[Interview] "We Must Reform the RPS System and Introduce the Carbon Budget Concept" ... Ruling Party Climate Energy Expert Park JiHye

Preparation of Amendment to the New and Renewable Energy Act
Reviewing Measures to Protect Small-Scale Solar Power Operators
Incorporating the Concept of Carbon Budget in the 'Unconstitutional' Carbon Neutrality Framework Act Amendment
Considering a Carbon Price Floor in the Emissions Trading Act

JiHye Park, Member of the Democratic Party of Korea. Office of JiHye Park

"With the closure of coal-fired power plants, the Renewable Portfolio Standard (RPS) system for renewable energy supply obligations is inevitably on its way out. We are currently preparing a bill to reform the system."

JiHye Park, a member of the Democratic Party of Korea (Uijeongbu-gap, Gyeonggi Province, pictured), is actively working on amendments to laws related to renewable energy. Having entered the 22nd National Assembly, she is recognized as a leading climate and energy expert within the Democratic Party and serves as the party's secretary on the National Assembly Special Committee on the Climate Crisis.

Until recently, she served as Special Advisor on Climate and Energy to the National Policy Planning Committee. Since passing the bar exam in 2017, she has also been active in various climate organizations, including as an auditor for the Energy Transition Forum, co-representative of Plan 1.5, and director at Climate Solution.

In an interview with Asia Economy on the 19th, Assemblywoman Park announced her intention to propose an amendment to the "Act on the Promotion of Development, Use, and Supply of New and Renewable Energy" (New and Renewable Energy Act), with the main focus on reforming the RPS system. She also stated that she is considering introducing a support system for small-scale solar power operators.

The New and Renewable Energy Act was also proposed by Kang SeungKyu of the People Power Party in February. As both the ruling and opposition parties emphasize the need to improve the RPS system, the pace of legislative amendments is expected to accelerate in the National Assembly.

Introduced in 2012, the RPS system requires large-scale power generators, such as thermal and nuclear power operators, to supply a certain percentage of their electricity from renewable sources. While it contributed to the initial expansion of renewable energy in Korea, the system has been criticized for being complex and inefficient. There has also been significant uncertainty, as seen in the volatile prices of Renewable Energy Certificates (RECs). In particular, as power generation subsidiaries-major obligated suppliers-shut down their coal-fired plants, the mandatory supply volume is expected to decrease.

Assemblywoman Park stated, "For large-scale power generators, we should induce a drop in renewable energy prices through price competition. At the same time, I believe we need to introduce a Feed-in Tariff (FIT) system to protect small-scale solar power operators and cooperatives."

Last August, the Constitutional Court ruled the Carbon Neutrality Framework Act unconstitutional, and Assemblywoman Park is also preparing an amendment in response. The court found that the current law, which only stipulates reduction targets through 2030, does not effectively guarantee the long-term goal of carbon neutrality by 2050, and required the National Assembly to establish a reduction pathway by February 2026. In this context, multiple amendments to the Carbon Neutrality Framework Act have been proposed.

Assemblywoman Park plans to propose an amendment that newly incorporates the concept of a carbon budget. A carbon budget refers to the maximum allowable amount of additional carbon dioxide emissions to limit global temperature rise. She stated, "The bill will include a basis for calculating and monitoring the carbon budget," adding, "Full-scale discussions will take place in the National Assembly in the second half of this year."

The Ministry of Environment is currently formulating its 4th emissions trading plan for the power sector, aiming to expand the proportion of greenhouse gas emission allowances that are auctioned. The power and industrial sectors have expressed concerns that increasing the auctioned allowance ratio will raise the burden on power generators, leading to higher electricity prices and undermining industrial competitiveness.

In response, Assemblywoman Park said, "According to recent research by the Climate Change Conference, even if the proportion of auctioned allowances in the power sector is raised to 100% by 2030, the net industrial linkage effect will be positive. Raising the current emission allowance price, which is below 10,000 won, is necessary to incentivize investment in carbon reduction technologies."

She further explained, "We are preparing an amendment to the Act on the Allocation and Trading of Greenhouse Gas Emission Allowances to specify the auctioning system in detail or to introduce a carbon price floor." However, regarding the expansion of auctioned allowances for the industrial sector, she expressed a reserved stance, saying, "Since industries such as steel and petrochemicals are facing difficult conditions, it is desirable to expand gradually through dialogue."

She disagreed with some environmental and civic groups' calls to nullify and remake the 11th Basic Plan for Electricity Supply and Demand (2024-2038). Assemblywoman Park emphasized, "There are too many urgent issues ahead of us to spend time fighting over a plan through 2038. Now is not the time to remake the plan, but to implement it."

The recently announced government policy tasks by the National Policy Planning Committee include expanding renewable energy facility capacity from 35.1 gigawatts (GW) as of June this year to 78 GW by 2030. This is the same target outlined in the 11th Basic Plan for Electricity. Assemblywoman Park commented, "Even achieving this goal is a tremendous challenge in reality. We need to show results, not just words, in order to set even more ambitious plans for the future."