Dutch pension fund urges Seoul to abandon national coal-fired power projects
The letter, leaked by Seoul-based Solutions for Our Climate on Wednesday, concerns three power plants with a combined power capacity of 6.3 gigawatts under construction in Gangwon province.
Private power plants will pose a latent threat to the country’s industries in the near future as part of its efforts to achieve carbon neutrality, wrote Park Yoo-kyung, responsible investment and governance manager, Asia-Pacific. , at APG Asset Management, in the letter to a presidential panel sent on Tuesday.
“In the face of the climate crisis, coal-fired power plants will inevitably harm the Korean economy and the future of mankind,” the letter, written in Korean, reads. “Korea’s greenhouse gas emissions will be a significant burden not only for private sector participants, but also for other domestic enterprises in the export-oriented country. “
Failure to phase out coal will entail a substantial cost of offsetting carbon emissions and operational losses from 2030 at the latest, Park added.
The letter was sent to the co-chairs of the Commission on Carbon Neutrality in 2050, Prime Minister Kim Boo-kyum and Yun Sun-jin, professor at the Graduate School of Environmental Studies at Seoul National University.
The sustainability specialist went on to say that the risk of continuing to increase the carbon footprint far outweighed the consequences of withdrawing contracts from ongoing coal projects.
“We find that private sector entities are forced to move the project forward taking into account various obligations, financial pressure due to non-compliance with them, as well as progress payments and sunk costs, setting aside the profitability of the projects themselves, ”Park wrote.
“We strongly urge (the organization) to rescue the trapped private sector entities as soon as possible by putting in place a strong and clear political direction.”
This is in line with APG Asset’s sustainability goals for its pension fund clients, including the Dutch civil service pension fund ABP, as part of its emerging climate neutral portfolio.
APG sold its entire stake in the Korea Electric Power Corp. generator and distributor in February. in February. He was disappointed that the minority shareholder’s objection to the construction of a Kepco coal-fired power plant in Indonesia and Vietnam bore little fruit.
APG has also sold eight companies around the world that have more than 90 gigawatts of combined coal capacity in 2020.
Korea is poised to complete three coal-fired power plants in Goseong County, Gangneung City and Samcheok City over the next few years, all in Gangwon Province.
A 2.08 gigawatt project in Goseong, undertaken by SK Gas, SK Ecoplant and the Kepco subsidiary, is expected to become fully operational by October. Another 2.08 gigawatt project in Gangneung, led by Samsung Engineering & Construction and a subsidiary of Kepco, is expected to start in March 2023.
However, the Samcheok project, proclaimed to be Korea’s last coal-fired power plant with a capacity of 2.1 gigawatts, has been on hold since October 2020. Posco Energy, Posco Engineering & Construction and Doosan Heavy Industries & Construction are now participating in the project at neutral point.
By Son Ji-hyoung ([email protected])