The Ministry of Trade, Industry and Energy (Minister: Ahn Deok-geun, hereinafter referred to as the “Ministry”) will introduce a public-led offshore wind power bidding system to stably establish the initial industrial ecosystem of the offshore wind power market. The plan is to secure energy security and enhance industrial competitiveness simultaneously by having public institutions lead the process directly.
The Ministry announced plans for public sector-led offshore wind power bidding at the ‘2nd Offshore Wind Power Activation Industry Meeting’ held on March 20 at the Seoul Chamber of Commerce and Industry. This is a measure to establish a stable business model by having public institutions take the lead, separate from the existing method centered around private sector operators, during the process of the offshore wind power market’s substantial growth.
Under this plan, the government will conduct bids targeting projects in which public institutions and local public enterprises own a majority stake, with the first competitive bidding scheduled to begin in the first half of this year. Through public sector-led bidding, the government aims to accelerate the dissemination of offshore wind power and to expedite energy transition policies connected with the transition from coal-based energy.
The public-led bidding focuses not only on simply promoting projects but also on establishing a self-sustaining growth foundation for the offshore wind power generation industry. To this end, the government plans to actively support early technology verification and commercialization by linking R&D demonstration projects to public institution-led projects. Additionally, a new evaluation item (8 points) according to the ‘Special Act on Resource Security,’ which considers national energy security, has been newly introduced to increase industrial contribution in future bids.
However, some point out that in order for this policy to be effective, a distinct division of roles between the private and public sectors is necessary. While government intervention to stimulate the offshore wind power market is necessary, there is also concern that excessive involvement from the public sector could stifle private competition. The industry suggests that it is desirable for the public sector to lead the initial market stabilization, but in the long term, a competitive system led by the private sector should be established.
The Ministry expects this plan to serve as a foundation for the systematic diffusion of the offshore wind power market and for strengthening the global competitiveness of domestic companies. The first bid announcement is scheduled for May this year, with detailed conditions to be finalized after revising relevant regulations and collecting feedback from stakeholders.
Experts advise, “While the public sector’s role in driving the market is necessary, an organic cooperation with the private sector is crucial,” adding, “It is necessary to formulate policies that allow the private sector to continue growing by supporting technology verification and infrastructure development, referring to foreign cases.”
Whether this solution proposed by the government can establish itself as a long-term growth model for the offshore wind power industry, rather than a short-term policy, remains to be seen.