South Korea’s KEPCO cancels coal plant investment in South Africa

SOUTH AFRICASouth Korea’s majority state-owned utility Korea Electric Power Corporation (KEPCO) plans to cancel or convert to LNG two remaining overseas coal power projects in its pipeline including the 630MW Thabametsi plant in South Africa and the 1,000MW Sual 2 project in the Philippines.

According to a media statement from Solutions for Our Climate, a Seoul-based non-governmental organisation, KEPCO CEO Kim Jong-gap revealed the news during an annual governmental audit hearing by the Korean National Assembly.

Kim Jong-gap further underlined that the company has “no plans to pursue overseas coal power projects in the future.”

It was previously reported that there are concerns from South African environmental organisations with regards to the impact of the Thabametsi coal-fired power station on climate change.

“Out of the four [overseas coal power plants] projects, we decided to go ahead with two and transition the other two to gas or cancel them at this point. KEPCO and its subsidiaries will not be pursuing new overseas coal power projects.”

Kim Jong-gap – CEO, KEPCO

According to their impact assessments, emissions from the Thabametsi coal plant could be 60% higher than that of Medupi and Kusile.

Kim Jong-gap’s address comes after the minister of trade, industry and energy’s announcement that KEPCO currently has no more overseas coal power projects in the pipeline after Vung Ang 2 in Vietnam.

Global investors including Blackrock, Legal & General Investment Management, APG and the Church Commissioners for England have warned the South Korean utility to drop coal power projects, citing financial and environmental concerns.

South Korea remains one of the top three public financiers of overseas coal power providing approximately $10 billion to overseas coal power projects between 2008 and 2018 according to a 2019 study.

South Korea’s recent coal power projects in Indonesia and Vietnam have been met with widespread international criticism especially given the Moon administration’s drive with the Korean Green New Deal which aims for a “net-zero emissions society,” earlier this year and more recently, the Korean legislature’s adoption of a climate crisis declaration last month.

Commenting on the development, Sejong Youn, director of the overseas coal finance program at Seoul-based NGO Solutions for Our Climate, said: “We welcome that KEPCO has finally stopped the Sual project in its tracks. This is a major victory for the Sual community’s health and our climate. It is not too late for KEPCO to take the same approach for its recent investment in Jawa 9, 10 in Indonesia and Vung Ang 2 in Vietnam. Both countries have adopted ambitious renewable energy plans and converting these coal projects into gas or renewables will be far more beneficial for all parties involved.”

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