“The United Kingdom is rapidly shifting its energy sources from existing fossil fuels to renewable energy and nuclear power. It is a very attractive market for South Korean corporations with excellent technology and potential in related fields.”

On the 4th of last month (local time) in London, former Energy and Climate Change Select Committee Chairman Tim Yeo noted, “The United Kingdom has been making massive investments in the energy sector. This trend will continue in the future.”

Former Chairman Yeo served as Vice Minister in the Ministry of Foreign Affairs, Ministry of the Interior, Ministry of Health, and Ministry of Environment from 1988 to 1994. He also held the position of Shadow Secretary of State for Health, Education, Industry, Environment, and Agriculture during the Labour Party's rule from 1998 to 2005. Afterward, he was Chairman of the Environmental Audit Select Committee from 2005 to 2010 and of the Energy and Climate Change Select Committee from 2010 to 2015. He is currently serving as Korea Trade-Investment Promotion Agency (KOTRA) ambassador for investment promotion in South Korea.

Yeo, who graduated from the University of Cambridge with a degree in history, began his career in London as an investment analyst and has also worked as a fund management and corporate finance expert. He entered politics in 1983, serving as a Member of Parliament for South Suffolk until 2015.

Tim Yeo, the former chair of the Energy&Climate Change Select Committee, explains the UK energy market. /Courtesy of Jeong Jae-hwon.

Even after retiring from politics, he has been active in several corporations in the energy and technology sectors, participating in renewable energy and climate change-related projects. In 2016, he was appointed as an ambassador for investment promotion in South Korea, working to strengthen business and investment relations with the country.

The United Kingdom completely halted coal power generation on Sept. 30 last year, turning off the switch at the Ratcliffe-on-Soar coal power station after 142 years. Considering that the United Kingdom was the first country in the world to begin commercial operation of coal power plants, this is a symbolic event. The United Kingdom has reduced greenhouse gas emissions by more than 50% compared to 1990, becoming the first major advanced country to achieve this milestone by 2022, and in the second quarter of this year, renewable energy accounted for 51.6% of the country's electricity generation. The following is a Q&A session with the former chairman.

─What is the outlook for the United Kingdom's renewable energy market?

“The United Kingdom, which has legislated its carbon reduction targets, generated approximately one-third of its total electricity from wind power last year. In the future, more electricity will be produced through renewable energy such as wind and solar power, as well as nuclear power. Moreover, since wind and solar power are intermittent energy sources that fluctuate depending on environmental conditions, the demand for energy storage systems (ESS) is also growing.”

─What policies is the United Kingdom pursuing to attract investment in the energy sector?

“The United Kingdom guarantees stable revenue through a Contracts for Difference system, where the government compensates the difference if the wholesale price sold by electricity producers is lower than a fixed price. Thanks to this system, the United Kingdom is considered the most attractive energy market in Europe, where the pace of renewable energy adoption is rapid.”

─The United Kingdom shows strengths in the offshore wind sector.

“The United Kingdom has a very long coastline and strong winds blowing in its seas, such as the North Sea and the English Channel, making it suitable for offshore wind power generation. Because of these characteristics, the British government has actively supported the offshore wind industry for the past 20 years. It has also provided attractive financial conditions for corporations entering the related market for the first time, along with significant financial support.”

The United Kingdom plans to more than double its offshore wind power generation capacity within the next few years. For South Korean corporations that excel in offshore wind-related equipment, this is seen as the optimal time to invest in the United Kingdom.”

─What are the plans for expanding nuclear power generation in the United Kingdom?

“The United Kingdom has set a goal to expand its nuclear power generation capacity from the current 6.4 gigawatts (GW) to 24 GW by 2050. A considerable number of new reactors will be constructed in the United Kingdom. The British government views nuclear energy as an essential part of responding to climate change and believes that more nuclear power plants are necessary for carbon reduction.”

─How do you assess the potential for the South Korean nuclear power industry to enter the United Kingdom?

“I see great potential for South Korean nuclear technology to be used in the United Kingdom. The British government is planning to construct two reactors in the Wylfa area located in northwestern Wales and is actively engaging in negotiations with South Korea. The United Kingdom has been deeply impressed by South Korea’s successful construction of nuclear power plants in the United Arab Emirates. The recent contract for a nuclear power project in the Czech Republic is also viewed as a significant achievement for South Korea within the EU, which could influence the British government’s decisions moving forward.”

However, for South Korea to build a nuclear power plant in the United Kingdom, it will need to go through a process of obtaining approval for nuclear technology from regulatory agencies, which will take about 2 to 3 years. Nevertheless, the British government desires to have nuclear power plants operated based on various technologies and will welcome South Korea's requests for technology approval.