South Korea issues tender for battery ESS in Jeju

Market: Battery materials, Electricity, Metals
17/08/23

South Korea plans to open the country's first central contract market for low-carbon power and has issued a tender for battery energy storage in Jeju province.

Power generators participating in this tender will build and operate long-cycle energy storage system (ESS) facilities that can operate for over four hours, the country's energy and industry ministry (Motie) said on 17 August. The winning bid will secure a long-term tender of 15-20 years, which will determine the price and volume through the ESS bidding market, and providers will be paid at the pre-contracted price when the facility is operating in the future. The tender will be awarded by the end of this year, with the successful bidder to be selected after a comprehensive evaluation of the bidding prices and non-price indicators such as technical capability.

The volume stated in the tender is 60MW/260MWh, with the capacity to charge and discharge 65MW for four hours. This is also the targeted volume of ESS that will be introduced next year, and corresponds to the volume required to stabilise the Jeju power grid in the short term.

The ministry expects the ESS to stabilise power supply in Jeju by storing surplus power and providing power during storage, alleviating the issue of the intermittency of renewable power generation. This is especially so since renewables make up a high proportion of Jeju's power mix.

Investment in industrial complexes

The Busan specialised complex has received 800bn won ($597mn) worth of corporate investments for the compound power semiconductor market, which is rapidly growing on the back of an electrification trend. Further investments of over W500bn in power semiconductor-related companies are being discussed, since Busan was designated as a specialised complex. Motie plans to launch a W138.5bn project to develop technology related to power semiconductors next year, and build a W26.5bn demonstration base.

The Ulsan secondary battery complex is home to 173 firms and Motie expects it to receive W8.1 trillion in private investment by 2030. The ministry also confirmed W700bn in new investments after Ulsan was designated as a specialised complex, with an additional W900bn under discussion. Ulsan city also plans to develop all-solid-state batteries and to build the country's first lithium-iron-phosphate battery production plant. It consequently plans to invest over W2 trillion to build facilities for mineral refining, smelting and precursor manufacturing.

Motie and Ulsan will invest W34bn by 2024 to establish a next-generation battery park.

By Tng Yong Li

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