South Korea looks set to reduce its dependence on LNG as a power generation fuel over the next decade or so in a bid to cut costs and keep business competitive, while coal remains firmly in the No. 1 spot. The sixth long-term plan for power supply, running from 2013 to 2027, calls for a doubling in coal-fired generation capacity from the current 24 gigawatts to 45 GW, departing significantly from the previous plan, which had projected a gentle rise to 30 GW. With no more nuclear plants set to be approved, coal is expected to remain the dominant fuel in the generation mix with a share of 41.5%, a reversal from the fifth plan, which had envisaged a decline to 32%. By contrast, LNG will play a smaller role, as a 15% rise in unit costs last year made it less competitive with coal, whose costs dropped 1%, according to data from monopoly utility Korea Electric Power Corp. (Kepco). The greater reliance on coal could jeopardize emissions targets, even though renewables are planned to contribute more to power supply, as analysts do not expect renewables to get enough policy support to encourage investment.
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