Minister Kim Sung-hwan of the Ministry of Climate, Energy and Environment said on the 16th that "an increase in renewable energy generation does not mean electricity rates will go up."
The Minister answered this way to a question from People Power Party lawmaker Woo Jae-joon, who said, "Many people worry that if renewables increase, electricity rates could rise later," while appearing for an energy sector work report by the Climate, Energy, Environment and Labor Committee at the National Assembly in Yeouido, Seoul, that day.
The Minister said, "International energy agencies already show wind and solar as the cheapest energy," adding, "Korea has not yet reached 'grid parity' (Grid Parity), so renewable energy rates are a bit more expensive, but prices have fallen a lot recently." Grid parity refers to the point at which the expense of producing power from renewable energy equals the expense of fossil fuel generation.
The Minister added, "On the contrary, there was a time when electricity rates rose because liquefied natural gas (LNG) prices skyrocketed."
The Minister's remarks align with the current administration's logic that the levelized cost of energy (LCOE) for renewables falls the more renewables are expanded. According to materials titled "Estimated LCOE expense by power source," submitted by the Ministry of Trade, Industry and Energy to the office of People Power Party lawmaker Koo Ja-geun, the solar power expense is projected to decline from 102–132 won per kWh (kilowatt-hour) in 2022 to 54.8–99.1 won in 2036.
In response, lawmaker Koo Ja-geun noted, "This estimate does not include resident land compensation, backup power, or ESS (energy storage system) expenses," adding, "It may not be immediately visible in the public's electricity bills, but in the end Korea Electric Power Corporation will quietly be left holding this bomb."
President Lee Jae-myung also said while presiding over a meeting of senior secretaries and aides on Aug. 14 that "as we achieve greenhouse gas reduction targets, electricity rates will inevitably rise," adding, "We must actively inform the public and seek their understanding and consent."
The ministry said in its work report that day it will expand renewable generation capacity from the current 35 GW (gigawatts) to more than 78 GW by 2030. It plans to raise the share of renewables in total power generation from 10.5% last year to more than 33% by 2030.