The government will increase the number of electric vehicles eligible for subsidies from 300,000 this year to 430,000 next year. The subsidies (national funds) available for electric vehicle purchases next year will remain the same as this year at an average of 3 million won for passenger EVs and 70 million won for passenger vans. While subsidies for two-wheeled EVs will rise from 800,000 won to 1.15 million won next year, subsidies for cargo EVs will decrease from 10 million won to 8 million won.
The government held a Cabinet meeting on the 1st and approved the "2027 budget proposal," which includes these details. It set next year's electric vehicle subsidies budget at 2.1403 trillion won, up 32.8% from this year's 1.6114 trillion won.
◇ Next year's passenger EV subsidies expanded to 368,000 units
According to the Ministry of Climate, Energy and Environment, next year's passenger EV subsidies are set at an average of 3 million won per vehicle, the same as this year. Instead, the number of eligible vehicles was set at 368,160, up 41.6% from this year's 260,000. The largest share of the subsidies budget, 1.1404 trillion won (53.2%), will be allocated. This reflects growing EV demand. In fact, EVs as a share of new cars rose from 11.1% in the first half of last year to 23.3% in the first half of this year.
Subsidies for passenger electric vans will remain at 70 million won per vehicle, but the number of eligible vehicles will expand from 3,500 this year to 4,500 next year. While subsidies for cargo EVs will be cut from 10 million won to 8 million won, the number of eligible vehicles will increase from 35,837 to 61,000. Subsidies for children's passenger electric vans will stay at 1.15 billion won, but the number of eligible vehicles will decrease from 300 to 200.
Subsidies for two-wheeled EVs will increase from 800,000 won to 1.15 million won, and the number of eligible vehicles will remain at 20,000. This is the result of raising the subsidy benefit for delivery electric motorcycles from 10% this year to 50% next year to address noise and exhaust issues in residential areas. The budget is set at 23 billion won, up 43.8% from this year's 16 billion won.
Next year's EV conversion support payment will remain at 1 million won, but the number of eligible vehicles will increase from 176,500 to 186,820. The climate ministry plans to introduce conversion support payments for commercial vehicles such as taxis. The EV conversion support payment is an additional subsidy paid when a buyer scraps or sells an internal combustion engine vehicle owned for more than three years and purchases an EV.
◇ 65.1 billion won for solar income villages, 91.9 billion won to expand heat pump adoption
The climate ministry plans to invest 65.1 billion won next year to establish 93 solar income villages. The targets are 23 along the Han River, 10 along the Nakdong River, 25 along the Geum River, and 35 along the Yeongsan River. A solar income village is a business model in which residents install and operate solar power plants on idle land within the village and use the revenue for village welfare and the local economy.
A budget of 91.9 billion won has been set for large-scale heat pump deployment. Unlike conventional heating systems that use fuel to generate heat, heat pumps absorb heat from outside a building and transfer it indoors for heating. They can also provide cooling by expelling indoor heat outside. They are drawing attention as an eco-friendly energy source because they supply a lot of heat with little energy.
Next year, the climate ministry will supply air-source heat pumps to 11,273 detached dwellings nationwide. Heat pumps will also be supplied to eight newly built apartment complexes that can accommodate design changes (about 400 households) and eight aging apartment complexes more than 15 years after completion (about 80 households). At 330 social welfare facilities nationwide, heat pumps powered by solar photovoltaic and solar thermal energy will be installed.