When the war in Ukraine disrupted the global energy supply in 2022, South Korea found itself in a challenge for natural gas after being cut off from Russia’s supply. Europe, facing an energy crisis, began buying up natural gas worldwide, causing South Korea’s electricity costs to soar by an estimated $17 billion in 2022 due to the surge in prices.
To enhance its energy security post this upheaval, South Korea is ramping up its imports. The country is utilizing government funding to establish liquid natural gas (LNG) supply terminals, both domestically and internationally. However, this heavy investment in LNG has proven costly for South Korean citizens as energy prices have risen without any substantial gains in energy security, economic stability, or sustainability. Additionally, despite the government’s multi-billion dollar investments in new capacity, the country’s natural gas demand is expected to decrease significantly over the next decade.
The current focus on LNG in South Korea poses challenges in terms of cost and environmental impact. The process of transporting natural gas as LNG requires specialized infrastructure, leading to significant expenses. Public financing in new LNG infrastructure has reached staggering amounts, but the country’s transition towards net-zero emissions by 2050 indicates a decrease in natural gas demand, rendering the new terminals likely underutilized in the future.
Furthermore, South Korea’s heavy investments in LNG infrastructure have global implications in terms of climate change. The country’s role as a top international public financier of fossil fuels through investments in major US LNG projects contributes to the expansion of LNG export capacity, exacerbating climate concerns.
Reversing the current trajectory of public funding towards LNG infrastructure is essential to align with global climate goals. Investing in domestic renewable energy sources, such as offshore wind and solar power, holds the potential to not only boost employment but also enhance energy security. Shifting away from LNG towards renewable alternatives could be a more cost-effective and sustainable approach for the government and consumers.
Despite the challenges faced, activists in South Korea are already making strides in advocating for cleaner energy alternatives. The success in halting government funding for coal projects in Dangjin demonstrates the potential for a shift towards renewables. By leveraging its vast potential for renewable energy production, South Korea can play a crucial role in advancing the global energy transition towards cleaner and more sustainable solutions.
