As a result of the war in Iran and the closure of the Strait of Hormuz, gas prices have risen 41% year-on-year, making South Korea's existing wind and solar capacity ever more valuable. The two technologies are on track to save USD 4.7 billion in fossil fuel import costs in 2026 alone.
Matt Ewen, Energy Analyst at Ember says: “South Korea is one of the most exposed countries in the world to oil and gas price shocks. The country spends more of its GDP on fossil fuel imports than 94% of the world’s population. Renewable energy can help provide the country with the secure, cheap power it needs to shield itself against future price shocks. And through electrification that energy can ensure security across the rest of the economy. The goal is set. Now comes delivery."
Janna Smith, Project Manager at Global Energy Monitor says: “South Korea has the economic incentive, the technology and the industrial base. Land is the major constraint, but floating solar and offshore wind could be the answer. South Korea’s success could become a template for dozens of countries facing the same challenges."
While fossil fuels must be bought continuously, a one-time investment in wind and solar produces energy for decades. Since 2010, wind and solar have generated a cumulative 283TWh of electricity in South Korea. Had that power been generated with imported liquefied natural gas (LNG) instead, it would have cost USD 25 billion over the 16 years.
With 2026 spot prices, Korea’s annual fossil fuel imports for the whole energy sector would be worth USD133bn - almost six times annual debt repayments, three and a half times food imports, and almost three times defence expenditure.
Seoul's commitment to expand its renewable energy capacity to 100GW by 2030 is expected to be formalised in June as part of the country’s Green Great Transformation Strategy. This would nearly triple the country's current 37GW installed base. If solar continues its recent growth rate and 14GW of planned wind comes online, Korea is already on track for 92GW.
The remaining gap can be met through a combination of sources, including rooftop, floating, agricultural and village-scale solar, and accelerated offshore wind development. Global Energy Monitor’s (GEM) analysis indicates that the country has 11 GW of floating solar potential. Along with wider reforms to power pricing, an estimated 10 million citizens will be able to earn income by selling solar power back to the grid.
South Korea is pairing its clean energy expansion with a decisive retreat from fossil fuels, operating under a roadmap to significantly reduce coal power from its energy mix by 2040. This transition extends directly to the heating sector, which represents roughly 48% of the country’s final energy consumption. To decarbonize this space, the government is actively pushing to replace traditional gas-based heating with electric heat pumps and renewable district heating networks.
Yonghyun Song, Chief Technology Officer of NEXT group says: “Every gigawatt of renewable capacity installed is money that stays in South Korea rather than flowing to a fossil fuel exporter. We have saved $25 billion since 2010 by taking incremental steps - now we need to deploy our technology, expertise and capital at scale to reach 100 GW. Getting the grid ready for 100GW is as important as building the gigawatts themselves.The immediate prize is figuring out how to distribute storage intelligently across the network to transmit power generated in Honam to Seoul by maximizing existing grid capacity without building new lines. We have the technology to solve this at home, and then export that expertise to other countries."
Target 100: Finding space for solar
Meeting the ambitious target will require drawing on every potential source of renewables, but South Korea already has several domestic industrial advantages. The country has world-class solar panels and battery industries, and is one the world’s leading exporters of high voltage transformers, a key bottleneck for many countries. Much of the investment required to reach 100GW would flow directly to these industries.
Offshore wind is the biggest single lever in the utility-scale pipeline, making up 11.3 GW of the 14.4 GW of wind planned through 2030. As foreign developers have pulled back from the market, domestic policy support will be critical to keeping these projects on schedule. As wind development generally takes more than four years, much of the rest of the gap will have to be met by solar. If Korea continued its 2020-2025 compound annual growth rate, utility-scale solar would increase by 9.5 GW and distributed solar by 31 GW. In practice, it will take a concerted policy effort to make sure this happens, with only 1.1 GW of utility scale projects currently tracked in GEM’s pipeline data. Recent success in approaches like the country’s “solar income village” programme build confidence that the target can be achieved.
To realise this ambition, costs must fall. Korean costs for wind and solar are significantly higher than global averages, due both to policy and to the so far relatively small scale of the industries. Nonetheless, recent IEEFA analysis shows that renewables in the country are competitive against LNG in many circumstances, particularly in the current crisis. If Korea can achieve global average costs of capital, IEEFA estimates that wind and solar could be built for $50/MWh and $55/MWh respectively.
A grid in flux
Large-scale solar deployment has been held back by a lack of flat, open land to develop on, but South Korea's reservoirs could host nearly 11 GW of floating solar using high-efficiency panels. The Korea Rural Community Corporation has already targeted 3 GW in agricultural reservoirs by 2030.
Securing the capacity to generate 100GW of renewable energy is however only half the battle. South Korea must also build a grid capable of handling it. Power demand in the greater Seoul area is surging, driven by new semiconductor clusters and the AI boom, but the country's major renewable energy hubs are concentrated at the other end of the country in Yeongnam and Honam. Existing transmission lines can carry just 4.5GW of electricity from Honam to the capital, creating a severe bottleneck between where clean power is generated and where it is needed most.
To close this gap, the government has designated a high-voltage direct current energy highway as a national priority. The plan extends beyond physical infrastructure, envisioning a comprehensive digital grid integrating AI-based demand forecasting, large-scale battery storage, and distributed energy resources. South Korea also has plans for up to 10GW of pumped hydro storage by 2030, and is actively expanding grid-scale battery capacity.
However, the major infrastructure projects involved are not slated for completion until the 2030s, leaving an urgent need for near-term solutions in the meantime. Non-wires alternatives must be leveraged to supplement or bypass traditional grid infrastructure, such as implementing Dynamic Line Ratings to maximise existing line capacity.
South Korea is generally well placed to produce these technologies. The country has advanced capabilities in grid-forming inverters, devices that actively stabilise voltage and frequency on electricity networks. It’s also at the forefront of vehicle-to-grid technology that allows electric vehicle batteries to feed power back into the grid during periods of high demand. But actually unlocking their deployment will require immediate market reforms to properly compensate flexibility, alongside urgent revisions to grid codes.
Grid bottlenecks are fast becoming one of the defining challenges of the energy transition worldwide. South Korea's combination of industrial capability, policy ambition, and hard-won domestic experience means it has the potential not only to resolve its own constraints, but to export the solutions to dozens of countries facing the same problem. Enabling policy must now keep up to make the 100 GW target a reality.
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Methodology
Potential 2026 whole energy sector net import costs are calculated based on IEA World Energy Balances and fuel price data from NYMEX and ICE, assuming imports by fuel are similar to those in 2025.
Historical LNG import savings are calculated based on Ember monthly and yearly electricity generation data, using JKM LNG prices from NYMEX and the EI Statistical Review of World Energy. The calculation assumes that demand covered by wind and solar would otherwise have been met by gas generation. Projections through the end of 2026 are based on Ember’s internal generation forecasts, and assume May JKM prices hold through to the end of the year.
Prospective 2026 fossil import savings apply average 2020-2025 wind and solar capacity factors to a mix of 70 GW solar and 30 GW wind, roughly aligned with the 11th Basic Plan’s expectation of 63 GW solar and 18 GW wind. Savings assume that gas and oil generation are preferentially replaced by wind and solar, in line with very high prices for these commodities. Prices are from NYMEX and ICE.
Prospective wind, utility-scale solar, and pumped hydro capacities are from GEM’s Global Wind Power Tracker, Global Solar Power Tracker, and Global Hydropower Tracker.
The floating solar potential on dam lakes and reservoirs in South Korea is based on the analysis performed by Kim et. al in 2019. Their capacity estimates are updated using a 23% panel efficiency rather than the original 16.9% and assuming a 40% reservoir coverage.
