' where demand companies and certification bodies participate together in R&D, will also be promoted.
An annual 'Energy Innovation Company Survey' will be conducted to establish a policy foundation. The energy industry classification system will be improved to reflect changes in industry and market.
Energy industry convergence complexes will be developed as regional hubs for innovative companies, and support systems such as technology and manpower support will be established. 'Comprehensive demonstration research complexes' and 'materials, parts, and equipment specialized complexes' linked with local industry-academia-research will be built.
◆ Ministry of Trade, Industry and Energy Forms Practical TF for Support Strategy and Conducts Quarterly Reviews
Minister Sung Yun-mo of the Ministry of Trade, Industry and Energy explaining the key points of the 'Green New Deal' at the Government Complex Sejong on the morning of July 16. On the left is Minister Cho Myung-rae of the Ministry of Environment. (Image source=Yonhap News)
Prior to the briefing, the government, public enterprises, and related institutions will sign a 'Memorandum of Understanding (MOU) for Supporting Energy Innovation Companies.'
Participating institutions agreed to jointly promote the discovery of promising innovative companies, certification and evaluation support linked with R&D, activation of financial support and investment attraction, and institutional improvements based on the MOU.
Minister Sung said, "A growth ecosystem for energy innovation companies must be established for the successful implementation of the Green New Deal," adding, "We will actively support the establishment of an organic cooperation system among related institutions so that a new industrial ecosystem can take root in the energy industry."
The Ministry will form a practical task force (TF) by institution to implement the support strategy and will monitor progress through quarterly meetings.
Minister Sung emphasized, "In the paradigm shift represented by 'decarbonization, decentralization, and digitalization,' companies armed with new technologies and ideas will bring innovation to the energy industry," and added, "The government will actively support innovative companies contributing to the activation of the new energy industry and the promotion of the Green New Deal through the smooth implementation of this support strategy and improvements in market and systems."
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