[Inside Chodong] Dark Clouds Loom Over Solar Power

"While every country is putting great effort into expanding solar power, our country alone is shifting into reverse gear. Most small and medium-sized module companies have stopped operations, and the inventory piled up in warehouses is soaring as if reaching the sky. The solar power industry ecosystem is being driven to the brink."

The Solar Power Industry Association recently sent a public appeal to the government. They expressed their desperate feelings that the solar power industry, once regarded as a representative renewable energy source in the carbon-neutral era, has reached a critical point within one year of the Yoon Suk-yeol administration's launch.

Here is a brief summary of the appeal: "The renewable energy distribution environment has continuously worsened over the past year," "We have been hit hard by the reduction of the renewable energy generation share, the downward adjustment of the Renewable Portfolio Standard (RPS) mandatory supply targets, the implementation of the wholesale electricity price (SMP) cap system, and the expansion of output control without compensation measures," and "30-40% of solar power Engineering, Procurement, and Construction (EPC) companies have faced bankruptcy."

Since the RPS system was implemented in 2012, domestic solar power projects have grown rapidly. By 2015, installation capacity ranked 7th in the world. Solar panels were installed one after another on idle farmland, reservoirs, urban buildings, and apartments. However, the solar power industry was gradually sinking into a slump.

On the 27th, visitors attending the '2023 World Battery & Charging Infrastructure Expo - 2023 World Solar Energy Expo' held at Kintex in Goyang, Gyeonggi Province, are observing solar panels. Photo by Jinhyung Kang aymsdream@

Companies that had ventured into solar power also exited the business. OCI, which entered the polysilicon business in 2006, has shifted its focus to polysilicon for semiconductors. Last year, Woongjin Energy, the only domestic ingot and wafer company, went bankrupt, and LG Electronics also announced its withdrawal from the solar power business.

Behind the numerous solar power facilities scattered nationwide, corruption was also hidden. Large-scale audits and investigations by the Board of Audit and Inspection and the Financial Supervisory Service revealed improper licensing corruption. In such a situation, who would dare to engage in solar power?

What about other countries? Around the world, countries are focusing on solar power as a next-generation energy source with zero carbon emissions. The United States is increasing tax benefits for solar power facilities through the Inflation Reduction Act (IRA). It plans to grow solar power to 30% of U.S. electricity by 2030. The Group of Seven (G7) also agreed last April to increase solar power generation by more than 1 terawatt (TW) by 2030.

China, which occupies more than 90% of the global market for solar polysilicon, ingots, wafers, and other materials and components, is also expanding the related industry under national leadership. The International Energy Agency (IEA) forecasted, "This year, global investment in the solar power sector will reach about $380 billion (approximately 503 trillion KRW), surpassing investment in oil drilling for the first time."

As we transition to a decarbonized era, the challenge of finding new energy sources has emerged. Whether it will be nuclear power, hydrogen, or solar power, no one can guarantee. We must not insist on only one. Winston Churchill, who advocated using oil instead of coal on British warships, responded to criticism by saying, "Only variety guarantees Britain's future." Securing multiple energy sources is essential to strengthening energy security.

We cannot neglect solar power generation forever. If we have fallen behind China in materials and components, we can take the lead in businesses such as installation and maintenance. It is time for the government and companies to consider mid- to long-term development strategies. To avoid falling behind the global trend, we must not ignore solar power as if it were a core project of past governments.