Ministry of Industry to Reform 'Resident Participation Project' Established Under Moon Administration
Power Plant Local Residents Invest...Enhancing Transparency and Profit Distribution
Vice Minister Park Il-jun: "Must Uphold System's Purpose...Improvements Needed"
[Asia Economy Sejong=Reporter Lee Jun-hyung] The Yoon Seok-yeol administration is revising the renewable energy resident participation projects initiated by the previous government. This decision comes from the judgment that there are institutional issues, such as profits being distributed mainly to a small number of residents in some renewable energy projects. It is analyzed that the policy reform of renewable energy, triggered by the Moon Jae-in administration's 'solar power corruption,' is now gaining momentum.
The Ministry of Trade, Industry and Energy announced that on the morning of the 22nd, Second Vice Minister Park Il-jun visited the Gadoksan onshore wind power plant (43.2MW class) located in Taebaek, Gangwon Province, to inspect the current status of the resident participation project operation and the actual conditions of the project. On the same day, Vice Minister Park held a meeting with local resident representatives and local government officials to gather opinions on the direction of improving the resident participation project system. Vice Minister Park said, "Renewable energy power generation is eco-friendly, but residents living near the power plants and farmers and fishermen inevitably face impacts during the construction and operation of the power plants," adding, "It is essential for power generation businesses to promote projects while communicating sufficiently with the local community."
The Gadoksan wind power plant visited by Vice Minister Park is the first resident participation-type wind power plant in Korea. Taebaek residents and local governments invested 4% and 8.8%, respectively, of the total project cost (125 billion KRW). The resident participation project system was introduced by the Moon Jae-in administration in 2017 to increase the acceptance of renewable energy power generation facilities by residents. The goal is for residents who have lived for more than one year near renewable energy power plants such as wind and solar power to directly participate as investors in power generation projects, thereby increasing project transparency and sharing power generation profits with nearby communities.
Vice Minister Park Il-jun Inspects Ulsan Thermal Power Plant in Preparation for Typhoon (Seoul=Yonhap News) On September 3, Vice Minister Park Il-jun of the Ministry of Trade, Industry and Energy made an urgent visit to the Ulsan Thermal Power Plant operated by Korea East-West Power in preparation for the approaching typhoon 'Hinnamnor.' He inspected the typhoon preparedness measures. 2022.9.3 [Provided by Ministry of Trade, Industry and Energy. Redistribution and DB reproduction prohibited]
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However, the government sees institutional problems in the current resident participation projects. A representative regulation is that the target area for resident participation projects is grouped into towns, townships, and neighborhoods located within a 1 km radius of the power plant. A Ministry of Trade, Industry and Energy official explained, "The participation range (for resident participation projects) was uniformly set without considering the power source and project scale," adding, "There is a lack of consideration for nearby residents and farmers and fishermen who are the actual stakeholders of renewable energy power plants."
There is also a problem that profits from renewable energy power plants are concentrated only among some residents. The government issues additional Renewable Energy Certificates (REC) weighting when local residents invest a certain percentage or more of the total project cost through resident participation projects. Subsequently, power generation businesses increase dividends or interest for local residents who participated as investors, sharing the profits gained from the additional REC weighting. Residents who did not invest in the project do not receive any benefits from the renewable energy power plants.
Accordingly, the Ministry of Trade, Industry and Energy plans to reform the resident participation project system. Taking the opportunity of the Gadoksan wind power plant inspection conducted on this day, the ministry intends to prepare a 'resident participation project system reform plan' and actively promote measures to strengthen resident acceptance. Vice Minister Park emphasized, "Resident participation projects should also uphold the institutional purpose of enhancing acceptance," adding, "It is necessary to improve (resident participation projects) so that benefits are prioritized for residents who are substantially affected."
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