BDI obtains development permit for Asan fuel cell power generation project... "Accelerating the project"

[Asia Economy Reporter Hyunseok Yoo] VIDI announced on the 25th that it has received development activity approval from Asan City for the ‘Gwandaeri Fuel Cell Power Generation Project (generation capacity 40MW)’ being established in Dunpo-myeon, Asan-si, Chungnam.

In June, VIDI secured a construction contract worth 242.9 billion KRW from ‘K-Palm Energy,’ which holds the project rights for the Asan ‘Gwandaeri Fuel Cell Power Generation Project.’ Going forward, VIDI plans to participate as a strategic investor in the special purpose company (SPC) as well as proceed with construction as the contractor.

This development activity approval is expected to accelerate subsequent procedures such as SPC establishment and funding through ‘Project Financing (PF).’ Recently, IBK Investment & Securities submitted a letter of intent to participate financially. They signed a financial advisory and underwriting contract with K-Palm Energy to carry out the necessary financing services for this project.

A VIDI official stated, “The Asan Gwandaeri Fuel Cell Power Generation Project is currently undergoing follow-up procedures with the goal of commencing construction in the first half of next year,” adding, “With recent small-scale capital increases and investments from the largest shareholder enabling funding, we will improve the company’s financial structure and ensure rapid revenue generation from new projects.”

He continued, “Through this project, VIDI can generate construction profits as the contractor and also participate as a strategic investor to gain additional revenue from electricity sales,” adding, “Stable electricity sales are expected through the government’s Hydrogen Power Obligation System (HPS), which will be implemented starting next year.”

Fuel cells, a renewable energy source, are high-efficiency eco-friendly power generation systems that produce electricity through chemical reactions using hydrogen as fuel. The government aims to achieve a fuel cell power plant capacity of 3,200MW (with construction costs around 14 trillion KRW) by 2034 through the ‘Renewable Energy 3020 Plan’ and the ‘Hydrogen Economy Activation Green New Deal Plan.’

Recently, the government established the Hydrogen Power Obligation System (HPS) to expand fuel cell power generation projects. When this system is implemented in 2022, it will promote renewable power generation obligations exclusively for fuel cell power systems, separate from the existing RPS (Renewable Portfolio Standard) system, which is expected to lead to an increase and stabilization of Renewable Energy Certificate (REC) prices.