The South Korean Ministry of Trade, Industry and Energy has launched a tender for fixed-price solar PV and wind projects, looking for 2.8GW of new renewable power capacity.
The tender will be split into two parts, with 1.8GW allocated for wind—itself split between 1.5GW for offshore wind and 300MW for onshore wind—and 1GW allocated for solar PV. The upper price limit for bids will be set at KRW157.3/kWh (US$0.11/kWh) and is an increase on the upper limit set for last year’s tender, which reached KRW153.5/kWh.
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Additionally, this round of tenders will include “preferential pricing”, which will allow developers to negotiate the final contract price, based on the carbon footprint of the modules they plan to use in their projects. In theory, developers could bid for higher contract prices, using modules with lower carbon footprints, as South Korea looks to minimise its carbon footprint across its energy supply chain.
The government will also launch a pilot project for the power purchase agreement (PPA) “brokerage market” for successful applicants to the tender round. Projects with a power capacity of more than 1MW will be eligible for this scheme, and 36 Korean companies that are members of the RE100 list of companies will collaborate to work on offtake agreements, with the government aiming to expand the target and scope of the project in the future.
South Korea has operated an annual fixed-price bidding programme for solar projects since 2017, and its latest tender round is significantly more ambitious than in previous years. In the entirety of 2023, the government awarded just 332MW of new solar capacity, as it looks to expand its operating renewable power portfolio from just 7.5% of the country’s energy mix in 2021 to 21.6% by the end of this decade.
The news follows a number of new project announcements in South Korea, including leading Chinese manufacturer Trina Solar signing a deal for a 100MW portfolio and Peak Energy signing a memorandum of understanding for a rooftop portfolio.
