Significant Investment
SK Inc. has laid out an ambitious plan to invest 23 trillion won (US$17.82 billion) in eco-friendly initiatives by 2025, with a primary focus on “energy transition.” SK Group Chairman Chey Tae-won has shown keen interest in transforming SK’s business landscape from a petroleum-centric structure to one that centers on environmentally friendly energy ventures. Among the various eco-friendly initiatives, SK Inc. plans to allocate a staggering 12.4 trillion won in investment exclusively for projects related to hydrogen and nuclear energy by 2025.
According to industry sources on Aug. 1, SK Inc. continues to invest in energy transition, with hydrogen and nuclear power as its core areas of focus. A prominent example of such investment is SK’s joint venture with its energy subsidiary SK E&S, wherein they invested 1.8 trillion won in the U.S.-based hydrogen energy solutions company, Plug Power, back in 2021.
By 2025, SK Inc. aims to integrate and operate an entire “hydrogen value chain,” covering hydrogen production, distribution, and supply. As the first step, the company is currently investing around 500 billion won to construct a liquefied hydrogen production plant in Incheon, which is expected to be operational by the end of this year. Once operational, this facility is projected to supply 30,000 tons of liquefied hydrogen to the metropolitan area. SK Inc. reveals that 30,000 tons of liquefied hydrogen would be sufficient to power 75,000 units of its hydrogen-powered vehicle Nexo to circumnavigate the globe, a distance of roughly 46,520 km, leading to carbon reduction equivalent to planting 12 million trees.
In August last year, SK ventured into the small modular reactor (SMR) market by jointly investing US$250 million in TerraPower, a U.S.-based company founded by Microsoft co-founder Bill Gates, with SK Innovation. Furthermore, SK Inc. assumed the chairmanship of the “Public-Private Joint SMR Alliance” established in July under the leadership of the Ministry of Trade, Industry, and Energy, with the aim of bolstering the future competitiveness of the SMR industry.
SK has also made notable investments in bioenergy. In 2021 and 2022, SK Inc. partnered with SK innovation to invest a combined total of US$80 million in Fulcrum, a U.S.-based company equipped with technology to convert household waste into synthetic fuel. Fulcrum achieved a significant milestone by successfully operating its Sierra plant, the world’s first facility that produces synthetic fuels from waste gasification, in December last year. The Sierra plant has the capacity to produce 260,000 barrels of synthetic fuel annually by processing 500,000 tons of municipal waste.
In a strategic move, SK Inc. made a noteworthy foray into the carbon capture, utilization, and storage (CCUS) industry. The company acquired the management rights of 8 Rivers, a U.S.-based firm celebrated for its CCUS technology, both last year and in March of this year. The acquisition was valued at US$400 million. Notably, 8 Rivers holds patented technology that has the capability to capture over 99 percent of carbon dioxide, generating clean electricity and producing blue hydrogen.
In the area of electric vehicle (EV) materials and infrastructure, SK is actively advancing its investments through acquisitions of silicon carbide (SiC) power semiconductor companies and the establishment of new factories. In 2021 and 2022, SK Inc. injected 150 billion won into the acquisition of Yes Power Technix, a SiC power semiconductor design and mass production company, which was later rebranded as SK powertech. The company’s new factory in Busan officially commenced full-scale mass production in the first half of this year. It primarily serves clients in the solar and EV sectors, exporting more than half of its products to overseas markets such as the U.S., Japan, China, and Taiwan.
SK C&C, a business division of SK Group, is responsible for eco-friendly digital products and services. Throughout the previous year, SK C&C has successfully developed transaction platforms as well as environmental, social, and governance (ESG) management platforms, and continues to maintain its focus on eco-friendly service initiatives.
An official from SK said, “As a core strategy to enhance future corporate value, we have identified five key eco-friendly domains and are expanding our proactive investments in clean technologies while securing various business opportunities. Through these efforts, we aim to accelerate the realization of a ‘net-zero’ status by the year 2030.”