[Stalled Offshore Winds]①"Only 2 Out of 10 Projects Break Ground... Offshore Wind Power Stuck in Endless Bidding"

Construction Rate at 20%... Concerns Over "Hollow Achievements" in Offshore Wind Power
Another Round of Bidding Without Resolving Structural Bottlenecks
Debate Grows Over Effectiveness of Government Policy

A 5.5MW offshore wind turbine installed by Doosan Enerbility near Hallim-eup, Jeju. Doosan Enerbility

The government has selected a total of 10 large-scale offshore wind power projects since 2022 to expand offshore wind power adoption, but only two of these projects have actually begun construction. Once selected as a project operator, companies are responsible for independently securing subsequent permits and financing. However, numerous obstacles make it difficult for projects to proceed to the construction phase. Despite this situation, the government plans to select new large-scale project operators again at the end of this month. The offshore wind power adoption rate remains at only about 1% of the government’s target, raising concerns that simply selecting more operators without resolving structural bottlenecks could result in hollow achievements.

According to the offshore wind power industry and other sources on May 19, the government has selected a total of 10 projects since 2022: Jeonnam 1 Complex (96MW), Wando Geumil Phase 1 (200MW), Wando Geumil Phase 2 (400MW), Shinan Ui (396MW), Nakwol (364.8MW), Gochang (76.2MW), Anma Phase 1 (224MW), Anma Phase 2 (308MW), Taean (500MW), and Yawol (104MW). However, as of recently, only two projects?Jeonnam 1 Complex and Nakwol?have actually started construction.

The low construction rate after project operators are selected is due to structural constraints, including complex permitting procedures, opposition from local residents, delays in grid connection, and uncertainty regarding profitability. Project operators must independently handle multi-year procedures such as installing wind measurement devices, compensating fisheries, conducting environmental impact assessments, and undergoing military operational reviews. Much of the designated project areas overlap with fishing zones, making it difficult to secure local acceptance. In addition, uncertainty about grid connection, low electricity selling prices, and high equipment costs further undermine the profitability of these investments. While the government has offered fixed-price contracts as an incentive, private operators still face substantial burdens, including initial project financing, permitting risks, and negotiations with local residents.

This situation is clearly reflected in the actual performance of domestic offshore wind power projects. Currently, there are only six offshore wind farms (with capacity of 3MW or more) in commercial operation: Jeju Hallim, Southwest Demonstration, Jeju Tamra, Jeonnam Yeonggwang, Haengwon, and Nue Island. Their combined generation capacity totals only 229.83MW, which is just 1.6% of the government’s target. Even when adding the generation capacity of projects that have begun construction, such as Jeonnam 1 Complex and Nakwol, the total still falls short of 5% of the government’s 2030 adoption target of 14.3GW. An official from the Ministry of Trade, Industry and Energy stated, "We are aware that, aside from two sites, no other projects have begun construction," but added, "Since project operators must independently handle everything from permitting to securing local acceptance, there is limited scope for government intervention."

Despite the lack of progress in construction, the government plans to announce another fixed-price contract competitive bidding process at the end of this month to select offshore wind power operators for projects totaling up to 3.5GW. The final project operators will be announced in July.

Offshore wind power is considered virtually the only alternative capable of providing large-scale, long-term supply compared to existing onshore resources. However, experts point out that repeatedly holding bids without grid connection plans cannot resolve the structural bottlenecks. Electricity demand is expected to increase by double-digit percentages in the coming years, driven by high-performance semiconductor production and data center expansion. If supply fails to keep pace with demand and this imbalance becomes structurally entrenched, not only will the achievement of carbon neutrality targets be threatened, but the stability of the power grid itself could also be at risk. From the perspective of energy supply-demand balance, the current policy is assessed to have significant flaws in both feasibility and consistency.

This could also negatively impact South Korea’s export competitiveness. As global regulations such as the Carbon Border Adjustment Mechanism (CBAM) and the corporate-led RE100 (a global campaign for 100% renewable energy use) become more widespread, countries with a low share of renewable energy will inevitably face disadvantages in export competitiveness. Expanding offshore wind power has thus emerged as an urgent task for protecting domestic industries as well.

Yang Yebin, a researcher at the non-profit organization Climate Solution, said, "When expanding offshore wind power, it is extremely important to institutionalize values such as economic viability, environmental sustainability, and local acceptance," adding, "The permitting and bidding systems have not sufficiently incorporated these considerations."