The South Korean government, under the leadership of Moon Jae-in, has focused on reducing reliance on nuclear and coal, which may not be the case if a new administration emerges out of the March 2022 polls. President Moon’s policies attempt to bring more light on gas and renewable energy sources, which Fitch Solutions noted to be highly exposed to global energy price fluctuations, along with rising import costs and energy security concerns. 

“We believe that South Korea’s energy policy direction will likely remain in flux, particularly around the nuclear question, which continues to be politically divided across South Korea,” Fitch noted in a report. “As such, we are seeing increasing pressure around the continued need for nuclear, which might be reintroduced in a new administration, presenting some upside risks to our current outlook.

South Korea recently published the K-Taxonomy, a new draft green taxonomy, which classifies liquefied natural gas (LNG) as “green.” This could lead to new LNG-to-power projects as LNG now qualifies for green financing and tax incentives. The draft taxonomy, however, does not classify nuclear as “green.” 

Guest post from Asian Power