"Permission Granted for Academies and Hospitals on Gas Station Sites... Need to Consider Mixed-Use Development"

Forum on the 22nd... Exploring Strategies for the Energy Transition Era

It was suggested that gas stations facing a crisis due to the expansion of eco-friendly vehicles and intensified competition with budget gas stations need business model innovation through regulatory improvements and government support to survive. A government official responded that it is necessary to consider mixed-use development, such as permitting the establishment of academies at gas stations in areas with poor educational infrastructure and hospitals at gas stations in areas lacking medical services.

According to the industry on the 25th, a forum titled "The Future of Gas Stations in the Era of Energy Transition?" was held on the 22nd at the National Assembly Members' Office Building, hosted by National Assembly members Kim Won-i, Oh Se-hee, Jung Jun-ho, and Chae Hyun-il, and organized by the Korea Petroleum Association, Korea Petroleum Distribution Association, and Korea Gas Station Association, where related issues were discussed.

Yonhap News

The industry agreed that as gas station closures and suspensions increase due to competition with budget gas stations and declining demand, legal regulations should be relaxed to improve profitability through various non-fuel businesses beyond fuel sales.

Kim Tae-hwan, head of the Petroleum Policy Research Office at the Korea Energy Economics Institute, who gave the keynote presentation, emphasized, "The gas station market is a demand-driven market, making differentiation from other gas stations essential," and added, "It is necessary to establish a foundation for creating innovative business models by easing legal regulations on the gas station market." Professor Kim Hyung-geon of Kangwon National University, who participated as a discussant, pointed out, "Due to price competition, demand reduction, and rising opportunity costs, gas station profitability inevitably deteriorates," and stressed, "It is necessary to improve regulations to connect industries requiring road-adjacent networks with gas stations."

Park Joo-sun, chairman of the Korea Petroleum Association, explained, "The refining and petroleum distribution industries are in a difficult situation with an operating profit margin of only 1.7%, and the energy transition toward carbon neutrality is unavoidable, putting them at risk of becoming stranded assets." He added, "To prevent the current trend of gas station closures and minimize public inconvenience, a policy shift by the government and forward-looking legislative measures by the National Assembly are needed."

Kim Ki-yeol, team leader of the Petroleum Industry Division at the Ministry of Trade, Industry and Energy, stated, "We plan to consult with related ministries to enable mixed-use development without compromising safety," and added, "It is also necessary to consider mixed-use development that benefits the nation, such as permitting academies at gas stations in areas with poor educational infrastructure and hospitals at gas stations in areas lacking medical services."

Jung Jin-hoon, director of Urban Policy at the Ministry of Land, Infrastructure and Transport, said, "I agree with the direction of mixed-use development of gas stations to improve profitability amid poor business conditions," and explained, "District unit plan establishment and modification are operated mainly by local governments, so there are limitations to regulatory easing at the Ministry of Land level, but we will strive to facilitate mixed-use development as much as possible." Hong Young-geun, director of Fire Prevention at the National Fire Agency, stated, "We will actively consult with related ministries on mixed-use development, provided safety assurance and social consensus are secured."