The ruling Democratic Party of Korea (DPK) has introduced four amendment bills that would ban public enterprises and public financial institutions from investing in the overseas coal industry, which has been criticized over profitability and pollution.
The new regulation to restrict Korea Electric Power Corporation (KEPCO), Korea Development Bank (KDB), Export-Import Bank of Korea (KEXIM) and Korea Trade Insurance Corporation (K-SURE) from investing in overseas coal power projects was added to the amendment bill introduced by 21 members of the DPK. The bill was introduced while KEPCO, the largest state-owned electric power distribution company, announced its decision to invest $3.46 billion in a coal power project in Indonesia with KEXIM and K-SURE providing the majority of financing, despite global efforts to stop climate change.
“Major countries are cutting coal-fired power plants as their top priority to cope with the climate crisis,” Sunghwan Kim, chairman of the Green New Deal subcommittee of DPK’s K-New Deal Committee said. “If public institutions do not voluntarily end its investment in coal power, the National Assembly should restrict investment through legislation.”
South Korea invested over $10 billion in coal power from 2008 to 2018 and KEPCO is managing or considering seven overseas coal power projects. Major global financial institutions such as the Government Pension Fund of Norway and the California Public Employees’ Retirement System are trying to withdraw their coal power-related investments as these are considered not morally right during a climate crisis. Also the unit price of renewable energy is consistently becoming lower. Kim also pointed out that KEPCO’s overseas investment in coal power could be a financial risk factor when renewable energy eventually replaces coal power.
Wonsik Woo, who put forth a KEXIM amendment bill, said that public financial institutions’ overseas loans to coal power projects are not in sync with the global trend of a “Green New Deal” and the government should pursue greener energy policies. (Reporting by Hyewon Chang)