Last month, during the United Nations General Assembly, President Yoon Suk-yeol proposed the Carbon Free Alliance (CFA). Leading corporations such as Samsung Electronics, SK Hynix, and Hyundai Motor, which previously committed to RE100 (100% renewable energy), have now joined the alliance. The shift to CFE, which includes nuclear energy, is seen as less burdensome compared to RE100, which mandates fulfillment of power demand exclusively through renewable energy sources. Thus, major conglomerates have taken a change in direction.
According to materials presented to Representative Lee In-sun of the People Power Party by the Ministry of Trade, Industry, and Energy on Oct. 8, the Carbon Free Alliance (CFA) entity will be established this month under the auspices of the Korea Chamber of Commerce and Industry.
As of May 5, a total of 20 organizations have expressed their intent to join the CFA. Prospective members include Samsung Electronics, SK hynix, Hyundai Motor, LG Chem, POSCO, Hanwha Solutions, GS Energy, Korea Zinc, Doosan Enerbility, LS Electric, Hanwha Impact, and Yeochun NCC.
Additionally, public energy institutions like the Korea Electric Power Corporation, Korea Hydro & Nuclear Power, KTL Academy, Korea Testing Certification Institute, and KEPCO Nuclear Fuel CO., Ltd. will also be part of the alliance, along with private-public consultative bodies like the Hydrogen Convergence Alliance.
Samsung Electronics, SK hynix, Hyundai Motor, and Korea Zinc, among others, have previously committed to RE100. However, they are now signaling a shift in their energy management direction by expressing their intent to join the CFA. Following SK’s initial RE100 achievement declaration in 2020, over 30 major companies have since joined RE100.
RE100 is a global campaign where companies commit to source 100% of their electricity from renewable sources. In contrast, Carbon Free Energy (CFE) encompasses all power sources that do not emit carbon, including nuclear power, fuel cells, and Carbon Capture and Storage (CCUS). CFE is deemed less burdensome and more achievable than the renewable-only commitment of RE100.
Globally, there is a noticeable shift from RE100 to CFE. Global giants like Google and Microsoft have committed to achieving CFE. Last May, our government also launched a forum for Carbon Free Energy (CFE), which would be the precursor to the Carbon Free Alliance (CFA).
There is skepticism about the achievement of RE100. Google, who joined RE100 in 2015, declared CFE in 2021. Despite achieving RE100 for five consecutive years till 2021, they recognized the limitations in regions and time zones still dependent on fossil fuels.
Local conditions in Korea cannot be overlooked. Given the insufficient electricity grid infrastructure, such as Energy Storage Systems (ESS), it’s highlighted that relying solely on renewable energy sources is impractical. The instability arising from the rapid increase in renewable energy sources like solar and wind is becoming an issue. In regions with abundant solar power like Honam and Yeongnam, nuclear power output control is frequently executed.
The contribution from renewable sources remains significantly low. As of July, nuclear energy accounts for 29.7% of the energy generation, while renewables contribute only 9.3%. From a corporate perspective, there’s little incentive to invest in more expensive renewable energy when domestic electricity rates are cheaper.
The state-run think tank Korea Energy Economics Institute commented on this issue. In their recent report on “Analysis of International Initiatives for Carbon Neutrality,” they suggested, “Korea possesses top-tier technology in nuclear energy. At this juncture, the only immediately usable carbon-free energy source is nuclear.”
Given the nature of renewable energy, which is influenced by weather and time, there are periods when energy generation is challenging, necessitating the use of other sources like nuclear power.
Representative Lee emphasized, “With RE100 acting as a new regulation for companies, the role of the Ministry of Trade, Industry, and Energy is more crucial than ever in expanding CFE, which will ease corporate burdens and fit the domestic landscape better.”