South Korea: Billion-dollar initiative for energy transition and climate protection

South Korea wants to drive forward the energy transition and the reduction of CO2 emissions in the economy with an investment program worth billions. The government in Seoul presented a strategy up to 2035 on Wednesday that has a total volume of one quadrillion won (around 668 billion euros).

President Lee Jae-myung said South Korea must harness its innovative strength to lead the global green economy. “We must abandon the practice of following others and become architects and leaders of the green market ourselves,” Lee said.

Climate ministry officials said the project was intended to address increasing climate risks, reduce concerns about energy security and take into account stricter global CO2 regulations. At the same time, efforts to achieve climate neutrality should become a new engine for economic growth.

The government is aiming for 100 gigawatts of renewable energy capacity by 2030. By 2035, electric and hydrogen vehicles are expected to account for more than 70 percent of new car sales. The areas to be supported include green steel, batteries, solar and wind energy, hydrogen and small modular nuclear reactors (SMR), so-called “mini-nuclear power plants”.

The strategy aims to reduce carbon emissions more quickly in the country's five most emissions-intensive industries - steel, petrochemicals, refining, cement, and semiconductors and displays. At the same time, ten green industries are to be strengthened. Among other things, South Korea wants to be the first country to mass-produce hydrogen-reduced steel.

The head of the conglomerate SK Group, Chey Tae-won, welcomed the initiative. The strategy shows the government's willingness to share investment risks with the private sector. Many companies have so far shied away from long-term investments in climate neutrality due to uncertainties in technologies, markets and politics.