1 Trillion won Set Aside for Nurturing Renewables

Government accelerates its bid to nourish the domestic new & renewables energy industries

The government plans to ramp up financial support to nourish the new and renewable energy industry by earmarking more than 1 trillion won in its budget for this sector.
The Ministry of Knowledge Economy (MKE) set aside 1.003 trillion won for its 2011 budget for supporting the nurturing of the industry. The figure represents a 24.1 percent increase, more than 195 billion won higher than the 2010 earmark, reflecting the government’s strong willingness to nurture the industry and marking the first time the government has put aside more than 1 trillion won in its budget for the sector, said Hwang Su-sung, director of new & renewable energy at the MKE.
Specifically, the MKE earmarked 267.7 billion won for the R&D outlay, up 14.9 billion won from 267.7 billion won. The government plans to provide financial support for the development of the top 10 proprietary core technologies, including thin film solar cells, offshore wind power and next-generation bio-fuel, as well as the top eight core parts and equipment, including gear boxes and blades. It will set aside 10 billion won to finance a program to develop field-specific manpower with bachelor’s, master’s and doctor’s degrees, designed to meet corporate clients’ demands.
The 2011 budget for proliferating the new and renewable energy industry is set at 311.8 billion won, up 19.8 billion won from 292 billion won in 2010. The government will subsidize 90 billion won to install photovoltaic power, solar power, geothermal energy and other new and renewable energy installations, while 89 billion won will be spent to build green homes. It has earmarked 17 billion won to build a multi-purpose new & renewable energy complex in Buan, North Jeolla Province, to facilitate R&D and commercialization while subsidizing 4 billion won for the construction of a wind power complex in the Saemangeum area. It will set aside 111.8 billion won for new and renewable energy production, facility and operation funds.
The budget to subsidize cost differences for generating power was raised to 395 billion won in 2011, up 63.2 billion won from 331.8 billion won in 2010. The increase is designed to finance additional outlays for an 80MW-class photovoltaic power plant and a 16MW-class fuel cell power plant that will be inaugurated this year.
The budget for financing two new infrastructure projects is set at 29 billion won. The MKE sets aside 20 billion won for providing financial support to SMEs in connection with a project to build new and renewable energy test-beds. The project calls for the building of four or five test-beds for testing, analyzing and certifying technologies and items produced by SMEs for photovoltaic power, wind power and other renewables. The remaining 9 billion won will provide support for the domestic new and renewable energy industry’s facilitation of exports including market surveys, exploration of projects, feasibility surveys, certifications, overseas marketing, overseas marketing activities, the operation of market exploration teams and overseas market entry.
Figures released by the MKE showed that the Korean new & renewable energy industry saw exports surge from $770 million in 2007 to $2.04 billion in 2009 and an estimated $4.6 billion in 2010.
The MKE aims at posting $40 billion in exports in 2015 by nurturing the photovoltaic power and wind power industries into the nation’s next semiconductor and shipbuilding success stories.
The ministry plans to push ahead with new and renewable energy industry development strategies, made public last October, and expand budgetary support.
Here is a look at the current status of each of the new and renewable energy sectors: In the photovoltaic segment, Dongyang E&C Group is the most active Korean player with the Shinan Photovoltaic Power Plant with a capacity of 24MWh, the world’s largest one with a photovoltaic power tracking system using power voltage differences. Hyundai Heavy Industries Co. is the nation’s biggest photovoltaic power module producer. The nation’s biggest wind power complex is at Daegwalleong Pass. Korea Hydro and Nuclear Power Co. (KHNP) is a major Korean player in the atomic energy segment, while the Soyang River Dam in Chuncheon has the nation’s highest hydroelectric power capacity. POSCO Power is an active Korean fuel cell player.
New and renewable energy players are given such incentives as low-interest loans, a supply of cheaper electricity and tax benefits. nw