The government announced in August a measure of invigorating renewable energy industry, focusing on increasing mandatory generation of solar photovoltaic power. In the measure, the Ministry of Trade, Industry and Energy (MOTIE) increased amount of target solar photovoltaic power from 1,200MW to 1,500MW by 2015 by adding 150MW of mandatory solar photovoltaic power every year to initially set amount of 330MW in 2014 and 320MW in 2015. And the MOTIE plans to readjust the target of solar photovoltaic power after 2016, linking with the Second National Energy Master Plan.
In order to induce active participation of citizens in solar photovoltaic power plants, in particular, the government plans to raise the weight from 0.7 (based on land) to 1.0 when ratio of citizens’ stakes reaches 30~50% and to 1.2 when ratio of citizens’ stakes is 50~100%. It will also expand solar photovoltaic power plants eligible for applying preferential weight (1.0→1.2) from the current such plants with capacity of less than 30kW to those with capacity of less than 100kW.
Encouraged by this measure of expanding support for solar photovoltaic power facilities, citizen-participatory solar photovoltaic power plants are expected to sharply increase. Moreover, the solar photovoltaic power market is anticipated to be invigorated by giving more incentives to individuals who install small scale solar photovoltaic power plants. But the industry regrets that the target amount of solar photovoltaic power is increased to 1,500MW by 2015 whereas it requested the government to expand it to 2,000MW.
As for non-solar photovoltaic power industries, the government said it will apply variable weights to renewable energy certificate (REC) for offshore wind power and tidal power generation, which require huge amount of investments in early stages, to achieve the target of mandatory generation and help companies mitigate burden of up-front investments. Namely, the government will help offshore wind power and tidal power generation companies recover investments early by raising the weight to 3.0 for the first 5 years of operation and lower the weight to 2.0 for 15 years thereafter. After that, it will reduce the weight to 1.0 for the last 5 years of operation.
And the MOTIE decided to raise the percentage of mandatory installation of renewable energy facilities at public buildings from the original 20% to 30% by 2020, while seeking to apply this measure to private buildings starting in 2016. For private buildings, the MOTIE will recommend to install renewable energy facilities starting with buildings that consume power over 5,000kW of contract power, instead of mandating all buildings to do so from the outset.
The government’s new measure of invigorating renewable energy industry is expected to contribute to invigorating renewable energy industries to a certain extent, though belated, which have been stagnated since the renewable portfolio standard (RPS) was adopted. But, as we have seen in previous systems, it is important to work out specific implementation plan that can support this new measure as soon as possible. I expect that the government will devise a realistic implementation plan that can provide substantial benefits to the industry, beyond declarative action of boosting the industry.